High Court Power Subsidy Ruling Keeps States In The Dark

Law360, New York (April 19, 2016, 5:47 PM EDT) -- While the U.S. Supreme Court said Tuesday that power plant construction subsidies offered by the state of Maryland usurped the Federal Energy Regulatory Commission's authority over wholesale electricity markets, it didn't provide clear guidance to states as to what incentives to coax new power generation within their borders are acceptable, experts say.

The high court unanimously ruled that Maryland's program to provide subsidies for new gas-fired power plant construction through long-term power purchase agreements with local distribution utilities was preempted under the Federal Power Act because it undermines wholesale power prices in auctions conducted by regional grid operator PJM Interconnection LLC...

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