FERC v. Electric Power Supply Association
Full name: FERC v. Electric Power Supply Association and EnerNOC v. Electric Power Supply Association
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What was this case about
The Supreme Court ruled that the Federal Energy Regulatory Commission (FERC) can determine the compensation energy companies must pay to consumers who agree to cut back their energy demands during peak times.
What was the issue involved
Energy suppliers use a practice called demand response to encourage consumers to use less electricity during periods of high demand.
When a consumer uses less electricity, the electricity supplier saves money by not having to purchase the extra electricity. In regulating these transactions, the FERC required electricity suppliers to pay consumers the same price they would have paid to purchase the saved energy.
A group of suppliers challenged the FERC's authority to set that price.
What did the court decide
The Supreme Court ruled that the FERC does have the authority to regulate demand response transactions, and the FERC justified why consumers should receive the same compensation as the supplier would have been paid to an electricity producer.