Is FERC's Delegation of Regulatory Authority to AEP/APCO Legal?

posted Oct 30, 2014, 4:51 AM by Site administrator
On July 2, 2013 the United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT, case Department of Transportation v. Association of American Railroads, reaffirmed that delegation of regulatory authority to a private entity is impermissible under the US Constitution. Federal lawmakers cannot delegate regulatory authority to a private entity. To do so would be “legislative delegation in its most obnoxious form.” The Justices ruled that since AMTRAK is a private entity it therefore is illegal for AMTRAK to regulate US railroads by developing performance metrics to guide schedules. 

Article I, Section 1 of the US Constitution states that “All legislative Powers herein granted shall be vested in a Congress….” Derived from this grant of power, the non-delegation doctrine prohibits Congress from delegating legislative functions to the executive branch. In 1928, the Supreme Court acknowledged that Congress may delegate regulatory authority to an executive branch agency [think FERC] so long as it specifies an “intelligible principle” to limit and guide the agency in the exercise of its discretion. It is another issue, however, when Congress attempts to delegate regulatory authority to a private entity. While private entities may be involved in an advisory capacity in making regulations, delegation of legislative authority to private entities is strictly prohibited. 

Now consider how these Constitutional limitations are applicable to the Federal Power Act, which created FERC, and FERC's delegation of regulatory authority to APCo through license Articles 415 Use and Occupancy and 413 Shoreline Management Plan
  • First, the Federal Power Act strictly limits FERC's authority to regulation of its licensee, and grants no authority to FERC to regulate State or local governments or their citizens. 
  • Second, the Federal Power Act contains NO reference to Shoreline Management or Shoreline Management Plans. 
  • Third, FERC delegated to APCo the authority to regulate uses and occupancies within the project boundary via License Article 415 Use and Occupancy
  • Fourth, APCo's Shoreline Management Plan created a regulatory framework, which APCo uses to regulate land use and development in the project. 
  • Fifth, FERC has no legal ability to grant APCo regulatory powers that FERC does not itself possess. 
  • Sixth, APCo's enforcement of the SMP, without sufficient property rights, illegally limits local governmental authority and illegally regulates citizens. 
On Monday, December 8th 2014 the US Supreme Court will hear oral arguments in the case of Department of Transportation v. Association of American RailroadsIt is highly likely Supreme Court Justices will continue to uphold the prohibition against delegation of regulatory authority to private entities, which will serve to further validate CURB's long held position that Shoreline Management Plans are an illegal Federal government overreach. APCo's insistence that property owners must agree to its Permit terms (which conflict with recorded and deeded property rights) is beyond its authority. APCo claims it has been granted its regulatory authority over property owners by FERC -- This should fittingly drive the final nail into the coffin of shoreline management. 

Note to FERC: Why wait to be discredited and instead immediately drop Shoreline Management requirements from your licenses.  Rest assured that State and local governments are the proper authorities and have and will do a superior job.