SEEM Deemed Insufficient by D.C. Circuit Court, Sending Ruling Back to FERC

Advanced Energy United was part of a coalition of clean energy business associations, environmental non-profits, and other petitioners last year in challenging a decision by the Federal Energy Regulatory Commission (FERC) over its split-decision approval of the Southeast Energy Exchange Market (SEEM). Last week, we received the welcome news that the U.S. Court of Appeals for the D.C. Circuit ruled in our favor and remanded the case back to FERC for further review. At United, we see this decision as a win for competition, for open markets, and for an efficient grid. 

SEEM is a trading platform for utilities in the Southeastern U.S., including Dominion Energy, Duke Energy, Santee Cooper, Southern Company, and Tennessee Valley Authority, and it falls far short of being a competitive market that could improve efficiency and save consumers money, as United’s then-Managing Director Jeff Dennis explained in a blog post in 2021 when SEEM was proposed. 

In short, the court agreed that FERC’s decision approving the transmission rules was “inconsistent” with the commission’s own open access requirements that aim to ensure transmission owners offer non-discriminatory access to their systems, which is a necessary component of market competition. The Court also agreed that requests by United and other organizations to rehear the case after SEEM took effect while FERC was deadlocked were not out of time, and that FERC was therefore wrong to decline them. 

In ruling for our party, the court said, in part: 

“The creation of a new service that — by its design — excludes existing market participants evokes the discriminatory practices against third-party competitors by monopoly utilities that prompted the commission’s adoption of Order No. 888." 

We were very fortunate to work alongside passionate supporters at Clean Energy Buyers Association (CEBA), Solar Energy Industries Association (SEIA), Earthjustice, Southern Alliance for Clean Energy (SACE), and R Street, and the team at Wilson Sonsini deserves special praise for their role in helping to secure this legal win. We hope this decision sends a signal to the utility participants of SEEM that the principles of open and fair access to transmission resources must be preserved to ensure a competitive playing field for all. This decision impacts roughly 5 million households across the Southeast whose access to clean energy and lower costs are negatively impacted by the lack of a wholesale market in the region. There is more work ahead to ensure the Court’s decision to send SEEM back to FERC results in progress toward true market competition in the Southeast, and we will continue to advocate for better market structures for the region and at FERC.