Document Type
Article
Publication Title
Georgetown International Environmental Law Review
Abstract
Net metering is the most utilized state incentive for renewable power nationwide, in place in more than eighty-five percent of all states. Utilities in all states have been required by federal law for the past seven years to make net metering available to all requesting customers. Yet a significant number of states have failed to comply with this federal law, and several other states have complied in a manner that has raised questions as to whether they have violated the Constitution's separation between state and federal jurisdiction over power. This article will not delve into the first issue of noncompliance with earlier statutes, but will instead focus on the important point of how renewable energy policy must be implemented consistently with the Constitution, and how to shelter this most used renewable energy incentive.
The pressing issues in energy policy in the twenty-first century are legal and regulatory, not technical. Because net metering is a dominant element of current U.S. renewable energy policy, if it does not survive legal challenges, a foundation of U.S. renewable power and the new "green" infrastructure will be in jeopardy. There is a host of newly successful or pending Constitutional challenges to particular state mechanisms to promote renewable power in California, New Jersey, Colorado, New York, Vermont, Massachusetts and Rhode Island, which are examined in this article.
Power, in its intangible embodiment, is cloaked in legal protocols that may not comport with the reality of the physical world. 2 Massachusetts has pushed boundaries further by creating "virtual" net metering where power can be credited not just to the owner's individual account, but to any number of other unrelated customers in the utility's service territory. This is equivalent to allowing the net-metered generator to run a "virtual" extension cord to supply another electricity customer, without any actual engineering or incursion of cost.
From a policy perspective, net metering subsidies3 raise potential Supremacy Clause, Commerce Clause, Federal Power Act,4 and filed rate doctrine issues. This article commences by charting all the Constitutional issues raised by program designs in forty-three net-metered states. This article does not address those states that have not implemented net metering. After presenting and examining all potential Constitutional challenges, this article identifies two key federal adjudicatory decisions, and discusses what can be done legally with net metering, taking into account Supremacy Clause and filed rate doctrine issues.
Once the policy and legal landscape is set, Part VI analyzes states on the legal "edge," and looks at the pending legal challenges. Part VII identifies exceptions and strategies to navigate to legal "safe harbors" that may protect some, but not all, state renewable energy initiatives. Certain policy designs may create elegant "safe harbors" tucked into the federalist legal structure of the Federal Power Act and the Constitution's Supremacy Clause.
Parties have commenced legal challenges to various state renewable energy initiatives, including net metering. These challenges may be motivated by the perceived costs to ratepayers of these incentives, but their fulcrum is the jurisdictional legal distinctions between federal and state power in the U.S. federalist system. A particular net metering system's statutory design and administration determines how well it integrates into the fabric of Constitutional law. This article reviews state net metering activity and recent legal challenges to renewable energy policies, and compares both the energy policies and renewable programs against the contours of U.S. constitutional law.
First Page
267
Last Page
323
Publication Date
2012
Recommended Citation
Steven Ferrey, Virtual "Nets" and Law: Power Navigates the Supremacy Clause, 24 Georgetown Int'l Env't L. Rev. 267 (2012).
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