D.C. appeals court orders regulators to reconsider approval of regional energy trading system

D.C. appeals court orders regulators to reconsider approval of regional energy trading system

WFAE |
By
David Boraks

Published July 17, 2023 at 3:51 PM EDT

A federal appeals court has ordered regulators to reconsider approval an automated regional energy trading market that includes Duke Energy.

A federal appeals court in Washington, D.C., has ordered federal energy regulators to reconsider their approval of an eight-month-old Southeast regional electricity trading system that includes Duke Energy.

The Southeast Energy Exchange Market, or SEEM, launched last November to automate the buying and selling of electricity among utility companies. Trades previously required telephone calls between companies. The exchange has 23 members in 12 states.

The U.S. Court of Appeals for the District of Columbia Circuit ruled that the Federal Energy Regulatory Commission (FERC) was wrong to disallow an appeal of the approval. And it said SEEM's structure could limit competition because it has closed membership.

FERC had previously ruled that the challenges were filed too late, which prompted the appeal to the D.C. Circuit Court of Appeals. Now regulators will have to consider the challengers' arguments in a new hearing.

The Southern Alliance for Clean Energy (SACE) was among the groups that challenged FERC's approval. Research director Maggie Shober said the group favors wider competition.

"We at SACE are advocating for inclusive competition across the electricity sector, so not just utility to utility, but renewable projects or any independent power projects able to compete, as well as transparent oversight of the utilities all across the Southeast," Shober said. "We really didn't see SEEM as helping on either of those issues."

The ruling won't have an immediate effect on customers or trading. The exchange plans to continue operating until regulators hold a new hearing, a Duke spokeswoman said.

Duke Energy and SEEM issued identical statements saying they're disappointed and that the exchange will help cut costs and support renewable energy.

"While we are still reviewing the opinion, we are disappointed by the Court's decision to remand certain matters concerning SEEM back to FERC. We are committed to SEEM because its design undoubtedly benefits customers and renewable generation. We will work through the FERC process to address the limited issues identified in the Court's decision."

"SEEM — as a voluntary wholesale market improvement — is designed to bring customers across the region more affordable, reliable and sustainable energy, particularly solar energy. There have been over 50,000 transactions representing more than 1.3 terawatts (TWs) that have occurred, all of which have benefited customers. We have recently added four additional participants from Florida. As this region works to add more renewable resources, like solar, customer-centric efforts like SEEM will enable these goals without imposing undue bureaucracy and cost."