A panel at last week’s Energy Bar Association annual Fall Conference examining FERC’s response to the D.C. Circuit of Appeals’ Allegheny Defense Project v. FERC ruling evolved into an in-depth Q&A with panelist David Morenoff, FERC’s acting general counsel.

Allegheny upended longstanding FERC practice by barring the commission from using tolling orders to delay judicial review under the Natural Gas Act and Federal Power Act. The July order by the D.C. Circuit Court of Appeals concluded that the commission’s use of tolling orders to stop the 30-day clock for acting on rehearing requests improperly prevents litigants from appealing its rulings indefinitely even as it allows gas pipeline companies to seize property under eminent domain and begin construction. (See D.C. Circuit Rejects FERC on Tolling Orders.)

Moderator Adrienne Claire, a partner with Thompson Coburn, noted that FERC Chairman Neil Chatterjee and Commission Richard Glick asked Congress to provide the commission with a “reasonable amount of time to act on rehearing requests.” (In light of Allegheny, FERC must now respond to all rehearing requests within 30 days or they are deemed denied “by operation of law.”)

“What would be a reasonable amount of time in your opinion? What’s feasible?” Claire asked.

Morenoff said Chatterjee developed “great respect” for members of Congress and their staff from both parties through his extensive experience working on Capitol Hill, “so he leaves to Congress the question about what will be the reasonable amount of additional time if Congress were to respond to that call and take action.”

Morenoff pointed to two bills introduced into Congress last spring, H.R. 6982 and H.R. 6963, to address rights to timely rehearing of FERC decisions under the NGA and FPA, respectively. The two bills would set rehearing time frames to 90 days under the NGA and 120 days under the FPA, “perhaps reflecting the relative greater complexity that we often see in rehearing requests under the FPA with respect to particularly the organized markets,” he said.

“I think that those provide a really good starting point for discussions that are proceeding on the Hill,” Morenoff said.

In response to Claire’s question about what changes FERC has already made in response to Allegheny, Morenoff said that, even before Allegheny, Chatterjee had directed commission staff to expedite actions on rehearing requests, especially regarding landowner requests in gas pipeline certificate proceedings.

“We have been doing coordination among not only the sections across [FERC’s Office of the General Counsel], including the rehearings section that we set up in February, but among the various program offices at FERC that work closely on a rehearing request … and I think that’s just more important now as we try to move even more quickly to cover that same ground in a post-Allegheny world,” Morenoff said.

Allegheny also prompted FERC to begin issuing two types of new notices in response to rehearing requests, Morenoff said. The first states that “rehearing may be deemed denied, period,” while the second says that “rehearing may be deemed denied and the commission intends to issue a further order on the merits addressing arguments on rehearing,” he said. (See FERC will not Seek SCOTUS Review of Tolling Decision.)

“We’ve been trying to move quickly on those second orders, but I think both of those notices indicate that the commission is going to put more emphasis on our underlying orders more often because, as we’re trying to move more quickly, the old kind of standing rehearing order that would have a lengthy background section, then summarize the order in detail, then summarize all the arguments raised in rehearing, that probably isn’t possible anymore given these time frames,” Morenoff said.

‘Uphill Battle’

“One of the issues that was percolating a few years ago was whether in the absence of a quorum, FERC could even issue a merits order on rehearing, much less a tolling order,” an audience member said. “Do you think the Allegheny decision gives us any insight into how the courts might resolve that issue?”

“I don’t think that Allegheny sheds a great deal of light on that subject, but I think it’s a very important question because regrettably we’ve had less time recently with five commissioners that all of us inside and outside would like,” Morenoff responded. He noted that when the commission realized it would be dropping below quorum in 2017, it issued an order that covered the delegation of additional responsibilities to staff.

“At the time, based on the research we had done, we felt quite confident that as long as there is a proper delegation from the quorum of the commission, there’s quite a good deal that can be done by staff,” he said.

Claire turned to the broader panel to pose a hypothetical question about how the Supreme Court would have responded had FERC appealed Allegheny, a step the commission said last month it would not take.

“I think there’s a decent chance the court would’ve granted review because it has a pretty high rate of granting petitions when the government is asking it to do so,” said Erin Murphy, an Environmental Defense Fund attorney.

But Murphy thought FERC would have faced a “pretty uphill battle” on appeal because the court, while potentially sympathetic to FERC’s arguments about the tolling orders as a longstanding policy matter, would still doubt that the rehearing delays complied with what Congress was “trying to accomplish” when it set rehearing request deadlines under the NGA.

“There’s certainly arguments about congressional acquiescence, and there’s a lot of water under the bridge at this point, but I think that there’s just that dynamic of [the rehearing delays] feeling like circumvention that would’ve been hard to overcome at the court,” Murphy said.