HMS Legal Blog

On June 2, the EPA released its much anticipated proposed rule mandating a reduction in carbon emissions from existing power plants.[1]  The rule requires an overall national decrease in carbon emissions by 30% from existing plants by 2030.  The proposed rule instructs states to submit plans to achieve state specific goals for emission reductions.  Alternatively, states may collaborate with other states and submit a joint plan.  Plans must be submitted by 2017, or 2018 if collaborating with other states.[2]

On May 15, 2014, during the Pennsylvania Bar Association’s annual meeting, the PBA’s Administrative Law Section presented the James S. Bowman Award to Kevin J. McKeon of Hawke McKeon & Sniscak, LLP.  The award honors a lawyer who is making a significant impact on the practice of administrative law and who is demonstrating leadership in mentoring administrative law practitioners.  McKeon regularly represents clients before the Pennsylvania Public Utility Commission and the Federal Energy Regulatory Commission, and also serves as lead counsel on significant cases before Pennsylvania’s appellate courts and the federal circuit courts of appeal. He serves on the Pennsylvania Supreme Court’s Appellate Court Procedural Rules Committee, is a co-author of Pennsylvania Appellate Practice, and is a frequent lecturer on topics in administrative law and appellate procedure.   The award is named for the late Honorable James S. Bowman, the first President Judge of the Commonwealth Court of Pennsylvania,   whose comprehensive knowledge of administrative law, government law and appellate procedure was widely recognized and respected.

On January 2, 2014 the Pennsylvania Public Utility Commission and Department of Environmental Protection (“Applicants”) filed an Application for Reargument of Robinson Township,1 in the Pennsylvania Supreme Court, requesting reconsideration of the December 19, 2013 plurality opinion and remand to the Commonwealth Court for an evidentiary hearing and findings of fact.  The Applicants argue that the plurality of the Court, in applying its newly coined Environmental Rights Amendment balancing test, adopted novel and unsupported findings of fact, contrary to established Supreme Court principle against taking on a fact finding role in its appellate jurisdiction.  Robinson Township, et al., (“Townships”) answer that no disputed facts were necessary to the Court’s balancing test, and in the alternative, judicial estoppel precludes Applicants from requesting an evidentiary hearing because Applicants successfully argued in the Commonwealth Court that the Act’s constitutionality was purely a question of law.  Applicants also request remand to have the Commonwealth Court determine whether the unconstitutional set back provisions are severable from the rest of Act 13.

Back in June 2011, we reported here that Congress’ brand new creation known as the “Federal Insurance Office” (FIO) had found its first Director in former Illinois regulator Michael McRaith.  We cautiously anticipated then the issuance of the FIO’s initial report to Congress, scheduled for January, 2012, regarding the effectiveness of the state-based system of insurance regulation, as well as recommendations for changes and improvements.  Industry stakeholders speculated then about what the establishment of this new federal bureaucracy might signal and what role the Feds might be looking to assume in their industry in the wake of scares about financial instabilities surrounding major U.S. insurers. The decades-old debates about federalism in the regulation of insurance were sparked anew and we waited for word from Director McRaith and his Office.  And we waited.  A year passed and we waited some more.  Another year passed and the Feds rolled out their health insurance marketplace and that went…well, they did roll it out!  You may have heard.

A government body subject to the Sunshine Act’s requirement of public decision-making is free to engage in non-public information gathering sessions, including private meetings with opposing parties in ongoing litigation in which a quorum of the agency members participate, so long as the actual decision-making, or “deliberation” takes place at a public meeting, the Supreme Court has ruled. In Smith v. Township of Richmond 34 MAP 2013, __A.3d __ (December 16, 2013), the Pennsylvania Supreme Court “allowed appeal on a limited basis to examine whether the Sunshine Act’s definition of ‘deliberations’ is implicated where… an agency meets with various parties – including opposing parties in litigation – to obtain information designed to help the agency make a more informed decision with regard to settling the ongoing litigation.” In finding no violation and permitting the fact-finding sessions, the Court affirmed the decisions of the Commonwealth Court and the trial court.

Pennsylvania Governor Tom Corbett has issued an Emergency Proclamation temporarily waiving certain state and federal motor fuel carrier regulations for propane and heating oil transport carriers.

The Pennsylvania Supreme Court held key provisions of Act 13 unconstitutional under the Environmental Rights Amendment (ERA) of the Pennsylvania Constitution in a plurality opinion on December 19, 2013.  Act 13 was designed to streamline regulation of the oil and gas industry by setting statewide zoning standards and administrative review procedures, which posed significant financial ramifications for non-compliant municipalities.  The Court specifically held that the provisions mandating municipal zoning standards, such as permitting industrial oil and gas operations as a use of right in every zoning district throughout the state, are unconstitutional. These provisions were overturned because the legislature has abrogated constitutionally proscribed municipal duties to protect the rights guaranteed by the ERA.  The Court also held that provisions of the act imposing a waiver process for mandatory setback from waterways, administered by DEP, also violated the ERA.

On November 25, 2013, Governor Tom Corbett signed Act 89 (the “Act”) into law.  The Act, predominantly funded by an increase in motor fuel taxes, will provide needed upgrades to Pennsylvania’s transportation infrastructure.

The PUC’s deadline of December 12, 2013, to receive comments from interested parties on the current state of competitiveness of the natural gas market in Pennsylvania is drawing near.

The Public Utility Commission (“PUC”) recently issued a Tentative Order in the matter of: The Use of Fixed Price Labels for Products With a Pass-Through Clause, Docket No. M-2013-2362961 (Tentative Order entered May 23, 2013), in which it requested interested parties to comment on what it views as an emerging problem: certain Electric Generation Suppliers (“EGS”) offering products labeled as “fixed price” when the products clearly are “variable price” products.  Comments were filed June 24 and a PUC decision is expected soon.

In what will likely prove to be a controversial decision, the Staff of the Pennsylvania Public Utility Commission denied the request of First Energy Solutions (FES0 to be the assignee of two default service supply contracts, currently held by BP, for two tranches of supply each with Metropolitan Edison Company and West Penn Power Company. FEs has appealed Staff's action to the Commission itself.

The Pennsylvania Supreme Court has adopted rule changes that will result in shorter appellate briefs based on a “word count” approach of the type used in the Federal Rules of Appellate Procedure.  The current volume limits are 70 pages for principal briefs and 25 pages for reply briefs. Under the new rules, the volume limits are a “word count” of 14,000 words for principal briefs (approximately 56 pages assuming 250 words per page) and 7,000 words for reply briefs (approximately 28 pages assuming 250 words per page).  A brief based on word count must be accompanied by certification of counsel that the brief complies with the limit.  The rule permits continued use of a page count to determine volume, but at the reduced page count levels of 30 pages for principal briefs and 15 pages for reply briefs.

In an effort that is likely to fall short of the expectations of more than a few participants, the Pennsylvania Public Utility Commission (“Commission”) officially shared its vision of the next steps for encouraging more competitive electricity markets in the Commonwealth.

In a long anticipated Tentative Order, the Pennsylvania Public Utility Commission (“PUC”) finally revealed its vision for the “end state” of the retail electricity market in Pennsylvania.  The problem; many observers believe that the “cure” will kill the patient.

Jersey and New York gasoline distributors continue to struggle to supply gas stations with diesel and gasoline product while federal and state legislatures both suspend and invoke regulations in order to assist and police gasoline distributors.

Pursuant to the Proclamation of Disaster Emergency issued by Governor Corbett on October 26, 2012, the Secretary of Transportation, Barry J. Schoch, has signed a waiver extending the hours drivers may drive in a single shift from 11 to 14 hours.  This waiver applies to drivers carrying motor fuels, heating oil, or propane.

The Pennsylvania Public Utility Commission (“PUC”) caused quite a stir with its August 16, 2012 Order[1] that partially approved the jointly filed default service plans of the four First Energy electric utility affiliates serving in Pennsylvania.

Providing a win to competitive suppliers, the Pennsylvania Public Utility Commission (“PUC”) at its July 19 public meeting unanimously denied PPL’s request for a migration rider for default service customers.

Historically the Pennsylvania Public Utility Commission (PUC) has permitted natural gas distribution companies (NGDCs) to use flexible pricing or “flex” contract rates to attract or retain large customers who have other energy alternatives.  The reasoning has been that “half a loaf is better than none,” and that such revenues, which cover and exceed marginal cost, contribute positively to overall cost of service.  The result is a benefit to the large customer, the utility, and all customers generally. Moreover, in terms of retaining a customer, the argument in favor of the status quo is that other ratepayers benefit as they do not bear the revenue burden of stranded investment or a smaller revenue pot over which to apply costs.  The NGDCs have generally been able to recover from other ratepayers the difference between the “flex” rate and what would have otherwise been charged under an ordinary general tariff rate.

Solar developers are finding that Pennsylvania funding sources for solar development are drying up with no plans of replenishing the pool.  The dearth of available solar grants could not come at a worse time.  On May 17, 2012, the U.S. Commerce Department announced stiff tariffs on Chinese-made solar panels raising costs on most future solar projects.