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 The court said it will hear an appeal filed by the U.S. Federal
Energy Regulatory Commission seeking to reverse a May 2014 ruling by
the U.S. Court of Appeals for the District of Columbia Circuit that
threw out the rule. The regulation, aimed at improving grid
reliability and encouraging clean energy, remains in effect as the
litigation continues.
FERC chairman Norman Bay said in a statement that the program is
"important to the nation's competitive wholesale electricity markets
and reliable electric service."
The regulation concerns what FERC calls "demand-response," which is
when, in an attempt to manage demand for electricity, regional
electrical grid operators agree to pay electricity users to cut
consumption at peak times.
The brief court order noted that Justice Samuel Alito will be
recused in the case, meaning only eight justices will participate.
The court did not give a reason.
 The Electric Power Supply Association, other trade groups that
represent utilities and PPL Corp challenged the regulation. They
would lose out if the regulation is allowed to stay intact because
it is likely to reduce demand for electricity generation.
Some utilities and companies like EnerNOC Inc that have developed
products to help customers lower electricity usage had backed the
government's appeal, as did companies like aluminum producer Alcoa
Inc that can benefit from the payments.
Environmental groups also back the rule, saying it helps promote
renewable energy sources and reduce air pollution by making the
electricity market more flexible and limiting demand for electricity
generation.
The case does not directly affect the Obama administration's
separate plan to regulate carbon emissions from power plants.
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The 2011 FERC order set the methodology that wholesalers had to use
to calculate the compensation, saying it must be the same as the
payments made to electricity generators.
The appeals court said FERC, as a federal agency, had no authority
to do so because "demand-response" is an issue that should be dealt
with by state regulators.
The Electric Power Supply Association's members include Exelon Corp
and Dynegy Inc. Also challenging the regulation is utility group
Edison Electric Institute, which represents such companies as
Entergy Corp and Southern Company.
The court will hear arguments and rule on the matter in its next
term, which begins in October and ends in June 2016.
The two related cases are FERC v. Electric Power Supply Association,
U.S. Supreme Court, No. 14-840 and EnerNOC Inc v. Energy Power
Supply Association, U.S. Supreme Court, No. 14-841.
(Reporting by Lawrence Hurley; Editing by Will Dunham)
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