Boston Edison Co. v. Federal Energy Regulatory Commission
United States Court of Appeals for the First Circuit
885 F.2d 962 (1989)
The Federal Energy Regulatory Commission (FERC) (defendant) issued an order adjusting the rate of return for Boston Edison Company’s (Boston Edison) (plaintiff) electric rates after March 25, 1988. FERC reduced the rate of return due to falling interest rates and rising stock prices. To adjust the rate of return, FERC relied on the United States Treasury’s interest rate on bonds. Specifically, FERC compared the rates the Treasury paid during the six-month period in 1985, which FERC had used to set the then-existing rate of return, to the rates the Treasury paid during the six-month period in September 1987 – March 1988. FERC did not introduce the Treasury’s bond interest rates into the administrative record. On rehearing, Boston Edison was given the opportunity to dispute the rate-of-return adjustment and any evidence relied upon. Boston Edison brought suit challenging the FERC order on the ground that it violated the Administrative Procedure Act (APA) by relying on facts outside of the administrative record.
Rule of Law
Holding and Reasoning (Breyer, J.)
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