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Consolidated Edison Company v. Federal Energy Regulatory Commission

676 F.2d 763 (1982)

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Consolidated Edison Company v. Federal Energy Regulatory Commission

United States Court of Appeals for the District of Columbia Circuit
676 F.2d 763 (1982)

  • Written by Galina Abdel Aziz , JD

Facts

After natural-gas shortages on several pipelines in 1970, the Federal Energy Regulatory Commission (FERC) (defendant) issued Order No. 43 (Order 43). Order 43 directed interstate pipeline companies to report whether they expected to experience shortages. If they did, they were required to submit a revised tariff outline of their plan for allocating shortages. Pro-rata curtailment plans entitled customers to the same proportion of natural gas that they contracted for. End-use curtailment plans provided natural gas to the highest-priority end users. FERC issued a policy statement announcing its preference for end-use plans because pro-rata plans did not efficiently allocate natural gas in the public interest. FERC established nine rankings for end users. Consolidated Edison (Con Ed) (plaintiff) sued FERC. Con Ed argued that FERC’s action constituted a taking without just compensation in violation of the Fifth Amendment to the United States Constitution and that the compensation scheme was arbitrary and capricious.

Rule of Law

Issue

Holding and Reasoning (Wald, J.)

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