Seventh Circuit Says Michigan’s In-State Requirement Violates Commerce Clause
Illinois Commerce Com’n v. Federal Energy Regulatory Com’n, 721 F.3d 764 (7th Cir. 2013)
Recent Developments: The U.S. Supreme Court denied a petition to hear an appeal of the 7th Circuit’s decision.
Case Documents

Case Summary
Michigan’s Renewable Energy Standard (RES), passed by the legislature in 2008, requires Michigan utilities to meet their renewable energy targets by holding RECs supplied by generators located in Michigan.

In a Federal Energy Regulatory Commission (FERC) proceeding unrelated to Michigan’s RES, the Commission approved tariff amendments submitted by the Midcontinental System Operator (MISO), an interstate grid operator. These amendments spread the cost of approximately twenty regional transmission line projects among member utilities. One purpose of the new transmission lines is to move wind power across the region so utilities can meet their RPS targets.

Several parties challenged FERC’s approval of the tariff amendments in the Seventh Circuit Court of Appeals. Michigan argued that it would not benefit from the new transmission lines designed to move power across the region because Michigan’s utilities could meet their renewable energy mandates only with in-state renewable generation. In a decision affirming FERC’s approval of the tariff amendments, the Seventh Circuit rejected Michigan’s argument, and remarked that Michigan’s RES “trips over an insurmountable constitutional objection. A state cannot, without violating the Commerce Clause, discriminate against out-of state renewable energy.”

Michigan’s RES, however, was not at issue in this proceeding, and it remains in effect.

Judicial Decision
Illinois Commerce Com’n v. Federal Energy Regulatory Com’n, 721 F.3d 764 (7th Cir. 2013)