PJM Transmission Owners v. FERC

── PJM Transmission Owners v. FERC ── Court: Court of Appeals for the D.C. Circuit Date: June 05, 2026 Category: General United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT No. 25-1064 September Term, 2025 FILED ON: JUNE 5, 2026 PJM TRANSMISSION OWNERS, ET AL., PETITIONERS v. FEDERAL ENERGY REGULATORY COMMISSION, RESPONDENT PJM INTERCONNECTION, L.L.C., ET AL., INTERVENORS Consolidated with 25-1100 On Petitions for Review of Orders of the Federal Energy Regulatory Commission Before: SRINIVASAN, Chief Judge, PAN and GARCIA, Circuit Judges JUDGMENT These petitions for review were considered on the record from the Federal Energy Regulatory Commission, the briefs and oral arguments of the parties, and the briefs of amici. The court has afforded the issues full consideration and has determined that they do not warrant a published opinion. See D.C. Cir. R. 36(d). For the reasons stated below, it is: ORDERED and ADJUDGED that the petitions for review be DENIED. * * * PJM Interconnection, L.L.C. (“PJM”) is a Regional Transmission Organization (“RTO”) that operates power transmission facilities serving the Mid-Atlantic states and the District of Columbia. The Planning Protocol that governs regional expansions and improvements to PJM’s electrical grid is contained in PJM’s Operating Agreement. The Operating Agreement requires planning decisions to be approved by a Members Committee, comprising representatives from five sectors of market participants: generation owners, other suppliers, electric distributors, end-use customers, and transmission owners. In response to a proposal from some of its Transmission Owners, PJM sought to streamline the grid-planning process by moving the Planning Protocol from the Operating Agreement to PJM’s Tariff, which would allow PJM to make planning decisions unilaterally, subject only to approval by the Federal Energy Regulatory Commission (“FERC”). To implement that change, PJM and the Transmission Owners proposed to amend the Operating Agreement, the Tariff, and the Owners Agreement (the contract under which the Transmission Owners consent to PJM’s operation of their transmission facilities). PJM and the Transmission Owners first presented their proposal to the Members Committee, which soundly rejected it. Undeterred, PJM and the Transmission Owners presented their proposal to FERC. PJM filed (1) a complaint under section 206 of the Federal Power Act (“FPA”) arguing that it was unreasonable for the Planning Protocol to be in the Operating Agreement, 16 U.S.C. § 824e(a); and (2) an FPA section 205 filing proposing to add the Planning Protocol to the Tariff, id. § 824d. The Transmission Owners made a third filing, seeking various changes to the Owners Agreement under section 205. PJM and the Transmission Owners submitted the three filings as a package deal, underscoring that “acceptance of the [Owners Agreement] Amendments is a ‘prerequisite’ to granting the relief” sought by PJM’s filings related to the Operating Agreement and the Tariff. J.A. 73. They further stressed that the “Amendments [to the Owners Agreement] are a carefully negotiated integrated package of reforms that are not severable.” J.A. 10 n.48. FERC rejected the package of reforms. The Commission determined that eight of the proposed amendments to the Owners Agreement were not just and reasonable. And it explained that because the deal was an “integrated package,” the disapproval of even one of those amendments was sufficient to doom the entire proposal. J.A. 10. FERC separately concluded that PJM had not carried its burden to show that the placement of the Planning Protocol in the Operating Agreement was unjust and unreasonable. PJM and