December 11, 2023

Supreme Court Decision Not to Grant Cert Signals that Texas Right of First Refusal Law is Unconstitutional

WASHINGTON – The U.S. Supreme Court decided not to grant cert in Lake vs. NextEra Energy, signaling that the Fifth Circuit Court of Appeals decision got it right and that there was no reason to overturn their Opinion. In that decision, the Fifth Circuit ruled that the Texas Right of First Refusal (ROFR) law is unconstitutional. There is bipartisan agreement that the Texas law is unconstitutional with the U.S. Department of Justice under President Biden and former President Trump filing comments in this case arguing that the ROFR is unconstitutional.

In a statement, Paul Cicio, Chair of the Electricity Transmission Competition Coalition, said: “Courts across the country have held that ROFR laws are unconstitutional, and the Fifth Circuit got it right that the Texas law was unconstitutional. Blocking new entrants from competing on transmission projects isn’t just unconstitutional, it’s anti-consumer, anti-free market policy that costs consumers billions of dollars in higher electricity rates.”

The FERC should see this denial of cert as a clear signal in support of transmission competition. FERC has an opportunity to take action now in a pending complaint in Docket EL22-78 to ensure that the FERC-regulated grid operator in the Midwest no longer applies state ROFR laws when conducting transmission planning.

Since Order No. 1000 was issued in 2010 by FERC to usher in competition for ownership of new regional transmission lines, incumbent transmission owners have sought to pass state protectionist, pro-monopoly laws to block new entrants and competition. ROFRs put utility profits over captive electric consumers. 26% of households experience energy insecurity in 2023 and one in five households are unable to pay an energy bill.      

Read ETCC’s comprehensive report: FERC’s $277 billion electricity price hike.


About the Electricity Transmission Competition Coalition

The Electricity Transmission Competition Coalition (ETCC) is a broad-based, nation-wide coalition committed to increasing competition in America’s electricity transmission infrastructure. We advocate for common-sense policies and solutions that result in competitively priced transmission projects, which reduce energy costs for all ratepayers – from large manufacturers to residential consumers. The ETCC represents a diverse group of more than 80 companies and organizations from 48 states, including manufacturing groups, retail electric consumers, state consumer advocates, public power representatives, think tanks, and non-incumbent transmission developers.

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Press Contact:
Julian Graham




Read How the Federal Energy Regulatory Commission’s Failure to Enforce Transmission Competition Will Lead to Decades of Electricity Price Inflation for American Consumers.