Tag Archives: regulation

The Supreme Court and Utilities

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The Supreme Court on Monday upheld the federal government’s ability to spur incentives for industrial businesses, schools and other large energy consumers to reduce power usage at times of peak demand.

The court, in a 6-2 ruling by Justice Elena Kagan, said the Federal Energy Regulatory Commission acted within its powers when it issued an order in 2011 requiring higher levels of compensation for some power customers that agreed to reduce their electricity use.

The Court likely is right on this, in that FERC’s rule is within the confines of the underlying law. However, this still is the government picking winners and losers, and this still is the government dictating to private enterprise what it must do.

The corrective answers that are required, then, are two: one is to withdraw FERC’s authority to issue such rules, to rescind Congress’ delegation of such rule-making to FERC (such a rescission is required across the board, but that’s for another writing).

The other required answer is to alter the underlying law that the FERC rule was…fleshing out. It’s a law that is no longer necessary and that, as the FERC rule demonstrates, has become vulnerable to Executive Branch abuse.

That law is Section 201 of the Federal Power Act, which

empowers FERC to regulate “the sale of electric energy at wholesale in interstate commerce.”

Congress’ authority (not an Executive Branch agency’s) to regulate interstate commerce is constitutionally limited to regularizing commerce among the States, not to dictate the terms of that commerce. Of course, for Congress to recover this authority and its limits, a third required answer consists of correcting a number of Supreme Court mistakes regarding how far Big Government may reach inside any State to regulate commerce there.

More Regulations

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Jason Godsil, founder and CEO of Godsil Motorcars, is building a new car that will run on natural gas; he’s in the design and prototyping stage. Joel Feder, of MotorAuthority, asked this question and got an answer that should be embarrassing to the Obama administration and its predecessors.

What’s the largest unforeseen issue you’ve encountered?

Crash tests and EPA certifications will need to be done but the level that will be required for a fully certified vehicle was an eye opener. … Do you want to use a custom headlight that isn’t used currently? Sure, we can look at that for $300,000. Do you want to have multiple options for seat belt colors? Sure, that will be $30,000 for the test of each color. It’s crazy! That is why other countries get some car models that are never for sale here in America.

Indeed.

There was this little tidbit in that conversation, too [emphasis added].

When do you realistically think the first production car will hit the street?

The ideal timeline is that we could debut a prototype, using the prototype engine we are working on now, in about eight-to-ten months after we finalize with our investment partners. With the development and testing of the powertrain and all the certifications that will be needed, we envision a production car hitting the streets about three-to-four years later.

This is just…amazing.

Well, Of Course

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…the Environmental Protection Agency’s Office of Inspector General on Wednesday effectively cleared the EPA of allegations of bias in its quest to preemptively kill a proposed mine in southwest Alaska.

The EPA’s IG—which works for the EPA’s Administrator—reached this conclusion even though it was “unable” (it claimed) to get hold of two years’ worth of emails from a key, carefully unnamed, retired employee. The IG claims in the report to have subpoenaed that worthy, but there’s no indication the IG ever bothered even to try to enforce the subpoena.

What else could we expect from an “inspection” function that works for, and is beholden to, the head of the agency it’s putatively inspecting?

Job Security

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On the matter of competition and business imperatives, particularly involving big data, Margrethe Vestager, European Commissioner for Competition, had this to say at her speech to the Digital Life Design conference in Munich:

If a company’s use of data is so bad for competition that it outweighs the benefits, we may have to step in to restore a level playing field[.]

Continuing:

We continue to look carefully at this issue….

Never mind that they’ve found nothing:

this certainly doesn’t mean we never will[.]

There isn’t any wrong doing, but we’re going to keep looking for it, anyway. Because jobs. Because government bureaucrat jobs.

A Cost of Inexperience

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What’s wrong with China’s stock market?

Just about everything, according to a statement from Xiao Gang [at the time, Chairman of the China Securities Regulatory Commission] delivered at a national meeting of Chinese securities officials….

In the statement, Mr Xiao defended his handling of successive market meltdowns, blaming the “abnormal volatility” on “an immature market, inexperienced investors, imperfect trading system, flawed market mechanisms and inappropriate supervision systems.”

He got that last part partially right—and only that much.

What’s wrong with the PRC’s stock market is inexperienced regulators and the idea that a functioning national economy can be managed—governed—from the center.