The Federal Energy Regulatory Commission (FERC) has allowed an Oregon state court jurisdiction over a contract dispute between Portland General Electric Co. (PGE) and Southern California Edison Co. (SCE) (Docket No. EL94-92-000).In 1987, the FERC accepted a contract for PGE to sell SCE long-term system power and for a mutual exchange of capacity and energy. In 1994, SCE filed a complaint in Oregon state court, alleging that PGE had defaulted on the contract by closing the Trojan nuclear plant. SCE argued that its continued performance under the contract was excused. PGE then asked the FERC to declare its exclusive jurisdiction over a filed rate schedule.
The FERC agreed with SCE that the complaint merely asked the court to interpret and apply the language of the contract according to Oregon law. To adjudicate the Trojan dispute, the FERC explained, it would have to assert primary jurisdiction based on a need for special expertise or uniformity of interpretation. The FERC rejected PGE's argument that its interest in setting policy on plant closings required it to assert primary jurisdiction, noting that exercising its jurisdiction would close off from state review a wide range of conventional contract interpretation issues. The FERC further noted that the case did not concern whether PGE's decision to close Trojan early was prudent, and that the question of whether PGE breached its contract by selling plant salvage did not involve its regulatory responsibilities.
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