Ruling Helps Clarify FERC's Post-Jarkesy Enforcement Power

This article examines a recent federal court decision that offers important guidance on the scope of the Federal Energy Regulatory Commission (FERC)’s enforcement authority under the Federal Power Act following the Supreme Court’s decision in Jarkesy. The court’s ruling addresses whether FERC may continue to assess civil penalties and seek disgorgement through its administrative enforcement process without violating the Seventh Amendment or Article III. By analyzing the decision in American Efficient LLC v. FERC, the authors explore how courts are distinguishing FERC’s enforcement framework from those called into question in Jarkesy. The article also highlights key considerations for energy companies facing investigations or enforcement actions under the FPA. Energy market participants and practitioners will gain insight into how courts may approach constitutional challenges to FERC penalty proceedings going forward.