D.C. Circuit Rejects DOE's FPA Emergency Power Used to Halt Plant Retirements
The D.C. Circuit rejected DOE's use of section 202(c) emergency authority to block plant retirements, with implications for utility closures, reliability certification, and M&A diligence on thermal and nuclear capacity.
In Michigan v. DOE, the D.C. Circuit rejected the Department of Energy's attempt to rely on section 202(c) of the Federal Power Act — a wartime/emergency authority to order the generation, delivery, interchange, or transmission of electric energy — to block power plant retirements. As reported by Blank Rome on October 7, 2026, the ruling signals that DOE cannot stretch emergency powers to override state decisions closing generating units, and pushes the agency back toward the congressionally mandated FPA reliability certification process run through regional transmission organizations and the North American Electric Reliability Corporation.
Why sophisticated counsel should care: retiring thermal and nuclear units underpins capacity market pricing, transmission investment, and utility rate-base strategy. A federal pathway that could freeze retirements would have added schedule, cost, and regulatory risk to utility capital plans; foreclosing it removes that overhang. M&A diligence should now test capacity assumptions, RTO deliverability positions, and the durability of state closure approvals rather than assume a federal backstop.
What to watch: rehearing or appeal, parallel litigation in other states, and whether DOE instead revives reliability certification under section 202(c) on its ordinary timetable. Exact holdings and procedural posture are not fully detailed in the available source and should be confirmed against the opinion.