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On September 9, 2025, the U.S. Court of Appeals for the D.C. Circuit issued a decision in Broadview Solar that, for the first time, applied the Supreme Court's new Loper-Bright framework to a Federal Energy Regulatory Commission ("FERC") order.1 Most directly, the D.C. Circuit upheld FERC's interpretation of how to measure a small power production facility's "power production capacity" for purposes of the Public Utility Regulatory Policies Act of 1978 ("PURPA"). The facility at issue was a co-located solar generation and battery energy storage renewable energy project. The D.C. Circuit confirmed that the best reading of PURPA is that a facility's power production capacity is equal to the facility's maximum net output (i.e. the amount the facility can "send out" to the grid) rather than some other measure such as installed capacity. More broadly, the decision is meaningful because the D.C. Circuit indicated how courts may address issues of statutory interpretation presented in FERC appeals post-Loper-Bright. Post Loper-Bright, if a court decides to speak on the "best reading" of an ambiguous statutory phrase, this limits the ability of FERC to re-interpret the provision in the future as such a re-interpretation may not be offered any deference. It is also noteworthy that the D.C. Circuit did not rely on other forms of deference available to it even after Loper-Bright's findings on Chevron deference (such as Skidmore deference).
As background, PURPA and the FERC's implementing regulations limit a small power production qualifying facility's ("QF's") capacity to a "power production capacity" of 80 MW.2 At the heart of the underlying dispute, as explained more fully in our previous posts, was whether, for PURPA capacity measurement purposes, FERC should consider a facility's maximum net output (the amount the facility can "send out" to the grid) or whether it should only consider the power production capacity of the facility's equipment. FERC has historically focused on the maximum net output of the facility rather than the installed capacity of the equipment at the site.3
In 2023, the D.C. Circuit, relying on Chevron deference, affirmed FERC's use of a small power production QF's maximum net output when calculating its power production capacity.4 In July 2024, the Supreme Court granted certiorari, vacated the D.C. Circuit's decision in light of Loper-Bright, and remanded the case back to the D.C. Circuit.5 In its subsequent September 9, 2025 decision, the D.C. Circuit held, employing traditional tools of statutory interpretation, that the "best view of the statute" is consistent with FERC's interpretation of "power production capacity" under PURPA.6
The most direct and practical consequence of the D.C. Circuit's decision is that owners of small power production QFs will continue to be able to build power generation facilities with a nameplate capacity exceeding 80 MW and remain eligible for QF status and corresponding benefits, provided that the QF does not inject more than 80 MW to the grid. Owners of QFs may install equipment to limit the "send out" capacity of the facility to 80 MW or lower. This ruling, applying the Loper-Bright framework, is also likely to have more permanence than an order issued based on Chevron: Because the D.C Circuit directly establishes the "best reading" of the meaning of the term "power production capacity," this limits the ability of FERC to depart in the future from this D.C. Circuit-approved interpretation. Whereas, under Chevron, courts would defer to well-reasoned agency statutory interpretations (which could change over time, provided the agency adequately explained itself), in a Loper-Bright world it now seems that the D.C. Circuit likely has had the final say on the meaning of the term "power production capacity" under PURPA. It is also noteworthy that the D.C. Circuit did not rely on other forms of deference available to it even after Loper-Bright (such as Skidmore deference which allows courts to defer to an agency's interpretation in many contexts). This indicates that when tasked with interpreting ambiguous statutory phrases—even highly technical ones such as "power production capacity" that fall squarely within an agency's expertise—courts may rely on their own statutory interpretation expertise to reach a determination without deferring to the agency's position.
The bottom line under PURPA is that, unless Congress intervenes, it seems that FERC will apply the D.C. Circuit's interpretation of "power production capacity" moving forward. More broadly, Broadview Solar suggests that the D.C. Circuit may choose to interpret statutes on its own rather than apply another form of deference (such as Skidmore deference). This type of appellate review likely limits the agency's ability to re-interpret their statutory authority. Once an issue of statutory interpretation is litigated, and a court reaches a determination on the "best reading" of the statute, the agency will likely apply this reading moving forward.
The period for filing a petition for rehearing or a petition for rehearing en banc in the Broadview Solar proceeding does not expire until Friday, October 24, 2025, which means that parties may still seek rehearing of the D.C. Circuit's decision. In proceedings that involve a U.S. agency, such petitions are not due until 45 days after judgment is entered by the court.
Footnotes
1. Solar Energy Indus. Ass'n v. FERC, No. 21-1126, 2025 WL 2599488 (D.C. Cir. Sept. 9, 2025).
2. 16 U.S.C. §§ 796(17), 824a-3; 18 C.F.R. § 292.204.
3. Occidental Geothermal, Inc., 17 FERC ¶ 61,231, at 61,445 (1981).
4. Solar Energy Indus. Ass'n v. FERC, 59 F.4th 1287 (D.C. Cir. 2023).
5. Supreme Court Order List, Certiorari—Summary Dispositions (July 2, 2024), https://www.supremecourt.gov/orders/courtorders/070224zor_2co3.pdf.
6. Solar Energy Indus. Ass'n, 2025 WL 2599488 at *1.
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