16 U.S.C. 824e

16 U.S.C.
United States Code, 2022 Edition
Title 16 - CONSERVATION
CHAPTER 12 - FEDERAL REGULATION AND DEVELOPMENT OF POWER
SUBCHAPTER II - REGULATION OF ELECTRIC UTILITY COMPANIES ENGAGED IN INTERSTATE
COMMERCE
Sec. 824e - Power of Commission to fix rates and charges; determination of cost of production or transmission
From the U.S. Government Publishing Office, www.gpo.gov

§824e. Power of Commission to fix rates and charges; determination of cost of
production or transmission
(a) Unjust or preferential rates, etc.; statement of reasons for changes; hearing; specification of
issues
Whenever the Commission, after a hearing held upon its own motion or upon complaint, shall find
that any rate, charge, or classification, demanded, observed, charged, or collected by any public
utility for any transmission or sale subject to the jurisdiction of the Commission, or that any rule,
regulation, practice, or contract affecting such rate, charge, or classification is unjust, unreasonable,
unduly discriminatory or preferential, the Commission shall determine the just and reasonable rate,
charge, classification, rule, regulation, practice, or contract to be thereafter observed and in force,
and shall fix the same by order. Any complaint or motion of the Commission to initiate a proceeding
under this section shall state the change or changes to be made in the rate, charge, classification, rule,
regulation, practice, or contract then in force, and the reasons for any proposed change or changes
therein. If, after review of any motion or complaint and answer, the Commission shall decide to hold
a hearing, it shall fix by order the time and place of such hearing and shall specify the issues to be
adjudicated.
(b) Refund effective date; preferential proceedings; statement of reasons for delay; burden of
proof; scope of refund order; refund orders in cases of dilatory behavior; interest
Whenever the Commission institutes a proceeding under this section, the Commission shall
establish a refund effective date. In the case of a proceeding instituted on complaint, the refund
effective date shall not be earlier than the date of the filing of such complaint nor later than 5 months
after the filing of such complaint. In the case of a proceeding instituted by the Commission on its
own motion, the refund effective date shall not be earlier than the date of the publication by the
Commission of notice of its intention to initiate such proceeding nor later than 5 months after the
publication date. Upon institution of a proceeding under this section, the Commission shall give to
the decision of such proceeding the same preference as provided under section 824d of this title and
otherwise act as speedily as possible. If no final decision is rendered by the conclusion of the 180day period commencing upon initiation of a proceeding pursuant to this section, the Commission
shall state the reasons why it has failed to do so and shall state its best estimate as to when it
reasonably expects to make such decision. In any proceeding under this section, the burden of proof
to show that any rate, charge, classification, rule, regulation, practice, or contract is unjust,
unreasonable, unduly discriminatory, or preferential shall be upon the Commission or the
complainant. At the conclusion of any proceeding under this section, the Commission may order
refunds of any amounts paid, for the period subsequent to the refund effective date through a date
fifteen months after such refund effective date, in excess of those which would have been paid under
the just and reasonable rate, charge, classification, rule, regulation, practice, or contract which the
Commission orders to be thereafter observed and in force: Provided, That if the proceeding is not
concluded within fifteen months after the refund effective date and if the Commission determines at
the conclusion of the proceeding that the proceeding was not resolved within the fifteen-month
period primarily because of dilatory behavior by the public utility, the Commission may order
refunds of any or all amounts paid for the period subsequent to the refund effective date and prior to

the conclusion of the proceeding. The refunds shall be made, with interest, to those persons who have
paid those rates or charges which are the subject of the proceeding.
(c) Refund considerations; shifting costs; reduction in revenues; "electric utility companies"
and "registered holding company" defined
Notwithstanding subsection (b), in a proceeding commenced under this section involving two or
more electric utility companies of a registered holding company, refunds which might otherwise be
payable under subsection (b) shall not be ordered to the extent that such refunds would result from
any portion of a Commission order that (1) requires a decrease in system production or transmission
costs to be paid by one or more of such electric companies; and (2) is based upon a determination
that the amount of such decrease should be paid through an increase in the costs to be paid by other
electric utility companies of such registered holding company: Provided, That refunds, in whole or in
part, may be ordered by the Commission if it determines that the registered holding company would
not experience any reduction in revenues which results from an inability of an electric utility
company of the holding company to recover such increase in costs for the period between the refund
effective date and the effective date of the Commission's order. For purposes of this subsection, the
terms "electric utility companies" and "registered holding company" shall have the same meanings as
provided in the Public Utility Holding Company Act of 1935, as amended.1
(d) Investigation of costs
The Commission upon its own motion, or upon the request of any State commission whenever it
can do so without prejudice to the efficient and proper conduct of its affairs, may investigate and
determine the cost of the production or transmission of electric energy by means of facilities under
the jurisdiction of the Commission in cases where the Commission has no authority to establish a
rate governing the sale of such energy.
(e) Short-term sales
(1) In this subsection:
(A) The term "short-term sale" means an agreement for the sale of electric energy at wholesale
in interstate commerce that is for a period of 31 days or less (excluding monthly contracts subject
to automatic renewal).
(B) The term "applicable Commission rule" means a Commission rule applicable to sales at
wholesale by public utilities that the Commission determines after notice and comment should
also be applicable to entities subject to this subsection.
(2) If an entity described in section 824(f) of this title voluntarily makes a short-term sale of
electric energy through an organized market in which the rates for the sale are established by
Commission-approved tariff (rather than by contract) and the sale violates the terms of the tariff or
applicable Commission rules in effect at the time of the sale, the entity shall be subject to the refund
authority of the Commission under this section with respect to the violation.
(3) This section shall not apply to—
(A) any entity that sells in total (including affiliates of the entity) less than 8,000,000 megawatt
hours of electricity per year; or
(B) an electric cooperative.
(4)(A) The Commission shall have refund authority under paragraph (2) with respect to a
voluntary short term sale of electric energy by the Bonneville Power Administration only if the sale
is at an unjust and unreasonable rate.
(B) The Commission may order a refund under subparagraph (A) only for short-term sales made
by the Bonneville Power Administration at rates that are higher than the highest just and reasonable
rate charged by any other entity for a short-term sale of electric energy in the same geographic
market for the same, or most nearly comparable, period as the sale by the Bonneville Power
Administration.
(C) In the case of any Federal power marketing agency or the Tennessee Valley Authority, the
Commission shall not assert or exercise any regulatory authority or power under paragraph (2) other

than the ordering of refunds to achieve a just and reasonable rate.
(June 10, 1920, ch. 285, pt. II, §206, as added Aug. 26, 1935, ch. 687, title II, §213, 49 Stat. 852;
amended Pub. L. 100–473, §2, Oct. 6, 1988, 102 Stat. 2299; Pub. L. 109–58, title XII, §§1285, 1286,
1295(b), Aug. 8, 2005, 119 Stat. 980, 981, 985.)
Editorial Notes
References in Text
The Public Utility Holding Company Act of 1935, referred to in subsec. (c), is title I of act Aug. 26, 1935,
ch. 687, 49 Stat. 803, which was classified generally to chapter 2C (§79 et seq.) of Title 15, Commerce and
Trade, prior to repeal by Pub. L. 109–58, title XII, §1263, Aug. 8, 2005, 119 Stat. 974. For complete
classification of this Act to the Code, see Tables.
Amendments
2005—Subsec. (a). Pub. L. 109–58, §1295(b)(1), substituted "hearing held" for "hearing had" in first
sentence.
Subsec. (b). Pub. L. 109–58, §1295(b)(2), struck out "the public utility to make" before "refunds of any
amounts paid" in seventh sentence.
Pub. L. 109–58, §1285, in second sentence, substituted "the date of the filing of such complaint nor later
than 5 months after the filing of such complaint" for "the date 60 days after the filing of such complaint nor
later than 5 months after the expiration of such 60-day period", in third sentence, substituted "the date of the
publication" for "the date 60 days after the publication" and "5 months after the publication date" for "5
months after the expiration of such 60-day period", and in fifth sentence, substituted "If no final decision is
rendered by the conclusion of the 180-day period commencing upon initiation of a proceeding pursuant to this
section, the Commission shall state the reasons why it has failed to do so and shall state its best estimate as to
when it reasonably expects to make such decision" for "If no final decision is rendered by the refund effective
date or by the conclusion of the 180-day period commencing upon initiation of a proceeding pursuant to this
section, whichever is earlier, the Commission shall state the reasons why it has failed to do so and shall state
its best estimate as to when it reasonably expects to make such decision".
Subsec. (e). Pub. L. 109–58, §1286, added subsec. (e).
1988—Subsec. (a). Pub. L. 100–473, §2(1), inserted provisions for a statement of reasons for listed
changes, hearings, and specification of issues.
Subsecs. (b) to (d). Pub. L. 100–473, §2(2), added subsecs. (b) and (c) and redesignated former subsec. (b)
as (d).
Statutory Notes and Related Subsidiaries
Effective Date of 1988 Amendment
Pub. L. 100–473, §4, Oct. 6, 1988, 102 Stat. 2300, provided that: "The amendments made by this Act
[amending this section] are not applicable to complaints filed or motions initiated before the date of enactment
of this Act [Oct. 6, 1988] pursuant to section 206 of the Federal Power Act [this section]: Provided, however,
That such complaints may be withdrawn and refiled without prejudice."
Limitation on Authority Provided
Pub. L. 100–473, §3, Oct. 6, 1988, 102 Stat. 2300, provided that: "Nothing in subsection (c) of section 206
of the Federal Power Act, as amended (16 U.S.C. 824e(c)) shall be interpreted to confer upon the Federal
Energy Regulatory Commission any authority not granted to it elsewhere in such Act [16 U.S.C. 791a et seq.]
to issue an order that (1) requires a decrease in system production or transmission costs to be paid by one or
more electric utility companies of a registered holding company; and (2) is based upon a determination that
the amount of such decrease should be paid through an increase in the costs to be paid by other electric utility
companies of such registered holding company. For purposes of this section, the terms 'electric utility
companies' and 'registered holding company' shall have the same meanings as provided in the Public Utility
Holding Company Act of 1935, as amended [15 U.S.C. 79 et seq.]."
Study
Pub. L. 100–473, §5, Oct. 6, 1988, 102 Stat. 2301, directed that, no earlier than three years and no later than
four years after Oct. 6, 1988, Federal Energy Regulatory Commission perform a study of effect of

amendments to this section, analyzing (1) impact, if any, of such amendments on cost of capital paid by public
utilities, (2) any change in average time taken to resolve proceedings under this section, and (3) such other
matters as Commission may deem appropriate in public interest, with study to be sent to Committee on
Energy and Natural Resources of Senate and Committee on Energy and Commerce of House of
Representatives.
1 See

References in Text note below.