The federal government can’t overrule state decisions to reject new electric transmission lines, under a new appeals court decision.

A three-judge panel from the 4th U.S. Circuit Court of Appeals threw out the Federal Energy Regulatory Commission’s  rulemaking to allow federal preemption of power line siting decisions. The decision, issued last week, was written by Judge M. Blane Michael.

The court was considering a challenge filed by citizen groups and public utility commissions in New York and Minnesota over FERC interpretations of provisions of the 2005 Energy Policy Act intended to encourage construction of new power lines.

I described some of these provisions in the initial story of the Gazette’s Lines of Power project, published in late 2007.  It’s not clear whether the new court ruling could have any effect on the TrAIL power line, which has received its required state approvals. But it could impact American Electric Power’s PATH project, which has not yet sought state permits.

According to the Environmental Appeals Blog, the 4th Circuit decision did the following:

— Reversed the “expansive language” in FERC rules granting the agency jurisdiction when a state utility commission has denied a power line application.

— Affirmed FERC’s determination that it was not required to prepare an environmental assessment or an environmental impact statement in connection with its procedural regulations dealing with power line permit applications.

— Concluded that FERC violated Council on Environmental Quality regulations when it failed to consult with CEQ before amending its National Environmental Policy Act regulations.

— Dismissed, without prejudice, part of the appeal petition that sought to challenge the content of those NEPA regulation amendments.

The Piedmont Environmental Council, which brought the case, said the court’s decision:

…Overturns FERC’s hard-charging, environment-be-damned approach to fast-tracking transmission line siting throughout the northeast and southwest corridors. The Court’s decision is a blow against heavy-handed federal preemption and the ruling restores a semblance of federal-state balance in the overall transmission line-siting process.

This lawsuit was the first of two filed by PEC against the previous Administration’s attempt to fast-track transmission line siting through much of the U.S. The second, which seeks to overturn the Department of Energy’s designation of multi-state corridors for transmission line siting, is pending before the Ninth Circuit Court of Appeals in San Francisco.

In the 4th Circuit case, the state of West Virginia was among a number of states that filed “friend of the court” briefs supporting parts of the challenge to FERC’s regulations.

West Virginia Gov. Joe Manchin, while initially announcing support for both TrAIL and PATH, later said he was concerned about FERC overruling any decision by the state about power line siting. Manchin complained that the FERC interpretation “flies in the face of the plaint language of the Act and threatens the critical balance between state sovereignty and national interests.” Any effort to overrule a decision by the West Virginia PSC on a power line “would be untenable from my perspective,” Manchin said.