Dive Brief:

Jacksonville Electric Authority (JEA) asked the Federal Energy Regulatory Commission (FERC) on Monday to determine whether it has authority over the purchase agreement (PPA) JEA signed in 2008 to buy energy from the besieged Vogtle nuclear expansion in Georgia.

JEA is hoping a decision from FERC could help it exit the deal and save billions of dollars, even thought the two municipal utilities involved in the PPA are exempt from FERC regulations. The Florida-based muni has also asked a Duval County, Florida circuit court to find the 2008 PPA to be unenforceable for a variety of reasons, including a lack of approval from the city's leadership.

Development of the pair of reactors was expected to cost $7.3 billion but ballooned to more than $27 billion as the project fell behind schedule. Project owners need to vote by Sept. 24 but could vote as soon as tomorrow on whether to continue construction, the Florida Times-Union reported , and JEA has been lobbying for them to pack it in.

Dive Insight:

JEA's deal with the developers of the Vogtle expansion is so bad, the muni argues, that federal regulators will never approve it. That it is a decade old, however, could be a complicating factor.

The municipal utility has argued that it has no ownership stake in the development of Vogtle Units 3 and 4, and hence should never have been allowed to sign deals that put it on the hook for debt service even if no power is ever delivered.

"This agreement revolves around wholesale, interstate commerce of electricity, so it should be evaluated by FERC," for compliance with the Federal Power Act, JEA Interim Managing Director and CEO Aaron Zahn said in a statement. "Exorbitant cost overruns and continued delays, all of which are being shouldered by ratepayers across the Southeast, suggest that the Plant Vogtle expansion project is no longer just and reasonable, let alone consistent with prudent utility practices."

JEA inked its deal with the Municipal Electric Authority of Georgia (MEAG), one of the owners and the target of its Duval County lawsuit. The muni has been pressing for MEAG to vote against continuing the project; in turn, the electric authority has sued JEA.

According to JEA, a reimbursement agreement was implemented without the authority's approval in June 2017, resulting in the utility's liability from $1.4 billion to almost $3 billion, with the potential to go higher.

JEA's FERC petition acknowledges that both JEA and MEAG are public entities generally exempt from FERC regulation. However, the Florida muni says the exemption applies only to activities that are intrastate in nature.

In its petition, Jacksonville said the commission has jurisdiction because transactions contemplated under the PPA "involve the sale at wholesale in interstate commerce by MEAG to JEA of electricity, capacity and ancillary services," specifically moving energy from Georgia into Florida for resale.