Entergy Louisiana, Inc. v. Louisiana Public Service Commission, 539 U.S. 39, 12 (2003)

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Opinion of the Court

automatic adjustment clause. We see no reason to create an exception to the filed rate doctrine for tariffs of this type that would substantially limit FERC's flexibility in approving cost allocation arrangements.

The Louisiana Supreme Court's other basis for upholding the LPSC's order was that FERC had not specifically approved the MSS-1 cost allocation after August 5, 1997, when it issued Order No. 415. See 815 So. 2d, at 38 ("The FERC never ruled on the issue of whether ELI's decision to continue to include the ERS units is a prudent one"). In so holding, the Louisiana Supreme Court revived precisely the same erroneous reasoning that was advanced by the Mississippi Supreme Court in MP&L. There this Court noted that the "view that the pre-emptive effect of FERC jurisdiction turn[s] on whether a particular matter was actually determined in the FERC proceedings" has been "long rejected." MP&L, supra, at 374. It matters not whether FERC has spoken to the precise classification of ERS units, but only whether the FERC tariff dictates how and by whom that classification should be made. The amended system agreement clearly does so, and therefore the LPSC's second-guessing of the classification of ERS units is pre-empted.

Finally, we address respondents' contention that the inclusion of ERS units in MSS-1 calculations was a violation of the amended system agreement and that, consequently, the LPSC's order is shielded from federal pre-emption. Curiously, respondents advance this argument here despite the LPSC's own prior holding that it does not have jurisdiction to determine whether the system agreement was violated and the Louisiana Supreme Court's acceptance of that concession. See App. to Pet. for Cert. 64a; 815 So. 2d, at 35-36. ELI and the United States maintain that the LPSC was correct when it initially held that FERC has exclusive jurisdiction to determine whether a FERC tariff has been violated and that state regulatory agencies may not, consistent with the FPA, disallow costs based on their own assessment of

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