Energy law focuses on regulating the use of electricity, petroleum and other resources on federal, state and local levels. The creation of the Department of Energy in 1977 and of a structured energy plan, began a new focus on keeping the energy market competitive and protecting American environmental, economic and security interests.
The Department of Energy is comprised of many smaller agencies that have been delegated various tasks associated with public utilities. These agencies, such as the Federal Energy Regulatory Commission (FERC), assist in regulating the sale of natural gas, oil and electricity.
The Sale and Licensing of Energy
Federal agencies are responsible for licensing hydroelectric plants and other entities. They are also responsible for governing wholesale prices for energy. Energy purchase contracts are commonly made between energy buyers and sellers. The contracts set out the terms of the agreement, including when energy will be delivered and the penalties if the terms are not fulfilled. The FERC is usually responsible for regulating such power purchase agreements in relation to interstate commerce.
Privately owned power companies are generally regulated on the state level. The cost of utilities and power operations are governed by public service commissions. Public power companies, meanwhile, are typically regulated by municipal governments and co-op boards. They are typically exempt from state regulation as they are considered to already have the best interest of the public in mind.
There is also a strong pull in energy law toward the deregulation of electric companies. Supporters of deregulation argue it would allow consumers to choose their own energy supplier. More competition, the argument goes, would create more competitive, affordable prices.
Energy law and environmental law frequently cross paths in America. Environmental law often focuses on reducing energy or being green. Federal agencies provide oversight to guard against environmental disasters like massive oil spills.
A recent environmental concern includes the use of fracking. Fracking is short for hydraulic fracturing -- forcing water and chemicals, at a very high pressure, into shale rock deposits deep in the ground. Fracking releases natural gas that's trapped in shale; byproducts are trucked away as toxic waste. Fracking uses a lot of water, which must be transported to the drill site.
Environmental groups are concerned that fracking may contaminate water sources and trigger tremors near the fracking sites. The practice is often regulated by local, state and federal agencies.
Owning a piece of land does not always mean that you own whatever minerals are found beneath it. The rights to ownership of minerals can be separated and sold apart from ownership of the property itself.
If mineral rights belong to someone else, that owner is permitted to use the land surface for things like oil drilling, extracting natural gas or building mines, for example. Access roads and other improvements can also be built on the property. There are some limitations that can be placed, however, depending on the terms of the sale, such as a limitation on the duration of drilling.
The rule of eminent domain may also apply to land containing plentiful natural energy resources. Under eminent domain, the government may procure privately owned land if it is for the benefit of the public. However, property owners are afforded certain rights before their land can be taken. For example, the government must offer to purchase the property first, and if it takes the land, it must provide the owner with payment for the fair market value of the property.
If your legal rights have been infringed, seek the help of an experienced energy law attorney. You can discuss of energy purchase agreements, toxic torts, eminent domain matters, property ownership, among other legal issues. A lawyer can help clients reach a settlement or otherwise protect their rights at trial.
The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.
Related Topics In This Section
- Business Law
- Business Litigation
- Securities and Exchange Commission
- Alternative Minimum Tax
- Income Tax