CAUSE OF ACTION SUES DELAWARE GOVERNOR MARKELL

AND PUBLIC SERVICE COMMISSION

TO STOP CRONYISM

 

Illegal Scheme Forces Ratepayers to Pick Up Tab for $133 Million Tariff-Subsidy

 

WASHINGTON – Government accountability group Cause of Action (CoA) filed suit today in federal court to challenge Delaware’s sweetheart deal with Bloom Energy, Inc. (Bloom). Governor Jack Markell and the members of the Delaware Public Service Commission are unconstitutionally discriminating against Bloom’s competitors and taxing a segment of Delaware residents to subsidize the crony company.

The suit is brought on behalf of individual plaintiff John Nichols, one of the Delaware ratepayers subject to a special tariff-subsidy created to pay for the deal, and a fuel cell manufacturer whose competitive place in the energy market has been thwarted by the state of Delaware’s scheme to prop up Bloom.

“Delaware has unconstitutionally undermined competitive markets to subsidize one favored company and forced a specific group of Delaware residents to pick up the tab,” said Amber Abbasi, CoA’s Chief Counsel for Regulatory Affairs. “Cause of Action is exposing this burden on taxpayers and businesses and is holding the Governor and the Public Service Commission accountable for violating the Commerce Clause and the rights of the people of Delaware.”

In late 2011, the Delaware Renewable Energy Portfolio Standards Act (REPSA) was modified solely to accommodate the state’s deal with Bloom. In return for Bloom’s promise to construct a manufacturing facility in Delaware, the state established a system of discriminatory eligibility requirements, subsidies, and energy-portfolio-standards multipliers that benefit Bloom. These requirements deny out-of-state companies equal competitive footing and increase costs for Delmarva ratepayers who might otherwise benefit from the competitive interstate market. According to a report by the Delaware Public Service Commission, the cost through tariffs to ratepayers will amount to $133 million.

“There’s no rational basis for forcing Nichols and other Delmarva ratepayers to fund Bloom Energy, while the rest of the state looks on.” stated Dan Epstein, Executive Director of CoA. “Governor Markell and the Public Service Commission are discriminating against competitive businesses in other states to prop up their cronies at Bloom, in direct violation of the U.S. Constitution, and they must be forced to answer for their actions.”

In addition to filing suit against the Governor andthe members of the Delaware Public Service Commission, Cause of Action also filed two Freedom of Information Act requests regarding public comments submitted during the formation of the Bloom tariff and economic impact studies that were submitted in support of the tariff.

The complaint can be found here.

About Cause of Action:

Cause of Action is a non-partisan, non-profit organization that uses public advocacy and legal reform tools to ensure greater transparency in government, protect taxpayer interests and promote economic freedom. For more information, visit www.causeofaction.org.


Comments

  1. clint laird says:

    This is likely the first layer of an ugly onion. 20+ years of one-party rule in Delaware has predictably created an arrogance that flows from the Governor’s office thru the legislature and into powerful committees and regulators. Although unfortunate that legal action is necessary, we should thank our Founding Fathers that the rule of law remains as a citizen safeguard until the electorate can put these people where they can do less harm.

    • So what company is coa suing for? Also cronies? Bloom is from California, not Delaware.

  2. William T. Garfinkel says:

    What is the remedy sought? Stop the project? Transfer the costs from the rate payers to the stockholders?

  3. CoA Staff says:

    This post has been updated with a link to the brief CoA filed.

  4. I’m going w/ Copeland for Lt. Governor because he’s been the closset thing we’ve had to a libertarian in the General Assembly. And while I’m glad that Markell beat Carney in the primary, and I think he’ll be a better Governor than Minner, I’m voting for Lee. I see his lack of a huge agenda as a good thing, whereas Markell is committed to spending lots & lots of the taxpayers money. I have no real expectation that he could win, but I have to vote for the policies i prefer, and “no tax increases” definitely beats Markell’s program.

  5. Excellent points altogether, you just won a new reader. What might you suggest about your put up that you made a few days in the past? Any sure?

  6. The sad underlying point is that we are not hinirg professionals to scrutinize the state’s needs and obtain federal money to meet them.We are hinirg them to make sure we grab as much as possible, for which we can qualify, no matter the actual public good involved.This is what comes when we are led by people (not Markell) of the twisted mind than ANY government spending is good, and much much much much more is all the better.Who cares if it goes down the rat hole, just get / grab all you can as fast as you can.

Trackbacks

  1. [...] non-profit government watch dog group called Cause of Action has filed a lawsuit accusing Delaware Governor Jack Markell, and the Delaware regulatory agency Delaware Public Service [...]

  2. [...] regulators over Bloom Energy deal A non-profit government watch dog group called Cause of Action has filed a lawsuit accusing Delaware Governor Jack Markell, and the Delaware regulatory agency Delaware Public Service [...]

  3. [...] The lawsuit, filed in federal District Court in Delaware, accuses Delaware governor Jack Markell and the Delaware Public Service Commission of “unconstitutionally discriminating against Bloom’s competitors and taxing a segment of Delaware residents to subsidize the crony company,” according to a Wednesday announcement. [...]

  4. [...] The lawsuit, filed in federal District Court in Delaware, accuses Delaware governor Jack Markell and the Delaware Public Service Commission of “unconstitutionally discriminating against Bloom’s competitors and taxing a segment of Delaware residents to subsidize the crony company,” according to a Wednesday announcement. [...]

  5. [...] – A non-profit government watch dog group called Cause of Action has filed a lawsuit accusing Delaware Governor Jack Markell, and the Delaware regulatory agency Delaware Public [...]

  6. [...] The lawsuit, filed in federal District Court in Delaware, accuses Delaware governor Jack Markell and the Delaware Public Service Commission of “unconstitutionally discriminating against Bloom’s competitors and taxing a segment of Delaware residents to subsidize the crony company,” according to a Wednesday announcement. [...]

  7. [...] Light & Power, remains under attack in the courts. On Wednesday, nonprofit legal advocacy group Cause of Action filed a lawsuit accusing Delaware Governor Jack Markell and the Delaware Public Service Commission of [...]