Justia Utilities Law Opinion Summaries

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The companies (Louisville) own and operate electric generation, transmission, and distribution facilities in Kentucky and Virginia; about 20 years ago, they joined MISO, which operates across 15 states (including Kentucky). Customers pay a single rate for access to transmission lines throughout the MISO service territory even if those lines are owned by multiple utilities. The Federal Energy Regulatory Commission approved a merger between the companies.The Commission later approved Louisville's withdrawal from MISO, requiring Louisville to provide its wholesale customers protections like those they enjoyed through MISO so that a transmission of energy from a within-MISO generator to the customer’s facilities would incur only one charge. Once Louisville withdrew, its wholesale customers could face two charges (pancaking): one from MISO for the trip from the power plant to the MISO/Louisville border, then another from Louisville for the trip to the final destination. Louisville contracted with its wholesale customers accordingly, including Owensboro’s municipally-owned utility. To secure backup service in case its coal-fired plant suffered outages, Owensboro bought reservations of transmission rights from MISO and another within-MISO generator and asked Louisville to absorb the costs, citing Louisville’s promise to “shield” wholesale customers from pancaking of transmission charges for certain transactions in which they purchased electricity from a within-MISO source for delivery in Louisville’s territory. Louisville refused,Owensboro brought a complaint before the Commission, 16 U.S.C. 825e. The Commission agreed that the contract required Louisville to absorb all the costs. The Sixth Circuit vacated. In "a straightforward case of contract interpretation," the Commission did not address the operative text but treated the matter as an invitation to make complex policy choices. View "Louisville Gas & Electric Co. v. Federal Energy Regulatory Commission" on Justia Law

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In a prior opinion, a panel of the Court of Appeal determined the tiered water rate system used by the City of San Juan Capistrano (the City) violated the California Constitution. The City offered to refund its water ratepayers the difference between what they paid and what they should have paid for a 10-month period of time, in exchange for a release of other claims against the City related to the tiered water rate system. Plaintiffs Hootan Daneshmand, Brian Montgomery, and John Bottjer were ratepayers in the City. Bottjer signed the release and received a refund; Daneshmand and Montgomery did not. Plaintiffs later filed a notice of claim against the City, on behalf of themselves and a putative class of ratepayers, to recover the difference between what they paid and what they should have paid during the entire time the tiered water rate system was in place. The City denied the notice of claim, which was filed more than one year after the last bill under the tiered water rate system was due, as untimely under Government Code section 911.2. The Court of Appeal determined claims of Bottjer and the other ratepayers who obtained a refund from the City were barred by the release those ratepayers signed. Contrary to Plaintiffs’ arguments on appeal, the release was valid and enforceable. Further, Plaintiffs’ causes of action for breach of contract and breach of the implied covenant of good faith and fair dealing were properly dismissed by the trial court. Finally, the claims of Daneshmand, Montgomery, and the other ratepayers who did not accept the City’s refund offer were barred because the notice of claim was filed more than one year after the claims accrued. Plaintiffs failed to show that waiver or any other legal or equitable doctrine affected the application of Government Code section 911.2 in this case. View "Daneshmand v. City of San Juan Capistrano" on Justia Law

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The Fifth Circuit affirmed the district court's dismissal of plaintiffs' complaint alleging that Southern Pine is required to distribute to them $112.5 million in "excess revenues." Because the previously-enacted 1936 Electric Power Association Act, Miss. Code Ann. 77-5-201, did not grant plaintiffs a vested right, the court concluded that the modern statute provides the applicable law. Under the modern statute, the court concluded that plaintiffs have not stated a claim for relief. In this case, plaintiffs seek to impose a specific asset-to-equity ratio beyond which any and all revenues must be deemed excessive and returned to the member-ratepayers. The court explained that plaintiffs do not have a right to revenues until the board deems that those revenues are "not needed" for other purposes. Because the board has not done so, plaintiffs fail to state a claim upon which relief can be granted. View "Harper v. Southern Pine Electric Cooperative" on Justia Law

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After the passage of Proposition 218, Sacramento voters approved a requirement that city enterprises providing water, sewer, storm drainage, and solid waste services pay a total tax of 11% of their gross revenues from user fees and charges. Nineteen years later, plaintiff-respondent Russell Wyatt brought a petition for writ of mandate and complaint for declaratory relief against the City challenging its fees and charges for utility services under article XIII D, section 6, subdivision (b) of the California Constitution (added by Prop. 218, as approved by voters, Gen. Elec. (Nov. 5, 1996)). It was undisputed that the City set these fees and charges at rates sufficient to fund the payment of the tax to its general fund. The trial court issued a writ of mandate and judgment in Wyatt’s favor. The Court of Appeal reversed the judgment and directed the trial court to vacate its writ of mandate. By approving the tax in 1998, Sacramento voters increased the cost of providing utility services, rendering those costs recoverable as part of their utility rates and the subsequent transfer of funds permissible under article XIII D. View "Wyatt v. City of Sacramento" on Justia Law

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The Supreme Court dismissed this appeal stemming from an illegal-exaction case challenging whether a court-ordered annual service fee charged to customers by Ozark Mountain Solid Waste District to repay Ozark Mountain's creditors is statutorily or constitutionally permitted, holding that the order was not a final order.Specifically, the Supreme Court held that the order in this illegal exaction case was not a final, appealable order because it contemplated further action by the parties and the circuit court. Further, the record demonstrated that the Attorney General did not seek a Rule 54 certificate to certify the issues presented for appeal. Because the order was not a final order, the Supreme Court dismissed the appeal. View "Ozark Mountain Solid Waste District v. JMS Enterprises, Inc." on Justia Law

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The Antelope Valley Groundwater Cases (AVGC) proceeding litigated whether the water supply from natural and imported sources, which replenishes an alluvial basin from which numerous parties pumped water, was inadequate to meet the competing annual demands of those water producers, thereby creating an "overdraft" condition. Phelan, which provides water to its customers who are located outside the Antelope Valley Adjudication Area (AVAA) boundaries, became subject to the AVGC litigation because a significant source of its water is pumping from a well (Well 14) located in the AVAA basin. The trial court's judgment and adopted Physical Solution concluded that, while Phelan held no water rights in the AVAA basin, Phelan could continue operating Well 14 to draw up to 1,200 afy to distribute to its customers outside the AVAA, on condition that Phelan's pumping causes no material harm to the AVAA basin and that Phelan pays a "Replacement Water Assessment" for any water it pumped for use outside the AVAA.The Court of Appeal concluded that substantial evidence supports the judgment as to Phelan; the trial court correctly rejected Phelan's claim that it had cognizable water rights as an appropriator for municipal purposes; Phelan was not deprived of its due process rights to present its claims; and the trial court did not err in rejecting Phelan's claim to return flows from native water it pumped from the AVAA basin. Accordingly, the court affirmed the judgment as to Phelan. View "Phelan Piñon Hills Community Services District v. California Water Service Co." on Justia Law

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After the Regional Board issued a permit authorizing the County and certain cities (collectively, the Operators) to operate stormwater drainage systems, some of the Operators filed claims with the Commission seeking a determination that the state must reimburse them for the costs related to the trash receptacle and inspection requirements pursuant to article XIII B, section 6 of the California Constitution. After the Commission determined that the trash receptacle requirement is a reimbursable state mandate and that the inspection requirements are not, the state agencies filed a petition in the superior court for a writ of administrative mandamus to command the Commission to set aside its decision concerning the trash receptacle requirement. The local governments filed a cross-petition challenging the Commission's decision as to the inspection requirements. The superior court granted the state agencies' petition and denied the cross-petition as moot.The Court of Appeal held that, under Government Code section 17556, subdivision (d), when, as here, the state imposes on local governments a new program or higher level of service, the state is not required to provide subvention to the local government if the local government "has the authority to levy service charges, fees, or assessments sufficient to pay for the mandated program or increased level of service." The court reversed the superior court's judgment and agreed with the Commission that the local governments have the authority to levy service charges, fees, or assessments sufficient to pay for the inspection requirements, but not for the trash receptacle requirement. Therefore, the trash receptacle requirement requires subvention under section 6. View "Department of Finance v. Commission on State Mandates" on Justia Law

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The Supreme Court affirmed in part and reversed and remanded in part orders entered by the North Carolina Utilities Commission addressing applications filed by Duke Energy Progress, LLC and Duke Energy Carolinas, LLC, holding that the Commission erred by rejecting an equitable sharing proposal without properly considering and making findings and conclusions concerning "all other material facts," as required by N.C. Gen. Stat. 62-133(d).Various interveners representing the utilities' consumers appealed the Commission's orders, challenging the lawfulness of the Commission's decisions concerning the extent to which the utilities were entitled to reflect costs associated with the storage and disposal of ash resulting from electricity production in coal-fired electric generating units in the cost of service used to set the utilities' North Carolina retail rates. The Supreme Court affirmed in part and reversed and remanded in part, holding that the Commission (1) did not err by allowing the inclusion of a majority to the utilities' coal ash costs in the cost of service used for establishing North Carolina retail rates and in increasing Duke Energy Carolinas' residential basic facilities charge; but (2) erred in rejecting an equitable sharing proposal without making the statutorily required findings and conclusions. View "State ex rel. Utilities Commission v. Stein" on Justia Law

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This is one of several cases involving disputes between Malaga and the agencies involved in issuing and enforcing the permits necessary for Malaga to operate its waste treatment facility. In this case, Malaga wanted a wastewater discharge permit allowing it to discharge 0.85 million gallons per day (mgd) into certain disposal ponds. Malaga seeks to set aside the trial court's decision that the permit allowed a discharge of 0.85 mgd, arguing that the permit actually limited Malaga to discharging 0.49 mgd.After noting Malaga's aggressive approach, the Court of Appeal stated that it was unclear why litigation of this type was necessary when alternative administrative procedures could have resolved this issue in a faster and more efficient manner. The court concluded that the primary issue raised in this case is sufficiently important to warrant the use of the court's discretion to hear issues that are technically moot. The court held that the verification process included in Malaga's permit constituted an improper delegation of authority from the Water Quality Board to its executive officer. However, the court did not reach the parties' remaining issues, because those issues were not part of the trial court's final judgment, were not resolved in the first instance by the trial court, and are thus insufficiently developed to determine whether they could either support the trial court's judgment or require vacating the entire permit issued. Accordingly, the court reversed and remanded for further proceedings. View "Malaga County Water District v. Central Valley Regional Water Quality Control Board" on Justia Law

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This is one of several cases involving disputes between Malaga and the agencies involved in issuing and enforcing the permits necessary for Malaga to operate its waste treatment facility. In this case, the Water Quality Board imposed penalties totaling $78,000 on Malaga for violating the water discharge requirements of its permit. Malaga contends that these penalties were inappropriately imposed for several reasons.The Court of Appeal agreed with Malaga that laches is a proper defense in administrative sanctions proceedings, and that the Water Quality Board utilized a void underground regulation when it issued the "Hearing Procedure for Administrative Civil Liability Complaint R5-2013-0527" (Hearing Procedure). The court explained that the first issue may only affect some of the penalties imposed by the Water Quality Board while the second may require a full rehearing. Therefore, the court reversed the trial court's order and remanded the matter to the trial court to determine whether a writ should issue based on one or both of Malaga's right to present a laches defense and the Water Quality Board's use of a void underground regulation via the Hearing Procedure. The court affirmed in all other respects. View "Malaga County Water District v. State Water Resources Control Board" on Justia Law