Justia Utilities Law Opinion Summaries

Three individuals filed a class action lawsuit against San Francisco, challenging new water rates adopted by the city’s Public Utility Commission in May 2023. The plaintiffs alleged that the new rates violated Proposition 218 of the California Constitution by including costs unrelated to the actual provision of water service, resulting in charges that exceeded the cost of service. Before adopting the new rates, the city provided required notice to ratepayers, including information about a 120-day period for legal challenges under the applicable validation statutes. The plaintiffs sought a refund, declaratory and equitable relief, and a writ of mandate.After the class action was filed, the City litigated the case for over a year. It participated in discovery, case management, and even moved for summary judgment, without initially arguing that the suit was procedurally improper. Eventually, the City moved for judgment on the pleadings, arguing that plaintiffs’ action was subject to the validation statutes, specifically Government Code section 53759 and Code of Civil Procedure sections 860 et seq., which require reverse validation actions attacking agency matters like water rates to be brought within 120 days and with specific notice by publication to all interested parties. The trial court (San Francisco County Superior Court) agreed with the City, finding the statutes mandatory and jurisdictional, and dismissed the case for failure to comply with the procedural requirements, including timely filing and appropriate notice.On appeal, the California Court of Appeal, First Appellate District, Division Two, reviewed the judgment de novo. The court held that compliance with the validation statutes was mandatory and jurisdictional. Plaintiffs’ failure to file a proper reverse validation action and to provide notice by publication deprived the court of jurisdiction. The court rejected arguments that the City had waived these requirements or that good cause existed for noncompliance. The judgment in favor of the City was affirmed. View "Toy v. City & County of S.F." on Justia Law

Six wind farms located in Minnesota, North Dakota, South Dakota, and Iowa, all subsidiaries of Avangrid Renewables, sought certification from the Public Utilities Commission of Ohio (PUCO) to be recognized as eligible Ohio renewable-energy-resource-generating facilities. Such certification would allow these out-of-state wind farms to sell renewable energy in Ohio. Carbon Solutions Group, L.L.C. (CSG), representing Ohio-based renewable energy interests, opposed the applications, arguing that the applicants failed to demonstrate their energy was physically deliverable into Ohio as required by state law.PUCO conducted a three-day evidentiary hearing in December 2022, during which staff, the applicants, CSG, and other interested parties presented testimony and evidence. The central issue was whether the energy generated by these noncontiguous out-of-state facilities could be shown to be deliverable into Ohio. The commission relied on its established Koda test, which uses distribution-factor (DFAX) power-flow studies conducted by regional transmission organizations (RTOs) to determine whether a facility’s energy is physically deliverable into Ohio. After review, PUCO found that the applicants’ DFAX studies, performed by PJM Interconnection, met the required deliverability thresholds and approved all six applications.CSG appealed to the Supreme Court of Ohio, arguing that the evidence was insufficient and that procedural errors occurred, including denial of a subpoena and improper reliance on hearsay. The Supreme Court of Ohio found that PUCO’s order was supported by sufficient evidence and complied with statutory requirements for findings and reasoning. The court held that the commission’s use of the Koda test and reliance on the PJM DFAX studies was reasonable and not against the manifest weight of the evidence or contrary to law. The court also found that CSG’s procedural objections were either waived or jurisdictionally barred. The Supreme Court of Ohio affirmed PUCO’s order. View "In re Application of Moraine Wind, L.L.C." on Justia Law

A multi-state utility company operating a gas-fired power plant in Washington alleged that the state's Climate Commitment Act (CCA) impermissibly discriminated against interstate commerce by allocating no-cost greenhouse gas emissions allowances only for electricity sold to Washington customers. Under Washington’s Clean Energy Transformation Act (CETA) and the CCA, utilities serving in-state customers receive no-cost allowances to offset compliance costs, while electricity exported to customers in other states does not receive this benefit. The company argued that this scheme increased costs for its non-Washington customers and potentially its shareholders, as out-of-state sales from the Washington facility required purchasing emissions allowances at auction.The United States District Court for the Western District of Washington reviewed the complaint and found that the electricity generated for export was not subject to CETA’s decarbonization mandates, distinguishing it from in-state electricity. The district court concluded that the two categories were not similarly situated for purposes of Dormant Commerce Clause analysis. The court reasoned that utilities serving Washington customers were already subject to more aggressive decarbonization requirements under CETA, justifying the allocation of no-cost allowances under the CCA. The district court dismissed the complaint with prejudice, finding no plausible claim of unconstitutional discrimination, and denied the motion for preliminary injunction as moot.On appeal, the United States Court of Appeals for the Ninth Circuit affirmed the district court’s dismissal and denial of the injunction. The Ninth Circuit held that because the regulatory schemes governing in-state and exported electricity are distinct, the emissions associated with each are not similarly situated. Therefore, Washington’s allocation of no-cost allowances did not violate the Dormant Commerce Clause. The court further held that dismissal without leave to amend was appropriate, as any amendment would be futile. The decision was affirmed. View "PACIFICORP V. SIXKILLER" on Justia Law

A transmission development company sought to build a high-voltage transmission line across three Maryland counties to address a regional electricity shortage. After receiving federal approval, the company was required to obtain a Certificate of Public Convenience and Necessity (CPCN) from Maryland's Public Service Commission (PSC) before construction. As part of the CPCN application, environmental and socioeconomic field studies needed to be conducted on properties along the proposed route. The property owners refused access for these surveys, prompting the developer to submit desktop studies instead, which the PSC's Power Plant Research Program (PPRP) found inadequate, deeming the application incomplete. The developer then sought an injunction to enter the properties for the necessary field studies.The United States District Court for the District of Maryland granted the developer's motion for a preliminary injunction, finding that the developer was likely to succeed on the merits under Maryland law, particularly Section 12-111(a) of the Real Property Article, which allows entities with eminent domain powers to access private land for surveys. The court determined that the developer had a viable claim to such power for the purposes of conducting the surveys, even though it could not condemn property until it obtained a CPCN. The court also found irreparable harm due to lost revenues from project delays, that the balance of equities favored the developer, and the public interest supported the injunction.The United States Court of Appeals for the Fourth Circuit reviewed the district court’s decision under an abuse of discretion standard. The Fourth Circuit affirmed, holding that the district court did not abuse its discretion in granting the preliminary injunction. The court concluded that the developer likely possessed the statutory right of access to conduct surveys prior to obtaining a CPCN, and that all four Winter factors for injunctive relief were satisfied. View "PSEG Renewable Transmission LLC v. Arentz Family, LP" on Justia Law

Jefferson County, Indiana, constructed a new jail just outside the city limits of Madison, Indiana, and needed water service for the facility. Dupont Water Company, a rural water association that holds federal debt, claims certain monopoly rights under 7 U.S.C. § 1926(b). The County initially attempted to procure water from Dupont but faced delays: Dupont failed to propose infrastructure solutions or provide a rate quote over several months. Eventually, Jefferson County contracted with the City of Madison, which had the necessary infrastructure and rate schedule, to supply water to the jail.The United States District Court for the Southern District of Indiana, New Albany Division, reviewed the case. Dupont sued Madison, alleging violation of its § 1926(b) monopoly rights. Jefferson County intervened, seeking a declaration that its agreement with Madison was lawful. The district court granted summary judgment in favor of Madison and Jefferson County, finding that Dupont had not "provided or made available" water service to the jail as required to trigger § 1926(b)'s protections.The United States Court of Appeals for the Seventh Circuit reviewed the district court's grant of summary judgment de novo. The appellate court held that, based on the undisputed facts, Jefferson County had requested water service from Dupont, but Dupont did not provide the necessary infrastructure or rate information within a reasonable time. As a result, Dupont did not "provide or make available" water service to the jail under § 1926(b). Therefore, Madison did not violate § 1926(b) by supplying water to the jail. The Seventh Circuit affirmed the district court's judgment. View "Dupont Water Company, Inc. v City of Madison" on Justia Law

A California corporation that manufactures medical devices sought to connect two of its properties separated by a public street using a privately owned microgrid, with supplemental power provided by Southern California Edison (SCE). The corporation alleged it would generate electricity solely for its own use and not sell or export power to others. After obtaining local approvals, it sought SCE’s cooperation to connect its properties, but SCE declined, citing concerns about safety, reliability, and loss of control over its distribution grid. The corporation proposed amendments to three SCE tariff rules to require SCE to accommodate such microgrid connections when compliant with state law.The California Public Utilities Commission (PUC) initiated a rulemaking process to facilitate microgrid commercialization under Senate Bill 1339, dividing the process into five tracks. In track five, SCE and other investor-owned utilities submitted proposed tariffs for multi-property microgrids, while the petitioner submitted its own proposed rule changes. The PUC adopted the utility tariffs but rejected the corporation’s proposals, finding they would allow unregulated entities to compel changes to regulated utilities’ infrastructure, violating Public Utilities Code section 218 and undermining safety and reliability. The PUC’s decision was based on statutory requirements and priority for safety. The petitioner’s application for rehearing was denied, with the PUC reiterating that the proposals would effectively circumvent regulation and create risks.The California Court of Appeal, Fourth Appellate District, Division Three, reviewed the PUC’s decisions under the standards set forth in Public Utilities Code section 1757.1, applicable to quasi-legislative rulemaking. The court held that the PUC’s decisions were consistent with statutory law, not arbitrary or capricious, adequately supported by findings, and aligned with legislative priorities for safety. The court affirmed the PUC’s decisions and denied relief to the petitioner. View "Applied Medical Resources Corp. v. Public Utilities Commission" on Justia Law

Several plaintiffs brought a class action lawsuit against a city, challenging the validity of recently adopted water rates. They alleged that the city’s new rates, implemented by a resolution passed in May 2023, violated Proposition 218 by including costs for public fire service, resulting in charges exceeding the actual cost of water service. Prior to filing suit, the plaintiffs submitted claims under the Government Claims Act, which were denied. The plaintiffs sought refunds, declaratory relief, equitable relief, and a writ of mandate.After the city litigated the case for more than a year, including discovery and other pretrial activities, it moved for judgment on the pleadings, arguing that plaintiffs failed to bring a reverse validation action as required by Government Code section 53759 and Code of Civil Procedure sections 860 et seq. The San Francisco County Superior Court granted the city’s motion, holding that the validation statutes applied, were both mandatory and jurisdictional, and that plaintiffs had not complied with them in two ways: their suit was time-barred and they failed to follow proper notice procedures, including service by publication.On appeal to the California Court of Appeal, First Appellate District, Division Two, plaintiffs argued that the city had waived the validation requirements by litigating the case and that their action was timely. The appellate court reviewed the matter de novo and held that the validation statutes were mandatory and jurisdictional for challenges to water rates, and plaintiffs’ failure to comply with statutory procedures—including timely filing and notice by publication—was fatal to their claims. The court rejected arguments regarding waiver, good cause, and belated publication, ultimately affirming the trial court’s order and concluding that the procedural requirements for reverse validation actions must be strictly followed. View "Toy v. City and County of S.F." on Justia Law

Several townships, individuals, and entities challenged a decision related to the construction of an electric transmission line. In early 2024, two utility companies applied to the North Dakota Public Service Commission (PSC) for a certificate of public convenience and necessity (CPCN) to build an 85-mile, high-voltage transmission line. The PSC provided public notice in various newspapers and held hearings before granting the CPCN later that year. No party appealed this order at that time. Months after the order was issued, a group of petitioners—including the townships and individuals—sought to intervene, arguing that the PSC’s order was deficient and that the wrong statutory framework had been applied.The PSC denied the petitioners’ request to intervene, stating that the decision on the CPCN was final and that deadlines to appeal or seek reconsideration had already passed. The PSC also noted that further permitting and proceedings would occur before construction, where concerns could be raised. The petitioners then appealed to the District Court of Burleigh County, South Central Judicial District. The district court dismissed as untimely the portion of the appeal challenging the CPCN order, affirmed the PSC’s denial of intervention, and concluded it lacked jurisdiction to address the validity of the CPCN order.On review, the Supreme Court of North Dakota held that the petitioners lacked standing to appeal the CPCN order because they did not participate in the original proceedings before the PSC. The Court further held that the PSC did not abuse its discretion in denying post-hoc intervention, finding that notice by publication was sufficient and that the petitioners had not shown good cause for their late intervention request. Accordingly, the Supreme Court of North Dakota affirmed the district court’s judgment. View "Wano Township v. North Dakota Public Service Comm'n" on Justia Law

A public utility company that sells electricity to Maryland customers used equipment such as conductors, substations, and transformers to transmit and distribute electricity generated outside Maryland. The transmission process involved “stepping up” and “stepping down” voltage to deliver electricity at a level suitable for customer use. The utility believed that most of its equipment used for these purposes qualified for a state sales and use tax exemption for tangible personal property used directly and predominantly in a production activity, specifically the “processing” of electricity for resale. During an audit period, the utility paid sales and use tax on some, but not all, of its relevant equipment due to an accounting irregularity. Afterward, it requested a refund for the taxes it believed were paid in error.The Comptroller denied both the refund and a related assessment challenge, concluding the exemption did not apply. On appeal, the Maryland Tax Court determined that the conductor, substation, and transformer equipment qualified for the exemption because it was used directly and predominantly for processing electricity, but found that certain support structures and other items did not qualify. The Circuit Court for Anne Arundel County affirmed the Tax Court’s exemption ruling but held that most of the refund claim was untimely under the four-year statute of limitations for tax refund claims. The Appellate Court of Maryland affirmed most of the Tax Court’s rulings and instead applied a 30-day limitations period, making the entire refund claim timely.The Supreme Court of Maryland held that the utility’s transmission and distribution equipment performed “processing” and thus a production activity, qualifying for the exemption. The Court agreed that only the conductor, substation, and transformer equipment qualified and not the support structures. The Court also held that the general four-year limitations period applied, not the 30-day period, and that the utility was entitled to interest on the refunded amounts. The judgment was affirmed in part, reversed in part, and remanded for further proceedings. View "Comptroller v. Potomac Edison" on Justia Law

A company sought permission from the Vermont Public Utility Commission (PUC) to build and operate a solar facility. After the PUC denied this request, the company filed motions for reconsideration, arguing that the decision had been made on grounds different from the proposal for decision, and later sought to serve interrogatories on the PUC Commissioners to determine if they had read the record as required by Vermont law. The PUC denied both motions, stating it had complied with statutory requirements, that Commissioners had sufficient opportunity to review the record, and that discovery from Commissioners acting in a quasi-judicial capacity was not permitted.After these denials, the company appealed to the Vermont Supreme Court regarding the underlying certificate denial and, separately, filed a complaint in the Civil Division of the Chittenden Unit of the Superior Court under 3 V.S.A. § 809b, challenging the PUC's denial of discovery. The PUC moved to dismiss this complaint, asserting that § 809b did not cover orders denying discovery and that appeals of interlocutory PUC orders were governed by another, more specific statute. The Superior Court agreed, concluding it lacked jurisdiction, since § 809b only applies to orders compelling discovery, not those denying it, and that appeals from PUC orders must proceed directly to the Supreme Court under 30 V.S.A. § 12.The Vermont Supreme Court reviewed the Superior Court’s dismissal de novo. It held that 3 V.S.A. § 809b does not authorize challenges to agency orders denying discovery and is limited to orders compelling action. Because the PUC’s order at issue denied, rather than compelled, discovery, the Superior Court was correct to dismiss the case for lack of subject matter jurisdiction. The Supreme Court affirmed the dismissal. View "Otter Creek Solar LLC v. Public Utility Commission" on Justia Law