Justia Utilities Law Opinion Summaries

In a dispute involving a power grid operator, PJM Interconnection, L.L.C., and the Federal Energy Regulatory Commission (FERC), the United States Court of Appeals for the Sixth Circuit ruled that the Chairman of FERC exceeded his authority by seeking a remand of a ratemaking challenge without the support of other Commission members.The case originated when PJM filed a request to modify its existing rates for electricity reserves, arguing that the existing rates were unjust and unreasonable. Initially, FERC agreed and approved the new rates. However, after a change in FERC's composition and a unilateral decision by the Chairman to request a voluntary remand from the D.C. Circuit for reconsideration, FERC reversed its decision and found PJM's evidence insufficient.The Sixth Circuit's ruling focused on the procedural irregularity, specifically the Chairman's unilateral decision to seek a remand, which it deemed exceeded his administrative authority. The court stated that a quorum majority must decide the Commission’s policy and dealings with the outside world, and the Chairman acting alone does not meet this requirement. As such, the court vacated the part of FERC's rehearing order that claimed the Chairman had this unilateral authority and remanded the matter back to FERC to address this issue.The court did not address the substantive issue of whether FERC's reversal on the ratemaking decisions was arbitrary and capricious. It noted that any interested party may renew a petition to challenge that decision after FERC resolves the procedural issue. View "PJM Power Providers Grp. v. FERC" on Justia Law

In a case involving the Federal Energy Regulatory Commission (FERC) and the Electric Power Supply Association and PJM Power Providers Group (collectively, PJM), the United States Court of Appeals for the Sixth Circuit had to address two questions. The first was whether the Chairman of FERC exceeded his authority when he moved for a remand of a ratemaking challenge without the support of any other members of the Commission, and the second was whether FERC's underlying ratemaking decisions were arbitrary and capricious.The case arose from PJM's request to FERC to raise the reserve price cap for electricity from $850 to $2,000 per megawatt hour and to replace the flat $300 per megawatt hour cap after Step 1 with a downward sloping price schedule. Initially, FERC agreed with PJM that the existing price cap and stepwise demand curve were unjust and unreasonable. However, after a change in the composition of the FERC, the Commission sought a voluntary remand from the D.C. Circuit to reconsider its prior decisions. The D.C. Circuit granted the unopposed motion for remand. On remand, the Commission reversed its previous decision and found PJM's evidence insufficient to show that the price caps for reserves and stepwise demand curve were unjust and unreasonable.PJM and others sought rehearing before the Commission, citing a procedural irregularity - the Chairman had directed FERC's Solicitor to seek remand without first informing the other Commissioners - and challenging the substance of the agency’s shift in views. The Commission rejected the request for rehearing but issued a modified order, reaching the same result, and reasoning that Chairman Glick had the unilateral authority to make the remand motion.The Court of Appeals for the Sixth Circuit held that the Chairman of FERC exceeded his legal authority when he requested a remand in the name of the Commission on his own. The court vacated part of the Commission’s order claiming the Chairman had this unilateral authority and remanded the case back to the Commission to decide what, if anything, it could or would have done differently in response to this legal mistake. The court did not rule on whether FERC's underlying ratemaking decisions were arbitrary and capricious, leaving it to the Commission to first resolve the legal mistake. View "Electric Power Supply Ass'n v. FERC" on Justia Law

This case involves a dispute over a tariff adopted by the Public Utilities Commission (Commission) of the State of California that affects the compensation utilities provide to customers for excess electricity generated by renewable energy systems. The tariff, known as the net energy metering (NEM) tariff, previously required utilities to purchase excess electricity from renewable systems at the same price customers pay for electricity. However, utilities complained that this overcompensated the owners of renewable systems and raised the cost of electricity for customers without renewable systems. In response, the California Legislature enacted a law requiring the Commission to adopt a successor tariff that promotes the continued sustainable growth of renewable power generation while balancing costs and benefits to all customers.Several environmental groups challenged the Commission's newly adopted successor tariff, asserting that it did not comply with various statutory requirements. The Court of Appeal of the State of California First Appellate District upheld the Commission's tariff. The court found that the Commission's successor tariff adequately served the various objectives of the law and was based on a reasonable interpretation of its statutory mandate. The court also found that the Commission's decision to value exported energy from renewable systems based on the marginal cost of energy to the utilities was a reasonable approach to fulfilling the law's requirement to balance the equities among all customers. The court rejected the plaintiffs' arguments that the Commission had failed to properly account for the costs and benefits of renewable energy, and that it had improperly favored the interests of utility customers who do not own renewable systems. The court also found that the Commission had properly fulfilled the law's requirement to include specific alternatives designed for growth among residential customers in disadvantaged communities. The court affirmed the decision of the Commission. View "Center for Biological Diversity v. Public Utilities Com." on Justia Law

The Supreme Court held, in response to a request by the United States Court of Appeals for the Ninth Circuit, that Cal. Publ. Util. Code 1759 bars a lawsuit that seeks damages resulting from public safety power shutoffs (PSPS) events where the suit alleges that a utility's negligence in maintaining its grid necessitated shutoffs but does not allege that the shutoffs were unnecessary or violated the regulations of the California Public Utilities Commission (PUC).To reduce the risk that its utility infrastructure would ignite a wildfire during extreme weather conditions Pacific Gas and Electric Company (PG&E) conducted a series of emergency power shutoffs that Plaintiff alleged were necessitated by PG&E's negligence in maintaining its power grid. Plaintiff filed a class action complaint against PG&E requesting class damages of $2.5 billion. At issue before the Supreme Court was whether section 1759 barred this lawsuit. The Supreme Court answered the question in the positive, holding that allowing suit under the circumstances here would interfere with the PUC's comprehensive regulatory and supervisory authority over PSPS. View "Gantner v. PG&E Corp." on Justia Law

Petitioner Liberty Utilities (EnergyNorth Natural Gas) Corp., d/b/a Liberty (Liberty), appealed a New Hampshire Public Utilities Commission order denying Liberty’s request to recover development costs related to a proposed natural gas pipeline and tank system, the Granite Bridge project. This case arose from an unrealized construction project. Liberty relied solely on Tennessee Gas Pipeline Co., LLC (Tennessee Gas Pipeline) for its gas supply in southern and central New Hampshire. Liberty executives testified that Liberty sought more supply from Tennessee Gas Pipeline because Liberty was facing increased demand. Liberty and Tennessee Gas Pipeline agreed to an arrangement whereby Liberty would receive additional gas from a second pipeline, but Tennessee Gas Pipeline cancelled that arrangement. In response, Liberty began to explore other options, and eventually decided to construct its own pipeline and tank system, the Granite Bridge project. Liberty estimated that $7.5 million of that amount consisted of engineering, environmental, consulting, internal labor, commission related costs, and land costs. Despite those costs, according to Liberty, it would have been years before Liberty broke ground on Granite Bridge. Later, Tennessee Gas Pipeline offered Liberty more space on its pipeline at a cheaper rate than the projected cost of Granite Bridge. Liberty accepted that offer, and then cancelled the Granite Bridge project. The New Hampshire Supreme Court concluded Liberty could not recover its costs when it cancelled the project and consumers derived no benefit. The Commission's order was thus affirmed. View "Appeal of Liberty Utilities (EnergyNorth Natural Gas) Corp., D/B/A Liberty" on Justia Law

The Illinois Cable and Video Competition Law requires operators to obtain statewide authorization and become a “holder” and requires anyone who wants to provide cable or video service to obtain permission from state or local authorities and pay a fee, as a condition of using public rights of way. In recent years traditional cable services have been supplemented or replaced by streaming services that deliver their content through the Internet. East St. Louis, contending that all streaming depends on cables buried under streets or strung over them, sought to compel each streaming service to pay a fee. None of the defendants were “holders.” A magistrate dismissed the complaint, concluding that only the Attorney General of Illinois is authorized to sue an entity that needs but does not possess, “holder” status.The Seventh Circuit affirmed, first concluding that it had jurisdiction under 28 U.S.C. 1332(a). Normally the citizenship of any entity other than a corporation depends on the citizenship of its partners and members but, under section 1332(d), part of the Class Action Fairness Act, an unincorporated entity is treated like a corporation. The court then held that the statutory system applies to any “cable service or video service” and the defendants do not offer either. If “phone calls over landline cables, electricity over wires, and gas routed through pipes are not trespasses on the City’s land— and they are not—neither are the electrons that carry movies and other videos.” View "City of East St. Louis v. Netflix, Inc." on Justia Law

In this review of a decision of the Public Service Commission relating to rates charged by Florida Power & Light Company (FPL) for the provision of electric service, the Supreme Court held that the Commission had not supplied a basis for meaningful judicial review of its conclusion that the settlement agreement provided a reasonable resolution of the issues, established reasonable rates, and was in the public interest.The settlement agreement at issue was between FPL and seven parties that intervened in the matter and permitted FPL to increase its base rates and service charges. After hearing arguments in favor of and against the settlement agreement the Commission concluded that the agreement "provides a reasonable resolution of all issues raised, establishes rates that are fair, just, and reasonable, and is in the public interest." The Supreme Court reversed, holding that remand was required because the Commission failed to perform its duty to explain its reasoning. View "Floridians Against Increased Rates, Inc. v. Clark" on Justia Law

Petitioner Pacific Gas and Electric Company (PG&E) sought extraordinary writ relief for the second time arising out of the parties’ ongoing efforts to clarify the standard of proof to be applied at trial on South San Joaquin Irrigation District’s (the District) right to take part of PG&E’s electric distribution system under the Eminent Domain Law. PG&E emphasized that it did not challenge the validity of the resolution of necessity adopted by the District. PG&E did challenge the District’s right to take its property on grounds that conflicted with various findings the District made in its resolution. Because these challenges were authorized by statute, PG&E could succeed at trial by essentially disproving one of these findings by a preponderance of the evidence. Further, the Court of Appeal agreed with PG&E that the superior court’s September 6, 2017 and November 28, 2022 orders erred in concluding that PG&E also needed to demonstrate the District abused its discretion in adopting its resolution of necessity. Therefore, the Court of Appeal issued a peremptory writ of mandate compelling the superior court to vacate its September 6, 2017 and November 28, 2022 orders, and enter a new order. View "Pacific Gas and Electric Co. v. Super. Ct." on Justia Law

The Supreme Court affirmed the orders of the Public Utilities Commission of Ohio approving a stipulation that authorized Dominion Energy Ohio to implement its capital expenditure program rider (CEP Rider), holding that the Commission's orders were not unlawful or unreasonable.Dominion filed an application to recover the costs of its capital expenditure program by establishing the CEP Rider at issue. Dominion and the Commission jointly filed a stipulation asking the Commission to approve the application subject to the staff's recommendations. The Commission modified and approved the stipulation. The Supreme Court affirmed, holding (1) the Commission did not violate an important regulatory principle in adopting the 9.91 percent rate of return; (2) the Commission did not inconsistently apply its precedent; (3) the Commission did not violate Ohio Rev. Code 4903.09; and (4) Appellants' manifest-weight-of-the-evidence argument failed. View "In re Application of East Ohio Gas Co." on Justia Law

Plaintiff Deer Creek Water Corporation filed suit against Oklahoma City and Oklahoma City Water Utilities Trust (together, the City) seeking a declaratory judgment that the City could not provide water service to a proposed development on land owned by Thomas and Gina Boling (together, the developers), who later intervened in the action. In support, Deer Creek invoked 7 U.S.C. § 1926(b), a statute that generally prohibited municipalities from encroaching on areas served by federally indebted rural water associations, so long as the rural water association made water service available to the area. The district court granted the developers’ motion for summary judgment after concluding that Deer Creek had not made such service available, and Deer Creek appealed. Although the Tenth Circuit rejected Deer Creek’s arguments related to subject-matter jurisdiction, the Court agreed that the district court erred in finding it dispositive that Deer Creek’s terms of service required the developers to construct the improvements necessary to expand Deer Creek’s existing infrastructure to serve the proposed development, reasoning that because Deer Creek itself would not be doing the construction, it had not made service available. The Court found nothing in the statute or in caselaw to support stripping a federally indebted rural water association of § 1926(b) protection solely because it placed a burden of property development on the landowner seeking to develop property. The district court therefore erred in placing determinative weight on Deer Creek’s requirement that the developers construct the needed improvements. The judgment was reversed and the case remanded for further proceedings on whether Deer Creek made service available. View "Deer Creek Water Corporation, et al. v. City of Oklahoma City, et al." on Justia Law