Justia Utilities Law Opinion Summaries

Section 205 of the Federal Power Act (FPA), 16 U.S.C. 824d(a), mandates that all rates and charges demanded, or received by any public utility for the transmission or sale of electric energy subject to the jurisdiction of the Commission shall be just and reasonable. Xcel petitioned for review of three of the Commission's orders denying a retroactive refund for unlawful rates. As a preliminary matter, the court concluded that, to the extent the Commission denied Xcel relief because it lacks authority to order refunds from Tri-County, a non-jurisdictional entity, this was not responsive to Xcel’s request. On the merits, the court concluded that the Commission’s reliance on section 2.4(a) of its regulations and related cases to deny Xcel retroactive relief is misplaced. Because the Commission’s reliance on section 2.4(a) of its regulations as applied in its precedent is inapposite, and its position that its section 205 error of law is irremediable beyond prospective relief under section 206 appears irreconcilable with the authority Congress granted it in section 309 to remedy its errors, the court granted the petition in part and remanded the case to the Commission for appropriate action. View "Xcel Energy Servs. Inc. v. FERC" on Justia Law

Until 1997, Illinois residents could only purchase power from the local public utility, whose rates were regulated by the Commerce Commission (ICC). The 1997 Electric Service Customer Choice and Rate Relief Law allows residents to buy electricity from their local public utility, another utility, or an Alternative Retail Electric Supplier (ARES). The ICC was not given rate-making authority over ARESs, but was given certain oversight responsibilities, 220 ILCS 5/16-115. The Law did not explicitly provide a mechanism for recovering damages from an ARES related to the rates. In 2012, Zahn began purchasing electricity from NAPG, after receiving an offer of a “New Customer Rate” of $.0499 per kilowatt hour in her first month of service, followed by a “market-based variable rate.” Zahn never received NAPG’s “New Customer Rate.” NAPG charged her $.0599 per kilowatt hour for the first two months, followed by a rate higher than Zahn’s local public utility charged. Zahn filed a class-action complaint, claiming violations of the Illinois Consumer Fraud and Deceptive Business Practices Act, breach of contract, and unjust enrichment. The court dismissed for lack of subject-matter jurisdiction, or for failure to state a claim. The Seventh Circuit certified, to the Illinois Supreme Court, the question of whether the ICC has exclusive jurisdiction to hear Zahn’s claims, noting that Illinois appellate courts are in conflict. View "Zahn v. N. Am. Power & Gas, LLC" on Justia Law

Columbia stores natural gas in Medina Field, a naturally-occurring system of porous underground rock, pumping gas into the Field during summer, during low demand, and withdrawing it during winter. Medina is among 14 Ohio gas storage fields used by Columbia. Columbia received a federal Certificate of Public Convenience and Necessity, 15 U.S.C. 717f, and was required to compensate those who own part of the Field by contractual agreement or eminent domain. The owners allege that Columbia stored gas for an indeterminate time without offering compensation and then offered $250 per lot. Each Medina owner rejected this offer. Columbia did not bring eminent domain proceedings. Other Ohio landowners accused Columbia of similar behavior and filed the Wilson class action in the Southern District of Ohio, including the Medina owners within the putative class. The Medina owners filed suit in the Northern District. Both actions claim trespass and unjust enrichment under Ohio law, and inverse condemnation under the Natural Gas Act. The Wilson suit also seeks damages for “native” natural gas Columbia takes when it withdraws its own gas. Columbia filed a counterclaim in Wilson, seeking to exercise eminent domain over every member of the putative class and join the Medina owners. The Northern District applied the first-to-file rule and dismissed. The Sixth Circuit reversed. The rule does apply, but dismissal was an abuse of discretion given jurisdictional and procedural hurdles to having the Medina claims heard in Wilson. View "Baatz v. Columbia Gas Transmission, LLC" on Justia Law

A trade association of California unions, contractors’ associations and contractors filed suit. Following discovery and a contested hearing, the court ruled that defendant Ross Valley Sanitary District lacked authority under Public Contract Code 20803 to engage its own workforce to complete a sewer system improvement project costing more than $15,000 without putting the project out for competitive bid and contract. The trial court ordered the District to cease and desist from taking further action with respect to about 139 miles of its small diameter sewer pipe with in-house workers, and to conduct all future replacement of this pipe through competitive bid and contract. The court of appeal reversed. Section 20803 applies when a district contracts with a third party for public work, and not when a district relies on force account (in-house) work. View "Constr. Indus. Force Acct. Council, Inc. v. Ross Valley Sanitation Dist." on Justia Law

Trumbull County has provided sewer service to General Motors’ Lordstown Assembly Plant since 1964. In the mid-2000s, the County borrowed $3.4 million from the U.S. Department of Agriculture to maintain and improve its sewer lines. That loan obligation triggered the protections of 7 U.S.C. 1926(b), under which sewer providers that owe money to the Department are protected from competition with other sewer providers. The County claims that the Village of Lordstown violated section 1926(b) when the Village built sewer lines that could one day serve GM’s Plant. The district court granted the defendants summary judgment, holding on the merits that the Village’s mere construction of sewer lines did not curtail or limit the County’s service. The Sixth Circuit vacated, reaching the same result on grounds of lack of standing. While the County still owes a balance, section 1926(b) affords it a legally protected interest in freedom from competition, but it has shown not any actual or imminent invasion of that interest. Sewer lines can last for decades, so the mere fact of their construction does not show that the Village intends to compete with the County anytime soon. View "Trumbull Cnty. Bd. of Comm'rs v. Village of Lordstown" on Justia Law

Ed Friedman, joined by others, filed a complaint raising issues regarding the health effects Central Maine Power Company’s (CMP) advanced metering infrastructure (AMI) system. After conducting an investigation, the Maine Public Utilities Commission concluded that AMI does not pose a credible threat of harm to the health and safety of CMP’s customers. The Supreme Judicial Court affirmed, holding (1) the Commission applied the correct credible threat standard; (2) the Commission’s determination was supported by substantial evidence; and (3) the two Commissioners serving on the panel unequivocally concurred in the decision despite their differing rationales. View "Friedman v. Pub. Utils. Comm’n" on Justia Law

Plaintiff filed a putative class action against Edison, alleging in his second amended complaint that Edison fraudulently enrolled ineligible customers in the California Alternate Rates for Energy (CARE) program. The trial court sustained Edison’s demurrer to the second amended complaint without leave to amend. The court concluded that Public Utilities Code section 1759, subdivision (a) forecloses plaintiff’s claims because a judgment in his favor would have the effect of undermining a general supervisory or regulatory policy of the California Public Utilities Commission. The court also concluded that the trial court properly exercised its discretion in sustaining the demurrer without leave to amend. Accordingly, the court affirmed the judgment. View "Lefebvre v. So. Cal. Edison" on Justia Law

Monterey Peninsula Water Management District, a public agency, undertook work to mitigate environmental damage caused by California-American Water Co. (Cal-Am), a public utility, and then assessed a fee on the utility’s customers for the work. The fee was charged as a line item on Cal-Am’s bill and was collected by the Cal-Am on behalf of the District. In the underlying proceedings, Cal-Am filed an application with the Public Utilities Commission (PUC) for authorization to collect the District user’s fee. Before the PUC responded, Cal-Am, the District, and the PUC’s Division of Ratepayer Advocates entered into a settlement agreement under which the parties agreed that the District’s requested user fee was appropriate. The PUC denied Cal-Am’s application and rejected the settlement agreement. The Supreme Court set aside the PUC decisions rejecting Cal-Am’s application for authorization to collect the District’s user fee, holding that the PUC did not have the power to regulate the District’s user fee. View "Monterey Peninsula Water Mgmt. Dist. v. Pub. Utils. Comm’n" on Justia Law

The Federal Power Act authorizes the Federal Energy Regulatory Commission (FERC) to regulate “sale of electric energy at wholesale in interstate commerce,” including wholesale electricity rates and any rule or practice “affecting” such rates, 16 U.S.C. 824(b), 824d(a), 824e(a), leaving the states to regulate retail sales. To ensure “just and reasonable” wholesale rates. FERC encourages nonprofit entities to manage regions of the nationwide grid. These entities hold auctions to set wholesale prices, matching bids from generators with orders from utilities and other wholesale buyers. Bids are accepted from lowest to highest until all requests are met. Rates rise dramatically during peak periods and the increased flow of electricity can overload the grid. Wholesalers devised demand response programs, paying consumers for commitments to reduce power use during peak periods. Offers from aggregators of multiple users or large individual consumers can be bid into the wholesale auctions. When it costs less to pay consumers to refrain from use than it does to pay producers to supply more, demand response can lower prices and increase grid reliability. FERC required wholesalers to receive demand response bids from aggregators of electricity consumers, except when the state regulatory authority bars participation. FERC further issued Order 745, requiring market operators to pay the same price for conserving energy as for producing it, so long as accepted bids actually save consumers money. The D.C. Circuit vacated the Rule as exceeding FERC’s authority. The Supreme Court reversed. FERC has authority to regulate wholesale market operators’ compensation of demand response bids. The practice directly affects wholesale rates; FERC has not regulated retail sales. Wholesale demand response is all about reducing wholesale rates as are the rules and practices that determine how those programs operate. Transactions occurring on the wholesale market unavoidably have natural consequences at the retail level. View "Fed. Energy Regulatory Comm'n v. Elec. Power Supply Ass'n" on Justia Law

Newhall, a retail water purveyor, challenged a wholesale water rate increase adopted in February 2013 by the Agency. The trial court found the Agency's rates violated article XIII C of the California Constitution (Proposition 26), which defines any local government levy, charge or exaction as a tax requiring voter approval, unless (as relevant here) it is imposed “for a specific government service or product provided directly to the payor that is not provided to those not charged, and which does not exceed the reasonable costs to the local government of providing the service or product.” The court affirmed the trial court's conclusion that the challenged rates did not comply with this exception because the Agency based its wholesale rate for imported water in substantial part on Newhall’s use of groundwater, which was not supplied by the Agency. The court concluded that the wholesale water cost allocated to Newhall did not, as required, bear a fair or reasonable relationship to Newhall's burdens on, or benefits received from, the Agency’s activity. View "Newhall Cnty. Water Dist. v. Castaic Lake Water Agency" on Justia Law