Justia Utilities Law Opinion Summaries

The case involves Delta Air Lines, Inc. and PacifiCorp, both of which are centrally assessed businesses in Oregon. Under Oregon law, centrally assessed businesses are taxed on their intangible property, unlike locally assessed businesses. Delta and PacifiCorp challenged this tax, arguing it violated the state and federal constitutions by not being uniform and by violating equal protection and privileges clauses.The Oregon Tax Court addressed both cases in a single opinion, ruling in favor of Delta by finding the tax on intangible property unconstitutional for air transportation businesses. However, it ruled against PacifiCorp, upholding the tax for utilities. The Tax Court concluded that there were no genuine differences between the intangible property of centrally assessed air transportation businesses and locally assessed businesses, but found differences for utilities.The Oregon Supreme Court reviewed the case, focusing on whether the tax classifications were rationally related to a legitimate governmental purpose. The court reversed the Tax Court's decision regarding Delta, holding that the tax on intangible property for centrally assessed businesses is constitutional. The court found that the legislature's decision to tax intangible property of centrally assessed businesses, but not locally assessed ones, was rationally related to legitimate purposes such as administrative efficiency, expertise in valuation, and balancing revenue against resources. The court also affirmed the Tax Court's decision regarding PacifiCorp in a separate opinion, maintaining the tax's constitutionality for utilities. The case was remanded to the Tax Court for further proceedings. View "Delta Air Lines, Inc. v. Dept. of Revenue" on Justia Law

Florida Power & Light Company (FPL) entered into a multi-party settlement agreement to establish base rates, which was approved by the Florida Public Service Commission (Commission). The settlement allowed FPL to increase rates annually for four years, generating significant additional revenue and permitting incremental rate increases for solar projects. It also included provisions for an equity-to-debt ratio, return on equity, and a minimum base bill for customers. The settlement aimed to support investments in power generation, transmission, distribution systems, and renewable energy programs.The Commission's initial approval of the settlement was challenged, leading to a remand by the Supreme Court of Florida in Floridians Against Increased Rates, Inc. v. Clark (FAIR). The Court required the Commission to provide a more detailed explanation of its reasoning and to consider FPL's performance under the Florida Energy Efficiency and Conservation Act (FEECA). On remand, the Commission denied a motion to reopen the evidentiary record and issued a Supplemental Final Order, reaffirming that the settlement was in the public interest.The Supreme Court of Florida reviewed the case again. The Court upheld the Commission's approval of the settlement, finding that the Commission's factual findings were supported by competent, substantial evidence and that its policy decisions were within its discretion. The Court concluded that the Commission had adequately considered the mandatory and discretionary factors, including FPL's FEECA performance, and provided a reasoned explanation for its decision. The Court affirmed the Commission's Final and Supplemental Final Orders, determining that the settlement established fair, just, and reasonable rates. View "Florida Rising, Inc. v. Florida Public Service Commission" on Justia Law

Aquarion Water Company of Connecticut (Aquarion) filed a rate application with the Public Utilities Regulatory Authority (PURA) in August 2022, seeking to increase its rates to cover approximately $700 million in capital improvements made since 2013. Aquarion also sought to recover $3 million in deferred water conservation expenses and $2.2 million for its employee incentive compensation program. PURA reviewed the application and allowed Aquarion to include $650 million in plant additions completed before August 31, 2022, in its rate base but excluded $48 million in post-application plant additions. PURA also denied Aquarion’s request for the full amount of deferred conservation expenses and employee incentive compensation, reducing the approved revenue requirement to $195 million and the return on equity (ROE) to 8.7%.The trial court dismissed Aquarion’s appeal, finding substantial evidence supporting PURA’s decisions. Aquarion then appealed to the Connecticut Supreme Court, arguing that PURA acted arbitrarily and capriciously in its prudence determinations and that the rate order was confiscatory.The Connecticut Supreme Court upheld PURA’s exclusion of the $42 million in post-application plant additions, finding a discernible difference in the quality of evidence submitted for pre- and post-application additions. The court also upheld the denial of $2.2 million for the employee incentive compensation program, agreeing that PURA did not use hindsight but rather assessed the program’s future efficacy based on historical data.However, the court found that PURA improperly used hindsight to evaluate the prudence of $1.5 million in deferred conservation expenses, focusing on after-the-fact economic savings rather than the prudence of the decision at the time the expenses were incurred. The court reversed this part of the trial court’s judgment and remanded the case for further proceedings.The court also rejected Aquarion’s claim that the rate order was confiscatory, affirming that the approved ROE of 8.7% was not effectively reduced by the disallowance of certain costs and was sufficient to maintain Aquarion’s financial integrity and ability to attract capital. View "Aquarion Water Co. of Connecticut v. Public Utilities Regulatory Authority" on Justia Law

Snakeroot Solar, LLC, sought a good-cause exemption from the Public Utilities Commission (PUC) to extend the deadline for its photovoltaic generating facility in Pittsfield to reach commercial operation and participate in Maine’s net energy billing (NEB) program. The facility needed to be operational by December 31, 2024, but delays in the interconnection process and the time required for grid upgrades made this deadline unachievable. Snakeroot argued that these delays were outside its control and warranted an exemption.The PUC denied Snakeroot’s petition, finding that the delays were inherent to the interconnection process and not external. The PUC noted that the cluster study process, which took slightly longer than average, and the time required for grid upgrades were typical and did not constitute external delays. Snakeroot appealed, arguing that the PUC misinterpreted the statute and that the delays were indeed external and beyond its control.The Maine Supreme Judicial Court reviewed the case and upheld the PUC’s decision. The Court found that the PUC’s interpretation of the statute was reasonable and aligned with the legislative intent to limit the number of projects eligible for the NEB program to control electricity rates. The Court also determined that the PUC’s findings were supported by substantial evidence, including the typical duration of cluster studies and the standard lead times for equipment procurement. The Court concluded that the PUC did not abuse its discretion in denying the exemption, as the delays experienced by Snakeroot were part of the normal interconnection process and not extraordinary. View "Snakeroot Solar, LLC v. Public Utilities Commission" on Justia Law

Summit Carbon Solutions, LLC plans to build an interstate pipeline through Iowa, passing through Shelby and Story Counties. Both counties enacted ordinances regulating pipelines, including setback, emergency response plan, and local permit requirements. Summit challenged these ordinances, claiming they were preempted by the federal Pipeline Safety Act (PSA) and Iowa law. The district court granted summary judgment in favor of Summit, permanently enjoining the ordinances.The United States District Court for the Southern District of Iowa reviewed the case and ruled in favor of Summit, finding that the PSA preempted the counties' ordinances. The court held that the ordinances imposed safety standards, which are under the exclusive regulatory authority of the federal government. The court also found that the ordinances were inconsistent with Iowa state law, which grants the Iowa Utilities Commission (IUC) the authority to regulate pipeline routes and safety standards.The United States Court of Appeals for the Eighth Circuit reviewed the case de novo and affirmed the district court's decision. The court held that the PSA preempts the Shelby and Story ordinances' setback, emergency response, and abandonment provisions. The court found that the ordinances' primary motivation was safety, which falls under the exclusive regulatory authority of the federal government. The court also held that the ordinances were inconsistent with Iowa state law, as they imposed additional requirements that could prohibit pipeline construction even if the IUC had granted a permit.The Eighth Circuit affirmed the district court's judgment in both cases, but vacated and remanded the judgment in the Story County case to the extent it addressed a repealed ordinance. View "McNair v. Johnson" on Justia Law

The case involves Pacific Bell Telephone Company and other utilities suing the County of Napa and the state Board of Equalization for a refund of property taxes and declaratory relief. The utilities argue that from 2018 to 2023, the tax rates used to compute the debt-service component of their property taxes were higher than those applied to other properties, violating the California Constitution's requirement that public utility property be taxed in the same manner as other property.In the lower court, the trial court sustained the respondents' demurrer to the utilities' complaint without leave to amend, based on the precedent set by the Sixth District Court of Appeal in County of Santa Clara v. Superior Court, which held that the California Constitution does not mandate that public utility property be taxed at the same rate as other property. The trial court entered judgment in favor of the respondents.The California Court of Appeal, First Appellate District, reviewed the case. The court affirmed the lower court's decision, agreeing with the reasoning in Santa Clara and another case, Pacific Bell Telephone Co. v. County of Merced. The court concluded that the constitutional provision does not require the same or comparable debt-service tax rates for public utility and nonutility property. The court also rejected the utilities' claim that the tax rates violated the principle of taxation uniformity embodied in the California Constitution. The judgment in favor of the respondents was affirmed. View "Pacific Bell Telephone Co. v. County of Napa" on Justia Law

A real estate developer, HK Baugh Ranch, LLC, petitioned the Texas Public Utility Commission (PUC) to release its undeveloped land, River Bend Ranch, from the certificate of convenience and necessity (CCN) issued to Crystal Clear Special Utility District (Crystal Clear). Crystal Clear, a federally indebted utility district, sued the PUC’s Chair and Commissioners in federal court, alleging that Texas Water Code § 13.2541, which allows for decertification, was preempted by 7 U.S.C. § 1926(b). This federal statute protects certain federally indebted utilities from curtailment of their service areas while their loans are outstanding.The United States District Court for the Western District of Texas issued a preliminary injunction preventing the PUC from decertifying River Bend Ranch. The district court applied the “physical ability” test from Green Valley Special Utility District v. City of Schertz, determining that Crystal Clear likely made its service available to HK Baugh and was thus entitled to the protections of § 1926(b). The court concluded that § 1926(b) likely expressly preempts Texas Water Code § 13.2541, resolving the remaining preliminary injunction factors in favor of Crystal Clear.The United States Court of Appeals for the Fifth Circuit reviewed the case. The court held that the district court did not err in concluding that Crystal Clear would likely satisfy the “physical ability” test. However, the appellate court found that the district court erred in holding that § 1926(b) expressly preempts Texas Water Code § 13.2541. The appellate court remanded the case to the district court to determine whether § 1926(b) otherwise preempts Texas Water Code § 13.2541 and to address all preliminary injunction factors as necessary. The preliminary injunction remains in place pending further proceedings. View "Crystal Clear v. HK Baugh Ranch" on Justia Law

During Winter Storm Uri in February 2021, extreme weather conditions in Texas led to record electricity demand and severe power shortages. The Electric Reliability Council of Texas (ERCOT) declared a "Level 3 Emergency" and ordered transmission and distribution utilities (the "Utilities") to cut power to some customers, resulting in widespread outages. Plaintiffs alleged that the Utilities' actions during the storm, including failing to rotate blackouts and cutting power to critical infrastructure, worsened the crisis and violated common-law duties.The plaintiffs filed numerous lawsuits against various participants in the Texas electricity market, including the Utilities, asserting claims of negligence, gross negligence, and nuisance. The cases were consolidated into a multidistrict litigation pretrial court, which dismissed some claims but allowed the gross-negligence and intentional-nuisance claims against the Utilities to proceed. The Utilities sought mandamus relief from the court of appeals, which granted partial relief by dismissing some claims but allowing the gross-negligence and intentional-nuisance claims to continue.The Supreme Court of Texas reviewed the case and held that the plaintiffs' pleadings did not sufficiently allege that the Utilities "created" or "maintained" a nuisance, leading to the dismissal of the intentional-nuisance claims with prejudice. The court also found that the pleadings were insufficient to support gross-negligence claims but allowed the plaintiffs an opportunity to replead these claims in light of the court's guidance. The court conditionally granted mandamus relief, ordering the trial court to vacate its previous order and dismiss the intentional-nuisance claims while permitting the plaintiffs to amend their gross-negligence claims. View "IN RE ONCOR ELECTRIC DELIVERY CO. LLC" on Justia Law

Duke Energy Ohio, Inc. applied to the Public Utilities Commission of Ohio (PUCO) for an increase in natural gas distribution rates and approval of an alternative-rate plan. The Office of the Ohio Consumers’ Counsel (OCC) filed an application for rehearing, which PUCO initially extended through a tolling order. However, following a decision in a related case, In re Application of Moraine Wind, L.L.C., it was determined that PUCO lacked the authority to issue such tolling orders, meaning the OCC’s application for rehearing was denied by operation of law after 30 days.The OCC did not appeal the denial by operation of law but instead filed a second application for rehearing challenging PUCO’s tolling order practice. After the Moraine Wind decision, PUCO journalized an entry on September 4, 2024, acknowledging the denial by operation of law and closing the case. The OCC then filed a third application for rehearing, which PUCO denied on October 2, 2024. The OCC subsequently filed a notice of appeal on October 25, 2024.The Supreme Court of Ohio reviewed the case and denied Duke Energy’s motion to dismiss the appeal for lack of jurisdiction. The court held that under R.C. 4903.11, the OCC’s appeal was timely because it was filed within 60 days of PUCO’s journalized entry on September 4, 2024, which constituted an “entry upon the journal of the commission of the order denying an application for rehearing.” Thus, the OCC properly invoked the court’s jurisdiction, and the appeal was allowed to proceed. View "In re Application of Duke Energy Ohio, Inc." on Justia Law

Promenade D’Iberville, LLC, the owner and developer of a large retail shopping center in D’Iberville, Mississippi, discovered soil issues during construction in 2009. The problems were linked to the use of OPF42, a soil stabilizer containing bed ash from Jacksonville Electric Authority (JEA), a Florida public utility. Promenade filed a lawsuit in 2010 in the Harrison County Circuit Court against several parties, including JEA, alleging damages from the defective product.The Harrison County Circuit Court granted JEA’s motion to dismiss for lack of subject-matter jurisdiction, citing sovereign immunity based on California Franchise Tax Board v. Hyatt (Hyatt III). The court also held that the Full Faith and Credit Clause and comity principles required dismissal due to Florida’s presuit notice and venue requirements. Promenade appealed the decision.The Supreme Court of Mississippi reviewed the case and found that Hyatt III does not apply to JEA, as it is not an arm of the State of Florida but an instrumentality of the City of Jacksonville. The court also determined that neither the Full Faith and Credit Clause nor comity principles mandated dismissal. The court held that Promenade should be allowed to proceed with its claims against JEA in Mississippi, seeking damages similar to those allowed under Mississippi’s constitution for property damage.The Supreme Court of Mississippi reversed the trial court’s judgment of dismissal and remanded the case for further proceedings consistent with its opinion. View "The Promenade D'Iberville, LLC v. Jacksonville Electric Authority" on Justia Law