Justia Utilities Law Opinion Summaries

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judgment in both cases, but vacated and remanded the judgment in the Story County case to the extent it addressed a repealed ordinance.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

Summit Carbon Solutions, LLC plans to build an interstate pipeline through Iowa, passing through Shelby and Story Counties. Both counties enacted ordinances imposing various requirements on pipelines, including setback, emergency response plan, and local permit requirements. Summit challenged these ordinances, arguing 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 enforcement of 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 and Iowa law preempted the counties' ordinances. The court issued a permanent injunction against the enforcement of the ordinances. The counties appealed the decision.The United States Court of Appeals for the Eighth Circuit reviewed the case de novo. The court held that the PSA preempts the Shelby and Story County ordinances' setback, emergency response, and abandonment provisions. The court found that the ordinances were safety standards, which are preempted by the PSA. Additionally, the court held that the ordinances were inconsistent with Iowa law, as they imposed additional requirements that could prohibit pipeline construction even if the Iowa Utilities Commission (IUC) had granted a permit. The court 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 "Couser v. Shelby County" on Justia Law

San Francisco operates a combined sewer system that collects and treats both wastewater and stormwater. In 1996, California voters approved Proposition 218, which added provisions to the California Constitution requiring voter approval for property-related charges, except for "sewer, water, and refuse collection services." Plaintiffs Robert Gluck and Adam Hertz filed a class action against the City and County of San Francisco, challenging the constitutionality of the City's sewer charges related to stormwater services. They argued that stormwater services funded by the City's sewer charges were not "sewer" services covered by the exception to Proposition 218's voter approval requirement and that the charges failed the proportionality requirement.The trial court sustained the City's demurrer without leave to amend, concluding that the City's combined sewer system provides "sewer" services falling within the voter approval exception of article XIII D, section 6(c). The court also found that the plaintiffs' fourth cause of action failed because it was based on the premise that stormwater management is not a "sewer service."The California Court of Appeal, First Appellate District, Division Three, reviewed the case. The court affirmed the trial court's judgment regarding the first three causes of action, agreeing that the City's combined sewer system provides "sewer" services exempt from the voter approval requirement. However, the court reversed the judgment regarding the fourth and fifth causes of action, concluding that the City did not establish that the plaintiffs' allegations regarding the City's reliance on wastewater factors to support charges for stormwater services were insufficient as a matter of law to establish a violation of the proportionality requirement of article XIII D, section 6(b)(3). The case was remanded for further proceedings on these claims. View "Gluck v. City and County of San Francisco" on Justia Law

A qualified nonresident transmission company challenged an Iowa statute that granted incumbent utilities a right of first refusal (ROFR) for electric transmission projects, arguing it was unconstitutionally enacted. The statute prevented the company from competing for projects. The Iowa District Court for Polk County declared the statute unconstitutional under the Iowa Constitution's title and single-subject requirements and issued a permanent injunction against the statute's enforcement.The district court's decision was appealed by the State of Iowa, the Iowa Utilities Board (IUB), and two incumbent utilities, MidAmerican Energy Company and ITC Midwest, LLC. They argued that the district court could not retroactively enjoin their participation in projects awarded under the ROFR while the case was pending. They also contended that the district court lacked jurisdiction and that the nonresident company should have challenged the IUB's rule under Iowa Code chapter 17A.The Iowa Supreme Court reviewed the case and affirmed the district court's judgment and permanent injunction. The court held that the ROFR statute was void ab initio due to its unconstitutional enactment. The court determined that the district court had the authority to enjoin the parties from participating in projects awarded under the ROFR, as the incumbents were on notice of the constitutional challenge and no physical construction had begun on the projects. The court also rejected the argument that the IUB's rule could only be challenged under chapter 17A, as the constitutional challenge to the statute inherently invalidated the rule. The court deferred any remaining federal law issues to the Federal Energy Regulatory Commission (FERC). View "LS Power Midcontinent, LLC v. State" on Justia Law

Utility companies operating in Placer County, California, filed a complaint against the County and the Board of Equalization, seeking a refund of taxes. They alleged that the tax rate imposed on their state-assessed property was unconstitutionally higher than the rate imposed on locally-assessed property. The tax rate for state-assessed property is calculated under Revenue and Taxation Code section 100, while locally-assessed property is taxed under a different formula. The utility companies argued that this discrepancy violated article XIII, section 19 of the California Constitution, which mandates that utility property be taxed to the same extent and in the same manner as other property.The Superior Court of Placer County sustained the County's demurrer, effectively dismissing the complaint. The trial court relied on the precedent set by the appellate court in County of Santa Clara v. Superior Court, which held that the tax rates imposed on utility property were constitutional. The utility companies acknowledged that the Santa Clara decision was binding on the trial court but maintained that they had a good faith basis for their claims on appeal.The California Court of Appeal for the Third Appellate District reviewed the case. The court affirmed the trial court's decision, concluding that the utility companies had not established that the trial court erred. The appellate court found that the utility companies did not present a valid basis for defining comparability to state a valid claim. The court noted that while the utility companies argued for comparable tax rates, they failed to provide a clear standard or formula to determine what constitutes comparability. Consequently, the court held that the utility companies did not meet their burden of proving that the County's tax rates were unconstitutional. View "Pacific Bell Telephone Co. v. County of Placer" on Justia Law