2020

First Quarter

Tanya J. McCloskey, Acting Consumer Advocate v Pennsylvania Public Utility Commission

Docket No. 1549 C.D. 2018, Decided January 15, 2020 

This case involved the October 25, 2018 Order of the Commission approving a general rate increase filed by UGI Utilities, Inc.-Electric Division (UGI).  In the October 25, 2018 Order, the Commission approved an annual revenue increase for UGI of $3.201 million, or 3.6%.  Tanya J. McCloskey, Acting Consumer Advocate (Office of Consumer Advocate (OCA)), challenged the Commission’s decision, alleging that it resulted in unjust and unreasonable utility rates.  On appeal, the Court considered whether Sections 315, 1301, and 1301.1 of the Public Utility Code (Code), 66 Pa. C.S. §§ 315, 1301, 1301.1, supported UGI’s calculation of its rate base, rather than OCA’s calculation of that rate base, and whether the Commission’s acceptance of UGI’s calculations was supported by substantial evidence. 

The Court noted that the United States Supreme Court has explained, “[t]he economic judgments in rate proceedings are often hopelessly complex and do not admit of a single correct result.” Duquesne Light Company v. Barasch, 488 U.S. 299, 314 (1989), and that the Commission is given broad discretion in interpreting the Code and in setting rates. Popowsky, 706 A.2d at 1203. As such, the Commission’s determinations will not be overturned unless clearly erroneous or they lack a rational basis. The Court ultimately determined that the Commission’s determinations in the October 25, 2018 Order were consistent with Sections 315(e) and 1301.1 of the Code, and were supported, where required, by the accepted evidence, and, as such, the Commission’s decision was not clearly erroneous or lacking a rational basis. Accordingly, the Court affirmed the October 25, 2018 Order. 

Snyder Bros. Inc. v. Pa. PUC

No. 1043 C.D. 2015, 224 A.3d 450 (Pa. Cmwlth. 2020), 2020 Pa. Commw. Unpub. LEXIS 91, Decided February 6, 2020

This case involved a very limited issue of the assessment of interest and penalties associated with late paid impact fees under Act 13 of 2012.  That Act directed that producers of natural gas from unconventional formations must pay an annual impact fee per well.  Marginally producing wells were excepted from the fee.  After successfully defending the Commission’s position before the Pennsylvania Supreme Court regarding what wells were subject to the fee, the sole issue remaining was did the producers owe interest and penalties for failing to timely the fee they were ultimately responsible for.     

The Commonwealth Court held that the producers were not subject to interest and penalties for the late-paid fee.  The Court held that since Act 13 did not contain a refund mechanism for any fees paid under protest if those fees were later determined to be unwarranted.  Further, the Court found that Act 13 was not clear as to when a fee was deemed delinquent.  Under these circumstances, the Court declined to impose interest and penalties for challenged, unpaid fees.

Second Quarter

No cases reported.

Third Quarter

Crown Castle NG East LLC and Pennsylvania-CLE LLC v. Pennsylvania Public Utility Commission

No. 2 MAP 2019, 234 A.3d 665 (Pa. 2020), Decided July 21, 2020

This case involved the Commission’s determination that Distributed Antenna System (DAS) network operators are not jurisdictional public utilities under 66 Pa. C.S. § 102(2)(iv), since DAS facilities are used to furnish wireless service.  On July 21, 2020, the Supreme Court of Pennsylvania issued an opinion unanimously affirming the Commonwealth Court’s determination that DAS network operators are jurisdictional telecommunications utilities under 66 Pa. C.S. § 102(1)(vi) and therefore subject to regulation by the Commission. The Court determined that the statutory language of Section 102 was unambiguous and therefore the Commission’s interpretation was not entitled to deference. The Court also found that the Commonwealth Court correctly determined that the Commission’s interpretation of 66 Pa. C.S. § 102(2)(iv) was inconsistent with the plain language of Section 102, and that the Commonwealth Court’s decision was consistent with its prior decision in Rural Telephone Co. Coalition v. Public Utility Commission, 941 A.2d 751 (Pa. Cmwlth. 2008) and applicable Federal law.

Collins v. Pa. PUC

No. 1472 C.D. 2019, 2020 Pa. Commw. Unpub. LEXIS 459, 2020 Pa. Commw. Unpub. LEXIS 459 – Decided September 17, 2020

In this case, Ms. Collins appealed a Commission Order holding that she failed to meet her burden of proving any violation of a Commission rule, regulation, or order, or any entitlement to relief.  Her dispute arose from alleged billing and collecting practices by Pennsylvania American Water Company (PAWC).  Ms. Collins also contended that the Commission incorrectly determined (1) that the statute of limitations barred her claim with regard to a water service termination that occurred in 2001; and (2) that it does not have jurisdiction to remove municipal liens from her property.  Finally, she alleged that her due process rights were violated when the Commission held an evidentiary hearing telephonically rather than in person. 

The Court held that the Commission did not commit errors or law or abused its discretion in finding that Ms. Collins did not meet her burden of proving that PAWC engaged in deceptive billing and collection practices.  The Court also determined that there was substantial evidence to support the Commission’s findings that Ms. Collins’ claims were barred by the statute of limitations and that the Commission lacked jurisdiction to compel PAWC to act regarding a municipal lien not within PAWC’s ownership. Therefore, the Commission’s Order was affirmed.

Fourth Quarter

New Garden Twp. v. Pa. Pub. Util. Comm’n

No. 1360 C.D. 2019, 244 A.3d 851 (Pa. Cmwlth. 2020), 2020 Pa. Commw. LEXIS 835 – Decided October 14, 2020

In this case, the Commission issued an Order approving an Application submitted by Artesian Water Pennsylvania, Inc. (AW-PA) seeking a certificate of public convenience and approval of certain affiliated interest agreements with Artesian Resources Corporation (ARC) related to the assignment of ARC’s interests in the Broad Run Well to AW-PA.  New Garden Township appealed the Commission decision alleging that (1) the Commission’s findings were not supported by substantial evidence and (2) the Commission improperly relied upon the public benefits to customers located outside of Pennsylvania to find an affirmative public benefit.  With respect to the first issue, the Court found that the Commission properly exercised its discretion on a matter that falls within the scope of its expertise and that the Commission’s decision was supported by substantial evidence. With respect to the second issue, the Court found that the Commission’s references to the benefits the transaction would have on Delaware customers did not negate the Commission’s Pennsylvania-specific findings of affirmative public benefits to AW-PA’s customers.  Thus, the Court affirmed the Commission’s Order.

PPL Elec. Utils. Corp. v. PUC

No. 624 C.D. 2019, 241 A.3d 121 (Pa. Cmwlth. 2020), 2020 Pa. Cmmw. Unpub. LEXIS 521 – Decided October 27, 2020

This case involves an Application for Approval of a Proposed Intercompany Restructuring.  PPL Electric, a wholly owned subsidiary of PPL Corporation, proposed a two-step internal restructuring that would inject two new holding companies between PPL Corporation and PPL Electric, making PPL Electric an indirect subsidiary of PPL Corporation.  By Opinion and Order entered April 25, 2019, the Commission denied PPL Electric’s Application.  The Commission found that (1) the proposed restructuring would result in a change in control of PPL Electric so that a certificate of public convenience (CPC) was required as evidence of the Commission’s approval of the transaction and (2) the Public Utility Code and Pennsylvania Supreme Court precedent require that the proposed transaction provide affirmative public benefits for the Commission to issue a CPC.  The Commission denied a CPC after holding that PPL Electric had not established that the proposed restructuring would provide any affirmative public benefits. PPL Electric appealed the Commission’s determination.

The Commonwealth Court, affirmed in part and reversed in part the Commission’s Order.  Specifically, the Court affirmed the Commission’s conclusion that the proposed internal restructuring required Commission approval in the form of a CPC.  See 66 Pa.C.S. § 1102(a).  However, the Court reversed the Commission’s holding that it must apply the “affirmative public benefit” standard developed in City of York and Popowsky to determine whether to grant a CPC to PPL Electric.  Instead, the Court determined that the Commission need only find, pursuant to 66 Pa.C.S. § 1103(a), that the granting of a CPC was “proper for the service, accommodation, convenience or safety the public.”  Finally, the Court remanded the matter to the Commission for it to apply this standard of review and determine whether PPL was entitled to a CPC.

Blue Pilot Energy, LLC v. Pa. PUC

No. 1054 C.D. 2019, 241 A.3d 1254 (Pa. Cmwlth. 2020), 2020 Pa. Commw. LEXIS 720 – Decided October 27, 2020

This case involves a complaint brought by the Bureau of Investigation and Enforcement, Office of Consumer Advocate, and Office of Attorney General against an Electric Generation Supplier (EGS) for not charging rates disclosed or marketed to its customers during the winter of 2013-2014 a/k/a the “polar vortex” winter. Blue Pilot, LLC charged its residential and small business customers rates significantly higher than the electric distribution companies’ price-to-compare PTC, leading to excessive bills and financial hardship for approximately 2,000 customers.  The Commission determined that Blue Pilot billed amounts contrary to its disclosure statements, and assessed a $1.1 million civil penalty, and directed that Blue Pilot provide refunds to the affected customers. Blue Pilot appealed.

On appeal, the Commonwealth Court partially affirmed, and partially reversed the Commission’s Orders.  The Court found that the Commission acted within its jurisdiction in adjudicating issues addressing Blue Pilot’s  lack  of  compliance  with   PUC regulations governing EGSs in the Commonwealth, particularly with respect to the question of consistency between pricing and disclosure statements to customers and the contents of those disclosure statements.  In addition, the Court determined that the nearly $1.1 million civil penalty that the PUC imposed in this matter was not unconstitutionally excessive  or  that the assessment  of  the penalty  violated Blue Pilot’s procedural or  substantive due process rights.  Moreover, since Blue Pilot did not timely raise any issue concerning its ability to pay the civil penalty in this case, the Court did not address that issue on appeal.  However, the Court found that the Commission lacked the authority, either expressly or by necessary implication, to order the creation of a refund pool and direct the refund amount for all affected customers of Blue Pilot.