Case Title: In re Twenty Four VT Utilities

Citation: 

Docket Number: 

State: vermont

Court: Vermont Supreme Court

Date: 1992-02-01T00:00:00Z

Document:
NOTICE:  This opinion is subject to motions for reargument under V.R.A.P.
 40 as well as formal revision before publication in the Vermont Reports.
 Readers are requested to notify the Reporter of Decisions, Vermont Supreme
 Court, 109 State Street, Montpelier, Vermont 05609-0801 of any errors in
 order that corrections may be made before this opinion goes to press.


                                 No. 91-269


 In re Petition of Twenty-Four Vermont              Supreme Court
 Utilities, Pursuant to 30 V.S.A. { 248,
 for a Certificate of Public Good                   On Appeal from
 Authorizing Execution and Performance              Public Service Board
 of a Firm Power and Energy Contract
 with Hydro-Quebec and a Hydro-Quebec               February Term, 1992
 Participation Agreement (New England
 Coalition for Energy Efficiency and
 the Environment and the Grand Council
 of the Cree (Quebec), Appellants)


 Richard H. Cowart, Chair

 John H. Marshall and Holly Ernst Groschner of Downs Rachlin & Martin,
   St. Johnsbury, for petitioners-appellees

 Bonnie Barnes, William K. Sessions, III, James Allen Dumont, and Chris
   McAnany, Law Clerk (On the Brief) of Sessions, Keiner, Dumont, Barnes
   & Everitt, Middlebury, for intervenors-appellants

 James Volz, Director for Public Advocacy, and Robert V. Simpson, Jr.
   and John L. Hodge, Special Counsel, Montpelier, for appellee
   Department of Public Service


 PRESENT:  Allen, C.J., Gibson, Dooley and Morse, JJ., and Bryan, Super. J.,
           Specially Assigned


      DOOLEY, J.  Following the Public Service Board approval of the
 contract by twenty-four Vermont utilities to purchase electricity from
 Hydro-Quebec (HQ), the lead Vermont utilities agreed, subject to any
 necessary regulatory approval, to waive the right to collect damages in the
 event that HQ terminated the contract before December 1, 1991.  The PSB
 concluded that the waiver and release required its approval, and after an
 expedited review, granted it.  Some of the intervenors, the New England
 Coalition for Energy Efficiency and the Environment (NECEE), the Grand
 Council of the Cree (the Cree) and the National Audubon Society appeal the
 approval, arguing that the board erred in (1) refusing to reevaluate the
 merits of the overall purchase contract and admit evidence related to that
 reevaluation; (2) failing to give adequate notice of the hearings on the
 waiver and release; and (3) approving the waiver and release, which was not
 signed by all the Vermont utilities.  We affirm. (FN1)
      Many of the facts underlying this appeal are set forth in our decision
 of October 2, 1992, affirming the Board's approval of the overall purchase
 contract, Petition of Twenty-Four Vermont Utilities, No. 91-154 (Oct. 2,
 1992) [hereinafter Hydro-Quebec I].  As discussed in that opinion, a license
 for the export of power pursuant to the underlying sale contract was
 required from the National Energy Board of Canada (NEB).  See id., slip op.
 at 17-18.  The license came in an NEB decision issued after the Vermont PSB
 had closed the evidence in its review of the purchase contract, but the
 license was conditioned on Canadian environmental review of any facilities
 required to supply the power to the Vermont utilities under the contract.
 In order to ensure that circumstances had not changed because of the NEB
 decision, the Board requested the utilities to file an affidavit from an HQ
 official stating, in part, that the damage and compensation provisions of
 the contract were applicable if the NEB export license was voided because of
 HQ's failure to obtain needed environmental approvals.  The utilities filed
 the affidavit, and the Board relied upon it in refusing to reopen the
 evidence to consider the NEB decision.  We affirmed that ruling.  See id.,
 slip op. at 20.
      On April 3, 1991, while the underlying case was on appeal in this
 Court, the utilities and HQ proposed an amendment to the purchase contract.
 The critical provision of the amendment extended by one year, from April 30,
 1991 to April 30, 1992, the date by which a party could terminate the
 contract without penalty or payment of damages if regulatory approvals were
 "withheld or tendered upon terms unsatisfactory to it."  The amendment was
 negotiated at the insistence of HQ, and the utilities indicated that HQ was
 likely to terminate the contract by April 30th if the amendment did not
 extend the date for HQ to act.  At a hearing on April 17th, the Board
 concluded that the amendment required its approval because it affected the
 value of the overall purchase contract, but that it could not review the
 amendment as long as the case was pending in this Court.  It sought a remand
 from this Court to consider the amendment.  The intervenors opposed the
 remand, and added that they had new evidence relating to the Board's
 approval decision and would seek a general reopening of the case.
      At that point, the parties to the contract changed their approach,
 apparently in the hope of avoiding a remand.  They withdrew the contract
 amendment and negotiated a waiver and release which provided:
         [I]f one of the parties exercises such termination
         right between April 30th, 1991 and December 1st, 1991,
         the other party will waive any right to claim the
         payment of all costs, damages and expenses specified
         under Article 1.4 of the said Contract and will release
         the obligation for such payment.

 The Board persisted in its request for a remand, and on the morning of April
 26th, a Friday, this Court granted a remand until May 1, 1991 "for the
 limited purpose of considering the effect of the waiver and release and
 issues related thereto."  The Board had oral argument that afternoon (the
 26th) on the effect of the waiver and release and took testimony on the
 following Monday.  The next day, April 30th, it issued its decision
 approving the waiver and release.  The Board analyzed the waiver and release
 under each of the criteria in 30 V.S.A. { 248 and concluded that it would
 not change its earlier findings and conclusions with respect to each of
 these criteria.
      Intervenors' first argument is that the Board erred in refusing to
 allow evidence that showed that the overall contract does not meet the
 requirements of { 248, contrary to the Board's decision of October 12, 1990
 and its post-judgment decision of January 7, 1991.  Specifically, inter-
 venors argue that the Board refused to consider evidence that demand-side
 management (DSM) could have a greater impact than the Board found, that HQ
 would cancel irrespective of the waiver and release because of political
 tensions and legal battles in Canada, that the Board's findings on the
 ability to sell excess HQ power and the cost of alternatives to HQ proved to
 be wrong, and that the HQ contract would cause environmental damage.  In
 reviewing this and other arguments of the intervenors, we shall assume that
 the Board was correct that it was required to review the waiver and release
 under { 248, although that conclusion is vigorously contested by the
 utilities.
      For three reasons, we find intervenors' claim to lack merit.  First,
 intervenors ground their claim on case law which holds that it is error for
 the Board to refuse to admit relevant evidence in support of a party's
 theory of its case.  See In re Central Vermont Public Service Corp., 141 Vt.
 284, 292-93,