Title: Utah Power & Light Co. v. Public Service Com'n of Wyoming

State: wyoming

Issuer: Wyoming Supreme Court

Document:

Utah Power & Light Co. v. Public Service Com'n of Wyoming1986 WY 22713 P.2d 240Case Number: 85-115Decided: 01/28/1986Supreme Court of Wyoming
UTAH POWER & LIGHT 
COMPANY, PETITIONER, 

 
 
v. 

 
 
THE PUBLIC SERVICE 
COMMISSION OF WYOMING, RESPONDENT.

 
 
Petition for review from 
the Public Service Commission.

 
 
 
 
Representing 
Petitioner:

H.L. Harris, of Harris 
& Harris, Evanston, Bruce Asay, of Kline & Buck, Cheyenne, and Thomas W. 
Forsgren, Edward A. Hunter, Jr., and Rosemary Richardson, Salt Lake City, 
Utah.

 
 
Representing 
Respondent:

Steven R. Shanahan, Sr. 
Asst. Atty. Gen., Cheyenne.

 
 
Marilyn S. Kite and 
Donald I. Schultz, of Holland & Hart, Cheyenne, Michael D. Jones, Harlan S. 
Martens, and William J. Stack, Midland, Tex., for Exxon Co., U.S.A., in support 
of respondent.

 
 
Houston G. Williams, of 
Williams, Porter, Day & Neville, P.C., Casper; and Hugh Smith, James F. 
Fell, and Stephen H. Burger, Portland, Or., for Pacific Power & Light Co., 
in support of respondent.

 
 
Before THOMAS, C.J., 
ROONEY,* BROWN and CARDINE, JJ., and RAPER, 
J., Retired.

* Retired November 30, 
1985.

 
 

ROONEY, 
Justice.

 
 

[¶1.]     Petitioner petitioned 
the district court for review of an agency action by respondent Public Service 
Commission of Wyoming (commission). The district court concluded that the matter 
was appropriate for determination by this Court and certified it to this Court 
for such determination pursuant to Rule 12.09, W.R.A.P., 1985 Cum.Supp. 
Petitioner contends that the commission improperly authorized Pacific Power 
& Light Company (PP&L) to furnish electrical power to the entire Shute 
Creek gas processing plant of Exxon Company, U.S.A. (Exxon). 
The plant is located on the boundary of Sweetwater and LincolnCounties and requires electrical service 
in both counties. Petitioner holds a certificate of public convenience and 
necessity to provide service in LincolnCounty, and PP&L holds such to 
provide service in SweetwaterCounty.

 
 

[¶2.]     We affirm the agency 
action.

 
 

[¶3.]     The Shute Creek gas 
processing plant was being constructed to process gas from Exxon's LaBarge gas 
field in Sublette, Lincoln and SweetwaterCounties. It is composed of three gas 
processing trains and a carbon dioxide compression station. Two of the gas 
processing trains were to be located on the LincolnCounty side of the plant. The other gas 
processing train and the compressor station were to be located on the SweetwaterCounty side of the plant. The gas 
processing trains require a power load of 35 megawatts each, and the compressor 
station requires a power load of 45 megawatts. Thus, the power load for that in 
LincolnCounty is 70 megawatts, and for that in SweetwaterCounty it is 80 megawatts. The service 
requirement for the entire load is at a transmission voltage of 230 kV. 
PP&L's closest 230-kV source is its Granger line 12.8 miles from the site. 
Petitioner's closest kV source is at its Naughton generating plant 30.5 miles 
from the site.

 
 

[¶4.]     PP&L's request for 
a certificate of public convenience and necessity is to construct a single 
radial 12.8-mile 230-kV transmission line to provide the entire 150-megawatt 
load requirement of the plant. Petitioner opposed the request of PP&L and 
requested a certificate of public convenience and necessity for itself to 
construct a 30.5-mile 230-kV transmission line to provide 70 megawatts for the 
two gas processing trains in LincolnCounty. The commission granted PP&L's 
request and denied that of petitioner.

 
 

[¶5.]     Subsequently, 
petitioner unsuccessfully attempted to obtain a rehearing of the matter on the 
basis of alleged newly discovered evidence that Exxon was planning to expand the 
processing facility.

 
 

[¶6.]     Petitioner words the 
issues on appeal as:

 
 
"ISSUE 
I

 
 
"Did the Public Service 
Commission of Wyoming err in ordering that the public convenience and necessity 
requires that electric service be provided by Pacific Power & Light Company 
in the certificated territory of Utah Power & Light 
Company.

 
 
"ISSUE 
II

 
 
"Did the Public Service 
Commission of Wyoming abuse its discretion and err in refusing to allow the 
administrative record to be reopened in order to supplement it with 
newly-discovered evidence."

 
 
ISSUE 
I

 
 

[¶7.]     Petitioner emphasizes 
that it is willing and able to serve Exxon's demand for electrical power to the 
facilities in LincolnCounty, petitioner's certificated area. It 
points to language by the commission in connection with previous matters which 
recognizes the impropriety of invasion of a certificated area of one utility by 
another utility, but it refuses to accept the commission's determination that 
the conditions in this case are unique. At of its findings, opinion and order, 
the commission recites:

 
 

[¶8.]     "This Commission does 
not by this decision condone the raiding or invasion of another utility's 
certificated territory. * * * Pacific Power * * * would not have been allowed to 
serve the Shute Creek Plant if the public interest had not demanded that result. 
The Commission considers this case as 
unique and it would be a mistake for any public utility to attempt to use this 
decision as a stepping stone for the invasion of another's certificated 
area." (Emphasis in original.)

 
 

[¶9.]     Pertinent to this case 
are the following statutory powers given to the 
commission:

 
 
"No public utility shall 
begin construction of a line, plant or system, or of any extension of a line, 
plant or system without having first obtained from the commission a certificate 
that the present or future public convenience and necessity require or will 
require such construction. This act shall not be construed to require any public 
utility to secure a certificate for an extension within any city or town within 
which it has lawfully commenced operation, or for an extension into territory 
contiguous to its line, plant or system for which no certificate is in force and 
is not served by a public utility of like character or for any extension within 
or to territory already served by it, necessary in the ordinary course of its 
business. If any public utility, in constructing or extending its line, plant or 
system interferes or is about to interfere with the operation of the line, plant 
or system of any other public utility already authorized or constructed, the 
commission on complaint of the public utility claiming to be injuriously 
affected, may after hearing make such 
order and prescribe the terms and conditions for the location of the lines, 
plants or systems affected, as to it are just and reasonable. * * *" 
(Emphasis added.) Section 37-2-205(a), W.S. 1977.

 
 

[¶10.]  The commission has, thus, been given the 
power to accomplish the reason for the existence of certificates of public 
convenience and necessity. The purpose for such must be kept in mind in making a 
determination relative to incidents pertinent to, and the activities allowed by, 
certificates of public convenience and necessity. Such purposes are concisely 
set forth at 73B C.J.S. Public Utilities § 69(c) (1983):

 
 
"The purposes of 
requiring a certificate of convenience and necessity are to protect the public 
from speculation and duplication of facilities, and from inadequate service and 
higher rates which frequently result from such duplication, and to protect 
utilities from competition. * * *

 
 
"Whether there should be 
competition * * *, and to what extent, is largely a matter of policy [for] the 
commission. * * *"

 
 

[¶11.]  The facts upon which the commission based 
the decision in this case reflect that, by allowing PP&L to serve that part 
of the plant in the area which had been certificated to petitioner, the purpose, 
i.e., to "protect the public from * * * duplication of facilities," to "protect 
the public from * * * inadequate service," and to "protect the public from * * * 
higher rates," was accomplished. To have ruled in favor of petitioner, just the 
opposite would have occurred - and the purpose for certificates of public 
convenience and necessity in the specific territory would have been 
nullified.

 
 

[¶12.]  The commission found, and there was 
substantial evidence therefor, that service to the plant as proposed by PP&L 
through one 12.8-mile 230-kV line to provide the entire required 150 megawatts 
was more economical and less wasteful than such service by a 30.5-mile 230-kV 
line to provide 70 megawatts for only part of the plant as proposed by 
petitioner; that duplication of electrical facilities would thus be avoided; 
that costly major changes in plant design required for service from two sources 
would be avoided; that PP&L rates provide a significant cost advantage to 
Exxon; that PP&L can provide high speed reclosure when electrical faults 
occur, while petitioner's ability to do so is in doubt; that such high speed 
reclosure is necessary to prevent plant shutdown due to the large synchronous 
motors tripping off with resulting expense, loss of revenue, and flaring of 
unprocessed gas; and that a larger body of Wyoming ratepayers would benefit from 
service by PP&L since the rates for PP&L's approximately 101,100 Wyoming 
retail customers (plus seven Wyoming resale customers serving approximately 
47,600 customers) will be lowered about 4.9 percent, whereas that for 
petitioner's approximately 11,600 Wyoming customers would be lowered from .6 
percent to 1.59 percent. The commission recognized the beneficial import of 
Exxon's LaBarge project on Wyoming and the importance of assisting its 
operation. The project is expected to create temporary and permanent employment 
for many people, to add to secondary recovery of oil resources through sales of 
processed carbon dioxide, and to add to the state's tax base and provide a 
source of mineral royalty and tax revenue.

 
 

[¶13.]  Section 37-2-205(a) empowers the 
commission to act in matters such as this. The specific authorization 
is:

 
 
"* * * If any public 
utility, in constructing or extending its line, plant or system interferes or is 
about to interfere with the operation of the line, plant or system of any other 
public utility already authorized or constructed, the commission on complaint of 
the public utility claiming to be injuriously affected, may after hearing make 
such order and prescribe the terms and conditions for the location of the lines, 
plants or systems affected, as to it are just and reasonable. * * 
*"

 
 
We are not here setting 
forth any new concept.

 
 

[¶14.]  We have said before that the commission 
has continuing jurisdiction over utilities and has the power to amend 
certificates of public convenience and necessity. Williams v. Public Service Commission of 
Wyoming, Wyo., 626 P.2d 564, cert. denied 454 U.S. 896, 102 S. Ct. 394, 70 L. Ed. 2d 211 (1981); Tri-County Electric 
Association, Inc. v. City of Gillette, Wyo., 584 P.2d 995 (1978); Big Horn Rural Electric Company v. Pacific 
Power & Light Company, Wyo., 397 P.2d 455 (1964). We have also said that 
the commission's responsibility of regulating utilities in the public interest 
is a continuing one, and it is "unwise and impractical" to assume that the 
commission intends to grant a permanent and exclusive franchise for an 
indefinite future without reflection on changing conditions. Tri-County Electric Association, Inc. v. 
City of Gillette, supra at 1006.

 
 

[¶15.]  In Telstar Communications, Inc. v. Rule 
Radiophone Service, Inc., Wyo., 621 P.2d 241 (1980), we recognized that § 
37-2-205(a) does not contemplate that only one utility will be granted a 
certificate of public convenience and necessity within a certificated area, and 
we recognized that the section anticipates that more than one system can 
co-exist in one area, with paramount consideration being the public interest, 
and the desires of the utility being secondary. At page 246, we 
said:

 
 
"* * * The fact that a 
new service may have some effect on an existing service does not preclude the 
creation of additional facilities. Incidental disadvantages are simply weighed 
in balance against ultimate public advantages. Hohorst v. Greenville Bus Company, 1954, 
17 N.J. 131, 110 A.2d 122."

 
 

[¶16.]  The commission did not err, under the 
circumstances of this case, in determining that public convenience and necessity 
would be best served by authorizing PP&L to serve the entire plant located 
on the boundary of the certificated area of PP&L and 
petitioner.

 
 
ISSUE 
II

 
 

[¶17.]  Section 37-2-214, W.S. 1977, provides in 
pertinent part:

 
 
"* * * [T]he commission 
shall grant and hold such rehearing if in 
its judgment sufficient reason therefor be made to appear * * *." (Emphasis 
added.)

 
 
The newly discovered 
evidence upon which petitioner contended for a rehearing consisted of newspaper 
clippings relating to a possible expansion of the plant to require as much as 
300 megawatts. Any expansion is speculative at this time. The application for 
the industrial siting permit and the affidavit of an Exxon official reflect that 
any expansion would depend on market conditions, and that there was no present 
plan for such. Petitioner did not carry the burden of establishing a present 
intent to expand the plant. If such expansion should occur, requiring additional 
lines for electrical service, the commission would then hear petitioner's 
position relative thereto.

 
 

[¶18.]  A rehearing requires a "judgment" by the 
commission that there is "sufficient reason therefor." A rehearing is in the 
discretion of the agency and will be interfered with only for a clear abuse of 
such discretion. United States v. Pierce Auto Freight Lines, 327 U.S. 515, 66 S. Ct. 687, 90 L. Ed. 821 
(1946); Interstate Commerce Commission v. 
Parker, 326 U.S. 60, 65 S. Ct. 1490, 89 L. Ed. 2051 
(1945).

 
 

[¶19.]  "Abuse of discretion" as defined for 
court action is applicable to agency action:

 
 
"A court does not abuse 
its discretion unless it acts in a manner which exceeds the bounds of reason 
under the circumstances. In determining whether there has been an abuse of 
discretion, the ultimate issue is whether or not the court could reasonably 
conclude as it did. An abuse of discretion has been said to mean an error of law 
committed by the court under the circumstances. * * *" Martinez v. State, Wyo., 611 P.2d 831, 838 
(1980).

 
 

[¶20.]  As so defined, an abuse of discretion did 
not here occur in the refusal by the commission to rehear this 
matter.

 
 

[¶21.]  Affirmed.