Document: 343 U.S. 414 72 S.Ct. 843 96 L.Ed. 1042 PENNSYLVANIA WATER & POWER CO. et al.v.FEDERAL COMMISSION al. PUBLIC UTILITY v. FEDERAL COMMISSION. Nos. 428, 429. Argued April 3 and 4, 1952. Decided May 26, [Syllabus from pages 414-415 intentionally omitted] [415] Mr. Wilkie Bushby, New York City, for Pennsylvania Water Power Co. William J. Grove, Harrisburg, Pa., Public Utility Commn. Philip B. Perlman, Sol. Gen., Washington, D.C., Federal Alfred P. Ramsey, Baltimore, Md., Consolidated Gas Electric Lt. of Baltimore. Charles D. Harris, Service Maryland. Justice BLACK delivered the opinion Court. 1 In 1944 Maryland Commission, Mayor Council City Baltimore County Commissioners, several private purchasers electric power decided to ask Commission help. They requested investigate allegedly 'excessive rates' Company (Penn Water)1 was charging Light (Consolidated). The interests wanted reduce these charges so that state commission could lower Consolidated's rates its customers. federal held many months extensive hearings found Penn had charged customers almost three times what it should have in 1946. year a net operating income $3,477,408, as contrasted with $1,300,672 which would been fair return (5 1/4%) on rate base ($24,774,712), allowing 'about 8.64% common stock surplus, is adequate.'2 ordered file new schedule bring about reductions required. 2 subsequent orders denied Wate's applications rehearing, rejected insufficient schedules filed by Water, itself prescribed here seeks avoid. On review Court Appeals gave full consideration Water's multitudinous challenges approved Commission's action, one Judge dissenting. 89 U.S.App.D.C. 235, 193 F.2d 230. Most numerous questions presented are not petitions certiorari we granted.3 We called adequacy evidence support findings base, return, or any other except insofar our decision rather general might indirectly undermine some them. must decide these: 4 (1) Does fact licensee under Part I Act,4 therefore subject regulation Part, preclude II Act public utility engaged interstate commerce? 5 '(2) Assuming can be subjected both Parts Act, were correct holding all sales at wholesale 'in commerce' within meaning Act? 6 (3) reduction action compel continuance of, improperly based upon contractual agreements between cannot carry out without violating antitrust laws forbidding surrender corporations their corporate independence? I. 7 Although type 'public utility' argues since licensee, regulated utility. agree. With express exceptions relevant, language makes utilities' prescribes. No reason has advanced possibly justify judicial exception this statutory command. A major purpose whole protect consumers against excessive prices.5 leaves states circumstances. But, § 20 Government consumer if regulatory body does exist 'States unable agree * services rendered, payment therefor *.' proceeds assumption utilities transmitting selling commerce matter accomplished Government. provides more expansive than authorized It hinder, help, Act's program impliedly exempt licensees regulation. may possible future cases will develop minor inconsistencies administration two Parts. Today's case, however, such one. hold Act. also substantial evidence, court below held, States 'unable agree' II. 8 contended This contention refers made These alleged include 83% generated power. Because following circumstances commerce.' 9 Safe Harbor Corporation (Safe Harbor) hydrogenerating plants Susquehanna River Pennsylvania. operates large steam-generating flow varies greatly even day day. During periods low flow, receives steam-generated energy order meet supply commitments. Conversely, during high able receive cheaper hydroelectric Harbor. For years Consolidated, contracts coordinated sale distribution complete integration pooling producing facilities companies thus achieved. reference system production distribution, said: 10 'The central disclosed record they output own plant, but integrated an integral part. 11 'In manner crossing State boundary, energy, used fulfill requirements. There result when used, mixed unmixed, meeting requirements Similarly, there occasions Energy flows in, across, transmission network needs interconnected members minute 12 'It accordingly evident operations unified enterprise completely character, notwithstanding transactions particular involve never boundary.' F.P.C. 1, 12, 15. 13 authority regulate commingled flow.6 vary rise fall River. III. 14 contends require continue performing illegal contract continued performance basis findings. requires water management business affairs domination violates corporation incorporated. litigation, Fourth Circuit agreed certain provisions reasons stated. Viewing inseparable, entire unenforceable.7 15 need now question much argued concerning what, any, rely parties otherwise illegal; attempted exercise case. true do things compliance Water-Consolidated contract. present buy, sell, transmit same functioning twenty years. But order, construed us, neither expressly nor yield terms subjecting control Consolidated. highly unlikely event managerial freedom ever threatened time enough consider validity. To extent being controlled, acting authority, 'legalized' Commission. duty springs law contracts. 16 Nor premised assumed existence continuation first seeking rehearing directing rates. At fully re-examined former opinion, orders, modified reaffirmed strengthened others, stated validity dependent legality 'If foundation respondents' application indicates, those questions.' 170, 175. 17 gives ample long-existing operational 'practice' integrating output. Section 206 'Whenever after hearing shall find unjust, unreasonable determine just reasonable rate, practice, thereafter observed force, fix order.' ordering continued, furthering declared policy Moreover, ready-made prior arrangements regional coordination precisely 202. 202(a) declares: 18 'For assuring abundant throughout United greatest economy regard proper utilization conservation natural resources, empowered directed divide country into districts voluntary interconnection generation, transmission, 19 further section 'promote encourage' coordination. Under 202(b) authorizes interest, 'prescribe conditions arrangement persons affected including apportionment cost them compensation reimbursement reasonably due them.' If wishes discontinue rendered past years, pointed out, opens up way provided prove consistent interest. Shortly passed 1935, required 205(c), attacked then designated 'Penn Rate Schedule No. 1.' 205(d) 'no change *service relating thereto, thirty days' notice public.' Here instead procedure changing existing practices—a Congress supplemented rules own—the company tried utilize violation Sherman U.S.C.A. seq., nullify rate-reduction order. 21 Nothing whatever show end unjust unreasonable. Cf. Comm. Hope Co., 320 591, 603 64 281, 288, 88 333. 22 Affirmed. 23 FRANKFURTER, having heard argument, owing illness, took no part disposition cases. 24 DOUGLAS, whom REED concurs, 25 meets eye. surface seem only illustration exploitation through far greater issues lurk record. lawless conduct overshadows evils extortionate implicates agency well. desire blind us evil. better win legal skirmish struggle regulation, abandon standards let run riot. 26 start unholy alliance companies—Penn That condemned Circuit. See 184 552; 194 89. because violated permitted operated though department All competition destroyed, evidenced 1948 vetoed steam generating plant built Holtwood, What do, revenues receives, costs incur largely determined 27 said, questions. care leave operation effect, merely rates, (Italics added.) alliance. allowed manage latter alter ego. disingenuous say hereafter did premise contracts.* how vehement denial, truth laced initiative management. 28 Of course 202 promote companies. know place back another company, merge consolidate chooses, give veto over competitor. Those practices condemns, nothing sanctions. 29 reversed remanded directions build powers created sought perpetuate. wholly owned affiliate, Transmission before 1936 1945 dividends less 25% cash paid stock. 342 931, 375. 41 Stat. 1063, 49 838, U.S.C. 791a 761a seq. 'the service reasonable, nondiscriminatory, customer 205(a) 'All Corp. Cir., 179 179, affirming 221. W. G., E.L. 552. entered final litigation. dated February 1949, while September 30, 1950.

Category: 7