Opinion ID: 726753
Heading Depth: 5
Heading Rank: 1

Heading: 1994 Tariff Filing

Text: 44 SoCalGas argues that the structure of its November 1994 rate schedule for natural gas for NGVs constitutes a clear articulation of state policy allowing ratepayer subsidization of utility-built NGV fueling stations. The rate schedule provides that SoCalGas will charge 28.490 cents per therm for uncompressed natural gas to be used at a customer-funded fueling station, where compression will be performed by the customer using customer's equipment at the customer's designated premises, but will charge 63.683 cents per therm for compressed natural gas dispensed at a utility-funded fueling station, where compression will be performed by the utility. SoCalGas argues in its brief that [w]hile the [higher] compressed rate supports recovery of part of the capital and operating costs associated with the provision of the fueling station, it purposefully does not provide for full recovery and accordingly results in operator subsidization. Therefore, SoCalGas argues, CPUC approval of the tariff reflects a conscious state decision to subsidize NGV infrastructure development. 45 The parties dispute whether the district court's judicial notice of the November 1994 rate schedule under Federal Rule of Evidence 201(b) was proper, but we need not resolve the dispute, because even if notice is taken the rate schedule does not establish that SoCalGas is entitled to state-action immunity for three reasons. 46 First, there is no indication on the face of the rate schedule that the compressed-gas tariff, though higher than the uncompressed-gas tariff, is not high enough to provide for full recovery of costs. Therefore, the rate schedule alone does not demonstrate that the CPUC was aware that SoCalGas's tariff structure would result in subsidization such that any commission approval would be a clear articulation of state policy. 47 Second, while SoCalGas argues that the CPUC expressly considered the structure and substance of SOCAL's NGV tariff, the only support it provides for that argument is citation to the commission's January 1992 approval of SoCalGas's application to use ratepayer funds for its NGV programs. Even if the CPUC did approve the structure and substance of SoCalGas's tariff in 1992, that approval is irrelevant to whether state-action immunity shields the utility from antitrust scrutiny after July 1993, since at that point the CPUC adopted a new state policy on utility participation in the NGV-infrastructure market and expressly ordered that all existing utility NGV programs be brought into conformity with that new policy. In the absence of any evidence that the CPUC actually considered the structure and substance of SoCalGas's tariff after July 1993, the continued existence of the tariff structure approved earlier is insufficient to show a clearly articulated state policy in the later period. 48 Finally, there is no indication that the November 1994 tariff represents any articulation of policy by the CPUC, because it is not clear whether the CPUC actually considered and approved the tariff. According to the SoCalGas cover letter filing the November 1994 adjustments to its rate schedule, the tariffs were adjustments to those first approved by the CPUC as effective on 1 August 1992. The letter states that under the approved rate schedules, the utility is to redetermine its rates in the month following the close of each calendar quarter. Whenever the redetermined rates vary more than 5% from the then-existing rates, SoCalGas is to propose the appropriate rate changes and submit them to the Commission three working days before the end of that month and then [t]hese newly determined rates are to become effective on and after the first day of the month following their submission. (Emphasis added.) Thus, it appears from the rate schedules themselves that the November 1994 tariff changes simply became effective upon their filing by SoCalGas and the passage of time. There is no indication whatsoever that the CPUC actually examined and approved the tariff structure and these rates in light of its 1993 guidelines such that the tariff could be said to be a clear articulation of state policy. See Phillip Areeda and Donald Turner, Antitrust Law p 213f (1978) (In one recurrent situation, a regulated firm is obliged by state law to file with a state regulatory agency a tariff stating its rates and practices. Tariff provisions usually take effect unless the agency takes affirmative steps to suspend or disapprove them.... Agency inaction is not sufficient to justify immunity ... [I]t fails to meet the requirement ... that there be a clear state purpose to displace antitrust oversight of this particular activity. Inaction normally does not reflect any agency desire to approve.); cf. Ticor, 504 U.S. at 638, 112 S.Ct. at 2179 (holding as to actual supervision prong of Midcal state-action test that [w]here prices or rates are set as an initial matter by private parties, subject only to a veto if the State chooses to exercise it, the party claiming the immunity must show that state officials have undertaken the necessary steps to determine the specifics of the price-fixing or ratesetting scheme). 49 On this record, then, SoCalGas has failed to establish that the existence of its November 1994 rate schedules demonstrates a clearly articulated state policy to shield ratepayer subsidization of NGV fueling stations from antitrust scrutiny. The CPUC's 1991 approval of PG & E's NGV program provided that PG & E's tariffs would be reviewed annually, 40 C.P.U.C.2d at 744; while the 1992 approval of SoCalGas's NGV program does not contain the same provision, the fact that the commission expressly incorporated the policy decisions from the PG & E decision in its approval of SoCalGas's program suggests that annual review may have been contemplated for that utility's tariffs as well. Thus, SoCalGas may be able to show sufficient CPUC oversight of its rate structure to meet the first prong of the Midcal test, but it has not done so on this record. 50