Legal Document

350 U.S. 348 76 Supreme Court Reporter 368 100 L.Ed. 388 FEDERAL POWER COMMISSION, Petitioner,v.SIERRA PACIFIC COMPANY. GAS AND ELECTRIC COMPANY, Petitioner, versus SIERRA Nos. 51, 53. Argued Nov. 8, 1955. Decided Feb. 27, 1956. Motion to Amend Denied May 28, See 351 946, 843. Mr. Howard E. Wahrenbrock, Washington, D.C., for petitioner Federal Power Com'n. KF105 F3 T. Searls, San Erancisco, Cal., Pacific Gas & El. company William C. Chanler, New York City, respondent. Justice HARLAN delivered the opinion of Court. 1 This case presents questions under Title II Act, 49 Statutes-at-Large 847, 16 United States Code KF62 § 824 et seq., Annotated KF65 U5 which are in part similar those we have decided today Natural 15 717 Pipe Line Mobile Service Corp., 332, 373. The pertinent provisions set forth margin,1 §§ 205(c), (d), and (e), 206(a), substantially identical 4(c), 5(a), respectively, Gas. Act.2 2 Respondent Sierra Company (Sierra) distributes electricity consumers northern Nevada eastern California. For many years, it has purchased major its electric power from Electric (PG&E), a 'public utility' subject regulation Part Act. In 1947 Sierra, faced with increased postwar demands consumer agitation cheaper power, began negotiating other sources, including Bureau Reclamation, at time had unused capacity Shasta Dam. To forestall potential competition, PG&E offered 15-year contract special low rate, offer finally accepted June 1948. was duly filed Commission. 3 Early 1953, when Dam no longer available PG&E, without consent Commission 205(d) Act schedule purporting increase rate by approximately 28%. Commission, acting 205(e), suspended effective date new until September 6, initiated proceeding determine reasonableness. permitted intervene but motion reject filing on ground that could not thus unilaterally change denied. After completion hearings, order dated 17, 1954, reaffirmed refusal held be 'unjust, unreasonable, unduly discriminatory, or preferential.' 7 P.U.R. 3d 256. On Sierra's petition review, Appeals District Columbia, holding changed only upon finding aside Commission's remanded instructions dismiss 205(e) proceeding, prejudice instituting 206(a) reasonableness rate. 96 U.S.App.D.C. 140, 223 Reporter, 2nd Series 605. We brought here because importance involved administration 349 937, 75 785, 99 1265. 4 first question before us is whether PG&E's unilateral 205(d), approval were supersede Sierra. think not. As parties concede, relevant this all material respects equivalent supra, today, construed as authorizing changes, interpretation equally applicable Accordingly, reasons there given, conclude neither nor unlawful 5 case, however, raises further present case. undoubted prescribe rates whenever determines such unlawful. While limited prescribing 'to thereafter observed' can effect prior order, here, if based necessary findings, been proposed prospectively 1954. If proceedings satisfied substance requirements would seem immaterial investigation begun one into rather than existing 6 condition precedent exercise discriminatory preferential'. Petitioners contend did fact make finding. It stipulated 5.5% normally reasonable return operations, produce 2.6% return, 4.75% return. concluded unreasonably high provided more fair 0.75% deficiency yield being made up sales justified retain business loss result idle facilities. also preferential, despite substantial differences between charged customers. findings view permitting went say: 'However, may point out lawfulness 1948 appropriate, record therefore none evidence warrants any less resulting minimum willing accept.' 8 contended statement found 'unreasonable' fixed 'the just rate,' thereby satisfying 206(a). 9 But even accepting unreasonableness conclusion appears face an erroneous standard. short, holds unreasonable solely yields net invested capital. But, while impose public utility does follow itself agree affording that, so, entitled relieved improvident bargain. Cf. Arkansas Railroad Comm., 261 379, 43 387, 67 705. circumstances sole concern so adversely affect interest—as where might impair financial ability contunue service, cast excessive burden, discriminatory. That purpose given protection interest, distinguished private interests utilities, evidenced recital 201 scheme imposed 'is interest'. When read light purpose, clear said either 'unjust' simply unprofitable utility. 10 Whether facts adverse interest course determined instance shall affirm Appeals, remand proceedings, inconsistent opinion, deem desirable. ordered. 11 Order affirmed, instructions. '§ 205. * (c) Under rules regulations prescribe, every file within form designate, keep open convenient place inspection schedules showing charges transmission sale jurisdiction classifications, practices, affecting charges, together contracts manner relate rates, services. "(d) Unless otherwise orders, charge, classification, rule, regulation, relating thereto, except after thirty days' notice public. Such keeping stating plainly changes then force will go effect. good cause shown, allow take requiring herein specifying they published. "(e) Whenever authority, complaint own initiative complaint, once, and, answer formal pleading utility, notice, enter hearing concerning service; pending decision thereon, delivering affected writing suspension, suspend operation defer use period five months beyond effect; full completed service goes effect, orders reference thereto proper become effective. expiration months, end period, require interested utilities accurate account detail amounts received reason increase, whom whose behalf paid, refund, persons portion justified. At involving charge sought increased, burden proof show give preference over decide same speedily posible.' 851—852, 824d, 824d. 206. (a) find demanded, observed, charged, collected practice, classification unjust, observed force, fix order." 852, 824e, 824e. Set footnote 334, 375.

Classification Label: 7