Court Opinion

ID: 5174618
Source: CourtListenerOpinion
Date Created: 2022-01-02 05:22:49.138614+00
Date Added: 2024-06-11T08:26:13.844860
License: Public Domain

Chief Justice TROUT,
dissenting:
As established by statute and case law, the power of this Court to review decisions of the Public Utilities Commission is limited to “whether the Commission regularly pursued its authority and whether the constitutional rights of the appellant have been violated by the Commission’s action.” A.W. Brown Co., Inc. v. Idaho Power Co., 121 Idaho 812, 815, 828 P.2d 841, 844 (1992). This pursuit of authority is valid so long as the PUC “has not abused or exceeded its authority or made findings unsupported by substantial evidence or improperly employed its own methods of rate determination.” Intermountain Gas Co. v. Idaho Public Utilities Comm’n, 97 Idaho 113, 127, 540 P.2d 775, 789 (1975).
I dissent from the Court’s opinion because I believe it is the duty of the PUC, not this Court, to determine what the PUC meant in its first order. Though Idaho Power strongly argues that the PUC ultimately misstated its intent in its first order when it stated that Idaho Power “may” treat the lost revenue as a purchased power expense in the Power Cost Adjustment, I do not believe it is the responsibility of this Court to determine what the PUC meant when it said “may.” That is a determination best left to the PUC, which made the finding in the first place.
We have held that our review of the rate-making procedures of the PUC is very limited:
Our purpose is not to analyze each step of the rate-setting process to determine whether the regulatory agency was correct in its decision, but to look at the overall effect of the rate fixed to determine whether the return to the utility is reasonable and just. As the Supreme Court of the United States stated in Federal Power Commission v. Hope Natural Gas Co., 320 U.S. 591, 64 S.Ct. 281, 88 L.Ed. 333 (1944): “It is not theory but the impact of the l’ate order which counts. If the total effect of the rate order cannot be said to be unjust and unreasonable, judicial inquiry under the Act is at an end. The fact that the method employed to reach that result may contain infirmities is not then important. Moreover, the Commission’s order does not become suspect by reason of the fact that it is challenged. It is the product of expert judgment which carries a presumption of validity. And he who would upset the rate order under the Act carries the heavy burden of making a convincing showing that it is invalid because it is unjust and unreasonable in its consequences.”
Intermountain Gas Co., 97 Idaho at 120, 540 P.2d at 781. As stated above, the concern of this Court is not in the details of the PUC’s decision, but in the overall effect the rate-making order will have on ratepayers, and in ensuring that the effect of the order will not *144be unreasonable or unjust to the utility. The PUC is required to adequately explain any decision to decline a benefit a utility requests of it. However, as long as this denial does not result in an unjust or unreasonable return to the utility, the PUC’s decision must stand.
I believe the PUC clearly and adequately stated in its third order its reasons for denying Idaho Power the ability to include lost revenue in its PCA. Additionally, I believe the reasons stated by the PUC are justified and persuasive. In the best interests of ratepayers, the PUC declined to allow Idaho Power to be compensated for lost revenues because imposing the value of lost revenues on ratepayers would defeat the underlying purpose of the program. The PUC did allow Idaho Power to recover costs of the program, but in refusing to allow them to recover lost revenues, the PUC did not impose any unjust or unreasonable return to Idaho Power. Indeed, Idaho Power was seeking to recover revenues for power it would not have supplied, charging ratepayers for power that was not consumed.
The Commission explained its decision to deny Idaho Power lost revenues by stating:
In general, the Commission finds that the rates should accurately reflect the actual costs incurred to provide service. Given the unique context that caused this Program to be implemented, we find that lost revenue does not constitute an actual cost of providing service that should be born by ratepayers. To allow Idaho Power to recover lost revenue would at least partially destroy the goal of reducing overall energy costs to all ratepayers at a time when energy costs were at all time highs. To charge ratepayers for lost revenue is unreasonable in the context of the crisis that existed because of the drought and the unprecedented prices in the regional power market at that time. Requiring ratepayers to pay for energy they did not consume, but avoided due to this Program, is also unreasonable.
Order No. 29103, p. 9. Such an explanation for denying Idaho Power lost revenues is clear, persuasive and warranted. Accordingly, it is beyond the scope of review of this Court to delve into the particulars of the PUC’s ratemaking process and to analyze the language of a prior order in an attempt to bind the PUC to a purported guarantee that clearly goes contrary to the PUC’s mission to regulate power rates in the interest of Idaho ratepayers. “[S]o long as we determine that the order ‘may reasonably be expected to maintain financial integrity (of the utility), attract necessary capital, and fairly compensate investors for the risks they have assumed, and yet provide appropriate protection to the relevant public interests,’ we will not set aside the order of the Public Utilities Commission.” Intermountain Gas Co., 97 Idaho at 127, 540 P.2d at 789. As cited above, “[i]f the total effect of the rate order cannot be said to be unjust and unreasonable, judicial inquiry ... is at an end.” 97 Idaho at 120, 540 P.2d at 781.
Because I believe the PUC’s order was just and reasonable to Idaho Power, I respectfully dissent.