Court Opinion

ID: 6758183
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:29:10.864422+00
Date Added: 2024-06-11T16:02:30.898921
License: Public Domain

Locher, J.,
dissenting. Once again a majority of this court confirms a company-oriented assault on the test-year concept. See, e.g., Consumers’ Counsel v. Pub. Util. Comm. (1983), 6 Ohio St. 3d 405, 410 (No. 83-1428) (Locher, J., dissenting); Consumers’ Counsel v. Pub. Util. Comm. (1983), 6 Ohio St. 3d 412, 415 (No. 82-1461) (Locher, J., dissenting). Therefore, I must dissent.
In Consumers’ Counsel v. Pub. Util. Comm. (1981), 67 Ohio St. 2d 153, we refused to allow the utility to pass on the cost of cancelled nuclear plants to consumers. “It is our opinion that R.C. 4909.15 (A)(4) is designed to take into account the normal, recurring expenses incurred by utilities in the course of rendering service to the public for the test period. * * *
“The extraordinary loss sustained by CEI in connection with the terminated nuclear plants cannot be transformed into an ordinary operating expense pursuant to R.C. 4909.15 (A)(4) by commission fiat. The commission’s statement that ‘[c]ancellation does not create a past loss, but gives rise to a current cost’ is unpersuasive. Under this rationale we question whether there could ever be a ‘past loss’ the return of which would not be recoverable in future ratemaking proceedings notwithstanding the commission’s assertion to the contrary.” 67 Ohio St. 2d, at 164.
Quarto resembles those cancelled nuclear plants in many ways. CAPCO invested heavily in a power source which was intended to yield lower rates in the future, but the market changed. Furthermore, the regulatory environment changed. Now, CAPCO wants to amortize that excessive past cost over market by charging current and future ratepayers.
CAPCO also exacerbated the situation by agreeing to provisions in the mining contract which encouraged sub-optimal production. This should be no surprise in that the facts, as summarized by the majority, leave little doubt that the entire Quarto project was not a completely arm’s-length transaction.
For these reasons, the imposition of past losses on current and future ratepayers is not “fair, just, and reasonable.” R.C. 4909.191 (C). Likewise, CAPCO has exhibited “imprudent * * * [and] unreasonable fuel procurement policies and practices.” R.C. 4909.191 (D)(2). Although the commission is empowered to require electric power suppliers to meet the market, it refuses to do so.
Accordingly, I would reverse the order of the commission.