Court Opinion

ID: 9419622
Source: CourtListenerOpinion
Date Created: 2023-08-02 22:50:29.83654+00
Date Added: 2024-06-11T17:22:19.161298
License: Public Domain

Mb. Justice Murphy,
dissenting.
The findings and opinion of the Federal Power Commission in this case make clear that they are substantially and reasonably rooted in fact and law and that proper respect has been shown for jurisdictional limitations. Remand of the case to the Commission for further consideration thus can only serve to produce needless delay and to force the Commission to make certain minor and unnecessary changes in its written opinion. Cf. dissenting opinion in Securities & Exchange Commission v. Chenery Corp., 318 U. S. 80, 95.
*537The basic jurisdictional fact necessary to sustain the imposition on petitioner of the Commission’s accounting standards is that petitioner be a public utility within the meaning of the Federal Power Act. In the setting of this case petitioner must thus be found to own or operate facilities for the “transmission of electric energy in interstate commerce.” § 201 (b). Nowhere in the Act has Congress defined “transmission” or “facilities” other than to say in § 201 (c) that “electric energy shall be held to be transmitted in interstate commerce if transmitted from a State and consumed at any point outside thereof.” The Commission therefore has the duty in the first instance of interpreting and applying these terms to the factual situation confronting it. A court’s function in reviewing this jurisdictional determination is necessarily limited to ascertaining whether that determination has warrant in the record and a reasonable basis in law, giving due weight to the fact that the Commission is an expert body designated by Congress and specially equipped to grapple with the highly technical problems arising in this field. Labor Board v. Hearst Publications, 322 U. S. 111, 130, 131.
The Commission here has found that petitioner owns and operates an electric utility system in the State of Connecticut. It is undisputed that electric energy generated in Massachusetts is transmitted over the wires of other companies to petitioner’s facilities at Bristol, Connecticut. In order to transmit power economically for such a long distance, it is necessary to raise the voltage and reduce the current in Massachusetts as the energy •starts its interstate journey. But the high voltage needed for transit purposes cannot be utilized by consumers. It therefore is necessary to employ apparatus at the receiving end of the interstate transmission to lower the voltage. Petitioner accordingly maintains step-down transformers ■and substation facilities at Bristol for that purpose. After the voltage is lowered, the energy is subdivided and dis*538tributed over petitioner’s wires to consumers in and around Bristol.
The Commission concluded that the functions of the Bristol step-down transformers and substation facilities constitute transmission of energy in interstate commerce since it felt that, in its opinion, such transmission “extends from the generator, where generation is complete, to the point where the function of conveyance in bulk over a distance, which is the essential characteristic of Transmission,’ is completed and the process of subdividing the energy to serve ultimate consumers, which is the characteristic of ‘local distribution,’ is begun.” In other words, the Commission viewed the interstate transmission as complete only after the energy is converted back into a form suitable for local distribution and use and the facilities used for such conversion purposes are necessarily facilities for interstate transmission.
The jurisdictional determination of the Commission must therefore stand or fall upon the validity of its analysis of when long-distance transmission of electrical energy across state lines is at an end. Only if we can point to an absence of any substantial evidence to support the Commission’s view or if we can find legal or statutory principles compelling the opposite view can we justifiably say that the Commission had no jurisdiction in this case or that remand should be made to the Commission for further proceedings. But the Commission’s view cannot be undermined on either basis and it should therefore be affirmed.
Certainly there is ample testimony in this case by engineers to the effect that the Bristol substation equipment constitutes “facilities for transmission of electric energy in interstate commerce,” as distinguished from “facilities used in local distribution.” And the very fact that the Commission, with all its accumulated wisdom and experience, is of the opinion that interstate transmission ceases *539only after the transmitted energy has been converted into a form suitable for local distribution and use is not without weight and significance.
From a legal standpoint, the Commission made no plain error. Clearly no opinion in this Court has purported to decide at what precise point interstate transmission of electrical energy ends and local distribution commences. This seems to be a novel point insofar as legal precedent is concerned. The Commission’s conclusion in this respect hardly seems so unreasonable and unsound as to require us to hold, as a matter of law, that interstate transmission ends just before the voltage is decreased. And this Court does not pretend so to hold in this case.
The Court criticizes the Commission and remands the case to it, however, mainly because it cited Southern Gas Corp. v. Alabama, 301 U. S. 148, 155, and East Ohio Gas Co. v. Tax Commission, 283 U. S. 465, 471, in a footnote in support of its proposition that interstate transmission ends only after the energy is converted back into a form suitable for local distribution. It is said that the Commission erroneously assumed that those cases set forth a rule of law which excluded the process of reducing energy from high to low voltage in subdividing it to serve ultimate consumers from the business of local distribution. But even assuming that these two cases do not enunciate such a rule and do not directly support the Commission’s proposition, it does not follow that the Commission committed reversible error by citing them in a footnote. The Commission’s proposition was grounded not on these two cases but upon the testimony in the record and its own knowledge and experience pertaining to electrical transmission. This is plainly revealed by the use of the phrase “in our opinion” in the sentence setting forth the Commission’s distinction between interstate transmission and-local distribution. The slight reference to the Southern Gas and East Ohio cases was at most for purposes of-*540analogy and cannot serve to impair the true underlying basis of the Commission’s proposition. Presumably all the Commission need do on remand in this respect is to remove the footnote reference to these cases — a fact that makes obvious the proposition that more than an irrelevant or even erroneous citation of a case should be required before we are justified in reversing an administrative determination and sending it back for further consideration.
The Court also deals at great length with the policy declaration in § 201 (a) of the Act that federal regulation is “to extend only to those matters which are not subject to regulation by the States” and with the “but” clause in § 201 (b), which states that the Commission shall not have jurisdiction, except as specially provided, over certain facilities, including those used in local distribution. But neither of these provisions is controlling in this case where the Commission has made a clear and supportable finding that petitioner is a public utility within the meaning of the Act and where the only federal regulation sought to be imposed is the accounting requirements of §301 (a).
It may be conceded that this Court in Jersey Central Co. v. Federal Power Commission, 319 U. S. 61, did not read out of the Act the policy declaration in § 201 (a). But it did make clear that the declaration, which speaks solely in terms of “regulation,” was directed solely at proposed federal regulation of the generation, transmission and sale of electric energy rather than at proposed federal regulation of the corporate financial arrangements of utilities, such as their accounting methods. 319 U. S. at 74,75. Congress did not intend, in other words, to intrude upon state regulation of generation, transmission and sale of energy but it did intend to impose financial regulations on public utilities engaged in interstate transmission of energy even though states might also impose financial *541regulations. This means, under the facts of this case, that interstate transmission of energy is a proper test of whether federal accounting standards may be imposed. What sort of transmission may be a proper subject of federal regulation in and of itself if the State of Connecticut already regulates the transmission facilities is not in issue. The Commission clearly did not misconceive the meaning of this policy declaration and, in light of this Court’s opinion, it apparently need do no more than spell out its recognition of the scope and present inapplicability of the declaration.
Nor did the Commission do violence to the “but” clause of § 201 (b). Here the Commission, following the rule stated in the Jersey Central case, 319 U. S. at 73, that “the determinative fact is the ownership of facilities used in transmission,” has found that petitioner is a public utility since it owns and operates, facilities used in interstate transmission of energy. The Commission thus has jurisdiction over petitioner for accounting purposes. The denial of jurisdiction in the “but” clause where facilities are used for transmission of energy in local commerce has no relevance in this case, an obvious fact which the Commission apparently now must make explicit on remand.
The Commission is dealing here with a difficult marginal case. The precise dividing line between interstate transmission and local distribution can only be drawn by those familiar with the engineering and electrical problems involved. The problem in this case, moreover, is a relatively unique one. An informal survey by the Commission has shown that out of a total of about 1,000 privately owned electric utilities there are only 12 which own or operate step-down substation facilities for taking out-of-state energy and which would not otherwise be public utilities under the Act. The problem is thus one peculiarly within the competence of the Commission, which has shown no desire to use the principle it has enunciated in *542this case and could not use it as a vehicle for assuming unjustified jurisdiction over the facilities of all the local distributing companies in the nation. It has given proper respect to the dictates of Congress relative to state regulation. We should therefore affirm its action in this case without burdening it with requirements of artistic refinement and of negations of the applicability of irrelevant statutory provisions.
MR. Justice Black and Mr. Justice Reed join in this dissent.