Court Opinion

ID: 6916901
Source: CourtListenerOpinion
Date Created: 2022-07-23 22:44:49.108197+00
Date Added: 2024-06-11T16:06:40.992477
License: Public Domain

REED, Associate Justice, retired,
(dissenting) .
This Court concludes that the facts in this record require the Federal Power Commission to permit petitioners, the Midwestern Gas Transmission Company and the Tennessee Gas Transmission Company, to participate fully in the hearing on the application of the Natural Gas Pipeline Company of America, and its affiliates, to increase largely its sales capacity. This increased capacity is intended to give additional supplies to its distributing connections in the Northern Indiana-Chicago area. These are Northern Indiana Public Service Company [NIPSCO] and Peoples Gas Light and Coke Company [Peoples]. A part of the proposed increase was to supply the industrial needs of United States Steel Corporation and Inland Steel Company in Chicago, East Chicago, and Gary, Indiana.
For me the validity of the conclusion of this court depends upon whether peti*671tioners seek an opportunity to serve the same consumers that the Natural Gas Pipeline and its affiliated and distributing companies are serving and seeking to serve — that is, the consumers of Chicago and Northern Illinois. Where competing gas companies seek certificates of convenience and necessity from the Federal Power Commission for service to the same consumer groups, the law requires as a matter of fairness that the FPC hear all applicants in the same proceeding, with opportunity to all parties to examine the proposals of one another, so as to bring out before the Commission the facts necessary for the Commission to properly appraise the public interest as between the contending suppliers. This is the doctrine of Ashbacker Radio Corporation v. Federal Communications Commission, 326 U.S. 327, 66 S.Ct. 148, 90 L.Ed. 108. No one questions its soundness, where applicable. In recognition of and in conformity with that rule, the F.P.C. has directed by order of March 13, 1957, in Natural Gas Pipeline Company of America, Docket No. 9966, 17 F.P.C. 469, that the mutually exclusive portions of the applications of “Natural” and “Midwestern”, in the view of the Commission, be severed and heard in another proceeding where both are parties —the application of Midwestern in Docket Nos. G-9451 et al., order of March 29, 1957, 17 F.P.C. 461.
There is thus no clear-cut difference between the parties as to the law where applications of different lines seek mutually exclusive certificates of public convenience and necessity. The controversy centers around the facts in this case and the applicability of the recognized rule as to mutually exclusive applications for certificates. In such circumstances, the determination of the administrative agency carries great weight with me. The agency is the selected impartial entity for settling the public interest when rivals seek to serve the same consumers. If Midwestern was seeking an opportunity to serve generally the Chicago-Northern Indiana area with a duplication of'Natural’s service, such offer would fall within the Ashbacker Rule. But here Midwestern in that area actually seeks certification only for the steel companies, with vague suggestions, set out in the Court’s opinion, that once in the area it may in the indefinite future ask a wider authority.
Congress created the Commission to deal with the public interest, endowed it with a rule-making power to enable it to assure fair opportunity for open competition for service facilities, and charged it with administrative responsibilities. It is the expert body, not the judiciary, that is concerned with where, when and to whom, in the public interest, certificates are to be granted. Cf. National Broadcasting Co. v. United States, 319 U.S. 190, 63 S.Ct. 997, 87 L.Ed. 1344; United States v. Storer Broadcasting Co., 351 U.S. 192, 76 S.Ct. 763, 100 L.Ed. 1081. I am of the view that there was substantial reason for the action of the Commission in entering its two orders for severance and adversary hearing and therefore from the whole record would support the F.P.C. conclusion. O’Leary v. Brown-Pacific-Maxon, 340 U.S. 504, 508, 71 S.Ct. 470, 95 L.Ed. 483.
Briefly my reasons are these. The Court concedes, and the record bears out its statement, that Midwestern “specifically named only the two steel companies as its prospective customers in Natural’s service area.” It adds that Midwestern “proposes to supply gas to every customer in that area within economic reach of its line.” I do not so read the record. The Midwestern application was initiated by an application, filed October 10, 1955, docket No. G-9451, 20 Fed.Reg. 9032. It said:
“The principal market territory to which Applicant’s pipeline will make natural gas available lies in Minnesota, Wisconsin, western Michigan and eastern North Dakota. Much of this area is presently without natural gas service, despite the strenuous efforts to get natural gas which have been exerted for many years by public officials and officials of the local gas industry, and it is primarily *672service to this long neglected market that Applicant proposes herein.”
Every community listed for service was in Minnesota or Wisconsin.
In the original application this general .statement appeared:
“Other parts of this general market territory logically should be served by Applicant’s pipeline system. Applicant has received many requests for natural gas service from gas distributing companies and industrial plants in this area. Many of these potential customers .already enjoy the advantages of natural gas service but the fact that their present supplies are inadequate is forcefully demonstrated by long lists of unaccepted applications for natural gas service. There is no doubt that the entire territory accessible to Applicant’s pipeline system will benefit from service by a new natural gas pipeline system whose management has an established reputation for aggressive merchandising of natural gas.”
In amendments it was repeated and in 1956 Midwestern listed the two steel companies as prospective consumers. No •others have been named. Generalized statements of a desire to obtain more •customers wherever profitable to the applicant or to expand into areas of gas shortage outside the limits of its projected service are not enough to occasion admission of Midwestern, by judicial direction, into the application of Natural and its affiliates to obtain certificates to enable it to meet the inadequacies of their present service.
The application of Midwestern states a daily capacity of 401,574 m.e.f. Its supplement of February 7, 1956, to its application sets up an allocation wholly out of the Chicago area except as to the steel companies of 395,998 m.e.f. It would seem to have little to offer the Chicago area consumers.
Natural and its affiliates have a line extending from the gas fields of Texas through Oklahoma, Kansas, Nebraska and Iowa to the Chicago area. Another reaches from the South Gulf Coast region of Texas through Arkansas and Missouri. It obtains quantities of gas from Colorado Interstate and the wells of Kansas. Eighty per cent of their total annual sales are in Chicago and surrounding areas. The balance goes to local gas companies along the lines. Additional gas is available and needed for the area now served. The lines and stations requested for improvements are estimated to cost around eighty million. This immediate need for increased service to the Chicago area led the Commission to exclude from their present consideration the mutually exclusive portions of the Midwestern and Tennessee applications for service to the steel companies. The Commission said:
“We feel that action looking toward increased service to markets presently being served in non-competitive areas should not, where possible, be deferred until after the competitive aspects of the respective applications can be considered and determined.”
The Commission further pointed out that in allowing Natural’s application to proceed to a grant without the intervention of Midwestern, the Commission was in a position to protect the “limited area of mutual exclusiveness,” i.e., the service to the steel companies, by a properly conditioned certificate to Natural. I see no reason why this cannot be done.1
Courts should be slow to interfere with routine interlocutory proceedings of administrative agencies. A major advantage of agency, as opposed to judicial proceedings, is their flexibility. If Midwestern desires to serve other consumers than those stated in its application, it can set out its purpose, the needs of the public, and its gas and financial resources. This has not been done.
*673I would uphold the Commission in its effort to get adequate gas promptly into the Chicago area by affirming its order. The action taken by the Commission was an exercise of its discretion as to how to manage the routine hearings of its applications. Its conclusion was reached after detailed consideration of how to handle a conflict over the service to the steel companies. Under such circumstances courts are to leave decisions “to the expertise of the agency burdened with the responsibility for decision.” 2

. See F.P.C. order of May 14, 1957, in Docket No. G-2306, American Louisiana Pipe Line Company, and other dockets, all involved in Midwestern’s pending application. 17 F.P.C. 671.

. Panama Canal Co. v. Grace Line, 78 S. Ct. 752, 758.