Court Opinion

ID: 6758348
Source: CourtListenerOpinion
Date Created: 2022-07-21 00:29:18.296025+00
Date Added: 2024-06-11T16:02:31.194132
License: Public Domain

Holmes, J.,
dissenting. I dissent from the majority’s opinion in that it allows the commission to utilize a hindsight analysis to evaluate the business judgment of Columbia Gas. It is my position that the commission must review the utility company’s decision based solely on the facts known to management at the time of the decision. To hold otherwise would require the company to predict future economic events in a constantly changing industry.
*123Pursuant to R.C. 4905.302(E), the Public Utilities Commission cannot prevent rate adjustments in this situation unless “the commission has reason to believe that an arithmetic or accounting inaccuracy exists with respect to such a distribution or that the company has * * * employed such other practices, policies, or factors as the commission considers inappropriate.”
The record clearly establishes that due to the considerable increase in interest rates, the utility company selected a late nomination schedule. This decision was made to avoid the substantial interest costs which would be incurred for the prepaid purchase of the company’s entire winter supply of natural gas. In light of the relatively minor projected increase in gas prices, the company’s nominating policy was prudent and in the best interest of its customers at that time. An auditor’s report filed with the commission also verified that appellant’s actions were consistent with the objective of obtaining a sufficient supply of gas at a minimum price.
It is true that the projected increase in natural gas prices dramatically escalated two months after the company’s decision. The escalation was neither predicted nor foreseen by the appellant and other entities. However, the commission, having the benefit of hindsight, penalized Columbia Gas for its failure to correctly predict the amount of the increase. This use of hindsight analysis is an abuse of discretion and, accordingly, I would reverse the order of the commission.