3109 Hwy. 25 S., L.L.C. v. Duke Energy Carolinas, LLC
| Decision Date | 21 August 2019 |
| Docket Number | Memorandum Opinion No. 2019-MO-034,Appellate Case No. 2018-000475 |
| Parties | 3109 Hwy. 25 S., L.L.C. d/b/a 25 Drive-In and Tommy McCutcheon, Respondents, v. Duke Energy Carolinas, LLC, Appellant. |
| Court | United States State Supreme Court of South Carolina |
THIS OPINION HAS NO PRECEDENTIAL VALUE. IT SHOULD NOT BE CITED OR RELIED ON AS PRECEDENT IN ANY PROCEEDING EXCEPT AS PROVIDED BY RULE 268(d)(2), SCACR.
Appeal from the Public Service Commission
AFFIRMED
Frank Rogers Ellerbe III and Samuel J. Wellborn, both of Robinson Gray Stepp & Laffitte, LLC, of Columbia, Heather Shirley Smith, of Duke Energy Corporation, of Greenville, and Rebecca Jean Dulin, of Duke Energy Corporation, of Columbia, all for Appellant.
John J. Fantry Jr., of Fantry Law, of Winnsboro, and Alexander George Shissias, of The Shissias Law Firm, LLC, of Columbia, both for Respondents.
In this direct appeal, we must determine whether the Public Service Commission of South Carolina erred in ordering Duke Energy Carolinas, LLC,1 to return a Greenwood, South Carolina customer to a less expensive electricity rate that is available to certain Duke customers in that area of the state. We affirm the Commission.
Tommy McCutcheon and his wife own and operate 25 Drive-In, a drive-in movie theater located in Greenwood. Duke provides electricity to the theater. On May 30 and June 13, 2015, there were power outages at the property; both occurred when Duke's service line melted. Duke claimed the theater's energy consumption was too much for the existing service line to handle. McCutcheon claimed the theater's energy consumption was conservative and did not cause the outages. Duke upgraded the drive-in's facilities to handle the supposed increased load and per Duke's internal policy, removed the drive-in from the "Greenwood rate" and placed it on the significantly more expensive "Duke rate."
The Greenwood rate is a product of Act No. 1293 of 1966. In 1965, Duke offered to purchase properties of the Greenwood County Electric Power Commission (GEPC). In response to Duke's offer, the General Assembly enacted the Act, authorizing the sale of GEPC property under certain terms. In pertinent part, the Act provides:
The rates to be charged for electric power for all connections which exist at the consummation of the sale shall be the lower of the rates charged by [GEPC] and Duke Power Company and the same shall not be grounds for any claim alleging discrimination. The rates to be charged for electric power for connections after the date of the sale shall be the applicable rates of Duke Power Company. As used herein the word "connections" shall be deemed to mean the physical connection of a residence or business establishment and shall have no reference to the person or business firm occupying the premises so connected, and the benefit of the lower rate shall continue although the person or firm occupying such premises may change from time to time.
Act No. 1293, 1966 S.C. Acts 3294, 3297. At the time the sale was executed, energy costs were trending downward, and it was expected customers impacted by the sale would eventually migrate from the Greenwood rate to a lower Duke rate. Obviously, this estimate proved to be incorrect as energy costs instead trended upward. As a result, there are still approximately 2,540 Duke accounts on the 1966 Greenwood rate. The Greenwood rate is significantly less expensive than the Duke rate, and customers on the Greenwood rate work arduously to keep it.
This Court has previously interpreted the terms of the Act to allow customers to be transferred from the Greenwood rate to the Duke rate when a "new connection" has been established. See Payne v. Duke Power Co., 304 S.C. 447, 452, 405 S.E.2d 399, 401-02 (1991) (). We have further explained, "[A] change in either the character of the connection (e.g. from single to three phase) or use of the premises (e.g. from residential to commercial) constitutes a new connection effectuating a transfer to Duke rates." Id.
McCutcheon filed a complaint against Duke with the Commission, alleging the drive-in's transfer to the Duke rate was improper. Duke argues the transfer was proper because a new connection was established at the drive-in when it upgraded the drive-in's facilities to handle an increased load. The Commission ordered Duke to place the drive-in back on the Greenwood rate, subject to certain limitations. Duke appeals, claiming (1) substantial evidence in the record does not support the Commission's conclusions, and (2) the Commission's decision was controlled by an error of law.
In its order placing the drive-in back on the Greenwood rate, the Commission noted the critical need for Duke to provide safe, reliable power to its customers and the unfairness that would result in punishing Duke for actions taken to remedy an "unsafe situation." However, the Commission also noted, "[I]t would not be appropriate to have the [drive-in] -- operating for a number of years in apparent compliance with the Greenwood Rate, and taking measures to ensure compliance with the Rate -- to be removed from the rate without specific proof that they had become non-compliant with the rate." As a result, the Commission ordered Duke to place the drive-in back on the Greenwood rate, subject to certain limitations (these limitations are not an issue in this appeal).
Duke requested rehearing;2 in its order denying rehearing, the Commission clarified that its ruling was not based on a finding as to whether Duke's upgrade constituted a change in the character of the connection sufficient to establish a new connection. The Commission explained it found "inadequate information was available to determine that a change in character was necessitated in this case due solely to the actions of [McCutcheon]."3
We may reverse or modify the Commission's decision if the substantial rights of an appellant have been prejudiced by a decision clearly erroneous in view of the substantial evidence in the record. See S.C. Code Ann. § 1-23-380(5)(e) (Supp. 2018). We have held:
"Substantial evidence" is not a mere scintilla of evidence nor evidence viewed blindly from one side of the case, but is evidence which, considering the record as a whole, would allow reasonable minds to reach the conclusion that the administrative agency reached or must have reached in order to justify its action.
Lark v. Bi-Lo, Inc., 276 S.C. 130, 135, 276 S.E.2d 304, 306 (1981) (quoting Laws v. Richland Cty. Sch. Dist. No. 1, 270 S.C. 492, 495-96, 243 S.E.2d 192, 193 (1978)). We are prohibited from substituting our own judgment for that of the Commission upon a question as to which there is room for a difference of intelligent opinion. Hamm v. Pub. Serv. Comm'n of S.C., 310 S.C. 13, 16-17, 425 S.E.2d 28, 30 (1992).
Duke argues there is no substantial evidence in the record to support the Commission's ruling that the drive-in was eligible for the Greenwood rate. Specifically, Duke contends there was no basis for the Commission to conclude that "the thermal outages were caused by anything other than [the drive-in's] electricity demand exceeding the capacity" of the existing facilities, and Duke further argues McCutcheon "provided no credible alternative theory as to the failure of the electric service line." We disagree.
The parties agree the power outages occurred because the service wire had melted. However, they do not agree as to why the wire melted. McCutcheon's expert, James R. Calhoun, testified before the Commission the wire melted because it was deteriorated and that neither the drive-in's equipment nor thermal overload caused the wire to melt. Duke's expert, Joel Lunsford, testified the service wire failed because of thermal overload caused by the drive-in's consumption of...
To continue reading
Request your trial