Big Horn Rural Elec. Co. v. Pacific Power & Light Co.

• Decision Date: 17 December 1964
• Docket Number: No. 3250,W,Docket No. 9041,Docket No. 9408,3250
• Citation: 397 P.2d 455
• Parties: In the Matter of the Application of Pacific Power & Light Company for a certificate of public convenience and necessity, Wyoming Public Service Commission; and In the Matter of the Application of Big Horn Rural Electric Company for an order further amending its basic certificate of public convenience and necessity inyoming Public Service Commissionsub. 6. BIG HORN RURAL ELECTRIC COMPANY, Appellant (Appellant below), v. PACIFIC POWER & LIGHT COMPANY, Appellee (Respondent below).
• Court: Wyoming Supreme Court

Page 455

397 P.2d 455

57 P.U.R.3d 362

In the Matter of the Application of Pacific Power & Light Company for a certificate of public convenience and necessity, Wyoming Public Service Commission Docket No. 9408; and In the Matter of the Application of Big Horn Rural Electric Company for an order further amending its basic certificate of public convenience and necessity in Docket No. 9041, Wyoming Public Service Commission Docket No. 9041 sub. 6.

BIG HORN RURAL ELECTRIC COMPANY, Appellant (Appellant below), v. PACIFIC POWER & LIGHT COMPANY, Appellee (Respondent below).

No. 3250.

Supreme Court of Wyoming.

Dec. 17, 1964.

James A. Zaring, Basin, for appellant.

Richard E. Day, Sp. Asst. Atty. Gen., Cheyenne, for Wyoming Public Service Commission.

Houston G. Williams, Casper, for appellee.

Before HARNSBERGER, GRAY and McINTYRE, JJ.

Mr. Justice GRAY delivered the opinion of the court.

This is an appeal by Big Horn Rural Electric Company from a judgment entered by the District Court of Laramie County, Wyoming, confirming an order of the Public Service Commission of Wyoming granting to Pacific Power & Light Company a certificate of public convenience and necessity authorizing it to furnish, as a public utility, electrical service in an area embracing some 255 square miles located in the northeastern part of Big Horn County, Wyoming.

The record reveals that the area is bordered on the north by the Wyoming-Montana boundary line; on the east by the Big Horn-Sheridan county line; and on the south and the west by service areas certificated to Pacific and Big Horn, either jointly or severally. Although both companies had been operating in their authorized service areas for some time, neither--with one unimportant exception--had requested authority from the commission to extend facilities into the uncertificated area here involved. No doubt that is best explained by the evidence which indicates that for the most part the terrain of the area is rough and mountainous. It is virtually uninhabited. Prior to the fortuitous circumstance which initiated the controversy here, the only potential electrical customers in the area were the owners of a number of mountain cabins; a television microwave tower; a ski tow, with related facilities; and a ranger station. It seems to have been understood by all concerned, including the commission, that an extension of facilities to serve only those customers was not economically justified.

However, the circumstance mentioned which apparently made the area attractive to both companies as a service area was the contemplated construction and installation therein of a radar navigation facility by the Federal Aviation Agency on the peak of a mountain known as 'Medicine Wheel,' which has an elevation of approximately 10,000 feet. To operate the facility it was necessary to have a firm source of electrical power, and to that end the agency out-lined its needs to each company, with the request that consideration be given to the practicability of extending its facilities into the area for the primary purpose of furnishing such power. It was also established that unless commercial power could be furnished upon terms satisfactory to the agency, it would provide its own power.

In keeping with the request, both Pacific and Big Horn made preliminary studies of the area. Apparently concluding that the proposed project was practical and in the public interest, each company filed an application with the commission for a certificate of public convenience and necessity, requesting the exclusive right to extend its facilities into the area. The obtaining of such a certificate is a prerequisite to the commencement of construction. Section 37-31, W.S.1957.

In the joint hearing of the applications by the commission, Pacific proposed that it would construct a 34.5 kv line into the area, commencing at a point near the Lovell substation and terminating near the radar site, a distance of approximately twenty-four miles. The estimated cost of the line was $150,000. Big Horn proposed to serve the area by extending a recently constructed 12.5 kv line from a point near Kane, Wyoming, to the radar site, a distance of approximately fifteen miles. The estimated cost of such extension was $49,300. While there were other matters to be determined by the commission, special mention is made here of the service facilities proposed for the reason that the factual issue of which proposal would best serve public convenience and necessity is, as we view it, the critical question in determining whether or not the commission erred in its ultimate conclusion that the application of Pacific should be granted and that of Big Horn denied.

As an initial approach to review of the matter, and taking into consideration the whole of the record stripped of unimportant formalities, the nature of the proceeding was simply to call upon the commission to exercise its jurisdiction and to determine for the State, on a comparative basis, which of the two applicants should be awarded the right to extend facilities into an area concededly having need for electrical service.

The authority of the commission in the premises is contained in § 37-31, W.S.1957, which provides in part:

'No public utility shall henceforth begin the construction of a line, plant or system, or of any extension of such line, plant or system, without having first obtained from the commission, a certificate that the present or future public convenience and necessity require or will require such construction; * * *.'

It will be noticed that 'present or future public convenience and necessity' is the 'touchstone' for the exercise of the power. Federal Communications Commission v. Pottsville Broadcasting Co., 309 U.S. 134, 60 S.Ct. 437, 84 L.Ed. 656. To state it another way, the public interest is to be given paramount consideration; the desires of the utilities are secondary. Public Service Company v. Public Utilities Commission, 142 Colo. 135, 350 P.2d 543, 549, 558, certiorari denied Union Rural Electric Association, Inc. v. Public Service Company of Colorado, 364 U.S. 820, 81 S.Ct. 53, 5 L.Ed.2d 50; Application of Trans- Northwest Gas, 72 Idaho 215, 238 P.2d 1141, 1144; Kansas Gas & Electric Co. v. Public Service Commission of Kansas, 122 Kan. 462, 251 P. 1097, 1099. The discretion vested in the commission by the statute is broad indeed when, as here, no vested rights are involved. San Diego & Coronado Ferry Co. v. Railroad Commission of California, 210 Cal. 504, 292 P. 640, 643; Kansas Gas & Electric Co. v. Public Service Commission of Kansas, supra; 3 Pond, Public Utilities, § 913, p. 1849 (4th Ed.). The statutory standards to be observed are as stated in § 37-31(b), that the commission 'after hearing involving the financial ability and good faith of the applicant and the necessity of additional service' in the area, may grant, deny, or condition the certificate. No doubt we should here state that insofar as those standards are concerned, we are convinced that the commission applied the standards and was warranted in finding, as we think it did find, that either application withstood those tests. Big Horn does not seriously dispute this.

However, the commission for its guidance and for the guidance of persons interested in such matters has laid down what we might term as subsidiary issues that are to be considered in reaching a decision on the ultimate issue of public convenience and necessity. The order states these to be:

'In deciding which one of the Applicants herein is best fitted to serve this Area, many factors developed by the record herein must be carefully considered, i. e., the qualifications and fitness of the Applicants, the source and adequacy of their power supply, the proximity of their existing service facilities to the prospective loads in the Area, the nature of such loads, the immediate and long term electric requirements of the Area, the type of facilities each of the Applicants propose to construct, the topography and rigorous climate of the Area, and, above all, the overriding public interest.'

It is against these pronouncements that Big Horn levels its attack. In its petition on appeal it recites some seventeen claimed transgressions on the part of the commission in considering these factors. Several of these we regard as inconsequential. Others have already been answered in the discussion on statutory standards. Still others go to the weight that should have been given to the showing made by Big Horn on the several elements. While we can agree that these matters are important, we know of no rule of law, and we are cited to none, that prescribes the weight that must be accorded to each element. That, it seems to us, was for the commission to decide. Of course, a different question is presented if on the record there is a showing of arbitrary, unreasonable, or capricious action on the part of the commission. It is for these reasons that we revert to the critical question of the proposed facilities, which as we have indicated appears to have been the determinative factor so far as the commission was concerned.

The commission, in this regard, said in part:

'* * * The record indicates that 12 KV is the nimimum voltage acceptable for electric service at this radar installation; and that the voltage factor thereat must be maintained at a rigid constancy, as no safety factor will be built into radar equipment itself. It was further emphasized by Witness Harvey that spasmodic power fluctuations could cause extensive harm to the standby and radar equipment, and thus result in an equipment failure effectuating a dangerous gap in the FAA radar net. The evidence further indicates the critical nature of the radar load requires a larger voltage than the minimum requirement in order to provide a more firm and stable and, consequently, a more desirable basis for service. Expert testimony given in the proceeding indicates that a heavy pumping load on a 12...