In re Montana-Dakota Utilities Co., No. 24448.

CourtSupreme Court of South Dakota
Writing for the CourtKonenkamp
Citation740 N.W.2d 873,2007 SD 104
PartiesIn the Matter of the Petition of MONTANA-DAKOTA UTILITIES CO. for Approval to Provide Electrical Service for the New North Central Farmers Elevator to be Located Near Bowdle, South Dakota.
Decision Date17 October 2007
Docket NumberNo. 24448.
740 N.W.2d 873
2007 SD 104
In the Matter of the Petition of MONTANA-DAKOTA UTILITIES CO. for Approval to Provide Electrical Service for the New North Central Farmers Elevator to be Located Near Bowdle, South Dakota.
No. 24448.
Supreme Court of South Dakota.
Argued on August 30, 2007.
Decided October 17, 2007.

[740 N.W.2d 874]

David A. Gerdes of May, Adam, Gerdes & Thompson, Pierre, South Dakota, Attorneys for appellant Montana-Dakota Utilities.

John J. Smith, Assistant Attorney General, South Dakota Public Utilities Commission, Pierre, South Dakota, Attorneys for appellee South Dakota Public Utilities Comm.

[740 N.W.2d 875]

Robert C. Riter, Jr., Margo D. Northrup, Darla Pollman Rogers of Riter, Rogers, Wattier & Brown, Pierre, South Dakota, Attorneys for appellee FEM Electric & SD Rural Elec. Assoc.

Carlyle Richards of Richards & Oliver, Aberdeen, South Dakota, Attorneys for appellee North Central Farmers Elev.

KONENKAMP, Justice.


[¶ 1.] The question we address in this administrative appeal is whether an electric utility may petition to provide service outside its statutorily assigned service territory to a "large load" customer in another utility's assigned service area. We conclude that SDCL 49-34A-56 allows only customers to petition for an outside provider. Thus, we affirm the Public Utilities Commission's ruling that an outside provider lacked standing to bring a petition under the statute.

Background

[¶ 2.] The Public Utilities Commission (PUC) regulates which utility provides a customer with service. SDCL Chapter 49-34A. Under SDCL 49-34A-42, the Legislature allotted each utility an exclusive right to provide service to all new and existing customers within its assigned territory.1 North Central Farmers Elevator decided to build a new facility in Bowdle, South Dakota. Montana-Dakota Utilities Company (MDU) and FEM Electric Association (FEM) both furnish power to customers in the vicinity, but FEM is statutorily assigned to provide power in the territory where the Bowdle facility would be built. North Central entered into discussions with both MDU and FEM to decide whether it would receive service from the incumbent provider, FEM, or seek permission from the PUC to use the outside provider, MDU. Ultimately, North Central executed a service agreement with FEM.

[¶ 3.] Disappointed with FEM's choice, MDU brought a petition under SDCL 49-34A-56 seeking to have the PUC assign MDU as the provider for power to the Bowdle facility. Despite the fact that FEM had exclusivity in serving the new facility, MDU asserted in its petition that "regardless of customer preference, MDU is the best suited to provide electric service to North Central under a service contract pursuant to the criteria established by SDCL 49-34A-56[.]" In particular, MDU averred that the Bowdle facility is a large load customer and MDU "is fully able to provide the electrical service requirements of the load to be served." It also alleged that it had an adequate power supply available and would expend fewer dollars than FEM to provide service. According to MDU, it would need only one half mile of additional line, while FEM's line would have to extend for four miles.

[¶ 4.] FEM, North Central, and the South Dakota Rural Electric Association successfully petitioned to intervene. North Central asserted that MDU's petition was improperly brought because, among other things, it was North Central's preference that FEM provide service. Correlatively, FEM argued that the new Bowdle facility is within its exclusive territory, and it was willing and able to furnish

740 N.W.2d 876

adequate services, and therefore, it should be the provider.

[¶ 5.] FEM moved for summary disposition, alleging that MDU did not have standing to bring a petition under SDCL 49-34A-56. The PUC granted summary disposition concluding that (1) because the Bowdle facility would be located in FEM's service territory, FEM had the exclusive right to provide service; and (2) MDU is not a customer, and therefore, it did not have standing under SDCL 49-34A-56 to bring a petition. The circuit court upheld the PUC's decision. MDU now appeals to this Court. The question hinges purely on statutory interpretation: did the Legislature intend to open the competition between utilities for "large load" customers, or did it intend to grant exclusive territories for utilities except when customers seek an outside provider.

Standard of Review

[¶ 6.] We review agency decisions the same as the circuit court; there is no presumption that the circuit court's decision was correct. U.S. West Communications, Inc. v. Public Util. Comm'n, 505 N.W.2d 115, 122-23 (S.D.1993) (citing Northwestern Bell v. Public Util. Comm'n, 467 N.W.2d 468, 469 (S.D.1991)). Neither do we defer "to the interpretation of the trial court, nor to the agency's conclusions of law." Id. Questions of statutory interpretation are reviewed de novo. Aspen Storage, Inc. v. Flanagan, 2007 SD 66, ¶ 9, 737 N.W.2d 277, 280 (citing Town Square Ltd. P'ship v. Clay County Bd. of Equalization, 2005 SD 99, ¶ 9 n. 1, 704 N.W.2d 896, 899 n. 1 (citing Fall River County v. S.D. Dep't of Rev., 1999 SD 139, ¶ 15, 601 N.W.2d 816, 821 (citations omitted))).

Analysis and Decision

[¶ 7.] In 1975, our Legislature adopted the "South Dakota Territorial Act." This Act gave the PUC the power to establish zones in which utilities would be assigned exclusively to provide service to all new and existing customers in their respective territories. In the case of In the Matter of Establishing Certain...

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4 practice notes
  • Heinemeyer v. Heartland, No. 24717.
    • United States
    • Supreme Court of South Dakota
    • 12 Noviembre 2008
    ...West Communications, Inc. v. Public Utilities Com'n of State of S.D., 505 N.W.2d 115, 122-23 (1993)). In re Montana-Dakota Utilities Co., 2007 SD 104, ¶ 10, 740 N.W.2d 873, [¶ 11.] SDCL chs. 49-35 through 49-40, inclusive, govern consumers power districts. SDCL 49-36-11 provides: No person ......
  • Tucek v. Dept. of Social Services, No. 24444.
    • United States
    • Supreme Court of South Dakota
    • 17 Octubre 2007
    ...of lost profits based on a contract is not subject to the hearsay rule because such evidence concerns the existence of the contractual 740 N.W.2d 873 terms rather than an assertion of their 972 F.2d at 937 (internal citations omitted). [¶ 22.] Tucek argues the specimen contract should have ......
  • Leonard v. State ex rel. South Dakota Real EState Com'n, No. 25619.
    • United States
    • Supreme Court of South Dakota
    • 15 Diciembre 2010
    ...court; there is no presumption that the circuit court's decision was correct." In re Montana-Dakota Util. Co., 2007 S.D. 104, ¶ 6, 740 N.W.2d 873, 876 (citing U.S. West Commc'n, Inc. v. Pub. Util. Comm'n, 505 N.W.2d 115, 122-23 (S.D.1993) (citing Northwestern Bell v. Pub. Util. Comm'n, 467 ......
  • Leonard v. State Of South Dakota, No. 25619-rev & rem-JKK
    • United States
    • South Dakota Supreme Court
    • 15 Diciembre 2010
    ...court; there is no presumption that the circuit court's decision was correct." In re Montana-Dakota Util. Co., 2007 S.D. 104, ¶ 6, 740 N.W.2d 873, 876 (citing U.S. West Commc'n, Inc. v. Pub. Util. Comm'n, 505 N.W.2d 115, 12223 (S.D. 1993) (citing Northwestern Bell v. Pub. Util. Comm'n, 467 ......
4 cases
  • Heinemeyer v. Heartland, No. 24717.
    • United States
    • Supreme Court of South Dakota
    • 12 Noviembre 2008
    ...West Communications, Inc. v. Public Utilities Com'n of State of S.D., 505 N.W.2d 115, 122-23 (1993)). In re Montana-Dakota Utilities Co., 2007 SD 104, ¶ 10, 740 N.W.2d 873, [¶ 11.] SDCL chs. 49-35 through 49-40, inclusive, govern consumers power districts. SDCL 49-36-11 provides: No person ......
  • Tucek v. Dept. of Social Services, No. 24444.
    • United States
    • Supreme Court of South Dakota
    • 17 Octubre 2007
    ...of lost profits based on a contract is not subject to the hearsay rule because such evidence concerns the existence of the contractual 740 N.W.2d 873 terms rather than an assertion of their 972 F.2d at 937 (internal citations omitted). [¶ 22.] Tucek argues the specimen contract should have ......
  • Leonard v. State ex rel. South Dakota Real EState Com'n, No. 25619.
    • United States
    • Supreme Court of South Dakota
    • 15 Diciembre 2010
    ...court; there is no presumption that the circuit court's decision was correct." In re Montana-Dakota Util. Co., 2007 S.D. 104, ¶ 6, 740 N.W.2d 873, 876 (citing U.S. West Commc'n, Inc. v. Pub. Util. Comm'n, 505 N.W.2d 115, 122-23 (S.D.1993) (citing Northwestern Bell v. Pub. Util. Comm'n, 467 ......
  • Leonard v. State Of South Dakota, No. 25619-rev & rem-JKK
    • United States
    • South Dakota Supreme Court
    • 15 Diciembre 2010
    ...court; there is no presumption that the circuit court's decision was correct." In re Montana-Dakota Util. Co., 2007 S.D. 104, ¶ 6, 740 N.W.2d 873, 876 (citing U.S. West Commc'n, Inc. v. Pub. Util. Comm'n, 505 N.W.2d 115, 12223 (S.D. 1993) (citing Northwestern Bell v. Pub. Util. Comm'n, 467 ......

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