Pacific Power & Light Co. v. Public Service Com'n of Wyoming

• Citation: 677 P.2d 799
• Decision Date: 07 February 1984
• Docket Number: Nos. 83-75,s. 83-75
• Parties: PACIFIC POWER & LIGHT COMPANY, a corporation, Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent). LOWER VALLEY POWER & LIGHT, INC., Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent). CHEMICAL BANK, a New York corporation, Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent). WASHINGTON PUBLIC POWER SUPPLY SYSTEM, Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent). to 83-78.
• Court: United States State Supreme Court of Wyoming

Page 799

677 P.2d 799

PACIFIC POWER & LIGHT COMPANY, a corporation, Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent).

LOWER VALLEY POWER & LIGHT, INC., Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent).

CHEMICAL BANK, a New York corporation, Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent).

WASHINGTON PUBLIC POWER SUPPLY SYSTEM, Appellant (Petitioner), v. The PUBLIC SERVICE COMMISSION OF WYOMING, Appellee (Respondent).

Nos. 83-75 to 83-78.

Supreme Court of Wyoming.

Feb. 7, 1984.

Rehearing Denied March 8, 1984

in No. 83-75.

Houston G. Williams of Williams, Porter, Day & Neville, P.C., Casper, and Leonard A. Girard, Portland, Or., for appellant Pacific Power & Light Co.

Ted C. Frome, Afton, for appellant Lower Valley Power & Light, Inc.

Carl L. Lathrop and Richard P. Boley of Lathrop & Uchner, Cheyenne, for appellant Chemical Bank.

Thomas A. Nicholas and Alan B. Minier, of Hirst & Applegate, Cheyenne, and Michele Coad, Seattle, Wash., for appellant Washington Public Power Supply System.

A.G. McClintock, Atty. Gen., Steven R. Shanahan, Sr. Asst. Atty. Gen., and Dennis M. Boal, Asst. Atty. Gen., for appellee The Public Service Com'n of Wyoming.

Before ROONEY, C.J., and THOMAS, ROSE, BROWN and CARDINE, JJ.

ROONEY, Chief Justice.

This is an appeal from a district court ruling affirming an order of the Wyoming Public Service Commission (PSC) which denied appellants the right to recover in rates any and all investments, expenses or obligations related to three abandoned nuclear power construction projects.

We hold the matter to be moot as to all appellants except Pacific Power & Light Company (PP & L), and we affirm the decision of appellee insofar as it pertains to PP & L.

There are four appellants. Appellant Lower Valley Power and Light, Inc. (LV) is a distribution level electric cooperative. Appellant PP & L is a publicly held corporation providing electric service as a regulated public utility. Both LV and PP & L are electric public utilities within the regulatory jurisdiction of the Wyoming PSC. Appellant Washington Public Power Supply System (WPPSS) is a joint operating agency which builds, owns and operates electric generation and transmission facilities and sells electric power to its members and others. Appellant Chemical Bank (CB) is a New York corporation which is a bond-fund trustee.

LV and Fall River (FR), another distribution level electric cooperative which is not a party to this appeal, along with 86 other electric utility cooperatives, municipalities, and public utility districts, each signed, on July 14, 1976, identical Participants' Agreements (Agreements) which entitled them to a percentage share of power from two nuclear power projects (WNP-4 and WNP-5) which WPPSS was constructing in the state of Washington and which obligated them each to pay a proportion of the costs of said projects "whether or not" the projects were ever completed. PP & L was a 10% owner of WNP-5, and also was participating in another nuclear power project known as Pebble Springs. WPPSS financed its ownership shares of WNP-4 and WNP-5 through the sale of municipal tax exempt bonds. CB is the bond-fund trustee for said bonds.

The Agreements executed by LV and FR were not submitted to the PSC for review or approval prior to their execution, or at any time subsequent.

Construction of WNP-4 and WNP-5 was begun in 1976 and abandoned in 1981, when WNP-4 was 16% complete and WNP-5 was 20% complete. The Pebble Springs project was terminated in 1982, with no construction ever being done, but with over $200 million invested in site preparation. No electric power will ever be generated by any of these three power plant projects.

The controversy was initiated by the PSC under its investigative powers pursuant to § 37-2-117, W.S.1977 ¹ through a "Notice and Order Setting Hearing" made and entered on April 22, 1982 and directed to LV, PP & L and FR. The Commission Staff had previously petitioned the Commission to investigate the matter as to LV. Of course, the Commission could institute the investigation without such petition "summarily" and "of its own motion." It did so with its "Notice and Order Setting Hearing." The record amply reflects the waiver of any defect or objection in and to the investigation by PP & L. The scope of the investigation was also explored and understood by the parties, and the hearing proceeded on the issue of whether or not the investment, expenses and obligations incurred by PP & L and LV in the projects could be properly considered in fixing the rate base for their operation, and it did not proceed on the issue of what the rates should be, i.e., a rate case.

The transcript reflects that all parties recognized the correct issue and that it would be pertinent to rates and the procedure and evidence would be similar to that of a rate case. The following occurred prior to the testimony of the first PP & L witness:

"MR. ROGERS [Representing PSC Staff]: * * * I do have one additional matter.

"CHAIRMAN SMYTH: Yes.

"MR. ROGERS: And that is concerning the filing by the company made on July 2, 1982, pursuant to the commission's order. The commission will recall that these matters were originally set for hearing on July 16th of 1982, pursuant to the commission order of April 22, 1982.

"Upon the motion of the staff the hearings were continued until this week, and that was made pursuant to the commission's order of May 28, 1982. And contained within that order was a provision that all testimony by all parties was to be filed on or before July 2, 1982.

"Now, I don't know if the commission is aware, but as part of the company's filing on July 2, on or about July 2, they filed tariffs, and those tariffs contain a request for a change of rates in amounts variously set at $5,743,000, or $10,967,000. It was the staff's understanding at the beginning that this was to be a generic matter, that it was not to be a rate matter. The filing made by the company has changed that to a contested case.

"And the staff has concerns regarding the notice requirement of the Administrative Procedures Act, with regard to this matter. I am sure that the commission will recall its own rulings, that a rate making matter is a contested matter under the act, and the commission, or the act is very specific with regard to the notice required.

"And I think that this matter should be resolved by the commission in some way. I have broached the matter with Mr Girard, and we are attempting to come up with some type of a solution to the problem, but I think that the commission should be made aware of it prior to the beginning of this testimony.

"CHAIRMAN SMYTH: Mr. Girard, do you wish to respond to that?

"MR. GIRARD: Very briefly. Mr. Rogers is correct, he made me aware of this matter, I think it was five or six minutes before the hearing commenced this afternoon, so he and I didn't really have time to have a calm lawyer-like discussion of the problem. He agreed to raise it to bring it to your attention. The only thing I will say is this: The purpose of the generic proceeding, I believe, was to determine how to deal with the costs of the nuclear plants at issue.

"And the question the company had was: The generic proceeding presumably will consider how much was spent, why was it spent, was it reasonable, who bears the risk of that and so forth. And let us assume just for discussion, that the commission considered all that, and after deliberating said, 'We think the total costs that should be borne by ratepayers are, say, $10 million a year for five years.'

"Then the question would get to be, 'What would then happen?' Presumably, if the company hadn't filed rates it could then file rates designed to achieve the level of revenues found appropriate by the commission. And we would then wonder, would we have a rate case in which every issue would be open again, and we would then retry the question of who should pay for the nuclear plants.

"We figured that the commission likely didn't want to do that, that this is the hearing to find out how that expenditure is going to be dealt with. There may be a question as to exactly how the--which particular ratepayer should pay for it, but we would think that there should be one time and one time only to decide, is that a stockholder responsibility, a ratepayer responsibility, or anywhere in between.

"That's all I have to say.

* * *

* * *

"CHAIRMAN SMYTH: We will come back to order.

"The commission feels very strongly, not just a little bit, that this was wrong, that we cannot have a rate case without giving notice to the public, and that any issues as to asking ratepayers to pay for amounts in the future, will be taken care of in future rate cases and will not be taken care of in this generic hearing which is to determine whether or not any amount should be involved.

"And therefore, there being no notice to the public, and certainly in these cases significant intervention has been made by the public in the past, we will restrict the hearing to those matters that have previously been noticed and that as to what rates you are required in the future to pay for any amounts that might be found will be a matter to be determined in the future rate case.

"And perhaps, since you already have one filed before us, that it might be a more proper time to discuss those kinds of issues.

"So, if you will proceed on that basis, Mr. Girard.

"MR. GIRARD: Fine, thank you.

"I should have mentioned that when the revised rate schedules were filed, notice was posted, there was not a mailing made or I don't think a newspaper publication made. I wantd [sic] the record to show that, and I am not arguing it was adequate or what is not.

"We will present the case and the only question is, whether we should try and strike from it, if you will, before we ask our questions that material that might be...