HMS Legal Blog

            The Pennsylvania Public Utility Commission (PUC) recently issued a final rule making order concerning recovery of fuel costs by gas utilities at Docket No. L-2013-2346923.  The full order can be found here:  http://www.pabulletin.com/secure/data/vol46/46-4/110.html  The Order is designed to simplify and streamline information and procedures for small gas utilities (gross intrastate operating revenues of $40 million or less) when submitting gas cost rate (GCR) filings with the PUC. 

On February 18, 2016, EPA Announced its Triennial National Enforcement Initiatives (“Initiatives”).  The EPA issues these Initiatives once every three years in order to help “focus time and resources on national pollution problems” according to Cynthia Giles, assistant administrator for enforcement and compliance assurance at EPA.  The latest round of Initiatives will begin on October 1, 2016 and once again will list natural gas producers and water authorities as targets for EPA inspections and enforcement.

Yesterday the U.S. Supreme Court in a majority decision reversed the D.C. Circuit Court of Appeals’ decision and determined that a regional transmission organization’s (RTO) demand response program compensation comes under FERC’s jurisdiction. A demand response program is when, during high electricity demand, customers of electricity are paid not to use electricity. These demand response programs serve to lower electricity prices and increase the reliability of the electric grid. Center to the present issue is FERC’s issuance of Order No. 745 (Order 745). Order 745 requires market operators to pay the same price to demand response providers for conserving energy as to the generators for making energy. The D.C. Circuit Court held that FERC lacked authority to issue the order because Order 745 would directly regulate retail electricity rates. The D.C. Circuit Court also held that FERC’s demand response compensation scheme was arbitrary and capricious under the Administrative Procedure Act. The U.S. Supreme Court disagreed.

In a binding poll of the issues taken at its September 17, 2015 Public Meeting, the Pennsylvania Public Utility Commission (“PUC”) unanimously voted in support of the Natural Gas Supplier Parties’ (“NGS Parties”) request to modify the way Columbia Gas of Pennsylvania (“Columbia”) refunds back to customers’ their share of off-system sales revenue. 

Almost one year to the day from its 2014 rate increase filing, Columbia Gas of Pennsylvania is back before the Pennsylvania Public Utility Commission seeking an additional $46 million in revenue.

Despite high demand due to persistent cold weather, heating oil and propane will continue to flow to Pennsylvania homes due in part to the extension of the drivers’ hours-of-operation exemption issued by the Governor’s Office.

             In Pennsylvania Environmental Defense Foundation v. Com., -- A.3d – (2015),[1] the Commonwealth Court issued a decision that balanced statutory and constitutional environmental protections against economic development and deference to collateral branches of government. Specifically, in a 6-1 decision, the Court held that legislation authorizing revenue contributions to the General Assembly’s annual appropriations fund (“General Fund”) from a fund financed by oil and natural gas leases on public lands (“Lease Fund”) executed between the Department of Conservation and Natural Resources (“DCNR”)and various private parties does not violate Article I, Section 27 of the Pennsylvania Constitution (the “Environmental Rights Amendment”). 

The PUC is not required to disclose a utility employee’s “tip letter” or other records relating to an investigation of the utility’s practices where the documents are not considered by the Commissioners when approving the resulting settlement. 

In a 5-2 en banc opinion issued December 22, the Commonwealth Court flatly rejected the notion that a utility must prove “absolute necessity” before resorting to condemnation.  Affirming the PUC’s grant of PPL Electric’s application to exercise its eminent domain power to acquire rights-of-way and easements over the private lands of protestants to construct a new eleven-mile transmission line across the Susquehanna River and a related substation, the Court reaffirmed prior case law adopting an easier hurdle for would-be utility condemnors.  As the Court reasoned:  “Under Protestants’ proposed standard, utilities could only seek approval … when a problem is looming and the resolution is ‘absolutely necessary.’  Utilities would essentially have to wait until an existing system fails before seeking approval of a project.  Not only would this approach be impractical and unrealistic, it would actually pose a danger to the health, safety and welfare of the public.”  Hess v. Pennsylvania Public Utility Commission, 1370 C.D. 2013 (December 22, 2014) (en banc).

In a 4-2 decision,[1] the Pennsylvania Supreme Court upheld a Superior Court decision overturning the trial court and denying Duquesne Light summary judgment on the issue of whether a utility has a duty to warn a customer of potential danger on the customer’s side of the service point where the utility has taken affirmative action to restore service and has actual or constructive knowledge of such danger.  Alderwoods, Inc. v. Duquesne Light Co., No. 12 WAP 2013 (Pa. December 15, 2014).  The case arose from a fire caused by an electrical panel in the basement of Alderwoods’ funeral home after Duquesne restored service to the premises by making substantial repairs to a utility pole downed by a car crash outside the funeral home.   Slip op. at 2. 

Last week on our list of waiver traps for Pennsylvania appellate practitioners (“Taking an Appeal in PA? 10 Waiver Traps to Avoid,” 24 Nov. 2014), we included the warning “be specific enough in your petition for review.”  Fortunately, effective January 1, 2015, that trap has largely disappeared, as the result of yesterday’s amendment to Pa. R.A.P. 1513(d).  That rule, which requires the petitioner from an agency order to include in an appellate petition for review a “general statement of the objections to the order or other determination,” has too often been the basis for a finding of waiver of issues not specifically mentioned, sometimes resulting in the outright quashing of an entire appeal on essentially technical “gotcha” grounds.  The rule as amended retains the requirement for a “general statement of objections,” but adds the important qualification that “the omission of an issue from the statement shall not be the basis for a finding of waiver if the court is able to address the issue based on the certified record.”  The Official Note explains that the purpose of the amendment is to “preclude a finding of waiver” if an issue that is briefed but omitted from the petition for review can be addressed by the court on the basis of the certified record.  In other words, if an issue is otherwise preserved, but overlooked in the petition for review, that fact will no longer be a basis for a finding of waiver.  One less thing to worry about for administrative law practitioners!

A copy of the amendment to Rule 1513 can be found here.

Pennsylvania’s appellate rules and the ever-evolving case law interpreting them can make it a challenge to even get to the merits of an appeal.  Don’t get caught on the wrong side of a waiver trap. Some reminders:

As the PA PUC embarks on its investigation of the natural gas markets, what evidence can we discern about how the agency sees competitive energy markets and how those markets should evolve?

Public Utility Commission (PUC) Commissioners gave Sunoco Pipeline a fighting chance at exemption from local zoning for outbuildings housing utility structures on the Mariner East Pipeline, finding prima facie evidence that Sunoco is a public utility and overruling the ALJs’ July 23, 2014 Initial Decision granting preliminary objections finding to the contrary. 

Sunoco’s proposed Mariner East pipeline that would transport natural gas liquids (NGLs) from Pennsylvania’s rich Marcellus Shale production in Western Pennsylvania to processing plants in southeastern Pennsylvania, received a blow from Pennsylvania Public Utility Commission ALJs on July 23, 2014.

On Thursday, July 24, the Pennsylvania Public Utility Commission decided on a way forward that will allow App-based transportation networking services Uber and Lyft to continue operating in Pittsburgh while the Commission decides whether and how to grant them permanent authority to operate. The Commission granted Emergency Temporary Authority (“ETA”) for the entities to operate experimental transportation networks in Allegheny County and simultaneously granted Commission prosecutorial staff petitions ordering the entities to cease and desist operations.  The net effect is that the Commission has determined on a preliminary basis that Uber and Lyft have been operating illegally (i.e., before their applications to provide transportation service were granted), but has also allowed them to continue operating (in compliance with strict ETA requirements) while their pending applications are being considered by PUC ALJs. Moreover, during their operation under ETA, the Commission directed that the entities maintain insurance higher than the minimum required by the relevant regulations and imposed eligibility restrictions on vehicles that offer transportation service.

In Robinson Township v. Commonwealth, 83 A.3d 901(Pa. 2013) the Pennsylvania Supreme Court invalidated key provisions of Act 13, the statute that removed from local zoning control the power to regulate oil and gas operations through restrictions on the placement and operation of  oil and gas facilities.  The Court remanded to the Commonwealth Court to consider whether other provisions of Act 13, including provisions that give the PUC power to review local zoning ordinances and withhold impact fees, remain viable.

On June 2, the EPA released its much anticipated proposed rule mandating a reduction in carbon emissions from existing power plants.[1]  The rule requires an overall national decrease in carbon emissions by 30% from existing plants by 2030.  The proposed rule instructs states to submit plans to achieve state specific goals for emission reductions.  Alternatively, states may collaborate with other states and submit a joint plan.  Plans must be submitted by 2017, or 2018 if collaborating with other states.[2]

On May 15, 2014, during the Pennsylvania Bar Association’s annual meeting, the PBA’s Administrative Law Section presented the James S. Bowman Award to Kevin J. McKeon of Hawke McKeon & Sniscak, LLP.  The award honors a lawyer who is making a significant impact on the practice of administrative law and who is demonstrating leadership in mentoring administrative law practitioners.  McKeon regularly represents clients before the Pennsylvania Public Utility Commission and the Federal Energy Regulatory Commission, and also serves as lead counsel on significant cases before Pennsylvania’s appellate courts and the federal circuit courts of appeal. He serves on the Pennsylvania Supreme Court’s Appellate Court Procedural Rules Committee, is a co-author of Pennsylvania Appellate Practice, and is a frequent lecturer on topics in administrative law and appellate procedure.   The award is named for the late Honorable James S. Bowman, the first President Judge of the Commonwealth Court of Pennsylvania,   whose comprehensive knowledge of administrative law, government law and appellate procedure was widely recognized and respected.

The Pennsylvania Public Utility Commission (“Commission”), which regulates moving companies, is reviewing comments to proposed rules that would make it easier for movers to obtain authority to commence operations in Pennsylvania.  In its September 12, 2013 Proposed Rulemaking, the Commission recommended revisions to the evidentiary criteria applicable to moving company applicants.  As reported in an earlier blog post on this site, the revisions recommended by the Commission would significantly ease entry barriers for new applicants, thereby encouraging more entrants and creating increased competition within Pennsylvania.