PUC ALJ Limits Ability of Potential Competitors To Protest NGDC Service Territory Application

Does a natural gas company that is not currently authorized to provide service in a  territory, but with  future plans to file for such authorization,  have standing to contest another gas company’s application to provide service in that same territory?  This issue was addressed in an Initial Decision by ALJ David A. Salapa, who answered it in the negative.  Application of Leatherstocking Gas Co., L.L.C. for Approval To Supply Natural Gas Service to the Public, A-2011-2275595 (Initial Decision, issued March 20, 2012).

The Leatherstocking Application case presented a number of unique factual and procedural twists.  Leatherstocking filed its application to provide natural gas service in unserved portions of northeastern Pennsylvania on November 23, 2011.  On December 27, 2100, the deadline set for filing Protests, UGI Penn Natural Gas, Inc. (UGI Penn) filed a protest, stating that it had been engaged in market development in these same territories and intended to file its own application to provide service in the near future.  On January 17, Leatherstocking filed Preliminary Objections claiming that UGI Penn lacked standing at the time it filed its Protest.  On January 18, UGI Penn filed an Application to provide service in that territory, and then filed an Amended Protest claiming that its amended pleading rendered Leatherstocking’s preliminary objections moot under 52 Pa Code  Sec. 5.91(b).  UGI Penn claimed that its application gave it a direct and substantial interest in Leatherstocking application proceeding.  Leatherstocking then filed preliminary objections to the Amended Protest.

ALJ Salapa first noted that matters of standing are properly raised via a motion for summary judgment,  and elected to  treat Leatherstocking’s filing as such a motion.  He then addressed whether UGI Penn had standing to file its initial Protest, and found that it did not.  “A protestant must have some operating authority in actual, or potential conflict with the authority sought by an application to have the requisite standing to protest an application.”  I.D. at 11.  At the time it filed its Protest, UGI Penn had no certificate of public convenience authorizing it to serve the proposed service territory; therefore, it lacked standing.

ALJ Salapa then proceeded to consider whether or not UGI Penn’s subsequent  filing  of its application for service and amended protest  rendered Leatherstocking’s Protest moot, pursuant to 52 Pa Code §5.91(b).  Section 5.91(b)  permits filing of an amended pleading “as of course” and renders preliminary objections to the initial pleading “moot.”    ALJ Salapa interpreted §5.91(b) as applying to preliminary objections alleging insufficient specificity, and providing that only amendments filed “as of course” in response to such preliminary objections would render those objections moot.  He concluded that permitting amendment “as of course” in this proceeding would permit UGI Penn to circumvent the time limits on Protests.  Because the amended protest in this instance was filed long after the deadline set by the Commission, it was late-filed.

Finally, ALJ Salapa considered whether he should, as a discretionary matter, accept UGI Penn’s amended late-filed protest.  He concluded that UGI Penn had not met the standards set by the Commission for a late-filed protest.  Left open for another day is whether UGI Penn would have had standing under late-filed amended protest ,which alleged standing as an applicant to serve the same territory.

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