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Case No. PUC Docket No. 34298
Regular Panel Decision

Coastal Habitat Alliance v. Public Utility Commission

Justice Jan P. Patterson writes a concurring and dissenting opinion regarding the majority's decision to affirm the district court's granting of pleas to the jurisdiction in a case involving the Public Utility Commission and AEP Texas Central Company. The dissent argues that the Coastal Habitat Alliance, despite being a non-party, possesses an independent right to judicial review of the Commission's final order under the Administrative Procedure Act (APA), citing Mega Child Care. Justice Patterson asserts that the Public Utility Regulatory Act (PURA) does not prohibit such non-party review and that the Alliance has exhausted its administrative remedies. The opinion concurs with the majority on the proper dismissal of claims brought under the Uniform Declaratory Judgment Act (UDJA) and constitutional due process grounds but disputes the majority's stance on mandamus review for the Commission's discretionary denial of intervention. The dissent would reverse the district court's order in part and remand for further proceedings.

Administrative Procedure ActJudicial ReviewPlea to the JurisdictionPublic Utility CommissionNon-Party InterventionExhaustion of Administrative RemediesDue ProcessWrit of MandamusStatutory InterpretationTexas Law
References
36
Case No. 03-11-00072-CV
Regular Panel Decision
Aug 06, 2014

State of Texas' Agencies and Institutions of Higher Learning Office of Public Utility Counsel Steering Committee of Cities Served by Oncor Oncor Electric Delivery Company, LLC// Public Utility Commission of Texas v. Public Utility Commission of Texas Office of Public Utility Counsel Steering Committee of Cities Served by Oncor// State of Texas' Agencies and Institutions of Higher Learning Steering Committee

This case is an administrative appeal concerning a final order from the Public Utility Commission (PUC) that increased rates for Oncor Electric Delivery Company, LLC. The Texas Court of Appeals, Third District, at Austin, reviewed the district court's judgment on various regulatory and financial issues. The appellate court affirmed the district court's judgment on eight of twelve issues but reversed and remanded four issues back to the Commission for further proceedings. These reversed issues included the university discount, municipal franchise-fee expenses, the calculation of 'lead days' for the franchise-tax component of cash working capital, and the federal income-tax expense. The court's decision hinged on statutory interpretation and the application of regulatory standards in the context of utility ratemaking.

Electric Utility RegulationRate IncreaseAdministrative LawAppellate ReviewTexas Public Utility CommissionOncor Electric Delivery CompanyState Universities DiscountFranchise TaxFederal Income Tax ExpenseAutomated Metering Systems
References
110
Case No. 03-02-00246-CV
Regular Panel Decision
Aug 26, 2004

Reliant Energy, Incorporated Office of Public Utility Counsel And Gulf Coast Coalition of Cities/Magic Valley Electric Cooperative, Inc. Medina Electric Cooperative, Inc. Rayburn Country Electric Cooperative, Inc. And City of Bryan v. Public Utility Commission of Texas Consumer Owned Power Systems City of Houston Texas Industrial Energy Consumers State of Texas And Constellation NewEnergy, Inc./Public Utility Commission of Texas And Reliant Energy, Incorporated

This case concerns appeals from a district court's judgment affirming a Public Utility Commission (PUC) final order that set cost-of-service rates for Reliant Energy, Inc.'s transmission and distribution utility (TDU). Appellants, including Reliant Energy, Office of Public Utility Counsel, and various consumer groups, challenged the PUC's decisions on rate base calculations, return on equity, and operational expenses. The district court had largely affirmed the PUC's order, finding only one aspect to be a prohibited advisory opinion. The Court of Appeals, Third District, At Austin, reversed the district court's judgment regarding the inclusion of $107.3 million for the interconnection of Merchant Plant 4, citing a lack of substantial evidence. In all other respects, the Court of Appeals affirmed the district court's judgment and remanded the Merchant Plant 4 issue to the Commission for further proceedings.

Utility RegulationElectricity RatesPublic Utility CommissionCost-of-ServiceRate BaseReturn on EquityConsolidated Tax SavingsTransmission and Distribution UtilityAppellate ReviewAdministrative Law
References
38
Case No. 03-03-00428-CV
Regular Panel Decision
Sep 23, 2005

Cities of Corpus Christi, Appellants//AEP Texas Central Company Public Utility Commission of Texas And Constellation New Energy, Inc. v. Public Utility Commission of Texas and AEP Texas Central Company, Appellees//Public Utility Commission of Texas Cities of Corpus Christi Office of Public Utility Counsel And Constellation NewEnergy, Inc.

This dissenting opinion addresses an appeal regarding the Public Utility Commission's authority to order AEP Texas Central Company to refund excess earnings from accelerated recovery of stranded costs. The dissenting Justice agrees with the majority on affirming the Commission's decisions concerning member account balances and demand charges. However, the dissent strongly contends that the Commission possessed the authority to mandate these refunds prior to 2004, arguing the statutory scheme was ambiguous and the Commission's action was a reasonable interpretation consistent with its duties to promote fair competition and prevent overrecovery. The dissent highlights that the majority's interpretation may lead to absurd results by limiting the Commission's ability to correct overrecovery while allowing it to address underrecovery.

Electricity DeregulationStranded CostsUtility RegulationPublic Utility CommissionRegulatory AuthorityExcess EarningsRefundsCompetitive MarketTexas Utility CodeAdministrative Law
References
12
Case No. 03-01-00400-CV
Regular Panel Decision
Apr 11, 2002

Richard Wallace Pearce and Jesse Ray Blann v. City of Round Rock Round Rock Development Review Board Frank Del Castillo, in His Capacity as Member of the Round Rock Development Review Board Terry Hagood, in His Capacity as Member of the Round Rock Development Review Board

Appellants Richard Wallace Pearce and Jesse Ray Blann appealed the district court's judgment affirming the Round Rock Development Review Board's denial of their permit applications for seven outdoor advertising structures. The core issue was whether the structures qualified as 'signs' and were entitled to non-conforming use status under the City's ordinance, which became effective February 27, 1997. The Court of Appeals held that four of the structures were 'signs' due to having a surface capable of displaying text, despite not yet having advertising affixed, and were therefore entitled to non-conforming use. The court reversed and remanded the Board's decisions regarding these four structures. However, it affirmed the district court's judgment for the remaining three structures, which lacked such a surface, and also upheld the constitutionality of the City's sign ordinance against a takings claim.

ZoningOutdoor AdvertisingNon-conforming UsePermit DenialExtraterritorial JurisdictionAbuse of DiscretionStatutory InterpretationMunicipal OrdinanceTexas Court of AppealsProperty Rights
References
30
Case No. MISSING
Regular Panel Decision

AEP Texas Central Co. v. Public Utility Commission

This appeal challenges a final order of the Public Utility Commission (PUC) in a true-up proceeding under Chapter 39 of the Utilities Code, concerning stranded costs and other true-up amounts. AEP Texas Central Co. and its affiliate CPL Retail Energy initiated the proceeding, with the State of Texas and various consumer interests intervening. The Supreme Court of Texas reviewed the PUC's decisions on market value, net book value (NBV), and the capacity auction true-up. The Court affirmed the PUC's use of the sale of assets method for nuclear assets and upheld the inclusion of excess mitigation credits and construction work in progress in NBV. Furthermore, the Court confirmed the PUC's authority to adjust NBV for commercially unreasonable conduct, even when market value is determined by asset sale, and found the specific adjustments supported by substantial evidence. However, the Court reversed the lower court's judgment regarding the capacity auction true-up, instructing the PUC to recalculate it based on actual auction prices, and remanded the case for further proceedings.

Public Utility CommissionTrue-up ProceedingStranded CostsMarket ValueNet Book ValueCapacity AuctionUtilities CodeTexas LawCommercial ReasonablenessExcess Mitigation Credits
References
15
Case No. 03-14-00340-CV
Regular Panel Decision
May 08, 2015

CPS Energy, Time Warner Cable Texas LLC, and Southwestern Bell Telephone Company D/B/A AT&T// Public Utility Commission of Texas v. Public Utility Commission of Texas// Cross-Appellee, CPS Energy, Time Warner Cable Texas LLC and Southwestern Bell Telephone Company D/B/A AT&T

This brief argues that the Public Utility Commission (Commission) erroneously issued an advisory opinion concerning amendments to federal regulations (47 C.F.R. 1.1409(e)) that took effect after the relevant billing period of 2005-2010. CPS Energy contends that these findings were premature, advisory, and beyond the Commission's jurisdictional scope. Additionally, CPS Energy asserts that the Commission's interpretation of Utilities Code § 54.204(c) constitutes an unconstitutional delegation of power to a federal agency. The brief urges the Third Court of Appeals to reverse the Commission's contested findings (Findings of Fact 84-87 and Conclusions of Law 26 and 27) and remand the case for an order consistent with the court's opinion.

JurisdictionAdvisory OpinionPole Attachment RatesFederal Communications CommissionPublic Utility CommissionAdministrative LawStatutory InterpretationUnconstitutional DelegationRipenessAppellate Procedure
References
84
Case No. 03-08-00205-CV
Regular Panel Decision
Jul 08, 2009

Coastal Habitat Alliance v. Public Utility Commission of Texas Barry T. Smitherman, Chairman Kenneth W. Anderson, Jr., Commissioner Donna L. Nelson, Commissioner Texas Gulf Wind LLC PPM Energy, Inc. And AEP TCC

Justice Jan P. Patterson delivers a concurring and dissenting opinion, arguing that Coastal Habitat Alliance, a non-party, possesses an independent right to judicial review of the Public Utility Commission's final order under the Administrative Procedure Act (APA). The dissent contends that the Public Utility Regulatory Act (PURA) is silent regarding judicial review for non-parties, thereby permitting APA review. Justice Patterson asserts that the Alliance met administrative exhaustion requirements by filing a motion for reconsideration, thus obviating the need for a redundant motion for rehearing as a non-party. While concurring with the majority on the dismissal of claims under the UDJA and the absence of a vested property right for due process claims, the dissent challenges the suggestion that the Commission's denial of intervention is exclusively reviewable by mandamus, citing its inconsistency with the nature of discretionary acts and the exhaustion doctrine.

Administrative Procedure ActPublic Utility Regulatory ActJudicial ReviewExhaustion of Administrative RemediesMandamusDue ProcessInterventionConcurring and Dissenting OpinionTexas Court of AppealsSubject Matter Jurisdiction
References
42
Case No. 03-01-00195-CV
Regular Panel Decision
Nov 15, 2001

Reliant Energy, Incorporated v. Public Utility Commission of Texas Office of Public Utility Counsel And Steering Committees for the Cities Served by TXU Electric and Central Power and Light Company

This case involves a direct appeal where Reliant Energy, Incorporated (Appellant) challenged the Public Utility Commission of Texas's (the Commission) price-to-beat rules. Reliant argued that these rules failed to ensure an initial fuel factor above market costs and that the Commission erred in excluding Provider of Last Resort (POLR) customers from market share calculations. Additionally, Reliant contended that the Commission's rule 25.41 violated the reasoned justification requirement of the Texas Government Code. The Court of Appeals, Third District, at Austin, upheld the price-to-beat regulations, concluding that the Commission acted within its authorized powers, and its decisions regarding the fuel factor, POLR customers, and reasoned justification were valid and consistent with the legislative intent to balance fostering competition and providing customer rate reductions during the transition to a competitive electricity market.

Electricity MarketDeregulationPublic Utility CommissionPrice-to-Beat RulesFuel FactorRetail Electric ProvidersMarket CompetitionAdministrative LawReasoned JustificationStatutory Interpretation
References
55
Case No. 03-14-00735-CV
Regular Panel Decision
Apr 30, 2015

Entergy Texas, Inc.// Office of Public Utility Counsel and Public Utility Commission of Texas v. Public Utility Commission of Texas and Texas Industrial Energy Consumers// Office of Public Utility Counsel and Entergy Texas, Inc.

The Commission’s Order should be affirmed. The Commission reasonably interpreted its prior rate-case order, the Black-box Order, to authorize Entergy to book and amortize a regulatory asset for unrecovered Hurricane Rita reconstruction costs. The Black-box Order was ambiguous concerning the Rita Asset. That order was based on a “black box” settlement—one where only the amount of rates to be collected was set forth, not all of the individual components of a rate case. Because the Black-box Order did not explicitly state whether booking and amortizing the regulatory asset had been authorized, it was ambiguous. Courts defer to an agency’s interpretation of its prior, ambiguous order, and the evidence in the record supports the Commission’s decision. Substantial evidence supports the Commission’s decision that $13 million should be added to Entergy’s storm reserve based on the expenses Entergy incurred to repair equipment after a severe ice storm in 1997. A prior Commission decision that faulted Entergy for poor service quality did not amount to a finding that Entergy could not include the repair costs in the insurance reserve amount. Substantial evidence supports the Commission’s decision that Entergy failed to meet its burden to prove that predicted purchased-power capacity costs were known-and-measurable changes to the test-year data. The record supports the Commission’s decision that Entergy did not meet its burden of proving that requested changes were known and measurable. For example, Entergy based its arguments about purchasing capacity on the assumption that it would always purchase the maximum amount under new contracts. Entergy claimed that it would have more customers in the future. Not only is that speculative, but the utility failed to account for how additional customers would otherwise affect its recovery through rates. And Entergy’s arguments about transmission charges are controlled by numerous unknown variables used in a complex formula. The Commission’s test-year rule is created to avoid just such unknowns. Moreover, most of Entergy’s request for post-test-year changes to transmission costs were based on an agreement that was still waiting for approval from the Federal Energy Regulatory Commission. That is patently not a “known” change. Because substantial evidence supports the Commission’s decisions, the Order should be affirmed.

Utility RegulationRate CasePublic Utility CommissionAppellate BriefHurricane Rita CostsRegulatory AssetStorm Damage ReservePurchased Power CapacityTransmission EqualizationAdministrative Law
References
24
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