State Ex Rel. AG Processing v. Public Service Commission
2011 Mo. App. LEXIS 238
| Mo. Ct. App. | 2011Background
- KCP & L filed a December 30, 2008 tariff to adjust rates under its Fuel Adjustment Clause (FAC) approved in a prior rate case.
- FAC allows 95% pass-through of increases/decreases in fuel and purchased-power costs to customers, with six-month accumulation periods and a twelve-month recovery period.
- The proposed 2009 rate adjustment reflected higher fuel costs from June 2008 through November 2008; approval was sought for March 1, 2009 implementation.
- AG Processing and Sedalia Industrial Energy Users' Association challenged the tariff as unconstitutional retroactive ratemaking; PSC denied the motion to reject and approved the tariff.
- Circuit court affirmed; appellants, with Office of Public Counsel, appeal challenging retroactive ratemaking; the court reviews PSC orders, not circuit court judgments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FAC rate adjustment constitutes retroactive ratemaking | AG Processing: retroactive ratemaking | KCP & L: FAC authorized by statute | Not retroactive ratemaking |
| Whether §386.266 authorizes FACs without violating filed-rate doctrine | AG Processing: doctrine violated | KCP & L: statute permits adjustments outside rate cases | Authorized by statute; lawful practice |
Key Cases Cited
- State ex rel. Util. Consumers' Council of Mo., Inc. v. Pub. Serv. Comm'n, 585 S.W.2d 41 (Mo. banc 1979) (retroactive ratemaking doctrine and filed-rate principles)
- State ex rel. AG Processing, Inc. v. Pub. Serv. Comm'n, 311 S.W.3d 361 (Mo. App. W.D. 2010) (FAC applicability and recovery timelines under FAC scheme)
- State ex rel. Aquila, Inc. v. Pub. Serv. Comm'n, 326 S.W.3d 20 (Mo. App. W.D. 2010) (FAC framework and review of tariff approvals)
- State ex rel. Mo. Gas Energy v. Pub. Serv. Comm'n, 210 S.W.3d 330 (Mo. App. W.D. 2006) (past costs and future rates differentiation in adjustments)
- State ex rel. Midwest Gas Users' Ass'n v. Pub. Serv. Comm'n, 976 S.W.2d 470 (Mo. App. W.D. 1998) (adjustments apply to future bills, not past customers)