174 Pa. Super. 438 | Pa. Super. Ct. | 1954
Opinion by
These appeals are from an order of the Pennsylvania Public Utility Commission of August 12, 1952. This order denied petitions for rehearing in the proceeding in which the Commission by order dated February 14, 1951, found a fuel adjustment clause of the Pennsylvania Power and Light Company to be unreasonable' and ordered its modification; and it amended
The tariff supplements of the Power Company providing for the application of the first fuel adjustment clause were filed on December 11, 1947, to become effective February 10, 1948. ■ It was estimated that, approximately one thousand industrial consumers would have their bills' increased on an average of 7.94 per cent. Numerous complaints were filed by such com sumers against these supplements prior, to their ■ effective date. The. Commission did not suspend and consequently they became effective February 10, 1948. As originally filed the tariff supplements, relating to large industrial consumers, made the fuel adjustment clause applicable only to monthly consumption exceeding 15,-000 kilowatt hours. By supplements to become effective April 29, 1949, the exemption of 15,000 kilowatt hours per month was removed as to all consumers whose bills were calculated from the tariffs subject to the fuel adjustment clause.
The Commission held • hearings between May 11, 1948, and November 29, 1949, with respect-.to the complaints. On February 14, 1951, the Commission entered an order in which it found that the fuel adjustment clause had not produced an excessive return to the Power Company, and that as a fuel clause it was not unlawfully discriminatory. The Commission, however, made the further finding: “. . . that the clause itself is unreasonable, as a rate for electric service, in that it is being applied to all energy delivered- to customers to whom the clause is applicable, including hydraulic generation and purchased and interchange energy and that it does not make adequate provision
The several appeals in the statements of questions involved raise two primary issues: (1) Did the Commission have power to order refunds, and (2) if so, was the refund period designated by the Commission lawful and proper. As to the first issue, the Power Company concedes that the Commission had power to modify the fuel adjustment clause. But it argues that the Commission had no authority in law to order any refunds based on modifications of the clause alone; and that the Commission’s refund order is illegal and unfair, and deprives the Power Company of its property without due process of law. As to the second issue, the consumer-appellants contend that, since the Commission found the fuel adjustment clause unreasonable, it was mandatory for the Commission to allow refunds to the consumers from February 10, 1948. This was the date on which the fuel clause became effective, complaints having been made prior to the effective date.
The Commission’s finding in its order of February 14, 1951, that the fuel clause was unreasonable in that
Section 313 (a) of the Public Utility Law of 1937, 66 PS §1153, provides as follows : “If, in any proceeding involving rates, the commission shall determine that any rate- received by a public utility was unjust or unreasonable, or was in violation of any regulation or order of the commission, or was in excess of the applicable rate contained in an existing and effective tariff of such public utility, the commission shall have the power and authority to make an order requiring the public utility to refund the amount of any excess paid by any patron, in consequence of such unlawful collection, within two years prior to the date of the filing of the complaint, together with interest at the legal rate from the date of each such excessive payment. In making a determination under this section, the commission need not find that the rate complained of was extortionate or oppressive. Any order of the commission awarding a refund shall be made for and on behalf of all patrons subject to the same rate of the public utility. The commission shall state in any refund order the exact amount to be paid, the reasonable time within which payment shall be made, and shall make findings upon pertinent questions of fact. An appeal may be taken to the Superior Court from any refund order, but if no such appeal is taken, the parties shall be bound by the findings and orders of the commission.”
“[The Power Company’s] Fuel Adjustment Clause cannot be considered as properly applicable to costs other than fuel. Wages, materials'- and supplies' as stated by [the PoAvef Company] to be a portion of ‘production costs’ cannot'be deemed to'be within -the scope of the fuel adjustment clause!
*446 “The clause itself refers to fuel ‘on hand and delivered at the Company’s electric generating plants.’ Further, the fuel adjustment clause uses as a base the average system cost of fuel at its steam generating plants . . . Application of the Fuel Adjustment Clause now before us must be restricted wholly to the established increased or decreased cost of the fuel itself ‘on hand and delivered at the Company’s generating plants.’ ”
Whether the clause operated reasonably or unreasonably in effecting its limited purpose was like most questions dealing with the refinements of rate structures primarily a factual matter for determination by the Commission. The Power Company itself does not challenge the Commission’s finding of unreasonableness.
It is argued on behalf of the Power Company that, the Commission having found the fuel clause did not produce an excessive return on fair value and was not discriminatory between classes of consumers, the finding of unreasonableness cannot be the basis of any refunds under section 313 (a). The basis of the finding of unreasonableness is that the Power Company could recover from the affected consumers under the fuel clause more than the bare cost of fuel. The basic rates in the tariffs are not in issue in this proceeding. The Power Company inserted in its tariffs the fuel adjustment clause in question for a limited and specific purpose. The Commission' found that the fuel clause operated to permit the utility to récover from consumers subject to it more than the actual increase in fuel costs. The Commission having found the. clause unreasonable in this respect could make the “excess,” under, the terms of the statute, the subject .of refunds. The fact that the fuel clause contained, er. dealt with a variable did not prevent the Commission from mak
We are not concerned in the present appeals with the Power Company’s fair value or the fair return thereon, but rather with a supplementary arrangement in the rate structure under which one class of consumers has paid an excess which is properly subject to a refund order under the Act. We are of the opinion that the refund order as such is proper and lawful, and consequently no question of unconstitutional confiscation of the property of the utility is involved. An inadequate basic rate structure may produce confiscation but not a fuel clause intended to equitably adjust a variable item of cost to be reflected in the billings for kilowatt hours sold to the affected consumers. .
In this connection the Power Company places much reliance upon an order of the Commission of July 30, 1952, at C. D. 15559, etc., in which the Commission allowed the Power Company a rate increase amounting to approximately $3,000,000 applicable to industrial consumers of the type subject to the fuel clause. These new rate schedules in the tariff supplements to be filed by the Power Company by September 12, 1952, did not become effective, however, under the order of July 30,1952, until subsequent to August 12, 1952. The proceeding involving such tariffs with increases and adjustments was a complete rate case in which the Commission using the base figures for the year ending October 31, 1951, made a finding of fair value of the Power Company’s property used and useful in the public service, together: with all the subsidiary findings .nee-
Was-it proper for the Commission to limit the refunds to be allowed to the period from February 19, 1951, to August 12, 1952? The industrial consumer-appellants contend that, since the Commission found the fuel clause improper on February -14, Í951, payments under such defective clause were excessive from February 10■, 1948, the date of -its inception, and that
The Commission permitted the effect of the fuel clause as revised by its order of February 14, 1951, to be stayed pending disposition of the Power Company’s petition for rehearing. This did not prevent the Commission from ruling eventually against the Power Company and awarding refunds based on its failure to make effective the prescribed revision of the fuel clause. The stay was granted at the request of the utility, which ran the risk of persuading the Commission to alter its ruling relative to the application of the fuel clause which was the basis of the refund order. Cf. Pennsylvania Railroad Company v. Public Service Commission, 125 Pa. Superior Ct. 558, 568, 190 A. 367.
The order of the Commission of August 12, 1952, is affirmed.
Fixed efficiency factors were provided in tbe fuel adjustment clause as filed by tbe Power Company.