*1 of, CWDS, amplification a mere
GWDS, recovery attorney’s allows- expenses, and the court did
fees trial assessment, attorney’s fees
not err litigation- Accordingly, expenses. we
affirm the court’s order. trial
Affirmed. J., J.,
Najam, Bailey, concur. GROUP,
NIPSCO INDUSTRIAL
Appellant-Intervenor,
v. INDIANA PUBLIC
NORTHERN COMPANY,
SERVICE
Appellee-Petitioner. Appeals No.
Court Case
93A02-1607-EX-1644 of Appeals
Court of Indiana.
Filed June
Attorneys Appellant: A. Todd Rich- ardson, Joseph P. Terry, W. Jennifer P.C., Kappes, Indianapo- Lewis Rómpala, lis, Indiana Paul, Attorneys Brian J. Appellee: Pulliam, Faegre Baker Daniels E. Daniel Indiana, LLP, J. Indianapolis, Claudia Earle, Earls, C. NiSource Christopher trackers, including charge eral a fuel Services-Legal, Indianapolis, Corporate tracker, qualified pollution a tracker Indiana construction, control Kirsch, Judge. costs, federally mandated *3 (“Indus energy projects. tracker for clean Group NIPSCO Industrial Assembly Indiana Group”) appeals the decision the General enacted trial 8-1-39, utility Utility Regulatory chapter Commission which allows Indiana Code (“the Commission”) North pro- for a tracker for certain petition to Company’s gas Public or posed replacement ern Indiana Service new or electric (“NIPSCO”) distribution, petition plan update, transmission, for a storage pro- 8-1-39-9, pursuant to Indiana section jects. Code is to as the The statute referred previously Commission-approved to 7- its “TDSIC” statute. year is plan. Group Industrial raises two statute, utility Under the TDSIC sues, as: we consolidate and restate which pursuant approval 7-year plan, seeks of a approv Commission erred in
whether the (“Section to Indiana Code section 8-1-39-10 petition plan update, for ing NIPSCO’s 10”), designates improvements improvements finding categories certain transmission, distribution, storage sys and transmission, eligible be treated as as If tems. the Commission determines distribution, storage improve system and reasonable, 7-year plan is reflects the (“TDSIC”) In charges ment because improve estimate of costs of the best Group dustrial claims ments, improve demonstrates within the identified required for public are convenience ments enough specificity. with necessity, and and shows affirm.
We cost-justified, improvements are then the History and Procedural approves desig Facts and nates the for gas and public NIPSCO is a electric § Ind. Code TDSIC treatment. 8-1-39- utility that services customers northern 10(b). 7-year plan approved, After the is owns, operates, manages, and and Indiana occur, periodic proceedings tracker plants equipment controls in Indiana and pursuant to Indiana section 8-1-39-9 Code transmission, generation, used dis (“Section 9”), adjustments rate allow tribution, gas furnishing utility ser specific projects they completed. are public. provides gas vice to the petitions include an These should 821,000 resi utility service to more than 7-year plan, any costs that exceed dential, commercial, and industrial custom expenditures and TDSIC ers northern Indiana. Industrial “specific justification costs comprised of group is a some NIPSCO’s public utility specific approval by largest industrial customers. being before authorized [Commission utility charges The rates a its recovery rates.” in customer Ind. Code traditionally adjusted are customers § 8-1-39-9®. cases, through are ex periodic rate which 3, 2013; On October NIPSCO filed consuming, comprehen pensive, time petition seeking approval way under Section Another to set sive. rates 7-year plan gas system, of its for its which proceedings, which allow smaller improvement projects to trans specific projects costs increases mission, distribution, storage systems. general proceedings. between rate case approved the 7- Assembly By has sev- General authorized issued, cost After plan and found that NIPSCO’s the Electric Decision was year it impacted filings for the were reason- estimates Group appealed gas systems, the Com- its able. Industrial NIPSCO moved dismiss approving 7-year plan, system gas its TDSIC-2 its with mission’s motion, Group’s understanding that it request on own would but prejudice expenditures appeal dismissed recover the costs covered 23,2014. September peti- third tracker (“TDSIC-3”), tion and the trial court dis- 28, 2014, August filed On prejudice. missed TDSIC-2 without gas system, for its its first tracker 31, 2015, updates August sought approval which the 7- NIPSCO filed On TDSIC-3, including sought which plan, again actual and year *4 7-year plan of its capital expenditures updated and TDSIC costs that and included in proposed capital the the actual and ex exceeded amounts estimated that original 7-year petition penditures NIPSCO’s and TDSIC costs exceeded plan. those in In capital the estimated costs for amounts TDSIC-1. projected million, TDSIC-3, sought provide 7-year plan be which the NIPSCO $862.2 specificity respect pro of million over the more with was an increase $149.1 in petition jects project groups This in the original plan. was contained Commission, including response to the Electric Decision. In its petition, methodology order.approving for cal TDSIC-3 NIPSCO’s that, on adjustment. Commission found based the Elec culating the TDSIC in Nipsco Group, tric Decision pe filed its second tracker NIPSCO requires 7-year plan of a a find (“TDSIC-2”) on February tition in the ing proposed projects that the an the Commission issued Before enough contain detail for the Commission TDSIC-2, of panel a this court issued a projects to determine meet appeal electric decision NIPSCO’s Appel eligible improvements. definition (“the 7-year plan Electric De TDSIC case App. lant’s at 159. The Commission also cision”), in Commission’s order which the presented recognized TDSIC-3 a part, part, reversed affirmed was - although “unique situation” to the Commission. See NIP remanded NIP- previously approved Commission had Co., Grp. v. N. Ind. Pub. Serv. SCO Indus. Decision 7-year plan, the Electric SCO’s (Ind. 2015). Ct. This 31 N.E.3d proper such approval showed that was 7-year plan for court held Thus, Id. the Commis under the statute. its electric TDSIC sufficient detail lacked that, a making while sion found for the Commission to determine whether it was re -Section determination years through for two “NIPSCO’s quired to confirm that NIPSCO had shown or to determine a seven was ‘reasonable’ to find information sufficient improve of the ‘best estimate cost’ to be projects contained TDSIC-3 ments.” Id. at 8. The court-also found Id. eligible improvements. for impermissible it was the Commission “ order, also In its ‘presumption eligibility’ a establish projects years statutory “update” term regarding interpreted the undefined justify explain pre a NIPSCO two seven” because such for eligible estimates changes bur to the cost sumption “inappropriately shifts the had project’s eligibility showing den of 160. The Com- treatment from NIPSCO.” Id. at 9. approved. previously that, light mission of the Electric in the TDSIC-3 The TDSIC-4 found Decision, it presumpr provided greater had to detail reevaluate than projects proposed tion that years including project three previous petitions, .esti- estimates, seven of the mates, summary could be of unit cost presumed eligible, determined multiple project supporting and.it unit lists presented detail had sufficient documentation, project re- change regarding project descriptions cost es- quests. . concerning timates for those ma- updated plan changes The jority projects groups. projects and projects made to slated for 2015 and 2016 at 163. In TDSIC-3, sought to actual costs associated with provide more specificity respect plan. Specifical across the entire project in the contained ly, updated 7-year plan differ groups response to the Electric Deci- types ent in various sion. the Commis- single multiple unit and with both provided sion found that NIPSCO had as- projects. identifying certainable generally category described specific improvements selecting projects that an smaller NIPSCO cannot undertake will *5 Tr, 25, ticipate 164, exactly. example, at As an groups. Id. at The also Commission pipes has of NIPSCO thousands that are provided that determined had NIPSCO annually inspected, and when leaks are explanation for sufficient detail and the discovered, they may unexpected re need changes in of cost the estimated placement. Id. Although is known improvements updated included in the 7- projects replace which exact will need year plan, sufficiently had demonstrated ment, on history, it based that a public that known necessity convenience re- percentage projects certain of the fail quired will im- would The provements, year. multiple projects each and had shown that the incre- (1) plan justified of mental benefits the were three a ways: specified listed costs. Id. list, at 170-72. The TDSIC-3 specific order asset which included the as (2) of “project groups,” the use year; sets be each a list addressed some projects which “identified” included inspection projects; remediation “yet projects and other (3) identified” projects be prioritized other that were “provided and found ascer- that NIPSCO through alternative Appellant’s means. planning for' identifying criteria tainable App. at register 17. asset An was included selecting specific and- improvements appendix, projects an which as listed all project it' will undertake these subject to inspection were and could at 163-64. Industrial groups.” Group Tr. years. be addressed few next did not appeal the order. TDSIC-3 inspection The list remediation prioritized were based on United its fourth filed tracker Department Transportation (“TDSIC-4”) 29, States February on' (“DOT”)-mandated inspections. Ap annual which was before the Commission pellant’s App, on on at 17..Based issued results order TDSIC-3 inspection, of an petition, In the NIPSCO would schedule sought TDSIC-4 could, risk, mitigate actions to in 7-year plan, of an which which again replacement. actual proposed esti clude TDSIC-4 contained expenditures capital greater descrip mated than TDSIC-3 and TDSIC detail fts costs that exceeded the project groups amounts tion was consis- than, with, improvements tent and more detailed were not identified with ascertainable had particularity sought and because NIPSCO - previously approved by the Commis identify specific projects year by year been updates sion in TDSIC-3. Ex. pursuant to Sec- Non-Confidential II at tion 9 identifying 89-90. instead of Vol. 7-year plan. also issued an incorrectly claims approving the TDSIC-4 June granted designation eligibility to the order, 2016. In the the Com TDSIC-4 project categories, even that,
mission- reasoned though in these specific in not discuss what be statute does would be identified until in a Section 9 and what cluded filings later under Section 9. Industrial required, was would follow its review Group further asserts that the Commis- up findings in TDSIC-3 that Section sion’s which million $20 any dates “should include a discussion of costs, increase erroneously allowed changes eligible improvement’s in an best scope expand cost, necessity, estimate and associated plan to add identi- upon incremental benefits which Com original 7-year plan pursu- fied filed approve based its mission determination ant to Section 10. Appel Plan as reasonable.” [the] App. at The Commission ac lant's The Commission creat knowledged updated plan that the reclassi by Assembly primarily ed General and identified fied additional fact-finding body exper with the technical fit into the been groups had tise to regulatory administer the scheme in. having sufficient legislature. devised N. Ind. Pub. *6 Id. 33. ly planning criteria. ascertainable at Corp., Serv. Co. v. U.S. Steel N.E.2d 907 1012, 1015(Ind. 2009); The that NIP- § Commission determined Code 8-1-1-5. Ind. multiple project groups assignment SCO’s and The to ensure Commission’s is constant, categories by suffi project supported provide were utilities reli public able, for cient ascertainable and efficient to citizens service identifying specific Nipsco Grp., im Indiana. Indus. 31 N.E.3d at selecting only pow 5. can to and the re The Commission exercise provements be undertaken Id. upon by er conferred “Its classification identification statute. and further authority implicit powers replacements or asset within also ‘includes necessary statutory regu project and consis effectuate groups was reasonable ” latory (quoting Id. at scheme.’ Id. United tent with the TDSIC-3 order. 33-34. Co., Inc. Gas Gypsum, States v. Ind. 735 the TDSIC-4 Commission (Ind. 2000)). 790, Any updated 7-year plan the N.E.2d 795 doubts statutory regarding the Commission’s au cost increases contained in the Group appeals. thority must be resolved the exis against Industrial now authority. Corp. tence of such U.S. Steel v. Discussion and Decision Co., 542, N. 951 Ind. Serv. N.E.2d Pub. argues Industrial 2011), (Ind. 550 trans. denied. Ct. approving NIPSCO’s Commission erred the Commis Group con An order of petition. Industrial to deter erroneously ap subject appellate sion is tends that the Commission review supported by specific in mine whether is proved evidence, of fact updated 7-year plan findings sufficient NIPSCO’s because 736 determine development project well whether section 11 of Nipsco Grp., Indus. contrary to
is law. 31 chapter. this jurisdic- at 5. On within N.E.3d matters its 8-1-39-2(3). Therefore, § Ind. Code un- tion, enjoys discre- wide 8-2-39-2(3), der Indiana section if Code tion. at findings 5-6. Commission’s project designated the utili- just and decision will not' be overridden ty’s 7-year plan under sec- might this a contrary because reach court 10, 11, tion or under Section Id. opinion at On same evidence. then project is not an im- appeal, first we the entire record review provement purposes for of TDSIC rate whether determine there is evi- substantial treatment. support dence to find- Commission’s In Nipsco Group, ings of basic fact. Corp., U.S. Steel panel N.E.3d of this court examined Next, N.E.2d review we .ultimate 7-year NIPSCO’s electric to ascertain facts, law, 'questions fact and mixed if it identified for the for with the amount their reasonableness projected years spec seven sufficient depending deference owed on whether ificity. reviewing plan, After the court the issue falls or does fall within provided found sufficient Id. expertise. Finally, legal Commission’s year details for for one of the propositions are for reviewed their correct- plan, including type improvement, ness. More precisely, agency “an action improvement, project reason always subject contrary review as location, cost; title law, and a how constitutionally but this preserved re- ever, the same information was detailed view is limited whether the Commission jurisdiction included for stayed within its con- two seven, only expected statutory formed to the le- annual standards and gal principles producing spends major project categories involved de- total N.E,3d cision, ruling, or order.” provided. This court concluded the Commission erred in utility Under Section shall approving electric petition the the plan lacked sufficient detail transmission, for the Commission to determine whether distribution, and storage improvements. *7 years “NIPSCO’s two Additionally, 10, under the Com Section if. seven to was ‘reasonable’ or determine a approves 7-year mission the plan, desig it improve ‘best estimate of the cost’ of the eligible improvements nates the ments,” required by as is the standard in. 7-year plan eligible as TDSIC 8-l-39-10(b). Id. at Indiana Code section 8. § treatment. Ind. Code 8-1-39-10. Indiana Although the court acknowledged that eligible Code section 8-1-39-2 that states required in transmission, distribution, flexibility creating its storage 7-year plan system improvements as some equipment are as: re defined quire replacement earlier or later than replacement or gas new electric or originally planned, this transmission, believed distribution, or storage flexibility anticipated by legisla was (A) utility projects ... either were ture when it updating process enacted the designated in public utility’s seven (7) Section 9. Id. The court contained in year plan approved by cau process tioned that updating '[C]omission under 10 of this not [S]ection did treatment; chapter a utility obligation reheve to pro from (B) or targeted as a an 7-year plan economic vide initial that met the
737
Id.
jects
previously
not been
statutory requirements.
Additionally,
had
listed
original 7-year plan,
in the
impermissible
that it
the court found
was
not
“‘pre
reasoning
to
a
that it
have the authori-
for the Commission
establish
did
ty
projects
the un
that were not in-
sumption
eligibility regarding
approve
Id. at
original 7-year plan.
two
cluded in the
defined
presumption “inap
denying
petition
such
574. In
as to new
seven” because
a
propriately
showing
projects,
that a
shifts the burden
Commission found
project’s eligibility
plain reading
update
for TDSIC treatment
of the
in
term
Sec-
intervening par
only applied
from
tion 9
that the
NIPSCO to other
indicated
term
ties.” at 9.
designated
that had been
original 7-year plan
under Section 10.
utility
9
requires that
Section
Id. Our court affirmed the Commission’s
update
7-year
plan with each tracker
denial, concluding that
the Commission’s
files with the Commission. Ind.
interpretation
updating
that the Section
8-l-39-9(a).
Nipsco
§
Code
procedure precluded the
new
addition
Group,
up
this
that the
court concluded
language
was consistent with the
9 allows for
dating process under Section
referring
the TDSIC statute
writing
7-year plan
in the
of a
flexibility
because,
statute,
improvements
under the
9, utility
each
under Section
eligible improvement
an
is a
an updated plan.
must submit
31 N.E.3d at
original 7-year plan
in the
designated
Although
is not
“update”
8.
the term
de
approved by
Commission under
9,
Section
its TDSIC-3
fined
Therefore,
Section 10. Id. interpreted
statutory
corresponding
there is not a
definition of
showing
term
“update”
eligible improvements
that are
changes
desig
to the
have occurred
no
update,
in a
there is
basis
Section
eligible' improvements contained
nated
pro-
statute for a new
under the TDSIC
filing.
since the last TDSIC
7-year
ject
to an
be added
App. at
Appellant’s
The Commission
Commis-
plan, and this
court-held
update
also found that an
under Section
denying
not err in
the Section 9
sion did
con
changes to the factors
should include
projects.
update as to the addition
new
ie., changes
in approving
plan,
sidered
holding in
Based on the
estimate,
eligible improvement’s
in an
cost
in-
Indiana Gas on the Commission’s
This
necessity,
and associated benefits.
update
terpretation
the word
TDSIC-
interpretation
changes
previ
discusses
agree
interpretation
with the
an
we
improvements
ously-approved
contained
9 should include
Section
under
previous 7-year plan,
but does
previous-
changes
the cost estimates for
or
contemplate
improvements
new
ly-approved
previously-approved
7-
but
new
Section
*8
year plan.
improvements.
previously-unknown
court
Recently,
panel
of this
de
Utility
Indiana
Updates
Gas Co. v. Indiana
under Section
cided
Commission,
Regulatory
should not include new
and should
properly utility the TDSIC-4 to ad- affirm the order. dress those issues. update, we Commission’s Affirmed. expects one NIPSCO to antici No clarity
pate pinpoint with needs what its J., Robb, concurs. requirements may be expected, future. What can and should be Barnes, J., dissents with separate ampunt of though, is that there be an opinion. specificity anticipated projects utility that the simply get needs and not Barnes, Judge, dissenting. “update” carte blanche while respectfully I dissent. Given exploring a I rate increase. understand NIP outline and structure articulated any utility, particular, Group v. Northern SCO Industrial enjoy right profit. has a a I no have Co., Indiana Public Service 31 N.E.3d I problem with that. problem do have a (Ind. 2015), Ct. I see no basic differ vagueness the overall and almost “plan” says ence it here. sleight of using justify hand NIPSCO is it “update” says has for the future and the TDSIC rate increase. afoul, it my opinion, needs run 8-1-39, Chapter Indiana Code the TDSIC
statute. NIPSCO Indus. recognized
We “legislature anticipated that the
necessity of it flexibility when enacted the
updating process of Indiana Code Section Group, Indus. 8-1-39-9.” (Minor MATTER In the OF: K.S. “Allowing flexibility N.E.3d at 8. a Child) Child in Need thing having not same Services; Here, plan at all.” inclusion categories unspecified “multi broad (Mother), Appellant-Respondent, J.J. ple unit projects” comply does not with the statutory requirements. Allowing the utili v. ty of unspeci include broad Department The Indiana of Child
fied purpose having defeats the Services, Appellee-Petitioner. “plan.” Appeals Court of Case No. that, It is important also note 49A02-1701-JC-38 if even NIPSCO does receive rate for a project through increases the TDSIC Appeals Court Indiana. process, NIPSCO still be reimbursed June for unexpected way in the issues did through gener before enacted making
al rate cases. The TDSIC statute
requires specific plan, and was
designed to unexpected with those deal Rather, it for planned
issues. was intended course,
projects. projects might Of those projected,
cost than and the annual more