Central Illinois Public Service Co. v. Illinois Commerce Commission

579 N.E.2d 1200, 219 Ill. App. 3d 291, 162 Ill. Dec. 386, 1991 Ill. App. LEXIS 1673
Appellate Court of Illinois·Decided September 30, 1991·No. No. 4—90—0855·Published·Cited by 4 cases

Opinion

JUSTICE McCULLOUGH

delivered the opinion of the court:

Plaintiff in administrative review Central Illinois Public Service Company (CIPS) appeals a circuit court order which affirmed an order of the Illinois Commerce Commission (Commission). In its order, the Commission determined that CIPS is exclusively entitled to serve approximately 20 acres of the 100-acre site of a new State prison at Canton, and a competing electricity supplier, Spoon River Electric Cooperative (SREC), is exclusively entitled to serve the remaining 80 acres of the tract.

The prison tract was formerly a part of the 545-aere Gavenda farm. On the July 2, 1965, effective date of the Electric Supplier Act (ESA) (Ill. Rev. Stat. 1989, ch. lll2/3, par. 401 et seq.), CIPS provided service at one point on the farm, and SREC provided service at two points on the farm. Neither supplier at that time provided service on the portion of the farm which was to become the prison tract.

On June 19, 1968, the Commission approved a service-area agreement, entered into by CIPS and SREC, which provides in pertinent part:

“WHEREAS, the parties hereto, in order to avoid duplication of facilities and to minimize disputes between themselves which may result in inconvenience and diminished efficiency to the public, and in the public interest desire so to contract. ***
1. The parties hereto covenant and agree that each shall continue to be entitled to (a) furnish service to customers at locations which each was serving on July 2, 1965, (b) furnish service to customers or premises which it had agreed to serve under contracts in existence on July 2, 1965, and (c) resume service to any premises to which it had discontinued service in the twelve months preceding July 2, 1965, and on which are still located the supplier’s service facilities whether or not either such locations or premises are located within territory hereinafter delineated as its service area and each shall also continue to serve either such locations or premises as to which each has lawfully commenced service since July 2, 1965, and prior to the effective date of this agreement.
2. The parties hereto covenant and agree that [SREC] shall be entitled exclusively to serve all consumers with their electric service requirements in the area or areas designated as SREC on the maps hereto attached as Appendices 1 to 3, inclusive, and [CIPS] shall be entitled exclusively to serve all consumers with their service requirements in the area or areas designated as CIPS on said Appendices 1 to 3, inclusive, provided, however, that each party may continue to serve any locations or premises which it is entitled to serve under Paragraph 1 above even though such locations or premises be located in the areas designated on Appendices 1 to 3, inclusive, as the area of the other party ***.”

The maps appended to the service-area agreement establish that the 80 westernmost acres of the prison tract are in SREC’s designated service area, and the eastern 20 acres are in CIPS’ designated service area.

After the State announced plans to construct a new prison at Canton, both CIPS and SREC made efforts to be designated as the exclusive electricity supplier for the prison. Eventually, the Department of Corrections (DOC) chose not to select an electricity supplier for the new prison. Rather, DOC instructed CIPS to obtain a Commission determination of whether it or SREC should serve the prison. Accordingly, CIPS, on October 27, 1987, filed with the Commission a petition requesting a finding that it has an exclusive right to serve the new prison at Canton, and SREC, on August 31, 1988, filed a counterpetition requesting a determination of its right to serve the new prison.

Evidence presented at the hearing on CIPS’ petition and SREC’s counterpetition established that 87.4% of the square footage of the buildings at the Canton prison is within SREC’s service area designated in the CIPS-SREC service-area agreement, and 12.6% of the square footage is in CIPS’ service area. Furthermore, 92.9% of the prison’s total electricity usage will occur in SREC’s service area, while 7.1% of the prison’s electricity consumption will take place in CIPS’ service area. A map of the prison grounds reflects that the only structures entirely within CIPS’ service area are a guard tower, a boiler building, and a pump station. Portions of two wings of each of three residence halls are also within CIPS’ service area.

Before the prison was constructed, CIPS had three phase power lines paralleling the northern and western boundaries of the prison tract. Because of the existence of these lines, CIPS was capable of immediately providing service to the prison. SREC at that time had no similar facilities in proximity to the prison site, but it did have a single-phase power line running along the western boundary of the prison tract.

Before construction of the new prison began, DOC directed CIPS to provide temporary service to construction trailers on the site. Since then, CIPS has provided and continues to provide temporary electricity service to the prison tract.

In its order entered October 4, 1989, the Commission found that the CIPS-SREC service-area agreement controls resolution of the question of CIPS’ and SREC’s rights to serve the prison tract. The Commission further held that despite its preexisting service facilities on other portions of the Gavenda farm, CIPS has no grandfather rights to serve the prison tract which are superior to those of SREC. The Commission found that CIPS did not establish an exception under paragraph 2 of the service-area agreement which prevents Spoon River from serving the west 80 acres of the prison tract. The Commission further held that the City of Canton’s issuance of franchises to CIPS and SREC did not alter its conclusion regarding the rights of these two electricity suppliers under their service-area agreement. The Commission concluded that SREC is entitled to serve the portion of the Canton prison located in its service area (approximately the west 80 acres of the prison tract), “including without limitation the residence buildings which are substantially in” SREC’s service area, and CIPS is entitled to serve the remaining portion of the prison (approximately the east 20 acres of the prison tract). The Commission further ordered that neither supplier furnish electricity to DOC in the territory allocated to the other under the service-area agreement, except in the event of an outage of service provided by the other supplier.

Two members of the Commission filed a dissenting opinion. Among other things, they stated that the requirement in the Commission’s order that each supplier stand ready to serve the entire prison in the event of an outage on the other’s lines and the consequent necessity of each supplier installing transmission and distribution facilities capable of serving the entire prison violated the legislative intent expressed in section 2 of the ESA (Ill. Rev. Stat. 1989, ch. lll2/s, par. 402) of avoiding duplication of facilities of electricity suppliers.

Pertinent to the question of whether the Commission properly determined the rights of CIPS and SREC to serve the Canton prison are the following portions of the ESA:

Free access — add to your briefcase to read the full text and ask questions with AI

Central Illinois Public Service Co. v. Illinois Commerce Commission, 579 N.E.2d 1200, 219 Ill. App. 3d 291, 162 Ill. Dec. 386, 1991 Ill. App. LEXIS 1673 (Ill. Ct. App. 1991).

579 N.E.2d 1200 (Central Illinois Public Service Co. v. Illinois Commerce Commission) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Sieron & Associates, Inc. v. Department of Insurance
857 N.E.2d 805 (Appellate Court of Illinois, 2006)
Central Illinois Public Service Co. v. Illinois Commerce Commission
795 N.E.2d 865 (Appellate Court of Illinois, 2003)