Glustrom v. Colorado Public Utilities Commission

2012 CO 53, 280 P.3d 662, 2012 WL 2393079
CourtSupreme Court of Colorado
DecidedJune 25, 2012
DocketNo. 11SA164
StatusPublished
Cited by2 cases

This text of 2012 CO 53 (Glustrom v. Colorado Public Utilities Commission) is published on Counsel Stack Legal Research, covering Supreme Court of Colorado primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Glustrom v. Colorado Public Utilities Commission, 2012 CO 53, 280 P.3d 662, 2012 WL 2393079 (Colo. 2012).

Opinion

Justice EID

delivered the Opinion of the Court.

{1 With the approval of the Public Utilities Commission ("PUC"), in 2005 the Public Service Company of Colorado ("Xcel") began constructing a coal-fired electric power unit known as Comanche 8. When Xeel sought to recover a portion of its construction costs nearly four years later in a rate proceeding, Leslie Glustrom intervened. Glustrom sought to introduce testimony that Xeel acted improperly and, consequently, should not recover its costs. The PUC excluded most of her testimony, a ruling that lustrom challenged. Glustrom separately challenged the depreciation rate and the possibility that Comanche 3 might not be "used and useful" at the time rates went into effect. The PUC denied her challenges, and the district court affirmed. We likewise affirm.

{ 2 We find that the PUC did not abuse its discretion when it struck substantial portions of Glustrom's testimony pursuant to the Colorado Rules of Evidence. Further, the depreciation rate approved by the PUC was established pursuant to law and in accordance with the evidence. Lastly, the PUC was free to exercise its discretion in departing from a strict application of the "used and useful" principle. Glustrom failed to meet her burden in showing why such a departure here would result in a rate that is unjust and unreasonable in its consequences.

I.

T3 In 2004 Xeel filed an application with the PUC seeking to construct Comanche 3.1 The PUC held formal hearings with the intervening parties and also accepted public comments. Prior to the conclusion of the hearings, many of the parties reached a comprehensive settlement, which included a separate settlement with additional environmental groups concerning pollution. The PUC ultimately approved the comprehensive settlement, granting Xeel a Certificate of Public Convenience and Necessity (a "CPCN")2 The settlement provided that Xeel would recover its construction costs by increasing electricity rates through the utility rate base.

T4 On June 19, 2008, Glustrom filed a motion requesting that the PUC reconsider whether Comanche 3 was in the public interest.3 Specifically, Cilustrom asked the PUC to withdraw its CPCN for Comanche 3. She argued that since the approval of Comanche 3, "everything hald] changed dramatically-from the governance and philosophy of Keel to the climate change goals of Colorado to the cost and accessibility of coal." Primarily, she argued that Comanche 3 "doesn't have a secure supply of [coal.]" She also argued that Comanche 3 would "contribute massive amounts of unnecessary pollution to the environment of our state, country and planet." This unnecessary pollution, Gustrom claimed, makes Xeel "an easy target" for legal claims related to climate change, mercury toxicity, "and several other health and environmental problems."

T5 Xeel filed a motion to dismiss Glus-trom's motion as an improper collateral attack on a final PUC decision, and (Glustrom filed a reply.

T6 On July 16, 2008, the PUC denied Xeel's motion to dismiss, finding that, under section 40-6-112(1), C.R.S. (2011), the PUC possessed the authority to reconsider its pri- [665]*665or CPCN decision4 Even though it possessed the authority to reconsider Comanche 3's CPCN, however, the PUC chose not to do so. The PUC found that although "the sentiment towards coal and the economy may have changed since [granting a CPCN for Comanche 81," its decisions reflect that underlying factors "are not static." Here, the PUC felt that the issues raised by Glustrom regarding "energy prices, the environment, health, and her other points were fully assessed by the [PUC] during the Comanche 3 proceedings." Consequently, the PUC found "no need to reopen and reassess the Comanche 3 construction."

17 In November 2008 Keel sought to recover $174.7 million, including a portion of the Comanche 8 construction costs, through an increase in electricity rates.5 The PUC determined it would hold a formal evidentia-ry hearing on the increase and invited interested parties to intervene. Eighteen parties, including Glustrom, intervened, representing a wide range of interests.

18 In support of the rate increase, on November 14, 2008, Xeel's Director of Capital Asset Accounting submitted testimony supporting a 60-year depreciation life for Comanche 38. She stated that "[the deprecia-ble life for [Comanche 3] is based on the whole life that was established for the other units at the respective generating stations because the expectations for useful life are the same." The "other units" are Comanche 1 and Comanche 2, which are part of the same power station as the proposed Comanche 3, and, like Comanche 3, are coal-fired electric power units. She also noted that a depreciation study was completed, she described the process used to complete the study, and she included detail worksheets and other supporting information.

T9 On February 18, 2009, Glustrom filed testimony, which included over 100 exhibits. In her testimony, @ustrom argued that Xeel was not entitled to recover all its costs for Comanche 8 because, under PUC Rule 3613(d), circumstances had changed and Xeel's continued expenditures on Comanche 3 were improper. 4 Colo.Code Regs. § 723-3:8613(d)6 Without specifying when Xeel's expenditures became improper, Glus-trom primarily alleged the following changed cireumstances: (1) the coal supply has been shown to be insufficient to meet Comanche 3's needs; (2) climate change has become "extremely serious and ... threatens the planet as we know it"; and (8) impending legal changes will make coal-related pollution more costly (and thus makes other energy sources more feasible now).

[ 10 Xeel filed a motion to strike a substantial portion of @ustrom's testimony, and Glustrom filed a response. On March 18, 2009, the administrative law judge ("ALJ") granted Xeel's motion to strike.7 The ALJ characterized @lustrom's argument as primarily being that Xeel was required, and failed, to demonstrate a coal supply for the life of Comanche 8. The ALJ found that Glustrom "failled] to demonstrate the relevancy of the argument or the necessary foundation of any such requirement." Further, the ALJ noted that just six months before, in response to Glustrom's motion requesting the PUC to reconsider Comanche 3, the PUC had found that Glustrom's arguments had been "fully assessed by the [PUC] during the [initial] Comanche 8 proceedings." The ALJ found that Glustrom had presented procedurally proper arguments when she requested the PUC to reconsider Comanche 3 six months earlier, but her arguments were "now outside the scope of (and thus not relevant to) this proceeding."8

[666]*666{11 On April 22, 2009, Xcel and certain other parties filed a settlement agreement to settle the rate case, agreeing to a $1122 million rate increase, which included a portion of Comanche 3's construction costs.9 The PUC held a formal hearing and received public comments on the settlement. Glus-trom and two other parties opposed the settlement. Glustrom argued that the settlement violated the "used and useful" principle because it (1) included costs of Comanche 3, estimated to be in service in November, into rates that begin in July; and (2) failed to include a mechanism adjusting rates if Comanche 3's in-service date was delayed.

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

Related

Peo v. Daniel
Colorado Court of Appeals, 2026
Mississippi Power Co. v. Mississippi Public Service Commission
168 So. 3d 905 (Mississippi Supreme Court, 2015)

Cite This Page — Counsel Stack

Bluebook (online)
2012 CO 53, 280 P.3d 662, 2012 WL 2393079, Counsel Stack Legal Research, https://law.counselstack.com/opinion/glustrom-v-colorado-public-utilities-commission-colo-2012.