Northern Indiana Public Service Company v. JUPITER ALUMINUM CORPORATION

858 N.E.2d 1075, 2006 WL 3759210
CourtIndiana Court of Appeals
DecidedDecember 22, 2006
Docket93A02-0505-EX-403
StatusPublished

This text of 858 N.E.2d 1075 (Northern Indiana Public Service Company v. JUPITER ALUMINUM CORPORATION) is published on Counsel Stack Legal Research, covering Indiana Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Northern Indiana Public Service Company v. JUPITER ALUMINUM CORPORATION, 858 N.E.2d 1075, 2006 WL 3759210 (Ind. Ct. App. 2006).

Opinion

NORTHERN INDIANA PUBLIC SERVICE COMPANY, Appellant-Respondent,
v.
JUPITER ALUMINUM CORPORATION and INDIANA OFFICE OF UTILITY CONSUMER COUNSELOR, Appellees-Petitioners.

No. 93A02-0505-EX-403

Court of Appeals of Indiana.

December 22, 2006

STANLEY C. FICKLE, DANIEL W. McGILL, P. JASON STEPHENSON, Barnes & Thornburg, Indianapolis, Indiana, ATTORNEYS FOR APPELLANT.

MICHAEL B. CRACRAFT, Hackman Hulett & Cracraft, LLP, Indianapolis, Indiana, Ind. Municipal Electric Assn., Inc., LARRY J. WALLACE, Parr Richey Obremskey & Morton Indianapolis, Indiana, Ind., Statewide Assn. of Rural Electric Cooperatives, Inc., WAYNE C. TURNER, SHANNON D. LANDRETH, McTurnan & Turner Indianapolis, Indiana, Indiana Energy Assn., ATTORNEYS FOR AMICI.

JOHN F. WICKES, JR., TODD A. RICHARDSON, Lewis & Kappes, Indianapolis, Indiana, Attorneys for Jupiter Aluminum, ATTORNEYS FOR APPELLEE.

MEMORANDUM DECISION

MAY, Judge.

Northern Indiana Public Service Company ("NIPSCO") appeals and Jupiter Aluminum Corporation ("Jupiter") cross-appeals from a decision of the Indiana Utility Regulatory Commission ("IURC" or "Commission").

NIPSCO raises two related issues, which we restate as: 1) whether the IURC exceeded its statutory authority by requiring NIPSCO to make a direct cash payment of 2.5 million dollars to Jupiter for the purchase of equipment that will benefit Jupiter and that Jupiter will own; and 2) whether the IURC exceeded its statutory authority by prohibiting NIPSCO from recovering the 2.5 million dollars in rates. In its cross-appeal, Jupiter raises one issue: whether the "complete resolution" language in the IURC order bars Jupiter from pursuing legal remedies against NIPSCO.

The resolution of the first two issues depends in part on whether the Commission concluded NIPSCO provided "reasonably adequate service" to Jupiter. However, the Commission's conclusion on this issue is ambiguous and does not permit us to review the order. Nor can we determine what the Commission intended when it used the phrase "complete resolution." Accordingly, we remand this case to the Commission with instructions to clarify its order, enter appropriate findings and conclusions, and submit the revised order to us within sixty days of the date of this opinion.

FACTS AND PROCEDURAL HISTORY

Jupiter operates an aluminum recycling and manufacturing facility in Hammond, Indiana. Jupiter utilizes a continuous manufacturing process in which aluminum scrap is recycled and extruded into large aluminum coils. If the process is halted abruptly, the aluminum material moving through the equipment stops and cools down. This can damage the equipment. The manufacturing restart procedure takes approximately four hours. "[M]anufacturing operations are conducted 24 hours a day, seven days a week, year-round." (NIPSCO App. at 34.)[1]

NIPSCO is an investor-owned public utility in northwest Indiana. NIPSCO provides electric service to Jupiter from the Roxanna substation through a dedicated 34kV line known as Circuit 3409. NIPSCO charges Jupiter for firm electric service.[2]

In April 2003, Jupiter filed a complaint with the IURC alleging NIPSCO had failed to provide "reasonably adequate" electric service. See Ind. Code § 8-1-2-4 ("Every public utility is required to furnish reasonably adequate service and facilities.") Jupiter's complaint alleged it had suffered thirty-eight outages between 1995 and April 2003, which outages significantly disrupted its manufacturing process.[3] After an evidentiary hearing in July 2003, the IURC issued an interim order in December 2003, requiring NIPSCO to "fully evaluate the power quality aspects of circuit 3409 from which Jupiter receives service." (NIPSCO App. at 46.)

NIPSCO retained GE Industrial Systems Services to monitor and evaluate Circuit 3409. After receiving GE Industrial's report from NIPSCO in October 2004, the IURC entered its final order in April 2005. The Commission summarized the proceedings, the initial and final reports from NIPSCO, NIPSCO's conclusions and recommendations, and Jupiter's response to the report and its recommendations. The final order then provided:

5. Findings and Analysis of the Commission. NIPSCO indicates in its Initial and Final Reports that it failed to find the "smoking gun" regarding the problems experienced at the Jupiter Facility. NIPSCO['s] inability to locate a single issue (or "smoking gun") as the cause of the chronic problems faced by the Jupiter facility over the past several years is not surprising. It was our expectation that further evaluation and investigation of the apparently chronic and long term issues faced by Jupiter Aluminum could assist the Commission in more fully evaluating an appropriate resolution of the issues presented in this matter. Implicit in our determination was the expectation that the parties would attempt to resolve this matter by agreement based on their own review of the Initial and Final Report, coupled with an internal evaluation of the specific issues (if any) that needed to be addressed within the Jupiter facility. Unfortunately while the parties have presented specific proposals on what they believe are appropriate means to resolve this matter—it has not been resolved by agreement.
* * * * *
GE Industrial indicated in its Initial Report that based on its analysis of all the data the cause of the outages and voltage sags was from a variety of system faults including weather, vehicle collision, static line failure, pole repair, cable failure, neighbor line interference, and 138kV equipment failure. NIPSCO's investigation into the power quality problems has resulted in an Initial and Final Report that has—in many respects—simply recommended that NIPSCO perform basic maintenance that NIPSCO should have been doing all along in an effort to remedy the outages suffered by Jupiter.
While actions taken by NIPSCO to date, and its commitment to continue to review, maintain, and monitor the Roxanna Substation and line 3409, appear to be important steps to address the issues presented in this Cause, based on our review of the Initial and Final Report it appears that NIPSCO's failure to address these issues earlier could have contributed to a number of outages suffered by Jupiter. While NIPSCO could have done a better job with respect to routine maintenance, like any other industrial customer, Jupiter Aluminum could have requested (and received) a backup line years ago which could have prevented or reduced outages that have impacted production at the facility. Certainly the long term nature of the problems faced by Jupiter could have been addressed much sooner by the parties, or presented to the Commission for resolution, rather than allowing the problems to continue. While we find some merit in the service quality issues presented by Jupiter in its Complaint, as Jupiter seemingly chose not to pursue options available to it—to request a backup line and install switching equipment at its facility—we will not attempt to roll back the clock to remedy the impact of this decision as part of our consideration and resolution of the issues presented in this Cause.
The parties have not been able to resolve this matter and have instead made recommendations to the Commission that demonstrate how far apart the parties are with respect to resolving this matter by agreement.

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Bluebook (online)
858 N.E.2d 1075, 2006 WL 3759210, Counsel Stack Legal Research, https://law.counselstack.com/opinion/northern-indiana-public-service-company-v-jupiter--indctapp-2006.