Owen County Rural Electric Cooperative Corp. v. Public Service Commission

689 S.W.2d 599, 1985 Ky. App. LEXIS 490
CourtCourt of Appeals of Kentucky
DecidedJanuary 4, 1985
StatusPublished
Cited by3 cases

This text of 689 S.W.2d 599 (Owen County Rural Electric Cooperative Corp. v. Public Service Commission) is published on Counsel Stack Legal Research, covering Court of Appeals of Kentucky primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Owen County Rural Electric Cooperative Corp. v. Public Service Commission, 689 S.W.2d 599, 1985 Ky. App. LEXIS 490 (Ky. Ct. App. 1985).

Opinion

HOWERTON, Judge.

Owen County Rural Electric Cooperative Corporation (RECC) appeals from a judgment of the Franklin Circuit Court affirming an order of the Public Service Commission (PSC) which allowed Union Light, Heat and Power Company (ULH & P) to invade or take approximately 40 acres of the RECC’s certified, but undeveloped territory. The RECC argues that the PSC and the Franklin Circuit Court improperly interpreted the certified territory statutes, KRS 278.016-278.020. It also alleges that the PSC improperly failed to follow its own precedents and that the order and judgment violated the U.S. and Kentucky Constitutions by failing to award compensation for the confiscation of its territorial rights. We determine that the PSC made adequate findings of fact which were appropriately applied to the statutes. Accordingly, we affirm the order and judgment.

The Campbell County Fiscal Court (Campbell County) initiated this action by petitioning the commission to authorize ULH & P to supply retail electric service to an industrial park consisting of approximately 77 acres and located adjacent to U.S. Highway 27 in the southern part of Campbell County. ULH & P, the RECC, and Consolidated Foods Corporation (Consolidated) were named as respondents. Consolidated was to be the first tenant in the industrial park, and it, together with ULH & P, filed a response in support of the petition. The RECC responded by pointing out that Consolidated would be in a portion of the park, which presently lies within its certified territory, and that it had the exclusive right to serve the facility.

[601]*601The certified territories were established pursuant to legislation passed in 1972. KRS 278.016 reads in part that it is:

... in the public interest that, in order ... to avoid wasteful duplication of distribution facilities, to avoid unnecessary encumbering of the landscape ... to prevent the waste of materials and natural resources ... the state be divided into geographical areas, establishing the areas within which each retail electric supplier is to provide the retail electric service as provided in KRS 278.016 to 278.-020....

The boundary between ULH & P and the RECC runs through the middle of the industrial park. The certified territory of ULH & P encompasses all of parcels 1 and 2, and part of parcel 3 of the industrial park. The RECC’s territory encompasses all of parcel 4 and the remainder of parcel 3. Consolidated’s new facility will be located primarily in parcel 4, but its office building will be in parcel 2.

KRS 278.018(1) provides in part, “[i]n the event that a new electric-consuming facility should locate in two or more adjacent certified territories, the commission shall determine which retail electric supplier shall serve said facility based on criteria in KRS 278.017(3).” The criteria set forth in KRS 278.017(3) are:

(a) The proximity of existing distribution lines to such certified territory.
(b) Which supplier was first furnishing retail electric service, and the age of existing facilities in the area.
(c) The adequacy and dependability of existing distribution lines to provide dependable, high quality retail electric service at reasonable costs.
(d) The elimination and prevention of duplication of electric lines and facilities supplying such territory.

The PSC considered the entire industrial park to be an electric-consuming facility which could best be served by one supplier. It found that the park required three-phase electric service, and in applying criterion (a), it found that ULH & P has an existing three-phase, 13.2 KV primary service line on U.S. 27 adjacent to the western boundary of the park. The entrance to the park and its service road connect to U.S. 27. It further found that the RECC has a single-phase 7.2 KV distribution line located just beyond the eastern border of the park and intersecting with the northeast corner of parcel 4. The nearest RECC three-phase distribution line is 2.25 miles south of the park.

In considering criterion (b), the PSC found that the park was part of an 87-acre tract of land previously owned by a family named Trapp. ULH & P has supplied electric service to the Trapp family farm for many years. The RECC has never provided retail electric service to any portion of this tract of land.

Criterion (c) was analyzed in light of the park’s need for three-phase electric service. ULH & P has an existing distribution line which can adequately supply the electrical needs of the park without any additional construction, except for establishing the service within the park territory. Its line is located along U.S. 27, which will facilitate its ability to repair outages. The RECC’s line follows a five-mile route through hilly, wooded terrain. The approval of ULH & P to service the industrial park clearly meets KRS 278.017(3)(d) in that it eliminates and prevents the duplication of electric lines and facilities supplying the territory.

The Franklin Circuit Court affirmed the ruling of the PSC and held that what is necessary for the public’s convenience remains the bedrock on which all utility regulation in Kentucky is founded. It further concluded that the PSC had complied with the statute and that its ruling attempted to avoid wasteful duplication, the disturbance of the landscape, and the waste of materials and natural resources.

The RECC first argues that the PSC and the Franklin Circuit Court improperly interpreted the certified territory statutes. The basis for this allegation is that the PSC interpreted the meaning of a new electric-consuming facility to encompass the entire industrial park. KRS 278.010(8) provides, [602]*602“ ‘Electric-consuming facilities’ means everything that utilizes electric energy from a central station source.”

The definition does not limit a facility to being a building. The definition is broad enough for the PSC to reasonably interpret it to mean the entire industrial park, which will be served from the central station source. The plot plan of the industrial park reveals that ULH & P is to establish its service entrance, metering and transforming equipment for the park on parcel number 2 approximately 1000 feet from the park entrance on U.S. Highway 27.

The RECC cites cases from other jurisdictions, which generally limit the territorial considerations to serving individual buildings. We find none of the cases to be dispositive of this situation, either on their facts or the statutes applicable to the various states.

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

Related

PSO v. State Ex Rel. Corp. Com'n
842 P.2d 750 (Supreme Court of Oklahoma, 1992)

Cite This Page — Counsel Stack

Bluebook (online)
689 S.W.2d 599, 1985 Ky. App. LEXIS 490, Counsel Stack Legal Research, https://law.counselstack.com/opinion/owen-county-rural-electric-cooperative-corp-v-public-service-commission-kyctapp-1985.