People ex rel. Hartigan v. Illinois Commerce Commission

578 N.E.2d 46, 218 Ill. App. 3d 168, 160 Ill. Dec. 867, 1991 Ill. App. LEXIS 1206
Appellate Court of Illinois·Decided July 15, 1991·No. Nos. 1-90-0709, 1-90-0720, 1-90-0848, 1-90-0849, 1-90-1103, 1-90-1104 cons.·Published·Cited by 1 cases

Opinion

JUSTICE O’CONNOR

delivered the opinion of the court:

In this appeal, we consider whether the Illinois Commerce Commission (Commission) properly determined the amount of refund due consumers of electricity service provided by Commonwealth Edison Company (Edison) in view of our decision in Commonwealth Edison Co. v. Illinois Commerce Comm’n (1989), 180 Ill. App. 3d 899, 536 N.E.2d 899, appeal denied (1989), 126 Ill. 2d 557, 541 N.E.2d 1105.

In Commonwealth Edison, we affirmed an order of the Commission in docket No. 86 — 0128, approving a revised rate schedule which had been originally proposed by Edison in response to consumer dissatisfaction with the disparity between seasonal rate charges for electricity. We also vacated an order granting Edison’s petition for special permission to implement revised rates in docket No. R. 18712. The special permission was allowed subsequent to our grant of a stay, at Edison’s request, of operation of the docket No. 86 — 0128 order, pending Edison’s challenge to that order on appeal. Because the rates authorized by special permission in docket No. R. 18712 were substantially different from those established in docket No. 86 — 0128, consumers were charged more than they would have been charged had the rates under the docket No. 86 — 0128 order not been stayed. See Commonwealth Edison, 180 Ill. App. 3d 907, 536 N.E.2d 899, appeal denied (1989), 126 Ill. 2d 557, 541 N.E.2d 1105.

In the wake of our decision in Commonwealth Edison, the Illinois Attorney General, the Cook County State’s Attorney, and three community groups, National Peoples’ Action, South Austin Coalition Community Council, and Community Action for Fair Utility Practice, filed complaints with the Commission seeking refunds from Edison for overpayments made during the period June 8 through December 31, 1988, when the rates imposed by special permission in docket No. R. 18712 were in effect. The actions were consolidated. The office of public counsel, the Citizens Utility Board, and •the City of Chicago also eventually joined in the proceedings before the Commission.

Following several evidentiary hearings, methodologies for calculating the refund amount were submitted by the parties to the Commission, including a recommendation by the Commission’s staff. The Commission subsequently heard oral argument in October 1989. On February 23, 1990, the Commission entered its order in the matter. Essentially adopting the methodology urged by Edison, the Commission determined the refund amount to be approximately $5.7 million.

In turn, the governmental and consumer groups (together, complainants) initiated this appeal (Ill. Rev. Stat. 1987, ch. lll2/3, par. 10 — 201; 134 Ill. 2d R. 335), contending that the adopted methodology effectively eliminated consideration of the rates which should have applied under the docket No. 86 — 0128 order, resulting in an improperly calculated refund.

For reasons which follow, we agree.

Our disposition in the instant matter depends on an understanding of the chronology of events, including rate proposals and rates actually in effect, before, during, and after the time period for which the rate schedule contained in the docket No. 86 — 0128 order should have been in effect. To that extent, we must repeat some of the facts previously set out in Commonwealth Edison.

Under the established tariff for residential electricity use which would have been in effect through December 31, 1988, had the events in the instant case not taken place, Edison employed a rate schedule which utilized a seasonal rate differential permitting Edison to charge a higher rate per kilowatt hour during a four-month summer period than that charged per kilowatt hour during an eight-month nonsummer period. In 1986, Edison, in response to consumer dissatisfaction regarding the seasonal rate differential, initiated proceedings before the Commission in docket No. 86— 0128, proposing to decrease the rate differential between summer and nonsummer months. Shortly thereafter, Edison successfully sought to terminate those same proceedings in view of a proposed settlement of the matter. However, the Commission eventually denied Edison’s petitions regarding settlement.

Edison subsequently initiated proceedings in docket No. 87— 0427, seeking to implement a new rate schedule containing overall rate increases to become effective January 1, 1989. The issue of the seasonal rate differential under that rate schedule was included in the considerations before the Commission. Proceedings in docket No. 87 — 0427 remained pending throughout much of 1988.

In 1988, the Commission, on its own motion, reopened the record in docket No. 86 — 0128. The Commission’s intention was to draft an order based on the existing record in that docket as well as relevant portions of other prior proceedings related to altering the seasonal rate differential. However, the Commission did consider briefs and exceptions submitted by Edison, the Illinois Attorney General, the Cook County State’s Attorney, the Citizens Utility Board, Community Action for Fair Utility Practice, National Peoples’ Action, and the Commission’s staff, and held hearings on the matter.

The Commission entered its order in docket No. 86 — 0128 on April 27, 1988. Because proceedings in docket No. 87 — 0427 would not be concluded until well after the summer rate schedule, as altered by the docket No. 86 — 0128 order, became effective, the order was specifically intended to effectuate only an interim alteration of the summer rates to be charged during 1988 under the then existing rate schedule. The rate charges were to go into effect with the summer month billing period in June.

The Commission noted that Edison’s original proposal in docket No. 86 — 0128 contained complementary increases in rates over the nonsummer period. Those complementary increases would have the effect of offsetting the decrease in revenues which Edison would otherwise have expected if the summer rates were not lowered. The Commission acknowledged that it intended to likewise maintain the same “revenue neutrality” in its order. However, in the proceedings held pursuant to the reopened docket, Edison had asserted that the order proposed by the Commission in docket No. 86 — 0128 would achieve revenue neutrality only if the restructured rates remained in effect over a 12-month time frame, containing both summer and nonsummer billing periods. However, Roland Kraatz, Edison’s director of rates, had testified that to preserve revenue neutrality, the Commission could take into account the need to recoup any decrease in revenue during the remainder of 1988 in rates set in the docket No. 87 — 0427 proceedings.

Achievement of revenue neutrality was in issue throughout proceedings in the reopened docket. The Commission’s staff had criticized Edison’s claim of achieving revenue neutrality at the time Edison had made its proposal in docket No. 86 — 0128 because Edison had not considered whether consumer use would be affected based on the changed rates. The Attorney General, recognizing the proceedings in docket No. 87 — 0427 would not be completed prior to the start of the 1988 summer rate billing period, had accepted the revenue-neutral treatment for 1988 only, relying on statements in the proposed order in docket No. 86 — 0128 that the parties would not be prejudiced by that rate design.

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People ex rel. Hartigan v. Illinois Commerce Commission, 578 N.E.2d 46, 218 Ill. App. 3d 168, 160 Ill. Dec. 867, 1991 Ill. App. LEXIS 1206 (Ill. Ct. App. 1991).

578 N.E.2d 46 (People ex rel. Hartigan v. Illinois Commerce Commission) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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