Interstate Gas Supply, Inc. v. PUC ( 2023 )

IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Interstate Gas Supply, Inc. d/b/a :
IGS Energy, NRG Energy, Inc. and :
Shipley Choice LLC d/b/a Shipley :
Energy, :
Petitioners :
:
v. : No. 472 C.D. 2022
:
Public Utility Commission, :
Respondent : Argued: February 8, 2023
BEFORE: HONORABLE RENÉE COHN JUBELIRER, President Judge
HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE ANNE E. COVEY, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE ELLEN CEISLER, Judge
HONORABLE LORI A. DUMAS, Judge
HONORABLE STACY WALLACE, Judge
OPINION NOT REPORTED
MEMORANDUM OPINION
BY JUDGE CEISLER FILED: April 28, 2023
Petitioners Interstate Gas Supply, Inc. d/b/a IGS Energy, NRG Energy, Inc.
and Shipley Choice LLC d/b/a Shipley Energy (collectively Petitioners), each of
which are electric generation suppliers,1 petition for review of Respondent Public
1
An electric generation supplier is statutorily defined, in relevant part, as:
A person or corporation, including municipal corporations which
choose to provide service outside their municipal limits except to
the extent provided prior to the effective date of this chapter, brokers
and marketers, aggregators or any other entities, that sells to end-use
customers electricity or related services utilizing the jurisdictional
transmission or distribution facilities of an electric distribution
company or that purchases, brokers, arranges or markets electricity
or related services for sale to end-use customers utilizing the
(Footnote continued on next page…)
Utility Commission’s (Commission) August 26, 2021 opinion and order (First
Order).2 Through the First Order, the Commission ruled that certain electric
distribution companies’ (electric distribution companies or EDCs)3 policy of
providing what is known as “on-bill billing” for their own non-commodity goods
and services, while not providing the same for non-commodity goods and services
offered by Petitioners, was not unreasonably discriminatory and, thus, did not violate
the Public Utility Code, 66 Pa. C.S. §§ 101-3316, or the Electricity Generation
Customer Choice and Competition Act (Competition Act), 66 Pa. C.S. §§ 2801-
2815. By doing so, the Commission granted exceptions that had been filed by the
EDCs regarding a Commission Administrative Law Judge’s (ALJ) initial decision,
in which the ALJ had determined that the EDCs handling of on-bill billing was, in
jurisdictional transmission and distribution facilities of an electric
distribution company.
66 Pa. C.S. § 2803.
2
Though Petitioners refer to Respondent as “Public Utility Commission,” the correct name
for that entity is “Pennsylvania Public Utility Commission.”
3
An electric distribution company is statutorily defined as: “The public utility providing
facilities for the jurisdictional transmission and distribution of electricity to retail customers,
except building or facility owners/operators that manage the internal distribution system serving
such building or facility and that supply electric power and other related electric power services to
occupants of the building or facility.” 66 Pa. C.S. § 2803.
Typically, in a given region, there is one [e]lectric [d]istribution
[c]ompany. The Commission appoints that [e]lectric [d]istribution
[c]ompany as the default service provider for that region[, and]
energy consumers in [that region] are automatically enrolled as
customers of [that designated electric distribution company].
However, these consumers can also choose to purchase their
electrical service from an alternative source, i.e., an [e]lectric
[g]eneration [s]upplier.
Dauphin Cnty. Indus. Dev. Auth. v. Pa. Pub. Util. Comm’n, 123 A.3d 1124, 1126 (Pa. Cmwlth.
2015).
2
fact, unreasonably discriminatory and did therefore violate the Public Utility Code.
In addition, Petitioners petition for review of the Commission’s April 14, 2022
opinion and order (Second Order), through which the Commission denied
Petitioners’ Joint Petition for Reconsideration and/or for Reopening of the Record
of the Proceeding. After thorough review, we affirm the Commission, in full, as to
both the First Order and the Second Order.
I. Background
As explained by the Commission:
[This] case concerns a billing practice known in the utility
industry as “on-bill billing,” whereby a company includes
non-commodity goods and services on its monthly utility
bills to its customers.[4] In the present case, the EDCs offer
their own non-commodity goods and services via “on-bill
billing” to their customers. [Petitioners] are free to do the
same via their own direct billing of customers. Here,
however, [Petitioners] sought to require the EDCs, which
are required by statute to provide customer billing for
electric service provided by [Petitioners], to also provide
the [Petitioners] with the same “on-bill billing” services
for non-commodity (other than electric) for [Petitioners’]
customers as the EDCs were providing its own customers.
....
On October 25, 2019, [Petitioners] filed a Formal
Complaint (Complaint) . . . alleging that the EDCs’
conduct of providing a billing service, known in the
industry as “on-bill billing,” for non-commodity products
and services that it provides for the benefit of their own
electric distribution customers, while refusing to provide
“on-bill billing” for the [electric generation suppliers]
4
Neither the Commission nor Petitioners explain exactly what constitutes “non-commodity
goods and services” in the context of this matter. We note, however, that the Commission adopted
the ALJ’s factual finding that “[t]he [electric distribution companies] have a long history of
offering non-commodity products and services, such as surge protection and line repair programs,
to their customers.” See First Order at 11. In other words, it appears that this phrase encompasses
anything that does not directly pertain to the generation or transmission of electricity.
3
serving customers on its systems, violates [certain portions
of] the Public Utility Code [and the Competition Act], . . .
as well as [Pennsylvania Public Utility Commission v.
Columbia Gas of Pennsylvania, Inc., Docket No. R-2018-
2647577 (filed Jan. 16, 2020) (Columbia),] a Commission
Opinion and Order in a recent case involving [a] similar
issue in the natural gas industry.[] For relief, [Petitioners]
requested that the Commission sustain the Complaint and
require that if the [EDCs] provide billing services for any
provider of non-commodity services on its utility bills, that
it provide the same service to similarly situated providers
of those services on a non-discriminatory basis, or be
prohibited from providing such billing service at all. See
Complaint at 1-2.
On November 14, 2019, the EDCs filed an Answer and
New Matter to the Complaint averring that they offer non-
commodity products and services to their customers but
have not authorized [electric generation suppliers] to bill
for non-commodity products and services on the EDCs[’]
monthly electric service bills. In their New Matter, which
was accompanied by a Notice to Plead, the EDCs argued
that their tariffs prohibit the relief requested in the
Complaint. The EDCs further argued that these tariffs
were recently approved as part of their default service
plans (DSPs) in 2018 and [Petitioners] were served copies
of those documents. The EDCs also addressed other issues
raised by [Petitioners] in their Complaint and requested
that the Complaint be dismissed with prejudice.
On December 4, 2019, [Petitioners] filed a reply to the
EDCs’ New Matter. In their answer, [Petitioners] denied
the EDCs’ claim to the extent they contended it was not
appropriate or otherwise permissible to file a complaint
regarding the legality of a service or tariff of a public
utility. Additionally, [Petitioners] denied, inter alia, the
EDCs’ averment regarding their participation in the
EDCs’ DSPs proceedings in 2018 and its impact on the
Complaint. [Petitioners] requested that their Complaint be
sustained, and their requested relief be granted.
....
In the Initial Decision, issued on November 18, 2020, the
ALJ sustained the Complaint finding that the [EDCs] do
4
not provide [Petitioners with] rates, terms of access and
conditions that are comparable to the [EDCs’] own use of
the system. The ALJ found that the EDCs have, therefore,
made an unreasonable preference or advantage, and
established or maintained an unreasonable difference as to
service[,] in violation of the [Public Utility] Code.
....
Exceptions to the Initial Decision were filed by the EDCs
and the [Office of Consumer Advocate (OCA)] on
December 8, 2020.[] Replies to the Exceptions were filed
by [Petitioners] on December 18, 2020.
First Order at 2-5 (footnotes omitted).
On August 26, 2021, the Commission issued its First Order, through which it
granted the EDCs’ exceptions and reversed the ALJ’s Initial Decision. Id. at 29. In
doing so, the Commission concluded that the EDCs’ handling of on-bill billing in
this situation comported with the Public Utility Code’s relevant requirements and
did not violate the Competition Act. Id. at 25-28. Furthermore, the Commission ruled
that Columbia was distinguishable, as, unlike in this matter, “[t]he material fact in
[that situation] was that Columbia treated other third parties differently than [a
number of its] third-party former affiliates[,]” and because the Public Utility Code
applies broader competition-related duties upon natural gas utilities like Columbia.
Id. at 22-25.5
Thereafter, Petitioners sought reconsideration of the Commission’s First
Order, and the reopening of the record, on the basis that they had recently discovered
new evidence that the EDCs did, in fact, provide on-bill billing to HomeServe USA
(HomeServe), a third party. This, in Petitioners’ view, made the situation one that
5
The Commission also denied an exception filed by the OCA to the overall practice of on-
bill billing, on the basis “that the OCA’s Exception goes beyond the issue presented to have the
Commission deny a lawful billing practice.” First Order at 29. That denial is not the subject of this
appeal.
5
was analogous to the scenario present in Columbia, in that third parties were being
treated in a disparate manner, with some being provided with on-bill billing for their
non-commodity goods and services, while others were not.
The Commission initially granted the reconsideration request in September
2021, in order to review its substance, but ultimately denied it on the merits through
its Second Order on April 14, 2022. In doing so, the Commission determined that
the relationship with HomeServe is not one which
demonstrates that the EDCs provide “on-bill billing” to
non-affiliated third parties. Rather, the EDCs contracted
with HomeServe to serve as the program administrator for
certain of the EDCs’ own non-commodity products and
services. See EDCs Answer at 9-11.
As explained by the EDCs, the EDCs contracted with
HomeServe to provide certain of the EDCs’ own non-
commodity products and services, such as electrical line
and water heater protection plans, which the EDCs noted
was thoroughly explained in the EDCs’ DSP V
proceeding. See, id. We find that the EDCs do not, as
alleged by [Petitioners], allow HomeServe to bill for its
own non-commodity products and services on the EDCs’
bills.
Second Order at 17-18 (emphasis in original).
This Petition for Review followed shortly thereafter.
II. Discussion
Petitioners offer several arguments for our consideration, which we
summarize as follows.6 First, the Commission erroneously interpreted Section 1502
6
This Court’s authority to reverse a decision of the [Commission] is
limited to circumstances where substantial evidence supporting a
necessary factual finding is lacking in the record, where the
[Commission] erred as a matter of law, and where constitutional
rights were violated. 2 Pa. C.S. § 704; PECO Energy Co. v. Pa. Pub.
Util. Comm’n, . . . 791 A.2d 1155, 1160 ([Pa.] 2002). . . . This Court
(Footnote continued on next page…)
6
of the Public Utility Code, 66 Pa. C.S. § 1502, as permitting EDCs to provide a
service to itself, in this case on-bill billing for non-commodity goods and services,
while also refusing to offer that same service to third parties. In addition, the
Commission’s interpretation of Section 1502 arbitrarily departs from the reasoning
it articulated in Columbia regarding unreasonable discrimination in the context of
on-bill billing. Petitioners’ Br. at 19-22. Second, the Commission committed an error
of law by interpreting Section 2804(6) of the Competition Act, 66 Pa. C.S. § 2804(6),
as only barring EDCs from discriminating against electric generation suppliers
regarding electrical transmission and distribution-related services and facilities,
rather than regarding all types of services and facilities. Id. at 22-24. Finally, the
Commission erroneously and arbitrarily denied Petitioners’ Petition for
Reconsideration regarding the First Order, by both improperly disregarding the
may not “substitute its judgment for that of the [Commission] when
substantial evidence supports the [Commission’s] decision on a
matter within the [C]ommission’s expertise.” [Popowsky v. Pa. Pub.
Util. Comm’n, 706 A.2d 1197, 1201 (Pa. 1997)]. “Judicial deference
is even more necessary when the statutory scheme is technically
complex.” Id. at 1203.
With respect to issues of law, our standard of review is de novo and
our scope of review is plenary. Mercury Trucking, Inc. v. Pa. Pub[.]
Util. Comm’n, . . . 55 A.3d 1056, 1082 ([Pa.] 2012). [As for]
challenges to the [Commission’s] factual findings, “[s]ubstantial
evidence is such relevant evidence that a reasonable mind might
accept as adequate to support a conclusion.” Phila. Gas Works v.
Pa. Pub. Util. Comm’n, 898 A.2d 671, 675 n.9 (Pa. Cmwlth. 2006).
Coal. for Affordable Util. Servs. & Energy Efficiency in Pa. v. Pa. Pub. Util. Comm’n, 120 A.3d
1087, 1094-95 (Pa. Cmwlth. 2015).
7
evidence presented by Petitioners and by relying upon unsworn statements made by
the EDCs in opposition to the request for reconsideration. Id. at 24-28.7
Petitioners’ first two arguments focus upon the language used in specific
provisions of the Public Utility Code and the Competition Act and, thus, present
questions of pure statutory interpretation.
The object of statutory construction is to ascertain and
effectuate legislative intent. 1 Pa. C.S. § 1921(a). In
pursuing that end, we are mindful a statute’s plain
language generally provides the best indication of
legislative intent. See Com[.] v. McClintic, . . . 909 A.2d
1241 ([Pa.] 2006). Thus, statutory construction begins
with examination of the text itself. [Se.] Pa. Transp. Auth.
v. Holmes, 835 A.2d 851 (Pa. Cmwlth. 2003).
In reading the plain language of a statute, “[w]ords and
phrases shall be construed according to rules of grammar
and according to their common and approved usage.” 1 Pa.
C.S. § 1903(a). Further, every statute shall be construed, if
possible, to give effect to all its provisions so that no
provision is “mere surplusage.” 1 Pa. C.S. § 1921(a).
Moreover, although we must “listen attentively to what a
statute says[;] [o]ne must also listen attentively to what it
does not say.” Kmonk-Sullivan v. State Farm Mut. Auto.
Ins. Co., . . . 788 A.2d 955, 962 ([Pa.] 2001). We may not
insert a word the legislature failed to supply into a statute.
Girgis v. Bd. of Physical Therapy, 859 A.2d 852 (Pa.
Cmwlth. 2004).
Malt Beverage Distribs. Ass’n v. Pa. Liquor Control Bd., 918 A.2d 171, 175-76 (Pa.
Cmwlth. 2007). “When the words of a statute are clear and free from all ambiguity,
the letter of it is not to be disregarded under the pretext of pursuing its spirit.” 1 Pa.
C.S. § 1921(b). “However, if we deem the statutory language ambiguous, we must
7
The EDCs have intervened in this matter and have filed a brief, as have OCA and the
Retail Energy Supply Association (RESA). OCA’s and the EDCs’ respective arguments largely
mirror the positions taken on appeal by the Commission, while RESA’s are substantially similar
to those articulated by Petitioners. Compare Commission’s Br. at 12-33, with EDCs’ Br. at 10-39
and OCA’s Br. at 12-21, and Petitioners’ Br. at 17-28, with RESA’s Br. at 6-20.
8
then ascertain the General Assembly’s intent by statutory analysis, wherein we may
consider numerous relevant factors.” Bowman v. Sunoco, Inc., 65 A.3d 901, 906 (Pa.
2013) (citing 1 Pa. C.S. § 1921(c)). “An ambiguity exists when language is subject
to two or more reasonable interpretations and not merely because two conflicting
interpretations may be suggested.” Tri-Cnty. Landfill, Inc. v. Pine Twp. Zoning
Hearing Bd., 83 A.3d 488, 510 (Pa. Cmwlth. 2014).
Furthermore,
we recognize that the Commission’s “interpretations of the
[Public Utility] Code . . . and its own regulations are
entitled to great deference and should not be reversed
unless clearly erroneous.” Energy Conservation Council
of Pa. v. Pub. Util. Comm’n, 995 A.2d 465, 478 (Pa.
Cmwlth. 2010) (citing [Popowsky, 706 A.2d at 1203]). . .
. Similarly, because the Commission is “the administrative
body charged with implementing the Competition Act, [it]
is entitled to substantial deference in the performance of
its duties, and the [Commission’s] interpretation of the
Competition Act should not be overturned unless it is clear
that such construction is erroneous.” George v. Pa. Pub.
Util. Comm’n, 735 A.2d 1282, 1288 (Pa. Cmwlth. 1999).
However, when statutory language is unambiguous, we
will not give the Commission discretion in its
interpretation. “‘[W]here [the] statutory language is clear,
such interpretive discretion ends and the [Commission]
must abide by the statute.’” Dauphin [Cnty.] Indus. Dev.
Auth. v. Pa. Pub. Util. Comm’n, 123 A.3d 1124, 1133 (Pa.
Cmwlth. 2015) (quoting Pa. Power Co. v. Pub. Util.
Comm’n, 932 A.2d 300, 306 (Pa. Cmwlth. 2007)).
NRG Energy, Inc. v. Pa. Pub. Util. Comm’n, 233 A.3d 936, 948-49 (Pa. Cmwlth.
2020).
In this instance, the relevant statutory provisions are Section 1502 of the
Public Utility Code and Sections 2804(6) and 2807(c) of the Competition Act.
Section 1502 states:
9
No public utility shall, as to service, make or grant any
unreasonable preference or advantage to any person,
corporation, or municipal corporation, or subject any
person, corporation, or municipal corporation to any
unreasonable prejudice or disadvantage. No public utility
shall establish or maintain any unreasonable difference as
to service, either as between localities or as between
classes of service, but this section does not prohibit the
establishment of reasonable classifications of service.
66 Pa. C.S. § 1502. As for Sections 2804(6) and 2807(c), they read as follows:
Consistent with the provision of section 2806 [of the
Competition Act, which addresses the deregulation of the
electricity market in Pennsylvania], the [C]ommission
shall require that a public utility that owns or operates
jurisdictional transmission and distribution facilities shall
provide transmission and distribution service to all retail
electric customers in their service territory and to electric
cooperative corporations and electric generation suppliers,
affiliated or nonaffiliated, on rates, terms of access and
conditions that are comparable to the utility’s own use of
its system.
Id. § 2804(6).
Customer billing.--Subject to the right of an end-use
customer to choose to receive separate bills from its
electric generation supplier, the electric distribution
company may be responsible for billing customers for all
electric services, consistent with the regulations of the
[C]ommission, regardless of the identity of the provider of
those services.
(1) Customer bills shall contain unbundled charges
sufficient to enable the customer to determine the
basis for those charges.
(2) If services are provided by an entity other than
the electric distribution company, the entity that
provides those services shall furnish to the electric
distribution company billing data sufficient to
enable the electric distribution company to bill
customers.
10
(3) The electric distribution company shall not be
required to forward payment to entities providing
services to customers, and on whose behalf the
electric distribution company is billing those
customers, before the electric distribution company
has received payment for those services from
customers.
Id. § 2807(c).
The takeaway from the plain language of these statutes is that EDCs are not
legally prohibited from providing themselves with on-bill billing for non-commodity
goods and services while declining to offer the same privilege to third parties.
Section 1502 of the Public Utility Code explicitly states that “[n]o public utility shall,
as to service, make or grant any unreasonable preference or advantage to any person,
corporation, or municipal corporation, or subject any person, corporation, or
municipal corporation to any unreasonable prejudice or disadvantage.” 66 Pa. C.S.
§ 1502. The phrase “make or grant any unreasonable preference or advantage to any
person, corporation, or municipal corporation” establishes that this statute addresses
the services public utilities offer to other entities, not about those which public
utilities make available for their own use; as such, it would be illogical and extra-
textual to read Section 1502 as also barring public utilities from providing
themselves with different service offerings than those they provide to third parties.
Additionally, it is difficult to see how the EDCs’ refusal to provide Petitioners with
the desired type of on-bill billing would “subject any person, corporation, or
municipal corporation to any unreasonable prejudice or disadvantage[,]” given that
Petitioners and all other electric generation suppliers would be operating under the
same regime, in which none of them would be given the ability to have their non-
commodity goods and services billed in such a manner. This reading is supported by
the language used in Section 2804(6) of the Competition Act, which explicitly states
11
that “the commission shall require that a public utility that owns or operates
jurisdictional [electric] transmission and distribution facilities shall provide . . . all
retail electric customers in their service territory and . . . electric cooperative
corporations and electric generation suppliers, affiliated or nonaffiliated,” with the
same level of electric transmission and distribution services that the EDCs offer
themselves. Id. § 2804(6). Such a targeted directive would be unnecessary if Section
1502 broadly barred public utilities from refusing to offer electric generation
suppliers the same level and kind of services with which public utilities provide
themselves. See 1 Pa. C.S. § 1932 (“(a) Statutes or parts of statutes are in pari
materia when they relate to the same persons or things or to the same class of persons
or things. (b) Statutes in pari materia shall be construed together, if possible, as one
statute.”). Finally, Section 2807(c) of the Competition Act makes clear that on-bill
billing for third-party services is not a mandatory burden imposed upon EDCs. In
sum, Section 1502 of the Public Utility Code only applies regarding equality of
services offered to different third parties (rather than regarding services with which
public utilities provide themselves), and Section 2804(6) of the Competition Act
does not itself bar discrimination regarding non-commodity goods and services. The
Commission’s interpretation of these laws in this context was therefore correct and,
in addition, was not inconsistent with its decision in Columbia.
As for Petitioners’ remaining argument, we conclude that the Commission did
not abuse its discretion when it denied Petitioners’ Petition for Reconsideration
regarding the First Order. The Commission’s standard for granting a petition for
reconsideration
requires that [the petitioner] identify new and novel
arguments, not previously heard, or considerations which
appear to have been overlooked or not addressed by the
Commission, [rather that offering what amounts to] a
12
second motion to review and reconsider, [in order] to raise
the same questions which were specifically considered and
decided against them.
Exec. Transp. Co. v. Pa. Pub. Util. Comm’n, 138 A.3d 145, 150 (Pa. Cmwlth. 2016)
(some punctuation omitted). “[T]his Court’s scope of review of a Commission’s
denial of reconsideration is limited to determining whether the Commission abused
its discretion. . . . An abuse of discretion occurs if the agency decision demonstrates
bad faith, fraud, capricious action or an abuse of power.” J.A.M. Cab Co. v. Pa. Pub.
Util. Comm’n, 572 A.2d 1317, 1318 (Pa. Cmwlth. 1990) (internal citations omitted).
In this instance, the Commission concluded that reconsideration was not
warranted, because Petitioners’ own evidence showed that HomeServe was
operating as an agent of the EDCs, in that HomeServe had contracted with the EDCs
to provide certain kinds of non-commodity goods and services on the EDCs’ behalf,
rather than HomeServe’s own, separate non-commodity goods and services. As
explained by the Commission:
HomeServe is providing non-commodity products and
services on behalf of [the EDCs] as the program
administrator for these services. HomeServe can only act
within the interest delegated to it by [the EDCs] under the
contract between [the EDCs] and HomeServe. Billing for
HomeServe services provided outside the contract are not
included on the utility bill[s sent by the EDCs to their
customers].
As the program administrator for the non-commodity
products offered by [the EDCs], HomeServe is the
contracted agent for [the EDCs] and can only act under the
express authority of the contract entered into by [the
EDCs] and HomeServe. Such contracts evidence an
express agency relationship. . . . Beyond the contract
between [the EDCs] and HomeServe, Exhibits A-D to
[Petitioners’] Petition for Reconsideration all prominently
bear the name of the FirstEnergy Company and the names
of some or all of the individual . . . EDCs. In particular, at
the top of the screenshot in Exhibit D, it states that the
13
HomeServe services are being provided “in partnership
with West Penn Power, a FirstEnergy Company.”
[Reproduced Record at] 696a. In short, rather than
showing that [the EDCs were] providing on-bill billing to
a third party for non-commodity products and services, the
evidence presented by [Petitioners] proved that [the
EDCs] had contracted with HomeServe, and that
HomeServe was operating on behalf of [the EDCs]
providing non-commodity products and services under the
imprimatur of [the] EDCs.
....
Under no construction of the record in this matter can [any
electric generation supplier] be considered to have the
same relationship with [the EDCs] as that between [the
EDCs] and HomeServe. HomeServe is clearly acting on
behalf of, and in the name of, [the EDCs].
Commission’s Br. at 32-33 (citation omitted). Given the nature of the record
evidence, as well as that evidence’s support for the Commission’s explanation, there
is no basis for concluding that the Commission abused its discretion by denying
Petitioners’ Petition for Reconsideration.
III. Conclusion
In keeping with the foregoing, we affirm the Commission’s First Order and
Second Order.
__________________________________
ELLEN CEISLER, Judge
Judge Fizzano Cannon did not participate in the decision of this case.
14
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Interstate Gas Supply, Inc. d/b/a :
IGS Energy, NRG Energy, Inc. and :
Shipley Choice LLC d/b/a Shipley :
Energy, :
Petitioners :
:
v. : No. 472 C.D. 2022
:
Public Utility Commission, :
Respondent :
ORDER
AND NOW, this 28th day of April, 2023, it is hereby ORDERED that
Respondent Public Utility Commission’s (Commission) August 26, 2021 opinion
and order, as well as the Commission’s April 14, 2022 opinion and order, are
AFFIRMED.
__________________________________
ELLEN CEISLER, Judge
IN THE COMMONWEALTH COURT OF PENNSYLVANIA
Interstate Gas Supply, Inc. d/b/a :
IGS Energy, NRG Energy, Inc. and :
Shipley Choice LLC d/b/a Shipley :
Energy, :
Petitioners :
:
v. : No. 472 C.D. 2022
: Argued: February 8, 2023
Public Utility Commission, :
Respondent :
BEFORE: HONORABLE RENÉE COHN JUBELIRER, President Judge
HONORABLE PATRICIA A. McCULLOUGH, Judge
HONORABLE ANNE E. COVEY, Judge
HONORABLE MICHAEL H. WOJCIK, Judge
HONORABLE ELLEN CEISLER, Judge
HONORABLE LORI A. DUMAS, Judge
HONORABLE STACY WALLACE, Judge
OPINION NOT REPORTED
DISSENTING OPINION BY
PRESIDENT JUDGE COHN JUBELIRER FILED: April 28, 2023
Upon my review of this matter, I am persuaded by the arguments of the
electric generation suppliers Interstate Gas Supply, Inc. d/b/a IGS Energy, NRG
Energy, Inc., and Shipley Choice LLC d/b/a Shipley Energy (EGSs) that the Public
Utility Commission (Commission) erred in reversing the Administrative Law
Judge’s (ALJ) finding that certain electric distribution companies (EDCs) violated
Sections 1502 and 2804(6) of the Public Utility Code (Code), 66 Pa.C.S. §§ 1502
and 2804(6). Therefore, I must, respectfully, dissent.
The Code prohibits public utilities from discriminating in the provision of
services by providing one service to some parties and not to others. Section 1502 of
the Code states: “No public utility shall, as to service, make or grant any
unreasonable preference or advantage to any person, corporation, or municipal
corporation, or subject any person, corporation, or municipal corporation to any
unreasonable prejudice or disadvantage.” 66 Pa.C.S. § 1502 (emphasis added).
And, Section 2804(6) of the Code, a part of the Competition Act that restructured
the electric industry, provides:
Consistent with the provision of [S]ection 2806 [(deregulating energy
generation)], the [C]ommission shall require that a public utility that
owns or operates jurisdictional transmission and distribution facilities
shall provide transmission and distribution service to all retail electric
customers in their service territory and to electric cooperative
corporations and electric generation suppliers, affiliated or
nonaffiliated, on rates, terms of access and conditions that are
comparable to the utility’s own use of its system.
66 Pa.C.S. § 2804(6) (emphasis added). Unlike the Majority, I agree with the EGSs
that the EDCs practice of on-bill billing for their own non-commodity goods and
services, while not offering the same on-billing service to EGSs, violates these
sections.
“[T]he service of providing the utility bill to customers, i.e., utility billing, is
a utility service,” and, therefore, “is subject to the Commission’s jurisdiction” and
“to the requirements of . . . [Sections] 1502 and . . . 2804(6), which prohibit
discrimination in the provision of utility service generally [and] specifically apply
to the provision of utility service by EDCs to [] EGS[s].” (EGSs’ Brief (Br.) at 17-
18 (citing Aronson v. Pa. Pub. Util. Comm’n, 740 A.2d 1208, 1211 (Pa. Cmwlth.
1999) (referencing the information on billing statements as a public utility service);
Pa. Pub. Util. Comm’n v. Columbia Gas of Pa., Inc., (Pa. PUC Docket No. R-2018-
2647577, filed Dec. 6, 2018), slip op. at 44).) See also Section 102 of the Code, 66
RCJ-2
Pa.C.S. § 102 (broadly defining “service” as including “any and all acts done,
rendered, or performed, and any and all things furnished or supplied . . . by public
utilities . . . in the performance of their duties . . . to their patrons . . . and the public”);
Section 54.122(7) of the Commission’s Regulations, 52 Pa. Code § 54.122(requiring EDCs to supply all regulated services to nonaffiliated EGSs in the same
manner as it does itself and must do so uniformly in a nondiscriminatory manner).
The Commission’s interpretation of Section 1502 as not “prohibit[ing]
discrimination where a utility provides a service to itself at the exception of others”
reads out of Section 1502 the “plain language prohibiting discrimination by a utility
to ‘any person, corporation, or municipal corporation,’” by granting anti-
discriminatory protection only where services are discriminatorily provided to third
parties. (Id. at 19-20 (emphasis in original) (quoting 66 Pa.C.S. § 1502).) Section
1502 prohibits the provision of a preference or advantage to “any corporation,” 66
Pa.C.S. § 1502, and “any” corporation should include the public utility itself, and
not be limited to “another” corporation, which is the result of the Commission’s
interpretation. Holding otherwise is inconsistent with the Commission’s decision in
Columbia Gas, which held that discriminatory preferential treatment occurs where
a utility provides an entity “a clear benefit” and “business advantage” by having a
non-commodity service included on the utility’s bill. (Id. at 20-21 (citing Columbia
Gas, slip op. at 48-50).) Here, there is a “clear benefit” to the EDCs when they use
on-bill billing for their non-commodity goods and services because it provides
“convenience to customers[] by reserving the exclusive capabilities that go with
billing for non-basic services on the utility bill for its own use.” (Id. at 21.)
Therefore, in my view, the EDCs action in providing a benefit to themselves keeps
their competitors, the EGSs, “from having the same advantages . . . in providing
RCJ-3
convenience to customers” and constitutes discrimination in violation of Section
1502 of the Code. (Id.)
This interpretation of Section 1502 is supported by Section 2804(6), which
requires EDCs to provide, inter alia, rates and conditions to EGSs that are
comparable to the EDCs’ own rates and conditions. 66 Pa.C.S. § 2804(6). As the
EGSs argue, the Commission’s narrow interpretation of Section 2804(6) as not
applying to the billing of non-commodity products and services allows EDCs to
provide rates and conditions to the EGSs that are not comparable to the EDCs own,
which is contrary to that section’s plain language. (Id. at 23-24.) Although the
Commission asserts billing is not a part of the distribution service referenced in
Section 2804(6), this argument is “untenable” because “meter[ing] customer usage,”
“accumulat[ing] that data, and provid[ing] that data to [EGSs] to allow them to
calculate customer bills” is part of the provision of distribution services that must be
done on the same conditions as the EDCs own conditions. (EGSs’ Reply Br. at 12-
13.) Further, the Commission’s interpretation appears to be “contrary to the express
language of the Competition Act,” which “clearly assigns to the EDCs the role of
default biller” that “‘is responsible for billing customers for all electric services . . .
regardless of the identity of the provider of those services.’” (Id. at 13-14 (quoting
Section 2807(c) of the Code, 66 Pa.C.S. § 2807(c)).)
Ultimately, I would hold that, if the EDCs provide on-bill billing services to
themselves, thereby obtaining a benefit and business advantage associated with
issuing their customers a convenient, single bill, they must provide the same services
to the EGSs. If the EDCs do not offer the same services to the EGSs, they run afoul
of the Code’s anti-discrimination provisions found in Sections 1502 and 2804(6).
RCJ-4
To remedy the discrimination, the EDCs must either “simply not provide the
service” or must “provid[e] the service . . . without discrimination.” (Id. at 11.)
For these reasons, I would hold the Commission erred in finding no violation
of Sections 1502 and 2804(6) and would reverse the Commission’s August 26, 2021
Order. I therefore respectfully dissent.
__________________________________________
RENÉE COHN JUBELIRER, President Judge
Judge McCullough joins in this Dissenting Opinion.
RCJ-5