Utility company

“ The corporation is a public utility engaged in generating, transmitting, and distributing electric power and energy for barter, sale, and exchange to consumers in each of these three states, and in interstate commerce among them. The present suit was brought to enjoin the enforcement of an act of the Idaho Legislature, levying a license tax on the manufacture, generation, or production, within the state, for barter, sale, or exchange, or electricity and electrical energy. ”

“ Long before the Federal Government could be stirred to regulate utilities, courageous states took the initiative and almost the whole body of utility practice has resulted from their experiences.
We must not forget that regulatory measures are temporary expedients, not eternal verities-if indeed they are verities at all. Certainly one of the matters on which the states might well be indulged-the right to an opinion of their own-is as to the accounting methods of a utility whose whole property and business being accounted for is within the state. ”

“ Normally, the unit for rate-making purposes, we may assume, would be the entire interconnected operating property of a utility used and useful for the convenience of the public in the territory served, without regard to particular groups of consumers or local subdivisions. ”

“ We are confronted with regulation of a unique type of enterprise which I think requires considered rejection of much conventional utility doctrine and adoption of concepts of 'just and reasonable' rates and practices and of the 'public interest' that will take account of the peculiarities of the business. ”

“ A public utility is entitled to such rates as will permit it to earn a return on the value of the property which it employs for the convenience of the public equal to that generally being made at the same time and in the same general part of the country on investments in other business undertakings which are attended by corresponding, risks and uncertainties ”

“ Upon the valuation fixed, with an allowance for depreciation calculated with reference to that valuation, and upon the then prescribed rates, the company for the years 1920 to 1926, both inclusive, obtained a return of little more than 5 per cent. per annum. It is manifest that just compensation for a utility, requiring for efficient public service skillful and prudent management as well as use of the plant, and whose rates are subject to public regulation, is more than current interest on mere investment. ”

“ But if the amounts charged to operating expenses and credited to the account for depreciation reserve are excessive, to that extent subscribers for the telephone service are required to provide, in effect, capital contributions, not to make good losses incurred by the utility in the service rendered and thus to keep its investment unimpaired, but to secure additional plant and equipment upon which the utility expects a return. ”

“ The Public Utility Holding Company Act of 1935 is a reticulated statute, not a hodge-podge. To observe its explicit provisions is to respect the purpose of Congress and the care with which it was formulated. ”

“ The end result is that property has been transferred at a write-up from one of Southwestern's pockets to another. The impact on consumers of utility service of write-ups and inflation of capital assets through inter-company transactions or otherwise is obvious. The prevalence of the practice in the holding company field gave rise to an insistent demand for federal regulation. See S. Doc. No. 92, Pt. 84-A, 70th Cong., 1st Sess. Utility Corporations, Final Report of the Federal Trade Commission (1936) ”

“ The trust may consist of a single establishment; or of a group of establishments separately operated but united in a "pool" to divide output, territory, or earnings; or of such a group held together by a holding company, or combined into one corporation. Public utility is the name of special franchise enterprises of the kind just mentioned, including, in the broad sense, railroads and local utilities such as street railways, gas, water, and electric light-plants.
§ 5. #Industrial monopoly and fostering conditions.# The problem of monopoly is probably as old as markets. ”

“ No public utility shall sell, lease, or otherwise dispose of the whole of its facilities subject to the jurisdiction of the Commission, or any part thereof of a value in excess of $50,000, or by any means whatsoever, directly or indirectly, merge or consolidate such facilities or any part thereof with those of any other person, or purchase, acquire, or take any security of any other public utility, without first having secured an order of the Commission authorizing it to do so. ”

“ The Congress may fix utility rates in situations subject to federal control without regard to any standard except the constitutional standards of due process and for taking private property for public use without just compensation. ”

“ Qualified issuer.—The term `qualified issuer' means a public power provider, a cooperative electric company, a governmental body, a clean renewable energy bond lender, or a not-for-profit electric utility which has received a loan or loan guarantee under the Rural Electrification Act.''. ”

“ Even to obtain ownership over two systems, a holding company must, along with proving 'substantial economies,' show that there is geographical unity and that the combination is not so large as to impair 'the advantages of localized management, efficient operation, or the effectiveness of regulation' (supra, n. 1) . Section 8 (supra, p. 190) acts as a further restraint in some cases. Other sections of the Act regulate transactions between utility companies and require disclosure of reports and maintenance of accounting data and other records. ”

“ Besides trading companies there is another large class, exceeding in their number even trading companies, which for shortness may be called public companies, that is to say, companies constituted by special act of parliament for the purpose of constructing and carrying on undertakings of public utility, such as railways, canals, harbours, docks, waterworks, gasworks, bridges, ferries, tramways, drainage, fisheries or hospitals. ”

“ For this reason, generating facilities cannot be maintained on the basis of a constant demand. Rather, the utility's generating capability must be geared to the utility's peak load of demand, and also take into account the fact that generating equipment must occasionally be out of service for overhaul, or because of breakdowns. ”

“ In the United States a co-operative electrical development association canvasses both the general public and the electricity supply undertakers. Funds are provided by the manufacturing companies acting in concert with the supply authorities and contractors, and the spirit underlying the work is to advertise the merits of electricity—not any particular company or interest. Their efforts are directed to securing new consumers and stimulating the increased and more varied use of electricity among actual consumers. ”

“ The nature of the electric utilities industry is such that about 90 per cent of all power generation and distribution is intrastate in character, and most of the States have developed their own regulatory systems as to certificates of convenience, rates, and profits of such utilities. ”

“ But no one would question that the reasonable cost of an efficient public utility system 'is good evidence of its value at the time of construction.' We have said that 'such actual cost will continue fairly well to measure the amount to be attributed to the physical elements of the property so long as there is no change in the level of applicable prices.' McCardle v. ”

“ In 1913 the state Legislature adopted an act providing that the corporation commission 'shall have general super vision over all public utilities, with power to fix and establish rates and to prescribe rules, requirements and regulations, affecting their services.' Laws 1913, c. 93, § 2. It was under this act, and after a full hearing on a petition presented by the gas company, that the order in question was made. ”

“ Since he took office and dictated the policy of the Company, every single overture for more expensive equipment in the electric lighting of the city has come from the Company, and every single overture for reducing the rate to consumers has come from the company.
The consumption of electricity in the city is the largest per capita in the world, and the rate is the cheapest in the country; and, incidentally, the Company so trusts the people that they let them have electricity without metres, and the people so trust the Company that they save its electricity as they would their own. ”

“ And as further pointing out the characteristics of the public use justifying the fixing of prices, it will be noted that, with the exception of toll mills (which, however, to employ property devoted to a public use) , they all have direct relation to the business or facilities of transportation or distribution,-to transportation by carriers of passengers, goods, or intelligence by vehicle or wire; to distribution of water, gas, or electricity through ditch, pipe, or wire; to wharfage, storage, or accommodation of property before the journey begins, when it ends, or along the way. ”

“ No review of the decade's progress of electricity supply would be complete without reference to the great expansion of syndicate operation and management. Through the control by one company, usually known as a holding company, of numerous properties, a great saving was made. Central organizations have applied to small properties better engineering and management than they otherwise could have had. This also resulted in the discontinuance of small uneconomical plants and the substitution of large unified systems supplying many communities. ”

“ The independent contractors are utilized for a great variety of tasks on the Appliance Park premises. Some do construction work on new buildings; some install and repair ventilating and heating equipment; some engage in retooling and rearranging operations necessary to the manufacture of new models; others do 'general maintenance work.' These services are contracted to outside employers either because the company's employees lack the necessary skill or manpower, or because the work can be done more economically by independent contractors. ”

“ Petitioner and respondent are public electric utilities companies engaged in interstate commerce. Petitioner's predecessor and respondent were under the same management through interlocking directorships and joint officers. During that relationship the two interchanged electric energy, shared expenses, and made a number of intercompany contracts establishing rates and charges, which contracts were filed with and accepted by the Federal Power Commissoin. ”

“ The third thing that we should be doing is working with utilities all across America, including here in Indiana, to do what some utilities are already doing in California. And this is a really smart thing. What they do is, the utility is able to make money not just on how much energy it sells, but it's also able to make money on how much energy its customers save. ”

“ This was apparently so clear at the time the Act passed that in an early and now-repudiated decision the SEC went so far as to hold that gas and electric companies could be combined in the same single integrated public utility system. American Water Works & Elec. Co., 2 S.E.C. 972 (1937) .
Furthermore, a constricted reading of the 'substantial economies' provision is a quite unsuitable way of responding to the dangers in common ownership of competing types of utilities. ”

“ The obtaining of electrical energy from a commercial line is desirable because of its greater dependability, generally lower cost and the fact that unlimited use of electricity may be obtained without the overloading that frequently occurs where individual plants are set up. Probably the availability of public utility lines is the greatest asset of comfortable country life and one of the most important factors in creating genuine resale value. ”

“ The applicable State regulatory authority will seek to implement, in appropriate proceedings for each electric and gas utility, with respect to which the State regulatory authority has ratemaking authority, a general policy that ensures that utility financial incentives are aligned with helping their customers use energy more efficiently and that provide timely cost recovery and a timely earnings opportunity for utilities associated with cost-effective measurable and verifiable efficiency savings, in a way that sustains or enhances utility customers' incentives to use energy more efficiently. ”

“ The completion of a large public utility, planned on such a scale as to provide for the requirements of many years to come, utilizing but part of its capacity, and earning less than its operating expenses and fixed charges, with its rates of toll fixed by law, must be considered in a different way than a well-established public utility, with business forcing it to its utmost capacity, and with tolls not fixed by law. ”

“ For a new phase of the public utility problem has arisen—that of the private monopoly in the hydro-electric and superpower field. The private corporations are swiftly seizing upon every possible resource of water power and coal for the production of electric current, capturing and consolidating both private and municipal plants and tieing them into vast interconnected superpower systems. ”

“ It has long drawn a distinction between the underlying service to the public a natural gas company performs and the specific manifestation-the contractual relationship-which that service takes at a given moment. For example, an independent producer may file as its rate schedule its contract of sale with a pipeline company. ”