Tri-State Generation and Transmission is asking the Colorado Public Utilities Commission to throw out a recommended decision by an administrative law judge that its refusal to provide an exit charge to La Plata Electric Association was unjust and unreasonable.
The recommended decision is another chapter in LPEA’s effort to determine if buying out its contract with Tri-State, which supplies it with 95% of its electricity, makes sense.
LPEA is exploring if buying out its contract with Tri-State, which runs until 2050, would allow it to purchase electricity at a lower rate while at the same time getting more electricity from renewable sources – especially renewable power produced locally.
Tri-State filed exceptions with the PUC on Friday saying the recommended decision should be thrown out because it failed to address Tri-State’s objection that the PUC lacked jurisdictional authority to rule on the matter.
Tri-State has also asked the Federal Energy Regulatory Commission to rule on the issue of how to determine buyout costs.
“The CPUC should dismiss the complaints because its jurisdiction to enter an order that directly affects Tri-State’s wholesale rate is preempted by the Federal Power Act,” said Tri-State Chief Executive Officer Duane Highley in a news release.
LPEA and United Power of Brighton signed long-term power contracts with Tri-State in 2007 agreeing to share the costs of power supply with Tri-State’s other utility members through the terms of their contracts, Highley said.
United Power also is seeking to buy out its contract with Tri-State.
Hillary Knox, spokeswoman for LPEA, said the PUC has found it has jurisdictional authority over determining a buyout methodology in three other similar cases before the state agency.
She said Tri-State’s exceptions obscure the fact that while FERC accepted Tri-State’s methodology for determining a buyout cost, it did not approve that methodology.
“FERC has already said the PUC retains jurisdiction until a federal exit charge methodology is approved,” Knox said.
Knox said the administrative law judge issued a recommended decision after an extensive review of the evidential record.
She said Tri-State refused to provide its exit charge methodology to the PUC when given the opportunity to do so.
“Tri-State fails to note that it is a regulated public utility and that it does not get to tell its regulators what to do,” Knox said.
Tri-State in its exception, claims even if the state PUC does not recognize the jurisdictional authority of FERC, it nonetheless is guided by a recent July 10 court decision by the District of Columbia Circuit Court of Appeals that reaffirmed FERC’s exclusive jurisdictional authority in the matter.
In its exceptions, Tri-State also claimed other shortcomings in the recommended decision, including:
Significant procedural, legal and policy flaws.Exclusion of key parties’ testimony including other electric cooperatives that are members of Tri-State.Ignoring due process requirements under Colorado law.“If the CPUC declines to dismiss the original complaint, then it must dismiss the recommended decision. It must renotice the complaints and conduct a new proceeding,” Highley said.
The new proceeding must allow Tri-State the ability to present its methodology to determine a contract termination buyout cost, Highly said.
According to Tri-State, the recommended decision was insufficient and prejudicial because it relied on two complaining members while denying 29 other Tri-State members in Colorado, New Mexico, Wyoming and Nebraska from the ability to participate despite their “substantial interests” in the matter.
“If this recommended decision is allowed to stand, more than $1 billion in costs will be unjustly added to our remaining members’ electricity bills,” Highley said.
Knox said the administrative law judge conducted a thorough review of evidence before issuing the recommended decision.
“Tri-State refused to engage and provide an exit charge methodology proposal to the PUC when given the opportunity. Tri-State fails to note that it is a regulated public utility and that it does not get to tell its regulators what to do,” Knox said.
The PUC has seven days to respond to exceptions filed before making the recommended decision final.
PUC decisions can also be appealed to state district court.
If a district court judge’s decision of a PUC case is appealed, under Colorado law, it would go straight to the Colorado Supreme Court.
parmijo@durangoherald.com
