Opinion
Argued September 10, 1984
October 29, 1984.
Pennsylvania Public Utility Commission — Scope of appellate review — Violation of constitutional rights — Error of law — Findings of fact — Substantial evidence — Building insulation requirements — The Building Energy Conservation Act, Act of December 15, 1980, P.L. 1203 — Power of Commission — Public Utility Code, 66 Pa. C. S. §§ 1501 and 1504.
1. Review by the Commonwealth Court of Pennsylvania of a decision of the Pennsylvania Public Utility Commission is to determine whether constitutional rights were violated, an error of law was committed or findings of fact were unsupported by substantial evidence. [606]
2. Express provisions of The Building Energy Conservation Act, Act of December 15, 1980, P.L. 1203, and of the Public Utility Code, 66 Pa. C. S. §§ 1501 and 1504, and implied authorization reasonably derived from those provisions empower the Pennsylvania Public Utility Commission to approve tariffs under which building construction must meet specified minimum insulation standards as a condition for receiving electric service even when electricity is not the primary energy source for the building. [607]
3. A tariff requiring certain insulation standards to be maintained as a condition for receiving electric service is properly approved by the Pennsylvania Public Utility Commission when evidence supports findings that energy conservation involves the use of electricity, that a sufficient connection exists between electrical energy conservation and insulation of buildings even where electricity is not the primary energy source and that increased insulation will result in significant energy saving and will be cost-effective. [608-9]
Argued September 10, 1984, before Judges ROGERS, CRAIG and MacPHAIL, sitting as a panel of three.
Appeal, No. 931 C.D. 1980, from the Order of the Pennsylvania Public Utility Commission in case of Pennsylvania Public Utility Commission v. Pennsylvania Power Light Company, Docket No. R-78040578.
Tariff supplement filed with the Pennsylvania Utility Commission by electric company requiring building construction meet specified minimum insulation standards as condition for receiving electric service. Commission suspended tariff pending hearings. Complaints filed with Commission challenging legality of portion of supplement. Complaints consolidated. Tariff approved with modifications. Exceptions filed by electric company and complainants. Exceptions of electric company granted. Complainants' exceptions denied. Complainants appealed to the Commonwealth Court of Pennsylvania. Held: Affirmed. Application for reargument filed and denied.
Loudon L. Campbell, with him, J. Scott Calkins, Calkins Campbell, for petitioners.
Daniel P. Delaney, Deputy Chief Counsel, with him, Frank B. Wilmarth, Associate Counsel, and Charles F. Hoffman, Chief Counsel, for respondent.
David J. Dulick, with him, Bridget E. Grady, for intervenor, Pennsylvania Power Light Company.
David Barasch, Acting Consumer Advocate, with him, Philip McClelland, Assistant Consumer Advocate, for intervenor, Consumer Advocate.
The Pennsylvania Builders Association (PBA) appeals an order of the Pennsylvania Public Utility Commission (PUC), approving a supplement to a tariff rule filed by the Pennsylvania Power and Light Company (PPL), which requires that building construction meet specified minimum insulation standards as a condition for receiving electric service.
Our scope of review is limited to determinations as to violations of constitutional rights, errors of law and whether findings are supported by substantial evidence. Allied Development and Building Corp. v. Pennsylvania Public Utility Commission, 60 Pa. Commw. 207, 430 A.2d 1239 (1981).
Because our Supreme Court has held that the PUC does have jurisdiction to approve the tariff, we must determine, on remand, whether the PUC has the authority to approve it. Inherent in this case is the question of whether the PUC may approve such tariff when it applies to buildings that are neither heated nor cooled by electricity as the primary energy source. Because we conclude that the PUC may approve the tariff, we affirm.
Tariff 2H, as submitted by PPL and approved by the PUC requires, at 2H(2), that the contractor, engineer or architect issue a statement of conformance to the "effective insulation requirements" which may be verified by PPL prior to acceptance for electrical service. The tariff covers new residential buildings, new commercial buildings, additions to existing buildings, conversion of buildings to electric heat, and mobile homes. Additionally, the tariff is flexible in that it allows an increase or a decrease in a specific insulation assembly (wall, ceiling or floor), so long as the building still meets the overall heat loss requirements.
The Building Energy Conservation Act, Act of December 15, 1980, P.L. 1203, 35 P. S. § 7201.1017201.602 (Conservation Act), enacted after the Public Utility Code, Act of July 1, 1978, P.L. 598, as amended, 66 Pa. C.S. §§ 101-3315, directs the Commonwealth to "exercise specific authority in building construction to assure that . . . construction is performed using materials and techniques that will provide for energy conservation in the future operation and maintenance of said buildings." 35 P. S. § 7201.102(b).
The PUC is charged with ensuring that every utility furnishes adequate, safe and reasonable service. Further, the PUC may prescribe standards for conditions relating to the supply of the service. These standards, when approved by the PUC, need not originate with the PUC.
Public Utility Code, Act of July 1, 1978, P.L. 598, 66 Pa. C. S. § 1501.
As we have recently observed, the PUC has broad authority to supervise and regulate all utilities within the Commonwealth. Crown American Corporation v. Pennsylvania Public Utility Commission, 76 Pa. Commw. 305, 309, 463 A.2d 1257, 1259 (1983). In the earlier stage of this case, Pennsylvania Builders Association v. Pennsylvania Public Utility Commission, 502 Pa. 87, 464 A.2d 321 (1983), our Supreme Court concluded that the Legislature intended that the Conservation Act not limit energy conservation to a certain statutory minimum level. The court stated that the legislature intended only to forbid other standards less stringent than those enacted:
This decision vacated this court's order in Pennsylvania Builders Association v. Pennsylvania Public Utility Commission, 60 Pa. Commw. 438, 432 A.2d 1157 (1981), and remanded the case to this court.
Both the entire purpose of that Act, and the particular provisions with which we are concerned, have energy conservation as their sole and stated purpose. To strike standards which are entirely promotive of that purpose, on that ground that they do their job too well, is not consistent with the expressed legislative intention.
Id. at 92, 464 A.2d at 323.
A regulatory agency may have implied powers, with respect to matters not specifically stated in the enabling statute, if they are within the legislative intent. Western Pennsylvania Water Company v. Pennsylvania Public Utility Commission, 10 Pa. Commw. 533, 538, 311 A.2d 370, 373 (1973).
The PUC decision contains findings to the effect that: (1) energy conservation involves all forms of non-renewable energy sources, (2) there is a sufficient connection between electrical energy conservation and the insulation of non-electrically heated and/or centrally air conditioned buildings to justify the adoption of insulating standards as a precondition for new electrical service connections, and (3) therefore increased insulation will result in significant energy savings which will be cost-effective regardless of the fuel used for heating, producing system-wide benefits.
Our examination of the record shows adequate substantial evidence to support these findings. The testimony of Mr. Nonemaker of PPL — regarding the savings of energy resources required to produce electricity, deferral of power plant construction and financing costs, reduction in additional environmental impact, and delay of additional rate increases — provides adequate reasons to support the tariff.
Mr. McNair, also of PPL, gave definite testimony that minimum levels of insulation can be implemented immediately using available materials and techniques, that the minimum levels do not represent any significant change in lifestyle and that — once installed — the insulation represents continuing savings on annual energy bills over the life of the building, beyond the savings in the cost of generating electricity. He noted that the proposed insulation levels were supported by the guidelines of both the National Association of Homebuilders and the Farm and Home Administration. Finally, Mr. McNair gave persuasive testimony regarding the desirability of a uniform tariff because of its cost effectiveness for all of the fuels used to heat the home and because of flexibility needed in the event that a future shortage of one of the fuels forces a conversion to electrical heating.
We agree with the PUC that the tariff is reasonable and will encourage economical use of electricity, resulting in a significant saving of electricity system-wide.
Accordingly, we affirm.
ORDER
NOW, October 29, 1984, the order of the Pennsylvania Public Utility Commission, entered March 28, 1980, is affirmed.