Landowner opponents of the Rock Island Clean Line transmission project hoped that the Supreme Court oral argument yesterday would be the last they will see of Clean Line Energy Partners. They could be right.
Clean Line arrived overly confident, conflating the Court's desire to hear the case with a desire to reverse the decision of the Third District Appellate Court.
Clean Line arrived overly confident, conflating the Court's desire to hear the case with a desire to reverse the decision of the Third District Appellate Court.
Hans Detweiler, vice president of Clean Line Energy Partners, Rock Island's Houston-based owner, said he's "encouraged" that Illinois' high court will review the case and hopes it "will recognize that privately funded infrastructure projects" like Rock Island "serve a public purpose."
But softball questions and encouraging smiles were not to be had from the Supreme Court Justices yesterday. The Justices asked a plethora of questions regarding how RICL could legally be for "public use."
In response they got a whole bunch of complicated explanations on physics, Open Access Transmission Tariffs, and the idea that FERC's rules on a non-discriminatory auction process satisfied Illinois law regarding a utility's non-discriminatory service to the public. It's quite unfortunate for RICL that they decided the ICC's attorney should go first with his argument that the ICC is entitled to deference in how it interpreted Illinois law. The Justices didn't seem too interested in that, instead asking Matthew Harvey questions about how RICL could legally be a public utility. Poor Mr. Harvey... his answers did not satisfy RICL's bevy of attorneys in the first few rows and drew skeptical faces and negative headshakes from them. I was afraid that if Owen McBride's eyebrows knitted themselves any closer together whether he'd go cross-eyed. Despite this superior attitude from RICL, I can't say RICL's attorney fared any better before the judges than Mr. Harvey. RICL's attorney met the justices' questions with complicated circular answers and lots of smoke and mirrors that failed to shed any light on the issue.
When asked by a Justice if RICL's desire to be a public utility was for the sole purpose of acquiring eminent domain authority, RICL's counsel chose to deny it and blame the ICC for telling them they had to be a public utility. Really, now? I'm thinking that a straight up admission of how hard it is to build transmission without eminent domain authority would have served them much better than a ridiculous story nobody believed.
The appellees lead off with a strong argument defining "public use" that managed to answer all the Justices' questions that had remained basically unanswered after the appellants had their say. Matthew Price, representing Com Ed, was positively brilliant compared to the bombastic, uninspired arguments of the ICC and RICL. He explained public use so simply that it could be understood by anyone. Public use is a utility's obligation to serve all who want service. A public utility doesn't get to choose which customers it will serve in order to maximize its profit. RICL will pick and choose its customers in a way that maximizes its profits. A public utility must serve everyone, not just allow them to bid for service, or use service available when no one else is using it.
Mr. Price made it clear as a bell. And the Justices pretty much stopped asking the questions about public use, so I guess their questions were answered by Mr. Price. It's pretty clear to me that the merchant transmission business model doesn't comport with Illinois law. Price said something about a FERC-land determination of non-discrimination does not satisfy a determination in the Land of Lincoln. Right... because FERC is only looking at whether the auction process is fair. It does not concern itself with whether the merchant transmission company is discriminating against members of the public by only providing service to select customers. Just because FERC approves it does not mean it comports with Illinois law.
Mr. Price brought up the issue of RICL's refusal to expand capacity on its line if it gets more requests for service than it can provide. RICL claims it has to stick with the original plan because that's the project in its application. Maybe it could build another line if it had multiple requests, but why bother with that if it can increase its profits by limiting available capacity?
Price brought up the idea that RICL could pro-rate its available capacity at the auction, with each bidder receiving a share, instead of trying to maximize its profits by selling only to the highest bidders. And then the most humorous thing happened... in rebuttal, RICL's counsel decided it could pro-rate its capacity to auction bidders. I've never heard anything about this from RICL before, and I'm pretty sure it wasn't in their FERC application for negotiated rate authority. Nor was it in the Order of the ICC granting the CPCN. So now the Court is supposed to believe RICL has fundamentally altered its auction process on a whim? Way to admit you're wrong, RICL!
The ILA presented a short, cogent argument about how eminent domain is basically procedural once a CPCN is issued. And got snotty looks and smirks from the RICL attorneys for their trouble, along with an arrogant rebuttal that attempted to minimize and disparage landowner concerns. RICL showed the Court that it doesn't give any consideration whatsoever to the landowners it wants to get into perpetual easement partnerships with.
So, now we wait for the Court to issue its opinion. Some people say that you can tell which way a court is leaning by the questions its judges ask during oral arguments. Hans Detweiler better not count his chickens before they hatch. He's no constitutional scholar. Commerce Clause. Heh.
In response they got a whole bunch of complicated explanations on physics, Open Access Transmission Tariffs, and the idea that FERC's rules on a non-discriminatory auction process satisfied Illinois law regarding a utility's non-discriminatory service to the public. It's quite unfortunate for RICL that they decided the ICC's attorney should go first with his argument that the ICC is entitled to deference in how it interpreted Illinois law. The Justices didn't seem too interested in that, instead asking Matthew Harvey questions about how RICL could legally be a public utility. Poor Mr. Harvey... his answers did not satisfy RICL's bevy of attorneys in the first few rows and drew skeptical faces and negative headshakes from them. I was afraid that if Owen McBride's eyebrows knitted themselves any closer together whether he'd go cross-eyed. Despite this superior attitude from RICL, I can't say RICL's attorney fared any better before the judges than Mr. Harvey. RICL's attorney met the justices' questions with complicated circular answers and lots of smoke and mirrors that failed to shed any light on the issue.
When asked by a Justice if RICL's desire to be a public utility was for the sole purpose of acquiring eminent domain authority, RICL's counsel chose to deny it and blame the ICC for telling them they had to be a public utility. Really, now? I'm thinking that a straight up admission of how hard it is to build transmission without eminent domain authority would have served them much better than a ridiculous story nobody believed.
The appellees lead off with a strong argument defining "public use" that managed to answer all the Justices' questions that had remained basically unanswered after the appellants had their say. Matthew Price, representing Com Ed, was positively brilliant compared to the bombastic, uninspired arguments of the ICC and RICL. He explained public use so simply that it could be understood by anyone. Public use is a utility's obligation to serve all who want service. A public utility doesn't get to choose which customers it will serve in order to maximize its profit. RICL will pick and choose its customers in a way that maximizes its profits. A public utility must serve everyone, not just allow them to bid for service, or use service available when no one else is using it.
Mr. Price made it clear as a bell. And the Justices pretty much stopped asking the questions about public use, so I guess their questions were answered by Mr. Price. It's pretty clear to me that the merchant transmission business model doesn't comport with Illinois law. Price said something about a FERC-land determination of non-discrimination does not satisfy a determination in the Land of Lincoln. Right... because FERC is only looking at whether the auction process is fair. It does not concern itself with whether the merchant transmission company is discriminating against members of the public by only providing service to select customers. Just because FERC approves it does not mean it comports with Illinois law.
Mr. Price brought up the issue of RICL's refusal to expand capacity on its line if it gets more requests for service than it can provide. RICL claims it has to stick with the original plan because that's the project in its application. Maybe it could build another line if it had multiple requests, but why bother with that if it can increase its profits by limiting available capacity?
Price brought up the idea that RICL could pro-rate its available capacity at the auction, with each bidder receiving a share, instead of trying to maximize its profits by selling only to the highest bidders. And then the most humorous thing happened... in rebuttal, RICL's counsel decided it could pro-rate its capacity to auction bidders. I've never heard anything about this from RICL before, and I'm pretty sure it wasn't in their FERC application for negotiated rate authority. Nor was it in the Order of the ICC granting the CPCN. So now the Court is supposed to believe RICL has fundamentally altered its auction process on a whim? Way to admit you're wrong, RICL!
The ILA presented a short, cogent argument about how eminent domain is basically procedural once a CPCN is issued. And got snotty looks and smirks from the RICL attorneys for their trouble, along with an arrogant rebuttal that attempted to minimize and disparage landowner concerns. RICL showed the Court that it doesn't give any consideration whatsoever to the landowners it wants to get into perpetual easement partnerships with.
So, now we wait for the Court to issue its opinion. Some people say that you can tell which way a court is leaning by the questions its judges ask during oral arguments. Hans Detweiler better not count his chickens before they hatch. He's no constitutional scholar. Commerce Clause. Heh.
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