Bob Strong and Sean Gallagher recently achieved a reversal in the Michigan Court of Appeals of the Michigan Public Service Commission’s denial of summary disposition on a claim that the Commission exceeded its statutory authority when it authorized the defendant regulated utility company to raise electrical rates for Clark Hill’s client, a significant North American industrial energy transporter, generator, and distributor, at its facility in Michigan’s Upper Peninsula. Arguing the settlement resolved a disputed legal issue, the Commission approved the rate increases in 2012 under guise of approval of a settlement agreement from 2009 that included a rate-increasing accounting mechanism. The Commission approved the rate increase despite a prior Court of Appeals opinion holding that the statutory authority of electric utilities did not allow for use of the accounting mechanism. Under Bob’s direction, Sean drafted the brief and handled oral argument before the Court of Appeals panel, which included the judge who authored the prior opinion. In a published opinion, the unanimous panel decided the rate increases were ultra vires based on interpretation of clear statutory language and the prior Court of Appeals decision interpreting the Commission’s authorizing statute. The Court of Appeals ordered the case remanded for further proceedings before the Commission, which are expected to involve determination of the amount of refund owed to Clark Hill’s client, likely in excess of $200,000, and potentially all of the ratepayers of the utility, which could exceed $10,000,000.
Robert A..W. StrongRobert Strong Clark Hill
Robert A..W. Strong
Robert A.W. Strong has represented industrial clients in all areas of energy and utility law, including contracting, rate negotiation, ratemaking, environmental permitting, energy pricing and purchasing and civil litigation. Robert has developed cogeneration feasibility studies, negotiated electric interconnection agreements with utilities and negotiated special contracts. He has also represented clients in connection with their desire to replace investor-owned utilities with municipal utilities. Robert has an extensive background in all aspects of electric and gas utility ratemaking practice and procedures before the Federal Energy Regulatory Commission and the Michigan Public Service Commission. He has negotiated power purchase agreements, special contracts with utilities for utility service and general contracts governed by the Uniform Commercial Code. Robert has been the forefront of efforts to restructure the electric utility industry in Michigan so that customers can choose their electric service providers.