ELR Citation: ELR 21399
No(s). 62310 (N.Y. App. Div. May 9, 1991)

The court upholds a Public Service Commission (PSC) opinion permitting two utilities to recover in rates the direct costs of, lost revenues attributable to, and incentive payments for, consumer conservation programs. The court first holds that the PSC's rate-setting authority is not restricted to imposing charges directly related to the provision of electrical services. Courts have permitted rate charges and rate differentials that were based on a wide variety of factors not directly related to the provision of utility services or the quantity or quality thereof. The court next holds that Public Service Law §5(2) authorizes the PSC to provide for recovery of lost profits from and incentive payments for its consumer conservation programs. The court holds that the PSC was not required to support its determination on the recoverability of program costs with substantial evidence in the record, because no hearing was required for this proceeding before the PSC. The court further holds that the petitioner failed to show the irrationality or arbitrariness of the PSC's determination or that the recoveries authorized by the PSC will conflict with any limitations on recoveries under the Home Insulation and Conservation Act. Finally, the court holds that petitioner is precluded from seeking judicial review of its objection to the PSC's use of the utilities' fuel adjustment clause for the rate recoveries, because the petitioner failed to raise that issue before the PSC.

Counsel for Appellant
Algird F. White Jr.
Couch, White, Brenner, Howard & Feigenbaum
540 Broadway, P.O. Box 22222, Albany NY 12201
(518) 426-4600

Counsel for Respondent
William J. Cowan, Gen. Counsel; Lawrence G. Malone
New York State Public Service Commission
Agency Three, Empire State Plaza, Albany NY 12223
(518) 474-7080

Counsel for Intervenor
Stanley W. Widger Jr.
Nixon, Hargrave, Devans & Doyle
Clinton Sq., P.O. Box 1051, Rochester NY 14603
(716) 546-8000

Before MAHONEY, P.J., and MIKOLL, LEVINE, CREW, and HARVEY, JJ.

MAHONEY, P.J., and MIKOLL, CREW, and HARVEY, JJ., concur.