Public Utilities – Ratemaking – Multiple Appeals – Reparations Surcharge – Appeals Bond or Other Arrangements

It took several appeals and several years for the appellant-utility to finally get the rate increase amount it had requested (though in a different configuration). Although the utility asserts that it was unable to afford an appeals bond for the whole of the appellate period, the Public Service Commission correctly determined that it lacked the authority to allow the utility to recoup its lost fees via a reparations surcharge.

Affirmed.

S.C. Code Ann. § 58-5-240(D) contemplates two possible routes for a utility to collect higher rates during an appeal once the Public Service Commission (PSC) has disallowed revenues sought in a ratemaking application: the first is securing an appellate bond, and the second is making “other arrangements satisfactory to the [PSC] for the protection of parties interested.” There are no other options or exceptions set forth in that subsection of the statute.

As the PSC explained, “When a statute creates a substantive right and provides a remedy for infringement of that right, the [injured party] is limited to that statutory remedy.” Here, the statutory remedies do not include a reparations surcharge; therefore, the PSC has no authority to grant a utility equitable relief via such a surcharge.

Were we to agree with appellant and allow it to collect a reparations surcharge following a successful appeal, it would entirely obviate the need for a utility to ever secure an appellate bond or make “other arrangements,” thus placing all the risk on ratepayers and none on the utility. Given the clear system of checks and balances set forth in § 58-5-240(D) weighing the competing interests of utilities and their customers, we reject the suggestion that the General Assembly intended a utility to circumvent the protections afforded ratepayers.

We find it notable that appellant exclusively relied on the appellate bond option set forth in § 58-5-240(D) and never explored the second option available, that being to seek “other arrangements satisfactory to the [PSC].” This second (and presumably cheaper) option was specifically drawn to appellant’s attention during the proceedings before the PSC, yet appellant chose not to pursue it despite its alleged inability to pay for an extension of its appellate bond. Given the clear options set out in § 58-5-240(D), it was incumbent upon appellant to either secure an appellate bond or request “other arrangements.” Appellant’s failure to do so is fatal to its request for a reparations surcharge.

Affirmed.

Daufuskie Island Utility Co. v. South Carolina Office of Regulatory Staff (Lawyers Weekly No. 010-051-23, 13 pp.) (John Kittredge, J.) Appealed from the Public Service Commission. Thomas Gressette and George Trenholm Walker for appellant; Andrew McClendon Bateman, Benjamin Parker Mustian, Steven Hamm, John Julius Pringle and Lyndley Ritz Zwing Bryant for respondents. South Carolina Supreme Court