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News Digest

Fortnightly Magazine - January 1 2000

flexible pricing through performance-based regulation and the phase-out of fuel clause and other automatic adjustment clause rate mechanisms.

The PSC said that such issues would be decided by markets. It added that it would open new rulemaking proceedings to address promotional practices, flexible pricing and distribution service quality. Docket No. 97-454-U, Order No. 17, Oct. 1, 1999 (Ark.P.S.C.).

Gas Pipelines

Capacity Allocation. The FERC rejected pro forma tariff sheets for El Paso Natural Gas Co. to revise its pooling requirements and rolled the issue over into another docket on El Paso's allocation of firm delivery point capacity.

FERC found that El Paso's allocation of receipt point capacity on a pro rata basis created uncertainty and unreliability with respect to pooling and scheduling on its system. Docket Nos. RP98-407-000 (tariff sheets), RP99-507-000 (capacity allocation), Nov. 10, 1999 (F.E.R.C.).

Courts

Nuclear Plant Licensing. In a surprising turnabout favoring the nuclear industry, a federal appeals court said it would rehear arguments on whether to give opponents more time to fight the relicensing application for the Calvert Cliffs (Md.) nuclear plant, owned by Baltimore Gas & Electric. The new order suggests that the Nuclear Regulatory Commission was justified in denying any extension under a 1998 policy requiring intervenors to prove "unavoidable or extreme circumstances." Nat'l Whistleblower Center v. NRC, Nos. 99-1002 et al., Nov. 22, 1999 (D.C.Cir.)

Consumer Credit Laws. A Pennsylvania court ruled that natural gas utility bills were still exempt from the federal Truth-in-Lending law since the state still regulated charges "for public utility service."

It added that the bills in question satisfied a state law mandate to disclose the exact billing "due date," even though they used the more oblique language: "Please pay by [date]." Aronson v. Pa. PUC, No. 989 C.D. 1999, Nov. 16, 1999 (Pa.Cmwlth.).

Bankruptcy Setoffs. Reversing a bankruptcy court, the 5th Circuit interpreted rights between a natural gas local distribution company that owed payments for purchased gas and a gas marketer that petitioned for bankruptcy and then failed to make deliveries to the LDC.

It said the LDC could not offset its pre-petition debt with liquidated damages for the delivery failures, since the marketer had not enjoyed any concrete benefit from the LDC's continued gas nominations after it had filed its bankruptcy petition. Gasmark Ltd., v. Southwest Gas Corp., Nos. 98-20941, Nov. 1, 1999, revised Nov. 15, 1999 (5th Cir.).

Wireless PCS Towers. A state supreme court ruled that a telecom firm must apply to local zoning authorities before constructing wireless PCS transmission towers, even if the towers are built on rights-of-way owned by the state highway department (DOT).

Seeking to avoid zoning laws, the telecom firm had leased the easement from the state and in exchange had offered joint rights to the DOT to use the towers for official business, such as installing closed-circuit television cameras to monitor traffic flow. Fairfax Bd. of Supervisors v. Washington, D.C. SMSA L.P., No. 982627, Nov. 5, 1999 (Va.).

Superfund Cost Recoupment. Rejecting the rule of sovereign immunity, a state court held the state government partially liable for Superfund Law reimbursement where