State Ex Rel. Utilities Commission v. NORTH CAROLINA TEXTILE MANUFACTURERS ASSOCIATION, INC

306 S.E.2d 113 (1983)

STATE of North Carolina, ex rel. UTILITIES COMMISSION; and Carolina Power and Light Company (Applicant); Rufus L. Edmisten, Attorney General; Executive Agencies of the United States Government and Union Carbide Corporation v. NORTH CAROLINA TEXTILE MANUFACTURERS ASSOCIATION, INC.; The Public StaffNorth Carolina Utilities Commission; and Kudzu Alliance.

No. 674A82.

Supreme Court of North Carolina.

September 7, 1983.

Hunton & Williams by R.C. Howison, Jr. and Edward S. Finley, Jr., Charles D. Barham, Jr., Richard E. Jones and Robert S. Gillam, Raleigh, for plaintiff-appellee Carolina Power & Light Co.

Executive Director Robert Fischbach, Acting Chief Counsel, Theodore C. Brown, Jr. and Karen E. Long, Raleigh, for defendant-appellant North Carolina Utilities Com'n Public Staff.

PER CURIAM.

A recital of the evidence is not necessary in this opinion. See the decision of the Court of Appeals in this case for a statement of the facts.

This is a general rate case. The issue is whether the Court of Appeals erred in affirming the Utilities Commission's failure to determine the reasonable level of fuel expenses used in generation and production of power experienced during the twelve-month test period. This expense constituted approximately sixty-one percent of the *114 company's operating and maintenance expenses.

The Commission in this case adopted the fuel costs from the Sub 402 fuel clause proceeding, which was based upon a four-month test period. In the Sub 402 proceeding, which was consolidated with this proceeding, the reasonableness of the fuel expenses was not determined by the Commission.

For rate making purposes, the reasonable operating expenses of the utility must be determined by the Commission. N.C.Gen. Stat. § 62-133(b)(3) (1982). These expenses include the costs of fuel and purchased power. The opinion of this Court by Meyer, J., in cases numbered 529PA82 and 530A82, State ex rel. Utilities Commission v. Public Staff, filed this date is controlling upon this issue.

The case must be remanded to the North Carolina Utilities Commission for a determination of the proper level of fuel expenses to be included in the applicant's rates and charges in Docket No. E-2, Sub. 391.

The decision of the Court of Appeals is reversed, and the cause is remanded to the North Carolina Utilities Commission.

REVERSED AND REMANDED.