2017 ORS 756.040¹
General powers

(1) In addition to the powers and duties now or hereafter transferred to or vested in the Public Utility Commission, the commission shall represent the customers of any public utility or telecommunications utility and the public generally in all controversies respecting rates, valuations, service and all matters of which the commission has jurisdiction. In respect thereof the commission shall make use of the jurisdiction and powers of the office to protect such customers, and the public generally, from unjust and unreasonable exactions and practices and to obtain for them adequate service at fair and reasonable rates. The commission shall balance the interests of the utility investor and the consumer in establishing fair and reasonable rates. Rates are fair and reasonable for the purposes of this subsection if the rates provide adequate revenue both for operating expenses of the public utility or telecommunications utility and for capital costs of the utility, with a return to the equity holder that is:

(a) Commensurate with the return on investments in other enterprises having corresponding risks; and

(b) Sufficient to ensure confidence in the financial integrity of the utility, allowing the utility to maintain its credit and attract capital.

(2) The commission is vested with power and jurisdiction to supervise and regulate every public utility and telecommunications utility in this state, and to do all things necessary and convenient in the exercise of such power and jurisdiction.

(3) The commission may participate in any proceeding before any public officer, commission or body of the United States or any state for the purpose of representing the public generally and the customers of the services of any public utility or telecommunications utility operating or providing service to or within this state.

(4) The commission may make joint investigations, hold joint hearings within or without this state and issue concurrent orders in conjunction or concurrence with any official, board, commission or agency of any state or of the United States. [Amended by 1961 c.467 §1; 1971 c.655 §9; 1973 c.776 §15; 1987 c.447 §76; 1995 c.733 §53; 2001 c.569 §1]

Note: Sections 1 and 2, chapter 741, Oregon Laws 2017, provide:

Sec. 1. (1) The Public Utility Commission shall establish a public process for the purpose of investigating how developing industry trends, technologies and policy drivers in the electricity sector might impact the existing regulatory system and incentives currently employed by the commission. If warranted, the commission may consider changes to the existing regulatory system and incentives.

(2) As part of the public process established under subsection (1) of this section, the commission shall investigate the following:

(a) The obligations of and benefits to electric companies under the existing regulatory system;

(b) The obligations of and benefits to customers of electric companies under the existing regulatory system, including customers that participate in direct access;

(c) The current use of regulatory incentives, including but limited to:

(A) Incentives for electric companies to place capital investment in rate base, paying particular attention to the perception of bias in resource selection;

(B) Incentives for electric companies to plan for serving all existing and all new electricity loads in electric companies’ service territories; and

(C) Incentives for electric companies and for customers of electric companies to develop renewable energy resources and purchase renewable energy; and

(d) The primary public policy objectives that are promoted by the commission’s current statutory authority and by the existing regulatory system and incentives.

(3) As part of the public process established under subsection (1) of this section, the commission shall identify industry trends, technologies and policy drivers currently developing in the electricity industry, including but not limited to:

(a) Greater penetration by variable energy resources of electric utilities’ electrical systems;

(b) Increasing presence and cost-effectiveness of distributed energy resources in electric utilities’ electrical systems;

(c) Greater customer support sophistication and desire for energy service options and energy management tools;

(d) Increasing customer desire for energy service needs to be met by a specific generating resource through either nonutility owned resources and delivery options or utility owned resources and delivery options;

(e) Greater recognition of the carbon output of electricity generation;

(f) The electrification of the transportation sector;

(g) The potential for regional transmission markets;

(h) Advances in distribution system communication and control technologies;

(i) The need to replace aging distribution system equipment for grid modernization;

(j) Use of performance-based incentives used by other states in addressing the industry trends, technologies and policy drivers described in this subsection; and

(k) Changes in public policy objectives that are developing in relation to the electricity sector or that have directly or indirectly been identified by the Legislative Assembly.

(4) The commission shall explore changes to the existing regulatory system and incentives that could accommodate developing industry trends and support new policy objectives without compromising affordable rates, safety and reliable service. If the commission determines that changes to the existing regulatory system and incentives would be in the interest of customers of electric companies and the public generally, the commission shall develop plans to administratively implement changes to the regulatory system and incentives or shall make recommendations to the Legislative Assembly for the purpose of legislatively implementing changes to the regulatory system and incentives.

(5) As part of the public process established under subsection (1) of this section, the commission shall provide the public with an opportunity to comment.

(6) The commission shall submit a report on the findings of the public process established under subsection (1) of this section and the progress of investigations conducted under subsection (2) of this section in the manner provided by ORS 192.245 (Form of report to legislature) to the interim committees of the Legislative Assembly related to energy and business no later than September 15, 2018. The commission may include, as part of the commission’s report, recommendations for legislation. [2017 c.741 §1]

Sec. 2. Section 1 of this 2017 Act is repealed on January 2, 2019. [2017 c.741 §2]

Notes of Decisions

Where (1) a utility has purchased the bulk of its necessary equip­ment and supplies from an “affiliated” manufacturer and (2) due to the affiliated rela­tionship the manufacturer has unique market power rendering a comparison of its prices and profits with those of “peripheral” manufacturers inadequate as a measure of “reasonableness” of the utility’s pay­ments to it, the utility’s failure to provide addi­tional evidence of reasonableness may justify disallowing from the utility’s rate base and operating expenses the por­tion of the utility’s pay­ments that represent a return to the manufacturer greater than that allowed the utility itself. Pac. NW Bell Tel. Co. v. Sabin, 21 Or App 200, 534 P2d 984 (1975), Sup Ct review denied

Public Utility Commissioner has power under this sec­tion to determine unwarranted rate discrimina­tion. American Can Co. v. Davis, 28 Or App 207, 559 P2d 898 (1977), Sup Ct review denied

The Public Utility Commissioner has authority to impose rate design different from that proposed by utility. Cascade Natural Gas Corp. v. Davis, 28 Or App 621, 560 P2d 301 (1977), Sup Ct review denied

Commissioner has been granted broad legislative authority; consequently com­mis­sioner is not obligated to employ any single formula or combina­tion of formulas to determine what are in each case “just and reasonable” rates. Cascade Natural Gas Corp. v. Davis, 28 Or App 621, 560 P2d 301 (1977), Sup Ct review denied

Where disallowances neither violated specific statutory limits upon com­mis­sioner’s otherwise plenary ratemaking power nor resulted in imposi­tion of rates that produce taking of private prop­erty without just compensa­tion, they were reasonable and lawful. Cascade Natural Gas Corp. v. Davis, 28 Or App 621, 560 P2d 301 (1977), Sup Ct review denied

Approval of contract between utility and “affiliated” manufacturer or of utility’s annual budgets that included pay­ments thereunder did not “estop” com­mis­sioner from disallowing por­tion of pay­ments in determining “just and reasonable” rates. Cascade Natural Gas Corp. v. Davis, 28 Or App 621, 560 P2d 301 (1977), Sup Ct review denied

Public Utility Commissioner’s rule, which passed on utility expenses for pay­ment of county’s net business income tax to county ratepayers only, rather than to all utility ratepayers, was valid because Commissioner is granted both broad regulatory authority over rates by this sec­tion and broad rulemaking authority by ORS 756.060 (Authority to adopt rules and regulations). Multnomah County v. Davis, 35 Or App 521, 581 P2d 968 (1978), Sup Ct review denied

This sec­tion does not constitute clearly defined statutory grant of authority to Public Utility Commissioner for enact­ment of “tag­line” rule which requires public utilities to tag their advertise­ments with state­ment that advertise­ment is paid for by either customers or stockholders. Pacific Northwest Bell v. Davis, 43 Or App 999, 608 P2d 547 (1979), Sup Ct review denied

Where tel­e­com­mu­ni­ca­­tions utility retained excess revenue collected under interim rate schedule that was not in compliance with authorized revenue level, PUC did not err in ordering refund. Pacific Northwest Bell Telephone Co. v. Katz, 116 Or App 302, 841 P2d 652 (1992), Sup Ct review denied

Chapter 756

Notes of Decisions

Under regulatory scheme, Public Utility Commissioner has authority to promulgate rule limiting telephone company’s liability for directory listing errors or omissions. Garrison v. Pacific NW Bell, 45 Or App 523, 608 P2d 1206 (1980)

Refund is proper exercise of Public Utility Commission’s general powers if refund (1) is based only on in­for­ma­­tion in existence at time of rate order for which refund is being made; (2) is not based on evalua­tion of public utility’s actual expenses or revenues; and (3) is not effectuated by offsetting future rates. Gearhart v. Public Utility Commission, 255 Or App 58, 299 P3d 533 (2013), aff’d 356 Or 216, 339 P3d 904 (2014)

1 Legislative Counsel Committee, CHAPTER 756—Public Utility Commission, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ors756.­html (2017) (last ac­cessed Mar. 30, 2018).
 
2 Legislative Counsel Committee, Annotations to the Oregon Revised Stat­utes, Cumulative Supplement - 2017, Chapter 756, https://­www.­oregonlegislature.­gov/­bills_laws/­ors/­ano756.­html (2017) (last ac­cessed Mar. 30, 2018).
 
3 OregonLaws.org assembles these lists by analyzing references between Sections. Each listed item refers back to the current Section in its own text. The result reveals relationships in the code that may not have otherwise been apparent.