Case No. RF272-77400
June 19, 1997
DECISION AND ORDER
OF THE DEPARTMENT OF ENERGY
Application for Refund
Name of Applicant:Mount Carmel Public Utility Company
Date of Filing: October 30, 1989
Case Number: RF272-77400
This Decision and Order will consider an Application for Refund submitted by Mount Carmel Public Utility Company (Mount Carmel). Mount Carmel operated an electric utility during the crude oil price control period. (1) In its application, Mount Carmel has requested a refund from crude oil overcharge funds. These funds are available for disbursement by the Office of Hearings and Appeals (OHA) of the Department of Energy (DOE) under the provisions of 10 C.F.R. Part 205, Subpart V.
In the past, purchasers of refined petroleum products were allowed to apply to the OHA for a refund from crude oil overcharge funds collected by the DOE. 51 Fed. Reg. 27899 (August 4, 1986). We have established refund procedures for these funds, which have been made available through consent orders between the DOE and numerous firms that sold crude oil during the price control period. E.g., Berry Holding Co., 16 DOE ¶ 85,405 (1987); A. Tarricone, Inc., 15 DOE ¶ 85,495 (1987); Mountain Fuel Supply Co., 14 DOE ¶ 85,475 (1986). The procedures specify that, to receive a refund, an applicant generally must document its purchase volumes and show that it suffered injury from crude oil overcharges. If an applicant is an end-user, however, it does not have to make a showing of injury. We have found it reasonable to presume that an end-user absorbed rather than passed through the crude oil
overcharges.(2)52 Fed. Reg. 11737 (April 10, 1987); City of Columbus, Georgia, 16 DOE ¶ 85,550 (1987).
In addition, we have established that an electric utility that had a fuel adjustment pass through provision during the overcharge period is eligible to receive a refund under the presumption of end-user injury only to the extent that it passes on the entire refund to its retail customers. 52 Fed. Reg. 11737 at 11742-43; see also Pacific Gas & Electric, 17 DOE ¶ 85,234 (1988) (PG&E); enforced sub nom. In re: The Department of Energy Stripper Well Exemption Litigation, 707 F.Supp. 1269 (D.Kan. 1989). We found that granting a refund to a utility for the benefit of its injured customers "will assist us in distributing refunds in an efficient, cost-effective and equitable manner." Office of Special Counsel/ Tenneco Oil Co., 9 DOE ¶ 82,538 at 85,203 (1982). This is because "utilities simply 'stood in the shoes' of their customers and, having detailed records, were ideally situated to apply for and funnel back the refunds for oil overcharges to the very persons who were injured in the first place -- namely, their customers." PG&E at 88,465.
Mount Carmel filed a certification with the OHA stating that it will refund the proceeds realized from the crude oil refund claim to its customers through its fuel adjustment charge. It also certified that it will advise the Illinois Commerce Commission of the receipt of the net proceeds.(3)As a result, Mount Carmel's claim can be considered under the presumption of end-user injury.
Mount Carmel's claim is for No. 2 Fuel Oil it used to generate electricity. As a representative of end-users, Mount Carmel is presumed injured by the crude oil overcharges and is entitled to receive its full allocable share of the crude oil overcharge funds. Mount Carmel computed its gallonage claim from Marathon Petroleum Company records. We find that Mount Carmel's gallonage figures are reasonable.
We calculate the refund amount by multiplying the applicant's approved gallonage claim by the volumetric refund amount of $.0016 per gallon. The total volume that we have approved for Mount Carmel is 19,921,322 gallons of refined petroleum products. The total refund that we will grant Mount Carmel is therefore $31,874.
The final deadline for the crude oil proceeding was June 30, 1995. It is the current policy of the DOE to pay eligible crude oil refund applicants at the rate of $0.0016 per gallon. We will decide whether sufficient crude oil overcharge funds are available for additional refunds for this and other successful applicants when we are better able to determine how much additional money will be collected from firms that have either outstanding obligations to the DOE or enforcement cases currently in litigation.
It Is Therefore Ordered That:
(1) The Application for Refund filed by Mount Carmel Public Utility Company (Case No. RF272-77400) is hereby granted as set forth in Paragraph (2) below.
(2) The Director of Special Accounts and Payroll, Office of Departmental Accounting and Financial Systems Development, Office of the Controller of the Department of Energy shall take appropriate action to disburse a total of $31,874 from the DOE deposit fund escrow account denominated Crude Tracking - Claimants 4, Account Number 999DOE010Z, maintained at the Department of the Treasury, to:
Mount Carmel Public Utility Company
c/o Phillip Barnhard, IV
316 Market Street / P.O. Box 220
Mount Carmel, IL 62863
(3) Within 60 days of the date of issuance of this Decision and Order, Mount Carmel shall notify the appropriate regulatory agency of the amount of its refund as approved in this Decision and Order. Any future refund amounts shall be reported to the appropriate agency within 60 days of receipt of those funds. Mount Carmel shall pass through to its customers the amount of the refunds made available to it pursuant to this Decision and Order.
(4) No later than six months after the receipt of each refund disbursed pursuant to this Decision and Order, Mount Carmel shall file a report with the Office of Hearings and Appeals of the Department of Energy indicating the manner in which it has complied with Paragraph (3) above.
(5) To facilitate the payment of future refunds, Mount Carmel shall notify the Office of Hearings and Appeals in the event that there is a change of address, or if an address correction is necessary. Such notification shall be sent to:
Director of Management Information
Office of Hearings and Appeals
Department of Energy
1000 Independence Avenue, S.W.
Washington, D.C. 20585-0107
(6) The determinations made in this Decision and Order are based upon the presumed validity of the statements and documentary materials submitted by the applicant. These determinations may be revoked or modified at any time upon a finding that the factual basis underlying any Application for Refund is incorrect.
(7) This is a final Order of the Department of Energy.
George B. Breznay
Director
Office of Hearings and Appeals
Date: June 19, 1997
(1)The crude oil price control period extended from August 19, 1973 through January 27, 1981.
(2)We define an end-user as the ultimate consumer of the petroleum products, who was in a business unrelated to the petroleum industry, and who was not subject to the price regulations of the DOE or its predecessors.
(3)Letter from Mount Carmel to the OHA dated June 5, 1997.