MPUC Orders Contested Case in Territory Dispute

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MPUC Orders Contested Case in Territory Dispute

November 12, 2020

The Minnesota Public Utilities Commission (MPUC) Nov. 5 ordered a contested case hearing to resolve a service territory complaint brought by Red River Valley Cooperative Power Association (RRV) against the City of Barnesville.

The city is providing electric service to a Dollar General store and has provided service since the store commenced operations in 2013, RRV noted in its complaint, however it said the store is “wholly located” in the cooperative’s service territory.

In addition, there is a former Dairy Queen property adjacent to the Dollar General. The city has purchased the site for a new municipal liquor store. The site is also within RRV’s territory, said the cooperative, and it did not consent to the city serving any consumer located there.

RRV requested an order finding it had the exclusive right to provide retail service within its assigned service area, including to the Dollar General and Dairy Queen site. It also asked that the city compensate and reimburse RRV for the loss of revenue to RRV for the service of electric loads to the Dollar General from 2013 to the present, and for future loss of revenue.

RRV said the MPUC had all the information it needed to act.

Barnesville said it has served the property, and other surrounding properties, with electricity for generations, and is the only electric service provider who has ever supplied electricity to the property. This electric service pre-dates the Minnesota Public Utilities Act.

In addition, the city has had sufficient facilities in place to serve the electricity needs of the property for decades. The facilities were installed and owned by the city. The nearest cooperative facilities are nearly one mile away, said the city.

RRV, in its comments, said it has the capacity and ability to serve the Dollar General.

RRV referenced a June 2008 letter in which it told the city that “any new consumer desiring electric service” within the cooperative’s territory will be served by RRV.

Barnesville asserts that the electric utility service area maps published online do not accurately encompass Barnesville’s undisputed service to these properties in 1974 when the PUC assigned service territories and was to follow legislative policy in the statute of avoiding “duplication of electric facilities and to promote economical, efficient and adequate service to the public.”   Barnesville asks the PUC to re-draw the service territory to include these properties within Barnesville’s territory because Barnesville served these properties prior to and in 1974, the area was not contested by RRV and the statutes support assigning service territories reflecting then-existing properties served.   If the PUC does not re-draw the boundaries, Barnesville argues that RRV has consented in writing and by its inaction for over 40 years to object to Barnesville’s service in the disputed area.  This consent or waiver should apply to the property served, not only to a specific user.

The city argued a contested case was necessary for a full record to be presented to the MPUC:

“RRV has waited 46 years to claim customers that the City has served under Section 216B.39. A proceeding allowing a proper record to decide this matter is in the interests of the parties and the customers affected,” said the city.

The MPUC decision was 5-0 to refer the matter to the Office of Administrative Hearings.