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Commonwealth Edison Company v. Illinois Commerce Commission

August 2, 2002

COMMONWEALTH EDISON COMPANY, PETITIONER, (NOS. 2-01-0038 & 0212)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0912)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE PEOPLE OF COOK COUNTY BY RICHARD DEVINE, INTERVENOR-PETITIONER; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0914)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE CITY OF CHICAGO, INTERVENOR-PETITIONER; ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND THE CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0915)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (ENVIRONMENTAL LAW AND POLICY CENTER, INTERVENOR-PETITIONER; THE CITY OF CHICAGO, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0916)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, AND METROPOLITAN CHICAGO HEALTHCARE COUNCIL, INTERVENORS-PETITIONERS; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0917)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, INTERVENOR-PETITIONER; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0923)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, AND MODERN DROP FORGE COMPANY, INTERVENORS-PETITIONERS; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).



Petition for review of order of Illinois Commerce Commission. ICC No. 00-0361

The opinion of the court was delivered by: Justice Kapala

Released for publication August 8, 2002.

COMMONWEALTH EDISON COMPANY, PETITIONER, (NOS. 2-01-0038 & 0212)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0912)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE PEOPLE OF COOK COUNTY BY RICHARD DEVINE, INTERVENOR-PETITIONER; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0914)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE CITY OF CHICAGO, INTERVENOR-PETITIONER; ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND THE CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0915)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (ENVIRONMENTAL LAW AND POLICY CENTER, INTERVENOR-PETITIONER; THE CITY OF CHICAGO, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0916)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, AND METROPOLITAN CHICAGO HEALTHCARE COUNCIL, INTERVENORS-PETITIONERS; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0917)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, INTERVENOR-PETITIONER; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, MODERN DROP FORGE COMPANY, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).
COMMONWEALTH EDISON COMPANY, PETITIONER, (NO. 2-01-0923)
v.
ILLINOIS COMMERCE COMMISSION, RESPONDENT (CATERPILLAR, INC., ABBOTT LABORATORIES, INC., NORTHWESTERN STEEL AND WIRE COMPANY, MOTOROLA, INC., FORD MOTOR COMPANY, NABISCO BRANDS, INC., MONSANTO COMPANY, A. FINKL AND SONS COMPANY, ACME STEEL COMPANY, DAIMLER CHRYSLER CORPORATION, AND MODERN DROP FORGE COMPANY, INTERVENORS-PETITIONERS; THE CITY OF CHICAGO, ENVIRONMENTAL LAW AND POLICY CENTER, CITGO PETROLEUM CORPORATION, GENERAL MILLS, INC., R.R. DONNELLEY AND SONS COMPANY, METROPOLITAN CHICAGO HEALTHCARE COUNCIL, ENRON ENERGY SERVICES, INC., NEWENERGY MIDWEST, L.L.C., THE PEOPLE OF COOK COUNTY BY BY STATE'S ATTORNEY RICHARD DEVINE, THE PEOPLE OF THE STATE OF ILLINOIS BY THE ATTORNEY GENERAL JAMES RYAN, AND CITIZENS UTILITY BOARD, INTERVENORS).

Petition for review of order of Illinois Commerce Commission. ICC No. 00-0361

The opinion of the court was delivered by: Justice Kapala

PUBLISH

In this consolidated appeal, petitioner, Commonwealth Edison Company (ComEd), appeals directly to this court from an order of respondent, Illinois Commerce Commission (the Commission). The order approved, with modification, ComEd's proposal to collect funds from ComEd's customers to finance the future decommissioning of nuclear power plants that ComEd transferred to an entity that is not regulated by the Commission. ComEd contends that the Commission erred in reducing its proposed decommissioning rate. The intervenors-petitioners, the People of the State of Illinois by Attorney General James Ryan (State), the People of Cook County by State's Attorney Richard Devine (Cook), the City of Chicago (Chicago), Citizens Utility Board, Environmental Law and Policy Center (ELPC), Illinois Industrial Energy Consumers, which consists of A. Finkl & Sons Company, Abbott Laboratories, Inc., Acme Steel Company, Caterpillar, Inc., Daimler Chrysler Corp., Ford Motor Company, Modern Drop Forge Company, Motorola, Inc., Monsanto Company, and Nabisco Brands, Inc. (IIEC), and Chicago Area Industrial & Health Care Customers Coalition, which consists of Citgo Petroleum Corp., General Mills, Inc., R.R. Donnelly & Sons Company, and Metroplitan Chicago Health Care Council (Coalition) (intervenors-petitioners, collectively, the intervenors), were permitted to intervene in the proceedings before the Commission and have filed separate direct appeals from the Commission's order. All the intervenors challenge the Commission's authority to grant ComEd's petition, and some contend, in the alternative, that the approved decommissioning rates were excessive. For the reasons discussed below, we affirm the order of the Commission.

I. FACTS

These consolidated appeals involve financing the future cost of decommissioning nuclear fission thermal power generating plants (nuclear power plants) in Illinois. According to section 8--508.1(a)(1) of the Public Utilities Act (the Act) (220 ILCS 5/8--508.1(a)(1) (West 2000)) "decommissioning" means:

"the series of activities undertaken at the time a nuclear power plant is permanently retired from service to ensure that the final entombment, decontamination, dismantlement, removal and disposal of the plant, including the plant site, and of any radioactive components and materials associated with the plant, is accomplished in compliance with all applicable Illinois and federal laws, and to ensure that such final disposition does not pose any threat to the public health and safety." 220 ILCS 5/8--508.1(a)(1) (West 2000).

The Act establishes the framework for funding the decommissioning of nuclear power plants. First, public utilities are permitted to seek Commission approval for rate tariffs called "decommissioning rates" charging ratepayers for the future costs of decommissioning a nuclear power plant. 220 ILCS 5/9--201.5 (West 2000)). Second, every public utility that owns or operates, in whole or in part, a nuclear power plant must establish decommissioning trusts to hold decommissioning funds for the eventual purpose of paying decommissioning costs. 220 ILCS 5/8--508.1(b) (West 2000).

In the past, the Commission has determined the decommissioning rates based on detailed decommissioning cost estimates prepared by industry experts. Decommissioning cost estimates consist of an estimate of the present dollar value of the future cost to decommission each plant, adjusted by a projection of how much related costs such as radioactive waste burial will escalate in the future (escalation rate), while taking into account an estimate of the rate of return earned on the funds already collected and held in the decommissioning trusts (earnings rate). The Commission then prorates these costs over the projected life of each plant, allowing ComEd to collect an annual share of the total estimated decommissioning cost each year.

In the 1994 rate case, the Commission allowed ComEd to recover $112,736,000 in decommissioning costs as part of its base rates for that year and established an annual review of decommissioning rates in a proceeding designated as a "Rider 31" proceeding to determine whether adjustments to that amount should be made in the future. ComEd's decommissioning recoveries have been reviewed and adjusted annually since 1994. The collections that have been authorized in the past have been based on the assumption that ComEd will continue to make collections throughout the terms of the nuclear plants' United States Nuclear Regulatory Commission (NRC) operating licenses. NRC operating licenses are typically 40 years in duration.

Article XVI of the Act, titled the Electric Service Customer Choice and Rate Relief Law of 1997 (Customer Choice Law) (220 ILCS 5/16--101 et seq. (West 2000)), was enacted to introduce competition into the Illinois electricity market. 220 ILCS 5/16--101A(b) (West 2000). The General Assembly found that competition would result in lower prices for consumers and increased efficiency and innovation on the part of the power industry. See 220 ILCS 5/16--101A (West 2000). The Customer Choice Law authorizes electric utilities to transfer nuclear power plants to affiliated or unaffiliated entities and to enter into service agreements and power purchase agreements with the transferee. 220 ILCS 5/16--111(g)(3) (West 2000).

On May 18, 2000, in contemplation of a sale of ComEd's nuclear power plants to Exelon Generation Company, LLC (Genco), ComEd filed a petition for approval of a revised Rider 31 which would limit ComEd's recovery of decommissioning costs to a fixed amount over a six-year period. Genco was created in connection with the merger of Chicago-based Unicom Corporation, the parent company for ComEd, and Philadelphia-based PECO Energy Company. This merger spawned an entity known as Exelon Corporation. Genco is a wholly owned subsidiary of Exelon Corporation. In connection with the transfer of the nuclear power plants, ComEd stated that it intended to enter into a power purchase agreement (PPA), a contribution agreement, and an interconnection agreement with Genco.

Under the PPA, ComEd would obtain all its power supply from Genco through 2004. Up until January 1, 2005, base rates are frozen during the mandatory transition period pursuant to the Customer Choice Law. In 2005 and 2006, ComEd would obtain all its power from Genco, up to the capacity of the nuclear power plants.

Under the terms of the contribution agreement, ComEd would transfer the assets in the decommissioning trusts to Genco, and Genco would be responsible for decommissioning the nuclear power plants. ComEd would be responsible for decommissioning costs in such amounts as shall be approved by the Commission and is obligated to collect those decommissioning costs from its ratepayers and to transfer the funds to Genco.

In its petition, ComEd proposed to collect an annual decommissioning rate of $120,933,333 (rounded for purposes of our discussion to $121 million) which would be assessed to its ratepayers during the years 2001 through 2006. ComEd proposed to collect the same annual share of the total decommissioning cost that it would have sought had it continued to own and operate the nuclear power plants. Under its proposal, after six years ComEd would cease charging decommissioning costs to its ratepayers. While omitting the basis for its calculations, ComEd asserted that its proposal would reduce decommissioning collections from ratepayers by approximately 55%, or $1 billion. ComEd also asserted that its proposal would transfer the risks of increasing decommissioning costs from ComEd and its ratepayers to Genco.

Shortly after ComEd filed its petition, the Commission granted the intervenors' petitions to intervene. Two hearing officers appointed by the Commission conducted an evidentiary hearing on August 24, 2000, through August 29, 2000, at which ComEd, the Commission's staff, and the intervenors presented testimony from a number of experts. This testimony focused on the amount of "just and reasonable" (220 ILCS 5/9--101 (West 2000)) decommissioning costs.

During the proceeding, in response to four issues raised by the Commission staff, ComEd modified its proposal in four ways. The Commission's order discloses:

"(1) ComEd agreed to obligate Genco to refund to ratepayers any funds that remain in the decommissioning trusts in the unlikely event that there is a surplus after all the nuclear power plants are decommissioned. (2) ComEd has agreed to the inclusion of a requirement in the trust agreements governing Genco's use of decommissioning funds that, to the extent money is available after radiological decommissioning is completed, non-radiological decommissioning will be performed. (3) ComEd has agreed to a condition making collection of Revised Rider 31 monies from ratepayers in 2005 and 2006 dependent upon ComEd and Genco reaching agreement on a market price and purchasing ComEd's requirements up to the available capacity of the nuclear stations in those years. (4) ComEd has agreed to forever waive any right to seek additional decommissioning collections after the expiration of the six-year decommissioning collection period and to accept this condition in writing."

ComEd moved to stay its 1999 and 2000 Rider 31 cases pending the resolution of this petition. If the merger and transfer of assets to Genco occurred, ComEd committed that it would move to withdraw the petitions filed in those cases.

The parties filed briefs in support of their positions on the question of whether ComEd should be permitted to continue to collect decommissioning costs on behalf of Genco and, if so, the amount of those decommissioning costs.

The hearing examiners filed a proposed order on October 25, 2000, which denied ComEd's petition, concluding that the collection of decommissioning costs from ratepayers after the sale of the nuclear power plants to an unregulated entity was not authorized by the Act.

On December 20, 2000, the Commission disregarded the hearing examiners' proposed order and entered an order granting ComEd's petition as modified. The Commission concluded that ComEd was entitled to recover decommissioning costs each year for six years commencing January 1, 2001. However, instead of the $121 million requested, the Commission adopted certain recommended reductions and authorized ComEd to collect $73 million in decommissioning costs annually for the years 2001-2004. For the years 2005 and 2006, ComEd was permitted to collect an annual amount of decommissioning costs equal to $73 million multiplied by the percentage of the actual energy production of Genco's nuclear power plants that is purchased by ComEd each year.

On December 29, 2000, ComEd filed an application for rehearing (220 ILCS 5/10--113(a) (West 2000)) requesting that the Commission reconsider its reduction of the proposed decommissioning rate. ComEd also requested the Commission to reopen the record to add certain assumptions that were used to determine the decommissioning costs and to include these assumptions in its order. On January 10, 2001, the Commission granted the motion to reopen the record for the limited purpose of examining whether to amend the order to include a statement of assumptions, but it denied the remainder of ComEd's application for rehearing. On January 12, 2001, ComEd filed a notice of appeal to this court that was docketed as case No. 2--01--0038. Subsequently, the various intervenors filed applications for rehearing. On February 7, 2001, the Commission denied all of the intervenors' applications for rehearing. The Commission entered an amended order on February 21, 2001, that included a statement of assumptions used to calculate the approved decommissioning rate, but its order otherwise remained unchanged. Thereafter, the State, Chicago, Cook, ELPC, IIEC, and the Coalition filed notices of appeal to the First District (IIEC and the Coalition have filed a joint brief and therefore they will be hereinafter referred to as IIEC/Coalition). On February 23, 2001, ComEd filed a second notice of appeal to this court docketed as No. 2--01--0212. In an order entered on April 19, 2001, this court dismissed ComEd's appeal in No. 2--01--0038, finding that we lacked jurisdiction over that appeal. In a supervisory order entered on June 29, 2001, our supreme court directed the vacation of this court's order dismissing ComEd's appeal in No. 2--01--0038. Commonwealth Edison Co. v. Illinois Commerce Comm'n, 195 Ill. 2d 576 (2001). This court reinstated No. 2--01--0038. On September 19, 2001, our supreme court directed this court to accept a transfer of the intervenors' appeals from the First District. Thereafter, appeal No. 2--01--0212 and the intervenors' appeals were consolidated with appeal No. 2--01--0038.

II. DISCUSSION

A. Motions Taken with the Case

The material in this section is nonpublishable under Supreme Court Rule 23 (166 Ill. 2d R. 23).

[Nonpublishable material removed here.]

B. Authority Under the Act

The threshold question in this appeal is whether the Commission had the legal authority to allow ComEd to impose nuclear decommissioning rates on its ratepayers to contribute toward the cost of decommissioning nuclear power plants that are no longer owned by ComEd but, rather, by the unregulated Genco.

An order of the Commission is prima facie reasonable, and the party appealing the decision bears the burden of overcoming this presumption of reasonableness. 220 ILCS 5/10--201(d) (West 2000). The scope of our review of an order of the Commission is limited to determining whether the Commission (1) acted within the scope of its authority; (2) made adequate findings in support of its decision; (3) made a decision that was supported by substantial evidence; and (4) infringed on state or federal constitutional rights. 220 ILCS 5/10--201(e)(iv)(A) through (e)(iv)(C) (West 2000); Commonwealth Edison Co. v. Illinois Commerce Comm'n, 322 Ill. App. 3d 846, 849 (2001).

Our supreme court has stated that "[t]he Commission, because it is a creature of the legislature, derives its power and authority solely from the statute creating it, and its acts or orders which are beyond the purview of the statute are void." City of Chicago v. Illinois Commerce Comm'n, 79 Ill. 2d 213, 217-18 (1980). The Commission's authority to enter the order appealed in this case must, therefore, find its source in the Act. The Commission's interpretation of a legal issue is not binding on a court of review. Archer-Daniels-Midland Co. v. Illinois Commerce Comm'n, 184 Ill. 2d 391, 397 (1998). "However, because of an agency's experience and expertise, courts will generally give substantial weight and deference to the ...


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