Decision 08-11-061 November 21, 2008
Before The Public Utilities Commission Of The State Of California
Joint Application of SFPP, L.P. (PLC-9 Oil), CALNEV PIPE LINE, L.L.C., KINDER MORGAN, INC., and KNIGHT HOLDCO LLC for Review and Approval under Public Utilities Code Section 854 of the Transfer of Control of SFPP, L.P. and CALNEV PIPE LINE, L.L.C. |
Application 06-09-016 (Filed September 18, 2006) |
________________________________ Joint Application of the Goldman Sachs Group, Inc., American International Group, Inc., Carlyle Partners IV, L.P., Carlyle/Riverstone Global Energy and Power Fund III, L.P., for Exemption Under Section 852 of the Public Utilities Code for Certain Future Transactions Involving Non-Controlling Interests in California Public Utilities. |
Application 06-09-021 (Filed September 22, 2006) |
ORDER DENYING REHEARING
OF DECISION 07-12-006
This decision addresses the application for rehearing of Decision (D.) 07-12-006 (or "Decision"), filed by Consumer Federation of California ("CFC"). We have reviewed each and every allegation set forth in the application and do not find grounds for granting rehearing. We modify the Decision to clarify references to the Administrative Law Judge's ("ALJ") preliminary ruling regarding CFC's Notice of Intent to Claim Compensation ("ALJ ruling") and Public Utilities Code section 1801.3(a). We also correct typographical errors. We deny the application for rehearing of D.07-12-006, as modified.
I. FACTS
In D.07-12-006 we denied CFC's request for intervenor compensation in regard to D.07-05-061 on the grounds that the statutory intervenor compensation program does not apply to oil pipeline utilities. These two decisions were issued in consolidated Applications (A.) 06-09-016 and A.06-09-021, involving Commission-regulated intrastate portions of SFPP, L.P. ("SFPP") and its affiliate, Calnev Pipe Line, L.L.C. ("Calnev"), public utility pipelines which serve as common carriers of refined petroleum products such as gasoline, diesel fuel and jet fuel.
D.07-05-061 does two things: (1) it approves, pursuant to Public Utilities Code section 854,1 the transfer of indirect ownership and control over jurisdictional portions of SFPP and Calnev from Kinder Morgan, Inc. ("KMI") to Knight Holdco, LLC ("Knight Holdco"); and (2) it grants a limited exemption from the section 852 prohibition on purchase or acquisition of the capital stock of another public utility to Goldman Sachs Group, Inc. ("Goldman Sachs") and American International Group, Inc. ("AIG"),2 two of the investors in Knight Holdco. The section 852 exemption covers only non-controlling, passive investments by Goldman Sachs and AIG in the stock of California utilities. It does not change their statutory obligation under section 854 to obtain advance Commission approval before acquiring controlling interests in such utilities. (D.07-12-006, p. 2.)
D.07-12-006 addresses only CFC's request for intervenor compensation, finding that the plain meaning of section 1801.3(a) is clear, that it lists the utilities covered by the intervenor compensation program and that oil pipelines are not among them. (D.07-12-006, p. 5.)
CFC timely filed an application for rehearing of D.07-12-006, alleging that the Commission errs by: (1) failing to interpret the section 1801 phrase "in any proceeding" to require awarding compensation in "any and all proceedings" of the Commission; (2) holding that the scope of the consolidated proceeding does not "encompass" electric, gas, water and telephone utilities; (3) finding that no common fund exists allowing the Commission to order California utilities not named as applicants here to pay intervenor compensation for work done in this docket; (4) rejecting CFC's representation that in this proceeding the Commission was establishing precedent applicable to other utility transfers; and (5) interpreting section 1804(b)(2) as justification for reversing the ALJ ruling. CFC alleges further that, due to the doctrine of equitable estoppel, the Commission may not reverse the ALJ ruling finding CFC eligible for compensation. CFC also claims the doctrine of promissory estoppel requires payment of intervenor compensation.
1 Unless otherwise specified, all section references are to the Public Utilities Code.
2 Subsequent events involving the financial health of these two entities have no bearing on the intervenor compensation matters at issue here.
