     TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN



                                    NO. 03-02-00644-CV
                                    NO. 03-02-00701-CV



     Texas Municipal Power Agency; City of Denton, Texas; City of Garland, Texas;
                      and City of Greenville, Texas, Appellants

                                              v.

          Public Utility Commission of Texas and City of Bryan, Texas, Appellees

                                              &

    Texas Municipal Power Agency; City of Denton; City of Garland; and GEUS f/k/a
                     Greenville Electric Utility System, Appellants

                                              v.

  Public Utility Commission of Texas; City of Bryan; and City of Weatherford, Appellees


    FROM THE DISTRICT COURT OF TRAVIS COUNTY, 200TH JUDICIAL DISTRICT
   NOS. 99-11127 & 99-14787, HONORABLE LORA J. LIVINGSTON, JUDGE PRESIDING



                                       OPINION


              In this combined appeal, we must decide whether appellee the Public Utility

Commission of Texas had jurisdiction to determine whether the terms on which appellant Texas

Municipal Power Agency (“TMPA”) allocated wholesale costs for transmission of electricity to

appellee City of Bryan, Texas (“Bryan”) were reasonable. Bryan and appellants, City of Denton,
Texas; City of Garland, Texas; and GEUS f/k/a Greenville Electric Utility System (collectively,

“Northern Cities”), are the four member cities of TMPA, an entity created to provide electricity to

these cities.

                In three issues, TMPA, joined by the Northern Cities, contends that the Commission

was without jurisdiction to make any determination about wholesale transmission costs because in

so doing it impermissibly altered the terms of TMPA’s contract with Bryan.1 TMPA further asserts

that the district court erred in dismissing its request for declaratory relief that the Commission lacked

jurisdiction over this dispute. For the reasons set forth below, we affirm the judgments of the district

court.


                                          BACKGROUND

Early Wholesale Transmission Rate Proceedings

                A discussion of the history leading to the Commission proceedings at issue will be

helpful in putting TMPA’s arguments in context. In 1995, the legislature enacted the Public Utility

Regulatory Act (“PURA95”) to promote competition in the wholesale electricity market. Public

Util. Comm’n v. City Pub. Serv. Bd. of San Antonio, 53 S.W.3d 310, 312 (Tex. 2001) [hereinafter

“San Antonio”]. The electric industry has three principal components: generation, transmission, and

distribution of power. PURA95 required the Commission to adopt rules “relating to wholesale




         1
         These causes of action originally included a contract dispute between TMPA and Bryan,
which the district court severed. The contract dispute was transferred to and is pending in Grimes
County, the site of TMPA’s Gibbons Creek plant, which generates electricity for all of TMPA’s
member cities.

                                                   2
transmission service, rates, and access.”2 The Commission in turn adopted rules governing

wholesale transmission. See 21 Tex. Reg. 1397 (1996) (adopting 16 Tex. Admin. Code § 23.67)

[hereinafter rule 23.67], and 21 Tex. Reg. 3343 (1996) (adopting 16 Tex. Admin. Code § 23.70)

[hereinafter rule 23.70]. These rules required each ERCOT3 utility to pay every other ERCOT utility

a “facilities charge” for transmission service.

               The Commission then established matrices setting the net charges each utility would

pay other ERCOT utilities for providing wholesale transmission service in 1997 and 1998. See Tex.

Pub. Util. Comm’n, Regional Transmission Proceeding to Establish Postage Stamp Rate and

Statewide Loadflow Pursuant to Substantive Rule 23.67, Docket No. 15840 (Aug. 11, 1997) (final

order establishing rates) [hereinafter “1997 rate-setting proceeding”]; Tex. Pub. Util. Comm’n,

Proceeding to Modify ERCOT Transmission Rates for 1998 Pursuant to Substantive Rule 23.67,

Docket No. 18459 (June 26, 1998) (final order establishing rates) [hereinafter “1998 rate-setting

proceeding”]. A Travis County district court reviewed these orders, and, in the interim, the Texas

Supreme Court invalidated portions of rule 23.67 on the ground that chapter 35 of PURA gave the

Commission only an oversight role over a municipally owned utility’s wholesale transmission rates,

not the authority to dictate the rates by rule. San Antonio, 53 S.W.3d at 320-21. Because of the



       2
        Act of June 16, 1995, 74th Leg., R.S., ch. 765, § 2.08, 1995 Tex. Gen. Laws 3972, 4000
(amended 1997) (current version at Tex. Util. Code Ann. § 35.006(a) (West 1998)).
       3
          Texas utilities have voluntarily interconnected their regional transmission networks to form
a single grid maintained by the Electric Reliability Council of Texas (“ERCOT”). When power
within the ERCOT region is sold in a wholesale transaction, it is transported over this power grid.
See Public Util. Comm’n v. City Pub. Serv. Bd., 109 S.W.3d 130, 131 (Tex. App.—Austin 2003, no
pet.).

                                                  3
supreme court’s disposition, the district court in October and November 2003 reversed and remanded

these orders to the Commission for further proceedings.


Bryan’s 1998 Complaint Against TMPA

               In 1976, TMPA entered into four identical power sales contracts to sell power at

wholesale prices to Bryan and the Northern Cities. TMPA is a municipally owned utility, which is

defined as “owned, operated, and controlled by a municipality or by a nonprofit corporation the

directors of which are appointed by one or more municipalities.” Tex. Util. Code Ann. § 11.003(11)

(West 1998) [hereinafter “PURA § ____”]. Its board of directors is composed of two representatives

from each of the member cities. Each city is also a municipally owned utility and a TMPA customer

by contract. Under the contracts, TMPA provides electricity to each of the cities at designated points

of delivery.

               TMPA’s transmission of electricity to the Northern Cities involved both TMPA lines

and the lines of another utility, whereas transmission of electricity to Bryan involved only TMPA

lines. The Commission’s 1997 and 1998 wholesale transmission rate orders caused the Northern

Cities to bear greater costs for transmission than they had before. A majority of the TMPA board

of directors, outvoting Bryan six to two, passed a resolution requiring TMPA to reimburse the

Northern Cities for a certain amount of the transmission charges that they bore under the

Commission’s orders. This led to an increase in TMPA’s budget and in turn a reallocation of

TMPA’s charges to all of the member cities.

               In July 1998, Bryan filed a complaint with the Commission against TMPA, alleging

that the board’s actions required it to pay a portion of the Northern Cities’ transmission costs,

                                                  4
causing it to pay more for transmission service than the Commission’s transmission orders required.

Bryan argued that under the 1997 rate-setting proceeding, each city could “nominate” its own load

for power supplied by TMPA, that is, specify how much wholesale transmission service it would

need to provide power to its customers. In this way, Bryan contended, the cities treated their

contracts with TMPA as “unbundled,” meaning that TMPA charged them separately for generation,

transmission, and distribution of electricity.

               Bryan, concerned that the board might attempt to “rebundle” the contracts, sought a

declaration that it could continue to nominate its own load for power supplied by TMPA and that,

if it chose to do so, it would not be treated as a bundled wholesale customer of TMPA. TMPA

responded that it, not the member cities, bore all costs of transmission under the power sales

contracts. TMPA further argued that the Commission lacked the authority to unbundle the rate that

it charged the cities, because the contracts required a bundled rate.

               The Commission decided in Bryan’s favor that Bryan was authorized to nominate its

own load and was obligated to pay only those transmission charges established by the Commission.

See Tex. Pub. Util. Comm’n, Complaint of the City of Bryan, Texas Against Texas Municipal Power

Agency and the Cities of Denton, Garland and Greenville, Texas, Docket No. 19585 (Jul. 9, 1999)

(final order) [hereinafter “Bryan’s complaint proceeding”]. TMPA sought judicial review of the

order in a Travis County district court. The district court reversed and remanded the proceedings

to the Commission, due in part to the holding in the San Antonio case in 2001 invalidating the

Commission’s authority to set the wholesale transmission rates of municipally owned utilities. The




                                                  5
district court’s disposition of Bryan’s complaint proceeding is the subject of this appeal in cause

number 03-02-00644-CV.


1999 Wholesale Transmission Rate Proceeding

               In October 1999, the Commission established a matrix of wholesale transmission

charges for 1999. Pub. Util. Comm’n, Proceeding to Modify ERCOT Transmission Rates for 1999

Pursuant to Substantive Rule 23.67, Docket No. 20381 (Oct. 13, 1999) (final order on rehearing

establishing rates) [hereinafter “1999 rate-setting proceeding”]. Pursuant to its holding in Bryan’s

complaint proceeding, the Commission held in the 1999 proceeding that Bryan was “entitled to

unbundled transmission service and to nominate the resources that will be used to serve its loads.”

Id. at 1. In the meantime, effective September 1, 1999, the legislature amended PURA (“PURA99”),

in part by adding statutory provisions in chapter 40 governing municipally owned utilities. Thus,

PURA95 governs the first eight months of the 1999 rate-setting proceeding, whereas PURA99

governs the last four months of the proceeding.

               TMPA sought judicial review of the 1999 rate-setting order in a Travis County district

court. The district court reversed and remanded the proceedings to the Commission, due in part to

the holding in the San Antonio case in 2001 invalidating the Commission’s authority to set the

wholesale transmission rates of municipally owned utilities. The district court’s disposition of the

1999 rate-setting proceeding is the subject of this appeal in cause number 03-02-00701-CV.


Issues on Appeal

               By three issues, TMPA contends that the district court erred in reversing and

remanding to the Commission the order concerning Bryan’s complaint and portions of the 1999 rate-

                                                  6
setting order. All of TMPA’s issues hinge on the assertion that the Commission lacks the authority

both to adjudicate contract rights between TMPA and Bryan and to set wholesale transmission rates

for a municipally owned utility. In its first issue, TMPA asserts that the district court erred in

dismissing TMPA’s request for a declaration that the Commission lacked jurisdiction. TMPA’s

argument relies in part on the disposition of TMPA’s interlocutory appeal of a related Commission

matter, in which this Court held that TMPA’s administrative appeal did not deprive the district court

of jurisdiction to consider TMPA’s request for declaratory relief. See Texas Mun. Power Agency v.

Public Util. Comm’n, 100 S.W.3d 510, 520-21 (Tex. App.—Austin 2003, pet. denied).

               In its second issue, TMPA contends that the district court erred in granting Bryan’s

motion for partial summary judgment that as a matter of law chapter 35 of PURA conferred

jurisdiction on the Commission to determine whether the terms on which TMPA provided

transmission services to Bryan were reasonable. TMPA asserts that this holding was in error because

TMPA does not provide transmission services to Bryan and, moreover, the Commission lacked

jurisdiction to make the determination. In its third issue, TMPA contends that the district court erred

in denying its motion for partial summary judgment that the Commission lacked jurisdiction over

the matters at issue between TMPA and Bryan.


                                            ANALYSIS

Jurisdiction of the Commission under Chapter 35 of PURA

               TMPA’s second and third issues pertain to the district court’s grant in both

proceedings of one point of Bryan’s traditional motion for partial summary judgment and the denial

of TMPA’s traditional motion for partial summary judgment. The standards for review of a


                                                  7
traditional summary judgment are well established: the movant must show there is no genuine issue

of material fact and that it is entitled to judgment as a matter of law. See Tex. R. Civ. P. 166a(c);

Pustejovsky v. Rapid-Am. Corp., 35 S.W.3d 643, 645-46 (Tex. 2000); Nixon v. Mr. Prop. Mgmt. Co.,

690 S.W.2d 546, 548-49 (Tex. 1985). Here, the parties rely on statutory provisions to support their

entitlement to summary judgment. In general, matters of statutory construction are questions of law

rather than issues of fact. City of Garland v. Dallas Morning News, 22 S.W.3d 351, 357 (Tex.

2000).

               Generally, a party cannot appeal the denial of a motion for summary judgment

because it is an interlocutory order and thus not appealable. See Cincinnati Life Ins. Co. v. Cates,

927 S.W.2d 623, 625 (Tex. 1996). However, when both parties move for summary judgment and

the district court grants one motion and denies the other, the unsuccessful party may appeal both the

prevailing party’s motion and the denial of its own. See Holmes v. Morales, 924 S.W.2d 920, 922

(Tex. 1996). We will review the summary judgment evidence presented by both sides, determine

all questions presented, and render such judgment as the trial court should have rendered.

Commissioners Court v. Agan, 940 S.W.2d 77, 81 (Tex. 1997). When, as here, a trial court grants

summary judgment on a specific ground, we should consider all summary judgment grounds that the

trial court ruled on, are preserved for review, and are necessary for a final disposition of the appeal.

Cates, 927 S.W.2d at 625-26. We review the trial court’s decision to grant summary judgment de

novo. Natividad v. Alexsis, Inc., 875 S.W.2d 695, 699 (Tex. 1994).

               Bryan’s motion for partial summary judgment was granted on the sole ground that

“as a matter of law, PURA Ch. 35 conferred jurisdiction on the [Commission] to determine whether



                                                   8
the terms on which TMPA provided transmission service were reasonable.” The parties agree that

this requires us to apply principles of statutory construction in examining whether chapter 35 of

PURA conferred jurisdiction on the Commission to make this determination.

               Statutory construction is a question of law, which we review de novo. Texas Dep’t

of Transp. v. Needham, 82 S.W.3d 314, 318 (Tex. 2002). We must ascertain and give effect to the

legislature’s intent for the provision we are construing. See Fleming Foods v. Rylander, 6 S.W.3d

278, 284 (Tex. 1999); Union Bankers Ins. Co. v. Shelton, 889 S.W.2d 278, 280 (Tex. 1994); Calvert

v. Texas Pipe Line Co., 517 S.W.2d 777, 780 (Tex. 1974). The legislature’s intent is determined by

reading the language used in the particular statute and construing the statute in its entirety. See In

re Bay Area Citizens Against Lawsuit Abuse, 982 S.W.2d 371, 380 (Tex. 1998); Taylor v. Firemen’s

& Policemen’s Civil Serv. Comm’n, 616 S.W.2d 187, 190 (Tex. 1981). Further, we read every word,

phrase, and expression in a statute as if it were deliberately chosen, and presume the words excluded

from the statute are done so purposefully. See Gables Realty Ltd. P’ship v. Travis Cent. Appraisal

Dist., 81 S.W.3d 869, 873 (Tex. App.—Austin 2002, pet. denied); City of Austin v. Quick, 930

S.W.2d 678, 687 (Tex. App.—Austin 1996) (citing Cameron v. Terrell & Garrett, Inc., 618 S.W.2d

535, 540 (Tex. 1981)), aff’d, 7 S.W.3d 109 (Tex. 1999); see also 2A Norman J. Singer, Sutherland

Statutory Construction § 47.25 (6th ed. 2000) (stating that there is generally an inference that

omissions from a statute are intentional).

               The supreme court cautions that, in construing statutes


       [c]ourts must take statutes as they find them. . . . They should search out carefully
       the intendment of a statute, giving full effect to all of its terms. But they must find
       its intent in its language and not elsewhere. . . . They are not responsible for

                                                  9
       omissions in legislation. They are responsible for a true and fair interpretation of the
       written law.


RepublicBank Dallas, N.A. v. Interkal, Inc., 691 S.W.2d 605, 607 (Tex. 1985) (quoting Simmons v.

Arnim, 220 S.W. 66, 70 (Tex. 1920)). Because canons of statutory construction may be cited to

support conflicting interpretations of a disputed statute, we look to “the good sense of the situation

and a simple construction of the available language to achieve that sense, by tenable means, out of

the statutory language.” Karl N. Llewellyn, Remarks on the Theory of Appellate Decision and the

Rules or Canons About How Statutes are to be Construed, 3 Vand. L. Rev. 395, 401 (1950).

                 In ascertaining the scope of an agency’s authority, we give great weight to the

contemporaneous construction of a statute by the administrative agency charged with its

enforcement. State v. Public Util. Comm’n, 883 S.W.2d 190, 197 (Tex. 1994) (citing Dodd v. Meno,

870 S.W.2d 4, 7 (Tex. 1994); Tarrant Appraisal Dist. v. Moore, 845 S.W.2d 820, 823 (Tex. 1993)).

We recognize that the legislature intends an agency created to centralize expertise in a certain

regulatory area “be given a large degree of latitude in the methods it uses to accomplish its regulatory

function.” Id.

                 Before addressing TMPA’s second and third issues, we must be mindful of what is

not before us. First, we are not asked to determine whether the Commission’s orders were correct.

Second, we are not asked to decide any contractual issues between TMPA and Bryan. Instead, the

task before us is to decide the narrow question of whether chapter 35 of PURA conferred jurisdiction

on the Commission to determine whether the terms on which TMPA provided transmission services

to Bryan were reasonable. The parties agree on three matters concerning this question: the only



                                                  10
source of the Commission’s jurisdiction is chapter 35; this chapter confers at least limited

jurisdiction on the Commission; and we should resolve the jurisdictional issue. We thus turn to an

examination of the provisions of chapter 35.

               What became chapter 35 of PURA in 1997 was originally enacted as part of Title II

of PURA95.4 The purpose of Title II was to foster competition in the wholesale electric market and

“establish a comprehensive regulatory system . . . to assure rates, operations, and services that are

just and reasonable to consumers and to the utilities.”5 Chapter 35 “required all transmission-owning

utilities to provide ‘open access’ to their transmission facilities for wholesale transmission.” San

Antonio, 53 S.W.3d at 312-13.

               The supreme court held in San Antonio that “all powers that chapter 35 gives to the

Commission extend to municipally owned utilities.” Id. at 318; see PURA § 35.001 (“In this

subchapter, ‘electric utility’ includes a municipally owned utility.”).      Chapter 35 gives the

Commission the express power to


       ! ensure that an electric utility provides nondiscriminatory access to transmission
           service for qualifying facilities, exempt wholesale generators, power marketers,
           and other electric utilities;6



       4
        Act of June 16, 1995, 74th Leg., R.S., ch. 765, §§ 2.07-.08, 1995 Tex. Gen. Laws 3972,
3999-4000, amended by Act of May 21, 1997, 75th Leg., R.S., ch. 166, § 1, secs. 35.001-.008, 1997
Tex. Gen. Laws 713, 766-67 (codified at PURA §§ 35.001-.008). The Legislature again amended
PURA in 1999. Citations in this discussion are to the pre-1999 version of the act unless otherwise
noted.
       5
        Id. § 2.01, 1995 Tex. Gen. Laws 3972, 3988 (current version at PURA § 11.002(a) (West
Supp. 2004)).
       6
           PURA § 35.004(b).

                                                 11
       ! ensure that the utility recovers its reasonable costs in providing transmission
            services necessary for the transaction from the entity for which transmission is
            provided so that the utility’s other customers do not bear the costs of the service;7

       ! require an electric utility to provide transmission service at wholesale to another
            electric utility, a qualifying facility, an exempt wholesale generator, or a power
            marketer and . . . determine whether the terms for the transmission service are
            reasonable;8

       ! adopt rules relating to wholesale transmission service, rates, and access;9 and

       ! require that each party to a dispute concerning prices or terms of wholesale
            transmission service engage in a nonbinding alternative dispute resolution
            process before seeking resolution of the dispute by the commission.10


See San Antonio, 53 S.W.3d at 319-20. Chapter 35 does not, however, give the Commission the

authority to set wholesale transmission rates for municipally owned utilities. Id. at 321. Instead,

chapter 35 gives the Commission “largely an oversight role . . . with respect to wholesale

transmission transactions.” Id. at 320. “By its plain language, the statute anticipates disputes

between individual utilities about the price for wholesale transmission service . . . . Should the

parties not be able to agree on the terms for service, they can turn to the Commission.” Id. We now

turn to an examination of whether the assertions in Bryan’s complaint against TMPA fall within the

Commission’s jurisdiction under chapter 35.




       7
            Id. § 35.004(c).
       8
            Id. § 35.005(a).
       9
            Id. § 35.006(a).
       10
            Id. § 35.008.

                                                   12
               In its complaint, Bryan contended that the TMPA board’s actions in reallocating

expenses violated the orders in the 1997 and 1998 rate-setting proceedings because the actions

resulted in charging Bryan a higher rate for transmission than permitted under those orders. Bryan

further asserted that the board actions violated several provisions of PURA chapter 35:


       The attempt by the Northern Cities to use TMPA to reassign their . . . costs to Bryan
       causes TMPA to be in violation of PURA Sections 35.003, 35.004 and 35.005.
       Section 35.003 prohibits TMPA from granting a preference to any person in
       connection with the purchase or sale of electric energy at wholesale. The rate
       resolution violates this section because it grants a preference to the three Northern
       Cities by lowering their transmission costs at Bryan’s expense. The rate resolution
       also violates Sections 35.004(a) and 35.004(b) of PURA. Section 35.004(a) requires
       transmission service rates charged by an electric utility to be comparable to the rates
       charged by the utility for the use of its system. Section 35.004(b) requires that an
       electric utility’s transmission rates be non-discriminatory. The rate resolution
       violates these sections because it results in lower transmission rates for some users
       (the three Northern Cities) than for other users (Bryan . . .), rather than in
       “comparable” rates. This action also violates Section 35.004(c) of PURA, which
       precludes an electric utility from shifting transmission costs from one customer to
       another customer, in that it causes Bryan to bear the transmission costs of TMPA’s
       other customers, the three Northern Cities.

       The resolution also violates PURA Section 35.005, which requires transmission
       service rates to be reasonable, in that the resulting rates are not reasonable.


               TMPA conceded at oral argument that it does not generally dispute the Commission’s

jurisdiction over wholesale transmission rates. TMPA asserts, however, that it does not provide

wholesale transmission service to Bryan and therefore Bryan’s complaint does not fall within the

purview of the Commission’s jurisdiction under chapter 35. Under PURA, transmission service

“includes construction or enlargement of facilities, transmission over distribution facilities, control

area services, scheduling resources, regulation services, reactive power support, voltage control,



                                                  13
provision of operating reserves, and any other associated electrical service the commission

determines appropriate.”11     Commission regulations illumine this definition, explaining that

transmission service “allows a transmission service customer to use the transmission and distribution

facilities of electric utilities, electric cooperatives and municipally owned utilities to efficiently and

economically utilize generation resources to reliably serve its loads and to deliver power to another

transmission service customer.” 16 Tex. Admin. Code § 25.5(141) (West 2003). A transmission

service customer is a “transmission service provider, distribution service provider, river authority,

municipally-owned utility, . . . or other person whom the commission has determined to be eligible

to be a transmission service customer.” Id. § 25.5(142) (West 2003). TMPA does not dispute that

Bryan is its customer, but rather disputes that Bryan is its transmission service customer.

                TMPA asserts that it is its own transmission service customer because the power sales

contract requires it to bear all responsibility for delivering power to Bryan at the point of delivery.

However, in the 1997 rate-setting proceeding, which required a utility to apply for transmission

service if it were a transmission customer, 21 Tex. Reg. 3343, 3353 (1996), repealed 24 Tex. Reg.

2873 (1999) (former Commission rule 23.70(e)), TMPA declared to the Commission that



        TMPA is not a transmission customer, either in actuality or pursuant to the
        Commission’s rules. . . . TMPA is not a transmission customer because TMPA is not
        receiving transmission service. TMPA has no load responsibility. The electricity




        11
          Act of May 21, 1997, 75th Leg., R.S., ch. 166, § 1, sec. 31.002(7), 1997 Tex. Gen. Laws
713, 745 (amended 1999) (current version at PURA § 31.002(20) (West Supp. 2004)).

                                                   14
       generated by TMPA is purchased by its customers, who bear all load responsibility
       for TMPA’s generation. TMPA requests the Commission to revise the matrices
       attached to the proposed order to delete the designation of TMPA as a “transmission
       customer.”


(Emphasis added.) In the final order, the Commission left TMPA’s load responsibility blank and

listed the member cities as nominating their own loads. Similarly in the 1998 rate-setting

proceeding, the Commission listed TMPA as bearing no load responsibility and the member cities

as nominating their own loads.

               In Bryan’s complaint proceeding, the Commission cited a portion of TMPA’s

representation that it was not a transmission service customer and determined that Bryan was

authorized to nominate its own load. In the 1999 rate-setting proceeding, the Commission concluded

that “the fact that the Cities sought and obtained unbundled transmission services for 1997 and 1998

indicates that the contractual arrangement does not preclude Bryan from obtaining unbundled

services.” Based on TMPA’s representations in the earlier proceedings that it was not a transmission

customer because its member cities nominated their own loads—upon which the Commission was

entitled to rely in the later proceedings—we disagree with TMPA’s assertion that the member cities

are not wholesale transmission service customers. We thus conclude that Bryan is a wholesale

transmission service customer of TMPA.

               TMPA next asserts that the Commission lacked the authority to determine that Bryan

is entitled to nominate its own load because the dispute solely pertains to the rates prescribed by the

power sales contract. Accordingly, TMPA argues, the Commission’s orders allowing Bryan to take




                                                  15
unbundled service were impermissible reformations of the contract between TMPA and Bryan.12

TMPA further asserts that the Commission’s orders constitute rate setting, which the supreme court

invalidated in the San Antonio case.

               All parties agree that the Commission does not have the authority to adjudicate

contract disputes. The point of disagreement is whether the Commission’s orders constitute an

adjudication of a contract dispute. As those issues are pending in a separate suit, we are not being

asked to decide any contractual issues between TMPA and Bryan. Even assuming that the

Commission’s orders were an adjudication of contract rights, the Commission’s actions would be

permissible: TMPA’s enabling statute reserves the State’s “power to regulate an agency’s rates and

charges for electric energy supplied by the agency’s facilities.” PURA § 163.063(b) (West 1998).

               We thus turn to TMPA’s assertion that the Commission engaged in rate setting when

it determined that Bryan could nominate its own load. In its complaint, Bryan alleged that TMPA

had violated chapter 35 by granting a rate preference to the Northern Cities, engaging in

discriminatory pricing, impermissibly shifting transmission costs from one customer to another

customer, and setting rates that were higher than the rates set by the 1997 and 1998 proceedings.

Thus, Bryan asked the Commission to examine wholesale transmission charges that the TMPA board

of directors had already set. Under the limits of chapter 35 set forth in San Antonio, Bryan’s

complaint and subsequent request to nominate its own load in the 1999 rate-setting proceeding fell

within the Commission’s jurisdiction. Under chapter 35, the Commission has “the specific power




       12
         Although TMPA quoted portions of the power sales contract in its pleadings in Bryan’s
complaint proceeding, TMPA never introduced the contract into evidence.

                                                16
to review rates for reasonableness.” San Antonio, 53 S.W.3d at 319. The chapter additionally

confers on the Commission the express power “to ensure that all utilities provide nondiscriminatory

access to transmission service.” Id. “Once confronted with a dispute between utilities,” as occurred

here, under chapter 35 “the Commission can arrive at a reasonable rate to resolve that dispute.” Id.

at 320. That was precisely the Commission’s role in examining Bryan’s complaint and, in the 1999

rate-setting proceeding, in reviewing Bryan’s request to nominate its own load.

               Moreover, even had Bryan not filed a complaint, “to ensure that utilities are providing

comparable prices and services and non-discriminatory access, and to protect a utility’s customers

from bearing others’ transmission costs, the Commission has the independent ability to order

utilities to appear before it even without a dispute.” Id. (emphasis added). We do not find that the

district court erred in granting Bryan’s motion for partial summary judgment that “as a matter of law,

chapter 35 of PURA conferred jurisdiction on the Commission to determine whether the terms on

which TMPA provided transmission services to Bryan were reasonable.”13 Accordingly, the district

court further did not err in denying TMPA’s motion for partial summary judgment as to the

Commission’s jurisdiction.




       13
           TMPA additionally argues that chapter 40 of PURA, effective September 1, 1999, limits
the Commission’s jurisdiction. See generally PURA §§ 40.001-.104 (West Supp. 2004). Chapter
40, however, was adopted after Bryan’s complaint proceeding and applies to the 1999 rate-setting
proceeding only for the last four months of 1999. Furthermore, chapter 40 grants a municipally
owned utility the exclusive jurisdiction to “set all terms of access, conditions, and rates applicable
to services provided by the municipally owned utility, . . . but excluding wholesale transmission
rates, terms of access, and conditions for wholesale transmission service set by the commission
under this subtitle.” Id. § 40.055(a)(1) (emphasis added). Thus, chapter 40 does not limit the
Commission’s oversight jurisdiction under chapter 35.

                                                 17
               TMPA contends nevertheless that the Commission lacked jurisdiction to hear Bryan’s

complaint because the Commission’s wholesale transmission rate matrix was based on rules that San

Antonio has since invalidated. We disagree. The invalidation of the rules in 2001 does not figure

into whether Bryan’s complaint fell within the Commission’s chapter 35 jurisdiction. Additionally,

it was appropriate for the district court to remand these proceedings to the Commission in light of

the San Antonio case and the 1999 amendments to PURA. The Commission should have the

opportunity to reconsider its orders on remand. We may not make substantive decisions committed

by statute to the Commission. Public Util. Comm’n v. GTE-SW, 833 S.W.2d 153, 175 (Tex.

App.—Austin 1992), aff’d in part, rev’d in part on other grounds, 901 S.W.2d 401 (Tex. 1995).

“[T]he terms of the final order are matters committed to agency discretion as long as the agency

corrects the assignment of errors sustained on appeal.” Id. Were we to render judgment, we would

usurp the Commission’s authority to revisit the issues in light of the San Antonio holding and the

1999 amendments to PURA.


TMPA’s Request for Declaratory Relief

               TMPA conceded at oral argument that if we were to reach the jurisdictional issue, its

request for a declaration that the Commission was without jurisdiction would be redundant. Having

found that chapter 35 of PURA conferred jurisdiction on the Commission to determine whether the

terms on which TMPA provided transmission services to Bryan were reasonable, we hold that

TMPA’s request for declaratory relief is unnecessary and redundant. Accordingly, we overrule all

of TMPA’s issues, affirming the district court’s grant of summary judgment in favor of Bryan, denial




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of TMPA’s motions for partial summary judgment, and dismissal of TMPA’s request for declaratory

relief. We affirm the judgments of the district court.


                                         CONCLUSION

               The issue before us is whether chapter 35 of PURA conferred jurisdiction on the

Commission to determine whether the terms on which TMPA allocated wholesale costs for

transmission of electricity to Bryan were reasonable. Although TMPA disputes that Bryan is its

wholesale transmission customer, based on TMPA’s representations in earlier proceedings, on which

the Commission was entitled to rely in its determination of the proceedings before us on appeal, we

conclude that Bryan is a wholesale transmission customer of TMPA.

               In its complaint, Bryan asked the Commission to examine the allocation of rates by

the TMPA board of directors and asserted that the board’s actions violated several provisions of

chapter 35.   This chapter grants the Commission “the specific power to review rates for

reasonableness.” San Antonio, 53 S.W.3d at 319. The chapter additionally gives the Commission

the express power “to ensure that all utilities provide nondiscriminatory access to transmission

service.” Id. “Once confronted with a dispute between utilities,” as occurred here, under chapter

35 “the Commission can arrive at a reasonable rate to resolve that dispute.” Id. at 320. Because

Bryan’s complaint and subsequent request to nominate its own load in the 1999 rate-setting

proceeding falls within the Commission’s jurisdiction under chapter 35, we uphold the district

court’s grant of partial summary judgment in favor of Bryan that “as a matter of law, chapter 35 of

PURA conferred jurisdiction on the Commission to determine whether the terms on which TMPA

provided transmission services to Bryan were reasonable.” Furthermore, given that TMPA concedes

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that our determination of the jurisdictional issue renders redundant its request for a declaration that

the Commission lacked jurisdiction, we affirm the district court’s dismissal of TMPA’s request for

declaratory relief. We affirm the judgments of the district court.




                                               Jan P. Patterson, Justice

Before Chief Justice Law, Justices Patterson and Puryear

Affirmed

Filed: January 29, 2004




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