In this case, the Prince Edward Island Court of Appeal assessed whether the constitutents to be considered in the "public interest and necessity" test in section 2.1(2) of the Electric Power Act include province-wide customers of Maritime Electric's service, or simply those directly provided with electricity by the proposed City of Summerside electric energy plan. Justice McQuaid, writing for the majority, held that only customers to be provided with "service" under the proposed plan could be considered. In partial dissent, Chief Justice Jenkins found that all of Maritime Electric's customers were potentially affected, and should be considered within the test.
This appeal and cross-appeal were brought by the City of Summerside and Maritime Electric, following an application to the Island Regulatory and Appeals Commission for a permit allowing the City to construct a line and connect its substation to Maritime Electric's Bedeke station. In deciding to grant the permit, the Commission was to consider the public convenience and necessity of the area the applicant, the City, intends to service. Justice McQuaid found that the simple transmission of electrical energy over a geographical area does not constitute "service". According to s.1(1)(g) of the Act, "service" is the transmission or provision of electric energy for the benefit of customers and for compensation. Thus, only customers actually receiving the transmitted energy and paying fees in exchange are to be considered in the public convenience and necessity test. This includes customers of the City utilities within the city boundaries and beyond, but not customers of Maritime Electric in overlapping or other areas.
In partial dissent, Chief Justice Jenkins found that Maritime Electric customers further afield should also be considered in the test. Jenkins C.J. undertook a consideration of s.2.1 based on a modern interpretation of the Act in the context of the modern electric service franchise granted to Maritime Electric in exchange for guaranteed service to all areas of PEI. He rejected any analysis of analogous terms in former incarnations of the legislation and previous cases, noting that they had been decided when the legislation was aimed at standardizing quality and access across a number of small, independent electric providers across the province, each with a defined area of service. Relying on the language in the preamble of the Act, Jenkins C.J. argued that the present Act was designed to encourage reasonable and publicly justifiable rates for electrical power, and that a broader definition of "service" was required to achieve this goal.
July 13, 2011
Link to Decision
Webnesh Haile
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