Laserfiche WebLink
<br />- 3 - <br /> <br />'... <br /> <br />CREDA's counsel, Duncan, Allen and Mitchell of Washington, D.C., the policy <br />considerations which led to the development and continuation of the preference <br />clause are reviewed, the federal laws which support Western's decision not to sell <br />power to UP&L are discussed, and the flaws which render UP&L's constitutional <br />claims invalid are exposed. <br /> <br />The preference clause represents the Congressional determination <br />that national resources should be devoted to the people and should be distributed <br />directly to the people without the use of an intermediary that would profit by <br />acting as a middle-man. Accordingly, Congress decided that power generated at <br />federally-owned hydroelectric projects must be offered for sale first to public <br />bodies, such as municipalities, joint action agencies, cooperatives, and other <br />public, non-profit organizations, before any of the available power may be offered <br />to a private corporation like UP&L. An additional benefit of the preference <br />clause is that it helps to keep the rates of investor-owned utilities in check by <br />providing competition in the essentially monopolistic electric utility industry. <br /> <br />The marketing criteria which Western has proposed for the sale of <br />CRSP power after 1989 conform to the requirements of the preference clause. <br />These criteria distinguish between preference entities which own and operate <br />their own distribution systems and those that rely on private companies such as <br />UP&L to sell power to their citizens. The type of scheme UP&L proposes is <br />essentially a subterfuge. CRSP power would theoretically be allocated to UP&L's <br />Agent Cities but would, in reality, be instantaneously resold by those Agent Cities <br />to UP&L for ultimate distribution. Similar schemes have been attempted in the <br />past and have been rejected by courts and federal agencies. <br /> <br />Western's refusal to sell power in a manner which would benefit <br />UP&L does not violate UP&L's or its Agent Cities' due process rights, as claimed <br />by UP&L. The "due process" required by the Constitution simply means that one <br />must be given the opportunity to be heard at a meaningful time and in a meaning- <br />ful manner. The procedure which Western has instituted and is following for the <br />development of ' its post-1989 CRSP marketing pIan provides more than an ade- <br />quate opportunity for members of the public to be heard by Western. UP&L has <br />participated fully in Western's public proceedings. Accordingly, UP&L has no <br />legitimate claim that it has been deprived of due process of law. <br /> <br />UP&L has also claimed that the constitutional right of citizens to be <br />given equal protection of the laws would be violated if Western refused to accede <br />to its demands for power. Contrary to UP&L's allegations, the Constitution does <br />not require absolute equality nor does it preclude the government from enacting <br />laws which make distinctions or classifications between citizens or regions. The <br />guarantees of equal protection merely require that the government's reasons for <br />providing benefits to a particular group of persons or geographic region be ration- <br />al. If a classification created by a statute is "suspect" because it discriminates <br />according to race, national origin or alienage or if a "fundamental" right is affect- <br />ed, the government may be required to show that it had compelling reasons for <br />creating the classifications. <br />