A certificate case is a regulatory proceeding to evaluate a utility’s application for a Certificate of Public Convenience and Necessity (CPCN). A utility typically must file an application for a CPCN in the following circumstances: a) to provide service to a new geographic area, b) to enter into a new franchise agreement, or c) to construct and operate a new facility or an extension of a facility that is outside the “ordinary course of business.” In this case, the regulatory commission with jurisdiction will determine the definition of “ordinary course of business”. Factors may include the size, cost, and planned operation of the project; whether the project is necessary to serve load growth; whether non-standard financing arrangements are necessary; and whether the project will cause a significant change in rates.
The application filed by the utility typically includes costs, timing, and justification as to why the proposed expenditure is in the public interest. It may also consider environmental issues that may result from the project. The commission often will allow for public comment on the application and may hold formal hearings. If the application is ultimately approved, the commission will issue a decision authorizing a CPCN, along with any conditions attached to the authorization. Specific requirements and procedures for obtaining a CPCN vary among the state or federal commissions that issue them.