Utah Department of Administrative Services v. Public Service Commission

OAKS, Justice:

For over forty years, Mountain Fuel Supply Co. (MFS) has conducted oil and gas exploration activities to assure continuing supplies of natural gas for its customers. As a result, current gas production from MFS wells accounts for over thirty percent of its total requirements. Consumers (ratepayers) pay cost-of-service prices for this gas, a fraction of the federally regulated market price (about one-third in 1977). Since 1947, all or part of the expenses of such exploration and development have been treated as normal utility operating expenses and, with regulatory approval, have…