PSC’s Broad Reopening Power Under W. Va. Code § 24-2-2(a) and “Gray & Overlapping” Service Rights for Undeveloped Development Sites

I. Introduction

In Beckley Water Company v. Public Service Commission of West Virginia and City of Mount Hope (W. Va. June 1, 2026), the Supreme Court of Appeals of West Virginia affirmed a Public Service Commission (“PSC”) order that (1) reopened and ultimately vacated an earlier, final recommended decision identifying an undeveloped tract (“Appalachian Heights” or “the Site”) as within Beckley Water Company’s (“BWC”) exclusive service territory, and (2) reclassified the Site as located in a “gray and overlapping” service territory, allowing a future developer/customer to choose between BWC and the City of Mount Hope (“Mount Hope”) for water service.

The dispute arose from Mount Hope’s publicly funded water extension initiative toward the Site and BWC’s complaint seeking a cease-and-desist order. After an initial recommended decision favored BWC’s exclusivity (but denied a cease-and-desist as premature), events changed: Mount Hope annexed the Site. The PSC reopened the matter, revisited territorial rights, and concluded that—given annexation, the lack of any existing customer at the Site, and both utilities’ ability to serve—the Site fell within an overlapping territory.

The key legal issues were: (a) whether the PSC had statutory/regulatory authority to reconsider and modify a prior final order, and (b) whether the PSC properly applied its “gray and overlapping” framework (including the “Lumberport test” and “isolation test”) to an undeveloped economic-development location.

II. Summary of the Opinion

The Court held that the PSC acted within its statutory authority and jurisdiction when it reopened the proceeding and revisited the earlier final determination. The Court relied primarily on the plain language of W. Va. Code § 24-2-2(a), which provides that PSC orders remain in force until they expire or are “revoked or modified by the commission,” and on W. Va. Code R. § 150-1-19.5, which permits petitions to reopen closed matters without imposing the narrowing limitations urged by BWC.

On the merits, the Court concluded that the PSC did not err in finding the Site to be in a “gray and overlapping” service territory. Applying the PSC’s established framework—drawn from commission precedent (notably Harrison Rural Electrification Ass'n, Inc. v. Monongahela Power Co. (Comm'n Order, May 11, 2005) and Lumberport-Shinnston Gas Co., lnc. v. Equitable Gas Co. (Comm'n Order, Sept. 29, 1987))—the Court accepted the PSC’s determination that both utilities could be required to serve the Site under the “isolation test,” especially given the Site’s undeveloped status, existing nearby facilities, and a legislative policy favoring utility extensions to “business ready” sites (W. Va. Code § 24-2-1n).

Accordingly, the Court affirmed the PSC’s order.

III. Analysis

A. Precedents Cited (and How They Shaped the Decision)

1. Appellate review of PSC orders: deference and the three-part test

  • Central W. Va. Refuse, Inc. v. Pub. Serv. Comm'n of W. Va., 190 W. Va. 416, 438 S.E.2d 596 (1993) (Syl. Pt. 1), summarizing the review framework originating in Monongahela Power Co. v. Public Service Commission, 166 W. Va. 423, 276 S.E.2d 179 (1981).
    Influence: The Court reiterated that judicial review of PSC orders is “highly deferential,” asking (1) whether the PSC exceeded its jurisdiction/powers, (2) whether evidence supports findings, and (3) whether the substantive result is proper. This deferential posture mattered most on the territorial-overlap question, where the PSC’s expertise and fact-bound balancing were central.
  • W. Va. Citizen Action Grp. v. Pub. Serv. Comm'n of W. Va., 233 W. Va. 327, 758 S.E.2d 254 (2014) (per curiam), and United Fuel Gas Co. v. Pub. Serv. Comm'n of W. Va., 154 W. Va. 221, 174 S.E.2d 304 (1969).
    Influence: These cases supported the opinion’s emphasis on the PSC’s broad regulatory powers and the institutional competence rationale for deference.
  • Appalachian Power Co. v. Pub. Serv. Comm'n of W. Va., 251 W. Va. 44, 909 S.E.2d 79 (2024).
    Influence: Reinforced that PSC matters involve specialized expertise; the Court leaned on that principle when rejecting BWC’s effort to reweigh operational considerations (distance, feasibility, project posture) in the overlap analysis.
  • Pool v. Greater Harrison Cnty. Pub. Serv. Dist., 241 W. Va. 233, 821 S.E.2d 14 (2018) (quoting Appalachian Power Co. v. State Tax Dep't of W. Va., 195 W. Va. 573, 466 S.E.2d 424 (1995)).
    Influence: Provided the de novo standard for statutory and rule interpretation—critical to the threshold question of whether the PSC had power to revisit a final order under the governing statutes and regulations.

2. Administrative reconsideration/reopening authority

  • Atl. Greyhound Corp. v. Pub. Serv. Comm'n, 132 W. Va. 650, 54 S.E.2d 169 (1949).
    Influence: Supplied the foundational principle that an agency’s reconsideration power may be express or implied by statute—setting up the Court’s statutory analysis of W. Va. Code § 24-2-2(a).
  • Reed v. Thompson, 235 W. Va. 211, 772 S.E.2d 617 (2015).
    Influence: Gave the two-step framework for agency reconsideration power (statutory grant first; if absent, then rulemaking authority plus an adopted procedural reconsideration rule). The Court effectively resolved the first step in the PSC’s favor by finding an express statutory basis in § 24-2-2(a), and additionally found the reopening regulation consistent with that authority.

3. Textualism in construing statutes and regulations

  • Brooke B. v. Ray, 230 W. Va. 355, 738 S.E.2d 21 (2013) (Syl. Pt. 11).
    Influence: The Court used this canon—courts must not add omitted words—to reject BWC’s attempt to read limiting language into W. Va. Code R. § 150-1-19.5.
  • Snider v. Fox, 218 W. Va. 663, 627 S.E.2d 353 (2006) (per curiam).
    Influence: Supported applying the same construction principles to regulations as to statutes, which framed the Court’s plain-language reading of § 150-1-19.5.
  • Putnam Park Apartments, Inc. v. Plan. & Zoning Comm'n of Town of Greenwich, 218 A.3d 1127 (Conn. App. Ct. 2019).
    Influence: Persuasive authority reinforcing the “no added limitations” approach to regulatory text.

4. Territorial disputes and “gray and overlapping” service: commission precedent

  • Harrison Rural Electrification Ass'n, Inc. v. Monongahela Power Co., Case No. 03-0915-E-C (Comm'n Order, May 11, 2005).
    Influence: The Court treated this commission order as the key articulation of the three-prong “Lumberport test” and the principle that if a customer is in a gray/overlapping territory, the customer may choose the provider.
  • Lumberport-Shinnston Gas Co., lnc. v. Equitable Gas Co., Case Nos. 86-749-G-C and 87-115-G-GI (Comm'n Order, Sept. 29, 1987).
    Influence: The origin of the “Lumberport test” factors and the customer-choice consequence once overlap is found. The Court distinguished Lumberport factually (prior service and “stealing” customers) from this case (undeveloped site with no current customers).
  • Monongahela Power Co. v. Harrison Rural Electrification Ass'n, Inc., Case No. 04-1062-E-C (Comm'n Order, Aug. 24, 2005).
    Influence: The Court relied on this commission order’s “isolation test” methodology for prong three: assume each utility exists alone—would the rules and case law require service? If yes for both, the territory is gray/overlapping.
  • Harrison Rural Electrification Ass'n, Inc. v. Pub. Serv. Comm'n of W. Va., 190 W. Va. 439, 438 S.E.2d 782 (1993) (per curiam), referenced via the 2005 commission order.
    Influence: Supported the PSC practice of examining existing facilities “as those facilities currently exist” when resolving territorial disputes.
  • Harrison Rural Electrification Ass'n, Inc. v. Monongahela Power Co., Case No. 92-0319-E-C (Comm'n Order, April 26, 1996).
    Influence: Backed the Court’s acceptance of the PSC’s “case-by-case” approach to service territory determinations, which the Court used to rebut BWC’s reliance on other, dissimilar territorial cases.
  • Harrison Rural Electrification Ass'n, Inc. v. Monongahela Power Co., Case No. 96-0747-E-C (Comm'n Order, September 18, 1997), and Harrison Rural Electrification Association, Inc. v. Monongahela Power Company, Case No. 92-0319-E-C (Comm'n Order, April 26, 1993).
    Influence: These were invoked by BWC to argue distance and line-crossing should defeat overlap. The Court treated them as factually distinguishable and thus not controlling constraints on the PSC here.
  • Harrison Rural Electrification Ass'n, Inc. v. Monongahela Power Co., Case No. 18-1450-E-C (Comm'n Order, March 26, 2019) (“HREA”).
    Influence: The Court used this order as context for the Legislature’s economic-development mandates (including W. Va. Code § 24-2-1n) and the PSC’s understanding that promoting sensible, forward-looking infrastructure for development sites can be part of the § 24-1-1 balancing.

5. Annexation and “superior service rights” (acknowledged but not extended here)

  • Berkeley Cnty. Pub. Serv. Sewer Dist. v. W. Va. Pub. Serv. Comm'n, 204 W. Va. 279, 512 S.E.2d 201 (1998) (Syl. Pt. 3, in part).
    Influence: The Court included the municipal “superior right” concept under W. Va. Code § 16-13A-8, but emphasized that the PSC did not extend that doctrine to BWC (a private utility) and that point was not decided on appeal. The annexation’s real significance in this case was factual and statutory context for Mount Hope’s ability/obligation to serve, not a dispositive superior-right rule.

6. PSC authority to control utilities and hear service complaints

  • State ex rel. City of Wheeling v. Renick, 145 W. Va. 640, 116 S.E.2d 763 (1960) (Syl. Pt. 6).
    Influence: Reinforced the breadth of PSC authority over utility facilities, charges, and services, subject to lawful and reasonable requirements—supporting the Court’s general posture of upholding the PSC’s territory/service determinations absent clear legal error.

B. Legal Reasoning

1. The PSC’s power to reopen and modify a final order is broad under § 24-2-2(a)

The Court treated the reopening question as primarily statutory and regulatory interpretation (reviewed de novo). Although W. Va. Code § 24-1-9(g) sets a process by which an ALJ recommended decision becomes final if not excepted to or reviewed sua sponte, the Court held that finality under § 24-1-9 does not create an unchangeable order. The controlling provision, W. Va. Code § 24-2-2(a), states that “every order entered by the commission” continues in force until it expires or is “revoked or modified by the commission” (unless altered by a court). The Court read this language as an express grant of continuing authority to revise prior PSC orders.

2. W. Va. Code R. § 150-1-19.5 does not limit reopening to only post-hearing developments

BWC argued that § 150-1-19.5 narrows reopening to “matters which have arisen since the hearing” and prevents the PSC from revisiting settled determinations unless the petition itself seeks modification based on such new matters. The Court rejected this as an impermissible rewriting of the rule. The regulation requires that if a petitioner seeks to vacate/reverse/modify an order “by reason of” new matters or newly discovered facts, those matters must be set forth; it does not state that the PSC may consider only those matters, nor does it impose a categorical subject-matter limitation on what the PSC may revisit once reopened.

Invoking Brooke B. v. Ray and Snider v. Fox, the Court emphasized a plain-language, no-additions approach: courts should not insert constraints not present in the text. On that basis, the Court upheld the PSC’s authority to revisit exclusivity and to ultimately vacate the earlier recommended decision.

3. The “gray and overlapping” determination: Lumberport test and isolation test applied to an undeveloped site

The merits dispute centered on prong three of the “Lumberport test”—whether the Site is located in an overlapping service territory. The PSC used the “isolation test”: assume each utility exists alone, and ask whether the rules and case law would require it to provide service if requested. If both would be required to serve, the territory is gray/overlapping.

The Court accepted the PSC’s fact-driven application. The PSC considered: (1) the Site’s annexation into Mount Hope’s corporate limits; (2) the absence of any prior service because the Site is undeveloped; (3) existing facilities of both utilities in the area; (4) the PSC’s assessment that a 2.5-mile extension was not “too far” in context; and (5) the Legislature’s expressed policy favoring pre-tenant infrastructure extensions for economic development under W. Va. Code § 24-2-1n and the PSC’s balancing obligations under W. Va. Code § 24-1-1.

Importantly, the Court did not treat annexation as a per se rule awarding Mount Hope exclusive or “superior” rights over a private utility; rather, it treated annexation as a relevant circumstance informing whether Mount Hope would be required to serve under the isolation test and whether overlap exists given both utilities’ ability to serve a new user at a development site.

4. Deference sealed the result

Once the Court found the PSC acted within its statutory jurisdiction and applied a legally recognizable framework, the deferential review standard did the remaining work. The Court concluded there was no reversible error in the PSC’s application of its overlap methodology to these facts and affirmed.

C. Impact

  • Expanded practical finality risk for “exclusive territory” determinations. Even where an ALJ recommended decision becomes final under W. Va. Code § 24-1-9, the PSC retains statutory power under W. Va. Code § 24-2-2(a) to later revoke or modify that order. Utilities relying on “final” territorial rulings should account for the PSC’s continuing supervisory authority.
  • Reopening petitions may invite broader reconsideration than the moving party intends. BWC sought reopening to enforce exclusivity; the outcome was the opposite—vacatur of exclusivity and recognition of overlap. The decision signals that once reopened, the PSC is not confined to the narrow framing offered by the petition.
  • Economic-development sites may more readily be treated as “gray and overlapping.” By endorsing consideration of the “West Virginia Business Ready Sites Program” policy (W. Va. Code § 24-2-1n) alongside traditional facility/location factors, the opinion supports PSC flexibility in classifying undeveloped, publicly supported development tracts as overlapping territories, leading to customer/developer choice.
  • Commission precedent and methodology gain judicial reinforcement. The Court effectively “validated” the PSC’s use of the Lumberport/isolation-test approach as an administratively sound method for deciding prong three overlap disputes in novel postures (no current customer, development-driven extension).
  • Municipal annexation matters, but not as an automatic trump card against private utilities. The opinion keeps open (and does not decide) how annexation-based “superior service rights” doctrines apply outside the municipality-versus-public-service-district context described in Berkeley Cnty. Pub. Serv. Sewer Dist. v. W. Va. Pub. Serv. Comm'n.

IV. Complex Concepts Simplified

Recommended decision vs. final PSC order
An administrative law judge (“ALJ”) issues a recommended decision. If no party files timely exceptions and the PSC does not review it on its own (W. Va. Code § 24-1-9(g)), it becomes the PSC’s order. This case clarifies that such finality does not prevent later PSC modification under W. Va. Code § 24-2-2(a).
Petition to reopen (W. Va. Code R. § 150-1-19.5)
A procedural device allowing a party to ask the PSC to reopen a closed proceeding. The Court read the rule as requiring certain showings when modification is sought based on new matters, but not as limiting what the PSC may consider once a case is reopened.
Exclusive service territory
A territory where one utility has the sole right/obligation to serve, so competitors may be excluded. BWC sought such exclusivity for the Site.
Gray and overlapping service territory
An area where more than one utility may lawfully provide service; under PSC precedent discussed in the opinion, a customer located there may choose the provider.
The “Lumberport test”
A three-factor PSC framework (as quoted in the opinion) asking: (1) is the proposed customer a new user; (2) is there evidence of prior service; and (3) is the customer located in overlapping territory. Here, the dispute centered on factor (3).
The “isolation test”
A tool for factor (3): pretend only Utility A exists—would the rules require it to serve? Then pretend only Utility B exists—would the rules require it to serve? If both answers are yes, the location is gray/overlapping.
De novo vs. deferential review
Statutory/regulatory interpretation is reviewed “de novo” (the Court decides independently). PSC fact-bound determinations within its expertise are reviewed deferentially under the Central W. Va. Refuse, Inc. v. Pub. Serv. Comm'n of W. Va. framework.

V. Conclusion

The Court’s affirmance rests on two core holdings. First, the PSC possesses continuing authority under W. Va. Code § 24-2-2(a), reinforced by its procedural reopening regulation (W. Va. Code R. § 150-1-19.5), to revisit and modify prior final orders; courts will not read limiting language into those texts. Second, on the merits of territorial classification for an undeveloped, development-oriented site, the PSC may apply its Lumberport/isolation methodology in a case-specific manner, considering existing facilities, practical extension distance, annexation context, and legislative economic-development policies (including W. Va. Code § 24-2-1n), and may conclude the location is “gray and overlapping,” leaving provider choice to the future customer/developer.