Legal Memorandum: Retirement of Utilities in ND

Issue: What are the legal obligations for a company upon the retirement of power plants, transmission lines, and gas pipelines used in North Dakota?

A general provision governing the duties of public utilities in North Dakota provides that a public utility may not “dispose of” its works or system necessary or useful to perform its duties to the public without the Public Service Commission’s prior approval.  N.D. Cent. Code § 49‑04‑05 (2012).  This approval requirement does not apply to the disposal of tangible property valued at less than $500,000.  Id.  “Disposal” is not defined, so it is unknown whether the term encompasses abandonment.  Legislation that created the North Dakota transmission authority references the disposal of electric transmission facilities and related infrastructure.  The act gives the authority the power to dispose of transmission facilities owned pursuant to the chapter, but does not address a power company’s obligations regarding disposal or abandonment of its facilities.  Id. §§ 17-05-05, -11.  With respect to gas pipelines, North Dakota has adopted many of the federal pipeline safety standards set forth in 49 C.F.R. Parts 190–192; 199.  See N.D. Admin. Code § 69-09-03-02 (2011).  The legislation that created the North Dakota pipeline authority references pipeline-system disposal and gives the authority the power to dispose of pipeline facilities, but it does not address a power company’s obligations regarding pipeline disposal or abandonment.  N.D. Cent. Code §§ 54-17.7-04, -11 (2012).  

The North Dakota legislature directed the public service commission to adopt rules governing the decommissioning of commercial wind energy conversion facilities.  Id. § 49-02-27.  Before commencing operation of a commercial facility generated by wind energy, the operator must file information with the […]