Alliance to Protect Nantucket Sound, Inc. v. Department of Public Utilities
461 Mass. 166
Mass.2011Background
- National Grid entered into two long-term PPAs (PPA-1 and PPA-2) with Cape Wind under the Green Communities Act § 83 to procure renewable energy.
- Interveners Alliance, AIM, NEPGA, and TransCanada challenged the Department of Public Utilities’ approval, arguing commerce clause violations and process issues.
- § 83 requires distribution companies to solicit renewable proposals twice in five years and to seek approvals balancing costs and benefits; it also restricts capacity to 3% absent a best-interest finding.
- The department suspended the geographic limitation in § 83 during the relevant proceedings, allowing in-state and adjacent federal waters sources; National Grid proceeded with individual negotiations for PPA-1.
- PPA-1 covers 234 MW for 15 years; PPA-2 mirrors PPA-1 but contemplates assignment to another purchaser; department approved PPA-1 and denied PPA-2.
- The court remands to the county court with instruction to affirm the department’s decision.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the geographic limitation violate the dormant Commerce Clause? | Alliance and TransCanada contend it discriminates against out-of-state generators. | Department found no Commerce Clause violation; National Grid acted independent of the limitation under suspension. | Commerce clause challenge rejected; no constitutional violation. |
| Was the cost-effectiveness finding supported by substantial evidence? | Alliance and TransCanada argue department erred by not considering lost opportunity costs and treating cost-effectiveness as lowest cost. | Department adopted a broader cost-benefit view, including nonquantified benefits and environmental considerations. | Department's cost-effectiveness finding upheld. |
| Was the public interest finding supported by substantial evidence? | Alliance argues PPA-1’s above-market costs are not outweighed by benefits. | Cape Wind’s location, size, and reliability benefits justify the higher cost. | Public interest finding sustained. |
| Was individual negotiations permissible under § 83 as opposed to competitive bidding? | NEPGA argues multiple bids were required; otherwise competitive bidding should apply. | Statute allows individual negotiations; plural form of 'proposals' does not mandate multiple proposals. | Reasonable interpretation that individual negotiations may be used; approved. |
| Did the department exceed its authority by cost-recovering above-market costs across all customers? | AIM/NEPGA argue recovery method imprudent or ultra vires. | Statutory framework and broad rate-filing authority authorize cross-customer cost recovery for environmental benefits. | Cost recovery method approved; benefits allocated to all customers. |
Key Cases Cited
- Cambridge v. Department of Telecomm. & Energy, 449 Mass. 868 (Mass. 2007) (deference to agency statutory interpretation; complex regulatory framework)
- DSCI Corp. v. Department of Telecomm. & Energy, 449 Mass. 597 (Mass. 2007) (deference to agency expertise; statutory review standards)
- Alliance to Protect Nantucket Sound, Inc. v. Energy Facilities Siting Bd., 448 Mass. 45 (Mass. 2006) (agency interpretation given substantial deference; statutory construction)
- City Council of Agawam v. Energy Facilities Siting Bd., 437 Mass. 821 (Mass. 2002) (harmonious reading of related statutes; agency discretion)
- Commonwealth v. Russ R., 433 Mass. 515 (Mass. 2001) (implied repeal and specific vs general statute interpretation)