Whitehall Wind, LLC v. Montana Public Service Commission
2015 MT 119
| Mont. | 2015Background
- PURPA requires utilities to purchase energy from qualifying facilities and allows sale under a legally enforceable obligation (LEO) or contract; state law sets the parameters for LEO timing.
- Whitehall Wind, LLC is a qualifying facility seeking long-term avoided-cost rates from NorthWestern Energy under PURPA.
- In 2002–2003 Whitehall attempted to negotiate a contract and petitioned the PSC after failed negotiations.
- The PSC, in 2010, held Whitehall had not incurred an LEO, ruling that Whitehall’s negotiations were informational and not binding.
- The Fifth Judicial District Court reversed in 2014, deeming that Whitehall’s refusal to negotiate created an LEO entitling long-term rates.
- The Montana Supreme Court reversed the district court and reinstated the PSC order, concluding Whitehall did not incur an LEO.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Whitehall incur a legally enforceable obligation? | Whitehall argues its negotiation efforts created an LEO. | PSC argues LEO requires an unconditional, binding commitment. | No LEO; district court reversed; PSC order reinstated. |
| Is the Commission's totality-of-circumstances approach, and its related bright-line rule, proper under PURPA? | Whitehall contends the approach is appropriate enough to establish LEO given circumstances. | PSC’s approach is consistent with PURPA and other jurisdictions' reasoning. | PSC's approach supported; court did not find error in the analysis. |
Key Cases Cited
- Rosebud Enters. v. Idaho Pub. Util. Comm’n, 951 P.2d 521 (Idaho 1997) (LEO requires binding commitment; mere information gathering insufficient)
- A.W. Brown Co. v. Idaho Power Co., 828 P.2d 841 (Idaho 1992) (binding commitment to delivery or contract; precontract discussions insufficient)
- Armco Advanced Materials Corp. v. Pa. Pub. Util. Comm’n, 579 A.2d 1337 (Pa. Commw. 1990) (LEO occurs when project ready, willing, and able to sign contract; only acceptance remains)
- Appeal of Pub. Serv. Co., 539 A.2d 275 (N.H. 1988) (LEO arises with timely and viable rate petition showing project viability)