In re Petition of GMPSolar-Richmond, LLC (Allco Renewable Energy Limited, Appellant)
Nos. 2016-034 and 2016-148
Supreme Court of Vermont
2017 VT 108
On Appeal from Public Service Board October Term, 2016
Lynn Fabrizio, Hearing Officer (motion to intervene); James Volz, Chair (final order)
Thomas Melone, New York, New York, for Appellant.
Geoffrey H. Hand and Victoria M. Westgate of Dunkiel Saunders Elliott Raubvogel & Hand, PLLC, Burlington, for Appellee GMPSolar-Richmond, LLC.
Gеoffrey Commons, Montpelier, for Appellee Public Service Department.
PRESENT: Reiber, C.J., Dooley, Skoglund, Robinson and Eaton, JJ.
¶ 1. DOOLEY, J. Allco Renewable Energy Ltd. (Allco) appeals from the denial of its motion to intervene, and its renewed motion to intervene, in this certificate-of-public-good (CPG) proceeding for a solar electric generation facility. The applicant, GMPSolar-Richmond, LLC (GMPSR), is an affiliate of Green Mountain Power Corp. (GMP), an electricity utility. The applicant is owned by GMP and an investor. Allco is developing a number of solar electric generation facilities in Vermont. A hearing officer of the Public Service Board (PSB) denied Allco‘s request for intervention as of right and permissive intervention; the PSB on motion for reconsideration similarly denied the intervention request. Allco argues that the PSB used the
¶ 2. We begin with a brief overview of law that governs a CPG proceeding. Applicant‘s project requires a CPG prior to “site preparation for or construction” because it will be an “electric generation facility.”
¶ 3. A brief overview of Allco‘s PURPA position is also helpful to understand the proceedings below. Allco argues that PURPA requires GMP to buy power for resale produced by Allco‘s solar facilities—termed “qualifying facilities” or QFs—if the cost of such power is below GMP‘s “avoided cost,” that is, the cost of producing an equivalent amount of the power that it is currently selling to customers. It alleges that it offered such power to GMP, but GMP illegally declined to purchase it. It further alleges that if GMP purchased Allco‘s power, GMP‘s power needs would be met, and it would have no need to build its own facility. GMPSR responds that because of Vermont‘s unique method of implementing PURPA, GMP had no obligation to
¶ 4. With this framework in mind, we turn to the facts and proceedings in this case. In July 2015, GMPSR sought a CPG under
(A) Intervention as of right. Upоn timely application, a person shall be permitted to intervene in any proceeding (1) when a statute confers an unconditional right to intervene; (2) when a statute confers a conditional right to intervene and the condition or conditions are satisfied; or (3) when the applicant demonstrates a substantial interest which may be adversely affected by the outcome of the proceeding, where the proceeding affords the exclusive means by which the applicant can protect that interest and where the applicant‘s interest is not adequately represented by existing parties.
(B) Permissive intervention. Upon timely application, a рerson may, in the discretion of the Board, be permitted to intervene in any proceeding when the applicant demonstrates a substantial interest which may be affected by the outcome of the proceeding. In exercising its discretion in this paragraph, the Board shall consider (1) whether the applicant‘s interest will be adequately protected by other parties; (2) whether alternative means exist by which the applicant can protect that interest; and (3) whether intervention will unduly delay the proceeding or prejudice the interests of existing parties or of the public.
PSB Rule 2.209(A)(3), (B), http://puc.vermont.gov/sites/psbnew/files/doc_library/2200-procеdures-generally-applicable.pdf [https://perma.cc/HBB2-SVJP].1
¶ 5. In support of its intervention request, Allco stated that it had offered to enter into a long-term power-purchase agreement (PPA) with GMP but GMP rejected its offer. It argued that: (1) had GMP accepted its offer, Allco‘s QFs would have displaced the Project here; (2) the Project,
¶ 6. A hearing officer denied Allco‘s request in October 2015. She found that Allco failed tо demonstrate a substantial interest that might be adversely affected by the outcome of this proceeding. This proceeding, she explained, involved the siting review of a solar project under
¶ 7. Allco moved for reconsideration, adding several new arguments in support of its intervention request. In addition to the reasons statеd above, Allco asserted that no project could promote the general good unless Allco‘s interpretation of PURPA was followed; it also claimed a substantial interest in pursuing its corporate mission to combat climate change by seeking to enforce rights of QFs.
¶ 8. The PSB upheld the hearing officer‘s decision in a December 2015 order. The Board agreed that Allco failed to demonstrate a substantial interest that might be adversely affected by the outcome of this proceeding. It found that Allco‘s arguments revealed a flawed understanding of how PURPA was implemented in Vermont. The Board described the regulatory framework set forth below, and explained that in Vermont, if Allco wanted to sell its QF output under PURPA, it must offer its QF output to Vermont utilities through the designated purchasing agent. It concluded GMP had no contracting obligation under PURPA, although it could voluntarily enter a bilateral contract for power with a QF. As a result, the Board explained, a contract through the purchasing agent was the appropriate means for Allco to pursue its stated interest in selling the output of its QFs in the Vermont market under PURPA.
¶ 9. The Board found nothing to show that Allco had pursued a contract through Vermont‘s PURPA purchasing agent. Indeed, Allco‘s initial filing suggested that it sought to intervene primarily because it had approached GMP directly for a contract under PURPA and
¶ 10. The Board further found that GMP‘s avoided cost was not at issue here because the rates available to QFs in Vermont were based on a statewide composite pricing system determined under Rule 4.100. The statewide composite rates were based on projections of the energy and capacity prices in the wholesale electricity market administered by ISO-New England, a market representing approximately 31,000 GW in capacity. The Board found that the construction of a 2.0 MW solar facility within the broader, regional market would have virtually no effect upon these rate projections.
¶ 11. The Board also rejected Allco‘s argument that the Department of Public Service could not adequately represent Allco‘s interests or those of other QFs in Vermont. It explained that the Department did not “represent” the designated purchasing agent under Rule 4.104, as Allco argued. Instead, the Department was tasked with proposing to the PSB the avoided capacity and energy costs of the Vеrmont composite electric utility system under PURPA. The Board established the rate schedules under Rule 4.100 after reviewing the Department‘s proposal. Thus, the Board found that the Department was well-positioned to adequately represent the policy interests that Allco sought to advance in this proceeding to the extent that Allco‘s arguments were relevant to scrutiny of the Project under
¶ 12. The Board held a technical hearing on the merits of the Project in mid-January 2016. In mid-February 2016, Allco submitted a second motion to intervene. Allco asserted that it was entitled to intervene as of right because it had a substantial interest in not having the rates
¶ 13. We address several initial mattеrs relating to the scope of the appeal issues before turning to the merits. First, no party challenges Allco‘s right to appeal from the Board‘s denial of its first intervention request. We held in In re Vermont Public Power Supply Authority that “it is now thoroughly settled that a would-be intervenor may appeal a denial of intervention and the appellate court will reverse if it concludes that he was entitled to intervene of right.” 140 Vt. 424, 433-34, 440 A.2d 140, 144 (1981) (citing 7A C. Wright & A. Miller, Fed. Prac. & Procedure § 1923, at 628 (1972) (collecting cases)). This case predated the Board‘s adoption of the intervention rule at issue here, and “in the absence of other standards,” the Court relied on the intervention standard set forth in Vermont Rule of Civil Procedure 24. Id. at 430, 440 A.2d at 142.
¶ 14. The intervenor prevаiled in the case cited above, and we have not explicitly addressed how to dispose of unsuccessful intervention appeals. Traditionally, after reviewing and rejecting an intervention appeal on the merits, courts have dismissed the appeal for lack of
¶ 15. Second, we do not address any challenges to the merits of the CPG decision. Allco has no right to challenge the final CPG order because it was not a party below. See
¶ 16. We reject Allco‘s argument that it has a right to appeal under
¶ 17. Finally, we do not address Allco‘s arguments regarding the hearing officer‘s denial of its second motion to intervene. We agree with appellee that Allco‘s second motion to intervene was procedurally improper. We are not persuaded by any of Allco‘s arguments to the contrary, which attempt to recharacterize the filing below and rely heavily on out-of-state case law without directly addressing the clear holding of relevant Vermont case law. Having appealed the Board‘s
¶ 18. Even if the Board had jurisdiction over the second motion to intervene, we would not consider it. Putting aside that Allco never sought Board review of the second decision, the second intеrvention request, filed more than four months after the intervention deadline set by the hearing officer and a month after the technical hearing in this case, was repetitive and untimely. Notwithstanding Allco‘s claim that it needed to review the Department‘s actions before it could satisfy the “inadequate representation” requirement, Allco‘s position continued to essentially rest on the same argument as to how PURPA should be implemented in Vermont. As one court has explained, when a motion to intervene is denied, “the proper procedure is to pursue an immediate appeal, and not to file repetitive motions pestering the [trial] court. This is true regardless of how the motions are labeled where the substance of the motions and purported justification for intervention remain unchanged.” Plain v. Murphy Family Farms, 296 F.3d 975, 980 (10th Cir. 2002). Allco had ample opportunity to raise grounds for intervention in its first filing, and it is not
¶ 19. We turn now to the merits of the issues that are properly before us: (1) whether Allco established the right to intervene in its first motion under PSB Rule 2.209(A); and (2) whether the PSB erred in denying Allco permissive intervention under Rule 2.209(B). Although we have not clearly explained the standard of review for an appeal of a decision to deny intervention as a matter of right, our decision in In re Vermont Public Power Supply Auth., 140 Vt. at 431-32, 440 A.2d at 142-43, suggests that we review the determination de novo, and this is consistent with our standard of review for questions of law. Thus, we apply this standard to the Board‘s decision that Allco is not entitled to intervene as a matter of right. We recognize, of course, that we give deference to the Board‘s interpretation of statutes it implemеnts and its rules. See Grice v. Vt. Elec. Power Co., 2008 VT 64, ¶ 7, 184 Vt. 132, 956 A.2d 561 (“[A]bsent a compelling indication of error,” we “will not disturb an agency‘s interpretation of statutes within its particular area of expertise”); Petition of Vt. Elec. Power Producers, Inc., 165 Vt. 282, 288, 683 A.2d 716, 719 (1996) (stating that Supreme Court “give[s] great weight to the Board‘s interpretations of its own regulations” (citation omitted)). This deference may come into play when we consider whether a right to intervene exists. Permissive intervention is discretionary as provided in Rule 2.209(B); we reverse such a decision only if we find abuse of discretion. See In re MVP Health Ins. Co., 2016 VT 111, ¶ 19, 155 A.3d 111 (“This Court will not interfere with the decision of an administrative board made in the performance of a discretionаry duty in the absence of a showing of abuse of discretion resulting in prejudice to one of the parties.” (quotation omitted)).
¶ 21. In ¶ 3 above, we set forth in summary form Allco‘s argument why it has a “substantial interest which may be adversely affected by the outcome of the [CPG] proceeding.” We explain the argument in more detail here. Under the Federal Power Act (FPA), the Federal Energy Regulatory Commission (FERC) has “exclusive authority to regulate sales of electricity at wholesale in interstate commerce.” Allco Finance Ltd. v. Klee, 805 F.3d 89, 91 (2d Cir. 2015) (citing
¶ 22. Historically, Vermont has implemented PURPA in a “unique way.” In re Investigation of Nov. 15, 1990 Rate Design Filing of Vt. Power Exch., 159 Vt. 168, 171, 617 A.2d 418, 420 (1992). “Although the obligation to purchase at avoided cost is imposed on each electric utility,” the PSB “created statewide rates based on the combined avoided costs of all utilities in Vermont.” Id. at 171, 617 A.2d at 419 (citing Vermont Public Service Board, Rule No. 4.100, § 4.104(A)). PSB Rule 4.100 implements PURPA,
¶ 23. “Because no single utility is contracting to purchase power from a qualifying facility, Vermont‘s PURPA compliance system requires an intermediary to purchase the power, distribute it and pay the producer.” Id. At the time of the decision here, VEPP Inc. was the designated purchasing agent, and it operated under a contract with the Board. QFs may also negotiate and enter into voluntary bilateral contracts with Vermont utilities. See PSB Rule 4.102(B) (“This rule shall not be construed as prohibiting voluntary contracts with terms different from the terms contained herein.”). The utilities’ decision whether to buy power in this manner is entirely voluntary, except for the output of small power producers with an installed capacity of one hundred kilowatts or less. PSB Rule 4.104(B). Under Rule 4.100, the utilities are under no legal obligation to buy power directly from a QF. Citing other FERC rulings, FERC has stated that the PSB‘s “Rule 4.100 program is [its] implementation of PURPA and Rule 4.100 has been found [by FERC] to be consistent with PURPA.” In re Otter Creek Solar LLC, 143 FERC ¶ 61,282 (citing cases) (rejecting petition requesting that FERC initiate enforcement action against PSB
¶ 24. In light of this background, it is clear that Allco‘s main purpose for intervening in this CPG proceeding is to attack the Rule 4.100 implementation system and, if successful, to prevent GMP, as a competitor, from building its own source of renewable electrical energy. The Board reasoned that Allco met none of the three requirements of Rule 2.209(A)(3) because it had no substantial interest that would be adversely affected by the issuance of the CPG, it had alternative means to protect its interest, and its interest is adequately represented by the Department of Public Service. While we agree with the reasoning of the Board, we rest our decision on the conclusion that Allco had alternative ways to рursue its claim and advance its interests rather than intervening in a CPG proceeding.
¶ 25. The Board identified two alternatives: (1) to negotiate a PURPA contract with the designated purchasing agent under Rule 4.104, or (2) to bring a complaint directly against GMP under
¶ 26. Much of the Board‘s analysis also applies to whether permissive intervention should be allowed under Rule 2.209(B).5 The Board also found that intervention to raise the specified arguments “will unduly delay the proceeding or prejudice the interests of existing parties or of the public.” We can reverse this decision only if we find that it was made for reasons that are clearly untenable, or there is a clear showing of error, and therefore there was an abuse of discretion. In re Costco Stormwater Discharge Permit, 2016 VT 86, ¶ 39, 151 A.3d 320. We find
Affirmed.
FOR THE COURT:
Associate Justice
