*1 completely ignore [the statute]’s “would tion and rendered the Commission im- requirement specialized training.” properly OWI constituted decision-making body. 17A.19(10)(e). at 865. further noted the We absence See Iowa Code That stat- training of the was more than a “technical trumps ute the de facto officer doctrine. infirmity” But, the training provided because majority’s even under the common safeguards protect the citizens of Iowa analysis, law participation La Seur’s from improperly administered tests with should not be excused the de facto consequential criminal and administrative officer doctrine. Her participation in vot- penalties including driving privi- loss of therefore, ing, invalidates the Commis- leges. See id. at 865-66. As the majority antidegradation Wilson, sion’s rules. See out, points “the de facto officer doctrine is 165 N.W.2d at Accordingly, I would applied particular disqualifi- when the reverse the district court’s entry of sum- integrity cation at issue undermines the mary judgment against Farm Bureau. and confidence demanded in actions taken JJ., Mansfield and Zager, join this con- by government.” or decisions made part currence in part. and dissent in Here, allowing La Seur to vote on rules affecting the citizens of Iowa when she did qualification
not meet the basic she “ignore[s]
be an Iowa legisla- elector require
ture’s decision” to commissioners 865;
to be electors of the state. See id. at
Sargent,
tion.”). Further, above, as noted
elector requirement protects citi- Iowa’s by ensuring zens those individuals ENTERPRISES, SZ LLC d/b/a responsible making rules will af- Solar, Appellee, fect the citizens the state will be inter- ested and invested in the outcome of the v. rulemaking procedures, they as them- selves will live under the rules that are BOARD, IOWA UTILITIES a Division Therefore, enacted. the failure to main- Department Commerce, tain status as an elector of the state is Iowa, Appellant, State of more than a technical infirmity. As one of only qualifications required two every Light Company, Interstate Power and member, commission “goes to the heart” Coopera- Iowa Association of Electric qualifications set forth under section tives, Energy and MidAmerican Com-
455A.6(1), therefore, La Seur’s vote pany, Intervenors-Appellants, should not be rescued by the de facto Palmer, officer doctrine. See Advocate, Office of Consumer Environ-
at 865. Policy Center, mental Law & Iowa reasons, For Council, these I La conclude Seur’s Environmental Iowa So- failure to maintain Energy her status as an Iowa Wind Trade Asso- lar/Small elector, ciation, required by Iowa Energy Code section Iowa Renewable As- 455A.6(1), sociation, left her disqualifica- Energy Solar Industries
Association, Initia- Solar Vote Intervenors-Appellees.
tive,
No. 13-0642. of Iowa.
Supreme Court
July 14, 2014. Aug.
As Corrected *3 Lynch
David J. Gary D. Stump, Des Moines, for appellant Iowa Utilities Board. Brennan, Scott M. Deborah M. Thar- nish, and Sarah E. Crane of Davis Brown Firm, Moines, Law Des Johnson, Paula N. Rapids, Stewart, Cedar and Suzan M. City, Sioux for appellants Interstate Power Light Company and MidAmerican En- ergy Company.
Dennis L. Puckett and Elizabeth N. Ward, P.C., Overton of Sullivan & West Moines, appellant Des for Iowa Association Cooperatives. Electric Philip E. Stoffregen, L. Pray, James Brown, Winick, Jonathan M. Gallagher of Graves, Gross, Baskerville and Sehoeneb- aum, P.L.C., Moines, Des for appellee SZ Enterprises, LLC. Advocate,
Mark R. Schuling, Consumer Easier, Moines, and Jennifer C. Des for appellee Office of Consumer Advocate. Klein, Bradley Illinois, D. Chicago, Mandelbaum, Moines, Joshua T. Des appellee intervenors Solar Coalition. APPEL, Justice. case,
In this we consider whether SZ LLC, Enterprises, Eagle Point Solar d/b/a Point) (Eagle may long enter into a term with the proposed arrangement con- Point’s related financing agreement city make an electric energy system on the did not aof solar struction The IUB and purposes of the statutes. city Dubuque under property Compa- Energy Eagle intervenors MidAmerican city purchase from would Power, (kWh) basis, ny, and Iowa Association Point, Interstate hour per kilowatt Cooperatives, appealed. sys- Electric electricity generated all of cross-appeal challenging the Point filed a project, with the proceeding Prior tem. result, not the of the dis- ruling reasoning, but declaratory sought IUB) (the holding. trict Board court’s the Iowa from Utilities *4 (1) agreement proposed under the below, we expressed For the reasons utility” “public a Point not be Eagle would court. affirm the decision the district (2011), and 476.1 Iowa Code section under (2) not be an “electric Background Point Eagle would and Proceed- I. Factual section 476.22. utility” under Iowa Code ings. an public utility a Eagle If Point was A. Point is the Eagle Introduction. utility provi- these Code under electric installation, design, providing business of sions, serving from prohibited it would be maintenance, monitoring, operational, and customers, city, lo- such the who were in connection financing assistance services territory within the exclusive service cated (PV) gener- solar photovoltaic with electric utility, Interstate Power of another electric Dubuque ation The de- systems. city of (Interstate Power). Light Company develop energy sires to renewable the 476.25(3).' §
See Iowa Code city. use of the pro- The that under the IUB concluded into proposed Point to enter a Eagle posed arrangement, Eagle business Point relationship a third- business known as public utility was would be thus (PPA) party power purchase agreement selling the prohibited from with the city provide city the that would city proposed arrangement. under the PPA, energy. with renewable Under ruling of its on the utilities Because install, own, Eagle operate, Point would unnecessary it question, found IUB sys- on-site generation and maintain an PV party of whether a address city-owned supply tem building at a utility was not never- who could portion of the electric building’s needs. utility theless be an electric under city purchase The would the full electric statute. output gener- Point’s Eagle power solar basis, facility per Point ation on a which Eagle brought petition judi- kWh 17A.19(1). percent cial review. The escalated at a rate of three annual- See id. ly. According payments city district court reversed. to the The would not court, provision only the electrici- Eagle district Point’s consideration for ty project, power through provided by electric a “behind the me- but would also type genera- ter” not the activ- the cost of facility acquiring solar was finance required ity Eagle system, offsetting a conclusion that tion monetize renewable system, was a to the energy Point The district incentives related operating further was costs of although court found cover Point’s system. maintaining conceivable under some circumstances any own public utility was not a could would also renewable sys- generation electric with the nevertheless be an under credits associated city credit one applicable statutory provisions, Eagle tem but would third revenues from the any proposed arrangement received sale of city would At those credits. the conclusion of the be an unlawful incursion into the exclusive Eagle Point would transfer agreement, all territory service of Interstate Power. See ownership rights generation sys- PV id. city. tem to the The IUB held that under the proposed generation system The PV constructed arrangement, Eagle Point would be acting
by Eagle Point be on the customer would public utility as a under Iowa Code section provided by side of the electric meter the 476.1. The recognized IUB that in Iowa city’s utility, Interstate Power. State Commerce Commission v. Northern electricity generated by This means that I, Natural Gas Co. Northern Natural Gas system pass through would not Inter- this court held that in order to be a state Power’s electric meter. Due to size 476.1, under Iowa Code section limitations, Eagle generation Point’s PV record must show “sales to sufficient of the system generate would not be able to public to clothe operation with a enough electricity power the entire ... interest and not ... willingness to sell building. city would remain connect- *5 to each every one of public the without grid ed electric and continue to 111, discrimination.” purchase electric from power Interstate (Iowa 1968). The IUB also noted that Power to meet its remaining needs at the Northern Natural Gas I the court re- premises. ferred to an eight-factor test in Natural Proceedings B. Before the IUB. Ea- Gas Service Co. v. Serv-Yu Cooperative, gle a petition declaratory Point filed for a Inc., 70 Ariz. 219 P.2d 325-26 17A.9(1) ruling § with the IUB.1 See id. (1950), to help determine whether the busi- (a). Eagle Point sought declaration ness was “clothed public with a interest.” from the IUB that it was not a public I, Northern Natural Gas 161 N.W.2d at utility under Iowa section Code 476.1 and 114-16. was not an electric utility under Iowa Code IUB, however, The distinguished North- section 476.22. If Eagle Point was not a ern Natural by noting Gas I that the public utility or an electric under exclusive service territorial statutes appli- these provisions, Code proposed its rela- cable to electric apply utilities do not tionship with city the would not run afoul 476.25(3). gas § utilities. See Iowa Code of Iowa’s statutory provides scheme that IUB noted that one of the purposes exclusive service territories for Iowa’s 476.25(3). electric of exclusive arrangements § utilities. See id. territorial On was hand, the other Eagle if to ensure that oper- Point were utilities do not duplicate ating as a utility and an electric each other’s existing facilities or make fa- utility under provisions, these Code cilities unnecessary. See id. 476.25. The light issues, anticipated In of interest in the Cooperatives, Electric the Iowa Association electronically Utilities, the IUB served Municipal a notice of the the Environmental pending proceeding Center, Energy Policy to MidAmerican Law & the Iowa Environmen- (MidAmerican), Power, Company Council, Interstate tal the Iowa Wind Ener- Solar/Small Association, cooperatives, all municipal gy all elec- Trade the Iowa Renewable utilities, Association, Association, Utility tric the Iowa Energy the the Interstate Renewable Utilities, Council, Municipal Iowa Energy Association of City Corporation, Solar So- the Coopera- Association, Sunrun, Iowa Association Energy of Electric lar Industries Power, MidAmerican, Inc., America, tives. Interstate the Suntech the Vote Solar Initia- tive, Consumer Advocate Division of the Iowa Energy De- and Winneshiek District all in- Justice, partment of the Iowa Association of proceedings. tervened in the administrative Eagle operating not be exception that would that observed also
IUB or as an electric public utility as a in Iowa either self-generation regulation utility. certain elec- applies to 476.1 section Be- gas not utilities. but tric utilities reaching that its conclusion proposed PPA Eagle Point in the cause bring proposed activities would Point’s city, selling electricity to the would utility, the definition of it within requirement that concluded IUB did court noted that IUB district Further, present. was not self-generation analysis of Northern Natural apply ex- language the limited believed the IUB eight-factor approach I or the Serv- Gas units from self-generation certain cluding regulation elec- ground Yu on the public utility implies that the definition regulation from tricity was different do not fall within arrangements other Additionally, gas. natural district necessarily exception are scope analysis court found the IUB’s in the term included in Iowa exception contained Code section According was flawed. dis- strong emphasis 476.1 placed The IUB court, simply did not arrangement exception in trict unlike usual fact that lease, public utility relate to the definition of but ordinary Eagle Point facilities chap- that all of “this per provided provisions kWh basis. selling on a was qualifying self-gen- shall not apply the IUB observed that ter” Thus, exception materials was not tar- promotional indicated eration. Point’s geted to other to the definition of but it would offer its services aspects chapter and would not limit instead to all of Iowa Code members of *6 the the district court found that city. recognizing its activities to While some always bright exception suggests a line the least will- that there was part legislature ingness what the ac- to regarding activities constitute providers. public utility, exceptions of a the IUB conclud- allow for smaller tivities line Eagle that Point would cross the if ed The district next court considered proceed. it were allowed the fact electric utilities were whether that provisions that it territorial Finally, recognized the IUB was exclusive distinguishing that an could a possible provided be electric basis utility. I case. The being without a Northern Natural Gas dis- Nonetheless, had trict court there no because the IUB found concluded was utility, was for this and held Eagle Point a was basis distinction necessary territory provisions applied only in exclusive question address utilities. respect this case. electric The dis- court that before the ques- trict reasoned Proceedings Before the District C. whether Point was an Eagle tion of Point Eagle sought judicial review Court. considered, be a could threshold ruling. preliminary mat- of the IUB As needed to be made on the determination ter, the district court ruled that IUB’s Point Eagle whether was a interpretation relevant statutes was under not entitled deference NextEra further noted that Resources v. Iowa The district court Energy LLC Utilities (Iowa 2012) Board, were gas 815 N.W.2d 36-38 both and electric utilities includ- section, in the same Iowa Code section Rights Renda v. Iowa Commis- ed Civil (Iowa 2010). 476.1, sion, public” “to the ap- where term 14-15 merits, court thus believed pears. court concluded district On the district any determining meaning test for primary business of public” gas “to the should both to apply was the panels installation of solar and the and electric utilities. economic exchange that occurred between
Additionally, to the extent the exclusive Point and its customers was inciden- might territorial structure considered tal to what the company “actually does.” determining whether Eagle Point’s activi- Id. It noted that a behind-the-meter solar ties would make it public utility, facility had the impact same on the cus- district court believed that the countervail- tomer’s demand of the utility-supplied ing policy of Iowa Code section 476.41 electricity as energy behind-the-meter effi- must be provision considered. This states ciency technologies, a similarity which the policy is the “[i]t this state to district court previously observed had encourage the development of alternate recognized been by the IUB. See In re energy production facilities ... in order to Co., Interstate Power & Light Iowa Utils. conserve our finite expensive energy (June Docket No. EEP-2008-0001 at 11 resources and to for their most 24, 2009), available at https://efs.iowa.gov/ efficient use.” Id. 476.41. (“The efs Board can discern no difference The district court thus concluded that between the use of renewable technologies legal IUB committed error in failing to and classic efficiency measures follow the approach of Northern Natural when those activities take place on the IGas and its endorsement eight- meter.”). customers’ side of the The dis- approach factor light Serv-Yu. trict court found the IUB’s distinction be- legal error lack of deference to tween behind-the-meter electrical genera- IUB, be afforded to the the district court by tion customer and proceeded party third apply eight Serv-Yu fac- lacking tors to “practical” the facts of the analysis case. required by Northern Natural II. Gas See 679 N.W.2d The district court its evaluation began at 633. The district court believed that by noting that it should not just consider whether a behind-the-meter energy pro- *7 one isolation, of the Serv-Yu in factors but engage ject should in was “practical a structured as a PPA or a approach,” lease did considering “the nature of the actual oper- change not the essential character of the ations conducted pub- and its effect on the project or what Eagle Point “actually lic interest.” Northern Natural Gas v.Co. Therefore, does.” the district court found (Northern Iowa Utils. Bd. Natural Gas this factor did not favor a that finding II), (Iowa 2004). 633 In Eagle Point was a public utility. evaluation, order to make such an the dis- The second Serv-Yu factor “a involves
trict court examined each
eight
factors,
dedication to public
Serv-Yu
use.”
recognizing that the
Northern Natu-
eight
I,
factors were not necessarily
ral Gas
controlling of
The first Serv-Yu factor involves large segment of the population, nor was consideration of corporation “[w]hat the its integral provision activities to the of actually I, does.” Northern Natural Gas Serv-Yu, electricity 161 to the public large. N.W.2d at 115 at a (quoting As 325). P.2d at result, The district court concluded the second Serv-Yu factor favored a that upon fall back ensured public was tric to Eagle Point not that finding bar- produce PPAs would not unbalanced The district court there- gaining power. factor involves the third Serv-Yu The weighed against this fore found that factor authorization, “[ajrticles incorporation, of public utility. finding Eagle Point to be a entity. (quoting Id. and purposes” 325). Serv-Yu, at The district 219 P.2d “[ajcceptance The sixth Serv-Yu factor is unhelpful to be this factor court found substantially all service.” requests of irrelevant, that there concluding somewhat 326). Serv-Yu, 219 P.2d at (quoting Id. intent act as a any evidence of was no rec- The district court concluded that the Eagle at public utility large point was address this inadequate ord oper- organization, certificate of Point’s and made no conclusions related to it. ating agreement, its sales brochures. or that The seventh Serv-Yu factor states fourth Serv-Yu factor is whether The “[sjervice reserving under contracts activity “[djealing the service always right to discriminate is not commodity in which the has been Serv-Yu, Id. controlling.” (quoting generally held have interest.” Id. 326). Serv-Yu, 326). at The court that P.2d district noted (quoting 219 P.2d at case an indi- the PPA involved was recognized district court that this factor vidually might detailed contract. seem cut in favor a determina- Eagle district court observed that Point Eagle tion Point was that certainly right but retained the to discriminate provided noted that the was upon it dependent any common facilities with whom contracted. The district that court found the seventh Serv-Yu factor generated served the and was weighed against finding consumed behind meter public utility A would be a under the PPA. premises. customer’s shutdown Ea- gle be far Point facilities would less serious “[ajctual The last Serv-Yu factor is than the effects a shutdown of services potential competition corpora- with other by electric such as Pow- utilities Interstate tions whose business is clothed with er. The district did specifically court Serv-Yu, interest.” P.2d (quoting impact evaluate the fourth Serv-Yu 326). Here, found district court factor, suggest but while seemed competition, some but degree of noted tipped in favor of a finding totally able Eagle Point would never be a public utility, impact Point would be Inter- replace electricity provided by substantially the factor was weakened *8 state The Power. district court stated aas result of the behind-the-meter con- Eagle trying replace Point was text. relationship or sever the between Inter- “[mjonopoliz- The fifth factor is Serv-Yu city. state Power The district ing intending monopolize or territo- court would thus did believe factor ry commodity.” with a service Id. weigh finding Eagle in favor of to be 326). Serv-Yu, P.2d (quoting 219 at The public utility. district court re- third-party found energy developers Eagle newable were not Based “nat- nature Point’s ural monopolies,” like electric and natural actual their effect on the operations, interest, gas ample eight providers, and that there was an evaluation of Serv-Yu competition marketplace. policies sup- in legislative factors and Iowa’s always porting energy the fact that the host an elec- renewa- had conservation and
449
energy development,
legislature
authority
ble
the district court
has vested such
IUB,
Point did not furnish
concluded
with the
we defer
agency’s
thus was not a
interpretation of the statute
will
re
agency’s interpretation only
verse the
if it
“irrational, illogical, wholly unjustifia
question
by
The next
confronted
the dis-
17A.19(10)(l); Renda,
§
ble.” Iowa Code
court was whether
Point never-
trict
450 statute, an ity and electric ordinarily against cuts a find-
factor which against a find- important militating factor vested deference legislature ing that interpre- is argues ing this that the IUB vested that agency, IUB with the tive See Iowa Ass’n v. power. Ev- Dental is not determinative. See alone factor (Iowa 138, Bd., Div., 831 145 Utils., v. Iowa 805 Iowa Ins. N.W.2d Sys., Inc. ercom (Iowa 2011). 758, 2013); v. It fur- Sherwin-Williams Co. Iowa 762-63 N.W.2d Revenue, 417, to a number of 789 423-24 Dep’t our attention N.W.2d ther draws (Iowa 2010). event, granted any Eagle we have defer- In where Point cases other variety utility” “public IUB in a contexts. the terms and argues that ence v. See, City Iowa Utils. utility” Coralville are not e.g., specialized “electric (Iowa 2008) 523, Bd., 527 750 N.W.2d already interpreted that court has interpretation of “rates (holding the IUB’s utility” giving term “public without defer- 467.1(1) in enti- Renda, section was and services” agency. ence to the See deference); Consumer tled to Point Eagle
451
Code,
express grant
interpretive
in the direction
of broad
author-
point
sections of the
“
ity.”).
reviewing
lack of
See 784 N.W.2d at
after
the
‘lan-
deference.
statute,
context,
14.
...
guage
pur-
...
pose
practical
and the
considerations
prin
that these
We do not conclude
”
involved,’ we
“firmly
are not
convinced”
mean
IUB will never
ciples
that
the
legislature
the
to vest the
intended
IUB
granted
focus on the par
deference. We
authority to
the
interpret
terms at
statutory
ticular
at issue in a
provision
Renda,
here.
issue
N.W.2d at 14
784
given case. See id. at 13. Even where
63)
added).
Bonfield,
(quoting
(emphasis
at
supplied by
legis
definitions have been
the
Two sub-conclusions lead us to this deter-
art,
lature and the
are not terms of
terms
mination.
open
possibility
leave
that
First,
legisla
legislature
provided
structure or
matter of the
has
a def-
complexity
require
tion is of sufficient
to
utility”
inition for both “public
and “elec-
agency
legal
this court defer to
inter
utility,” a significant
tric
factor weighing
believe,
pretations. See id. at 14. We do
against
requiring deference. See Iowa
however,
parties seeking
require
to
476.1;
476.22;
§
id.
Hawkeye
legal
this court to defer to
determinations
Co.,
208;
Land
847 N.W.2d at
Iowa Dental
where,
battle
uphill
IUB face an
as Ass’n,
(“[T]he
490A.... in appeal is its must legislature legal presented issues statement miliar advisa- it novo. Iowa Code by when deems us de See lexicographer own be decided Renda, phrase”). 17A.19(10)(c); word N.W.2d at to define a 784 ble 14-15. Second, utility” “public and the terms very complex not and utility” are
“electric mat- subject within the “uniquely are not Third-Party Background III. they agency,” as are expertise of ter Utility Regula- Public PPAs and Renda, in the See elsewhere Code. used tion. 14; Dep’t v. Iowa at Gartner 784 N.W.2d Third-Party to the A. Introduction (Iowa Health, N.W.2d 344 Pub. 830 Traditionally, electricity has been PPA. 2013). highly IUB decides some While the by large provided in the United States technical terms under Iowa complex and heavy capital made invest- enterprises that require this court to chapter 476 that over transmission power ments inter- legal respect with IUB’s defer Jantz, See Gregory lines to customers. C. Coralville, see, City e.g., pretations, Comment, Electric Note Incentives (“rates services” in at 527 N.W.2d Development, Generation 476.1); Advo- Consumer section Infrastructure Office Oil, Gas, Energy Tex. J. & L. 373-77 (“unauthorized- cate, at 643 (2007) country’s electricity (describing 476.103), in section change-in-service” 1990s). time, market before the Over scope of legislatively can determine providing utilities electric service came to any in this case without defined terms in highly regulated order advance expertise. unusual interest and limit effects the Gartner court ex Additionally, as monopoly monopoly power or near plained, exclusively terms are not “[t]hese (describing consumers. See id. at 375-77 expertise within the [IUB].” quar- regulatory developments in the last “Instead, at legislature N.W.2d century). ter of the twentieth throughout utilized these terms the Iowa instance, [‘public Id. “For the term Code.” however, decades, the tradi- recent utility1] appears in statutes that the [IUB] approach challenged by tional has been Id.; see, enforcing.” e.g., has no role in First, there developments. several has 480A.2(4). 412.5, 422.93, §§ Iowa Code deregulation been an belief in increased Hawkeye in our recent decision marketplaces competitive generally. Co., Land we concluded that the IUB was Energy of America See Consumer Council respect not entitled to deference Foundation, Restructuring Research company determination that a involved in Utility Industry: Electric A Consumer electrical transmission lines was a (1998). Perspective Deregulation utility under Iowa Code section 476.1. 847 airline, gas, natural telephone, trucking, depart N.W.2d 218. We see no basis to largely and railroad industries has been from that here. approach accomplished, although deregulation reasons, has providing energy For these we conclude that un- utilities fashion, support der Renda in a principles applied proceeded Hawk- similar cases, eye legal regulated monopoly approach Land and other has been Co. recently past interpretations questioned of the IUB in this case are more than to deference this court. See decades. Id. *12 addition, promote the desire to alter- and fifty-nine percent tween 2000 2007 of energy seen as more environ- grid-connected nate sources for systems). PV friendly has mentally contributed to the As detailed in a recent report technical energy search for alternate models of de- published by the Depart- United States livery. government The federal pro- has however, Energy, ment of there signif- are energy in alternate facil- moted investment icant barriers to the installation of on-site incentives, by providing powerful ities tax energy solar facilities. See Katharine Kol- including thirty-percent investment tax lins, al., Lab., et Nat’l Energy Renewable types “energy proper- credit certain Dep’t Energy, Project U.S. Solar PV ty” depreciation and accelerated tax de- Financing: Regulatory Legislative and ductions for alternate energy projects. Challenges Third-Party System PPA for Bolinger, Berkeley See Mark Lawrence 1, 3, (2010), Owners 33-35 available at Lab., Financing Nat’l Non-Residential http://www.nrel.gov/docs/fyl0osti/46723.pdf Projects: Options Impli- Photovoltaic and [hereinafter Most prominently, Kollins]. (2009), cations i available at http://emp.lbl. capital the initial costs quite high, remain gov/sites/all/files/REPORT%201bnl- often in the millions of or dollars more. 1410e.pdf Bolinger] (noting [hereinafter 3; Farkas, See id. at 28 J. Land Use & thirty-percent investment tax credit 93, Envtl. L. at 98. Entities that do not depreciation provided and accelerated tax taxes, pay government such as nonprof- generation systems); to commercial PV it organizations, cannot even offset these Martinson, Richard Legisla- Federal Tax by costs realizing the economic benefits of tion Favors Alternative Energy Develop- favorable tax treatment of alternative en- Initiatives, Energy Efficiency ment and ergy Farkas, investments. See 28 J. Land Law., 2011, N.J. June at gen- 22-24. See &Use Envtl. L. at 100. Additionally, Moeller, erally James W. Credits Of potential some weary PV investors are Quotas: Federal Tax Incentives Re- for unpredictable fluctuations in electricity Resources, newable State Renewable Port- prices are concerned about their abili- Standards, and the Evolution Pro- folio ty to provide maintenance upkeep posals a Federal Energy Renewable by facilities driven unfamiliar technology. Standard, 15 Fordham Envtl. Portfolio Kollins, See at 34. (2004). L.Rev. 69 barriers, In order to overcome these Finally, in the generation, field of PV proponents of energy alternate facilities technological advances have made it in- have developed a method of con- financing creasingly feasible to generation install ca- struction of solar facilities called third- pacity at the source of consumption with- party power purchase agreements, or out use of power generation centralized 3, PPAs. See id. at 33-35. Under the PPA and extended transmission lines. See Sa- model, developer Farkas, builds and owns the Comment, mual Student Third- generation system, PV which is Party construct- Unleashing PPAs: America’s Solar Potential, ed on the customer’s site. Id. at 3. J. Land Use & Envtl. L. (2012) developer-owner 92-93 then sells the electric These [hereinafter Farkas]. power preestablished retail to the consumer at a generation projects decentralized are rate, thereby providing located “on the customer’s fixed side of the me- the customer hedge against price ter.” Id. at 93. The sheer with a number of such increases from grown solar facilities has the traditional electric rap- utility serving thus idly years. in recent Bolinger, See at i. location. See id. at 33-34. PPAs thus (noting compound growth barrier, annual rate be- minimize up-front cost see id. stabilize, reduce, may private if entities so affected greatly thereafter, Farkas, interests that duties arise for the consumer
costs *13 has L. from activities ancient common & Envtl. at 99. their Land 28 J. Use law, ordinarily addition, example, is For at common developer-owner origins. law able to income-generating entity mills essential to medi- provided a services private gave of the tax benefits afforded to a common advantage take eval inhabitants rise Rossi, development. See See The duty to alternative law to serve. Jim Moreover, Kollins, develop- “Duty 33-34. Law to Serve” and Protec- Common er-owner, system, is an maintains Competi- who in an Age tion Consumers of of technology. at 34. Id. expert PV Restructuring, tive Public Utility Retail PPA, Thus, (1998). the developer-owner under a 1233, 51 Vand. L.Rev. 1244-45 costs, initial retains high absorbs ac- subsistence farmers without Medieval sys- maintenance of the responsibility and, of mill went as a hungry cess to the tem, is based on electric- compensated result, imposed. serve See duties to were system. actually produced ity duty id. law to serve was The common ferries, markets, later and oth- extended however, question, legal A fundamental enterprises. er essential Id. at 1245. may PPAs coexist with tradi- is whether existing within public utilities tional influ The common law tradition has A thresh- regulatory state environment. construing courts enced state when some develop- whether the question old is often public service defining statutes utilities or PPA third-party public in a er-owner a authority line relies public. One of subject or supplier state in public on the notion that order to be a regulation. definitional of- This serving generally, developer-owner ten turns on whether the directly or hold itself indirectly must regarded in PPA is fur- third-party a as out service to all comers. providing as nishing “to the supplying See, City Englewood City v. & e.g., public.” Denver, 290, Cnty. 123 Colo. 229 P.2d statute, 667, (1951), abrogated by 672-73 The of this de- consequences threshold recognized Bd. v. Cnty. in Comm’rs the viability termination are critical to Comm’rs, Denver Bd. Water 718 P.2d third-party In states PPAs. where (Colo.1986). 235, theory, 244 a Under areas, utilities have exclusive service a sporadic provides business that services finding public utility gen- that PPA is a might ordinarily asso commodity be erally means that a PPA violates the exclu- public utility might ciated with a not be territory provisions sive of state law and is regulation. drawn within the ambit of See See, e.g., thus unlawful. Iowa Code (“The id. at nature must .25(3). of the service 476.1, .22, §§ pub- In states where be that all of the such members lic utilities do not have exclusive service it.”); right have enforceable demand areas, the consequence may PPAs Mississippi Corp. River Fuel v. III. Com regulation as a to substantial Comm’n, 509, merce 1 Ill.2d 116 N.E.2d utility, including requirements (1953) (“Selling to a limited gas and to service to all submit tariffs group prop cannot of industrial customers See, e.g., who desire it. N.H.Rev.Stat. erly devoting property be characterized as 374-F:4(lll) (LexisNexis 2008). §Ann. ”). ‘public to a use.’ B. State on What Caselaw Consti- hand, Utility” Providing On line of tutes a “Public Ser- the other different flexible authority developed “to has a more vices the Public.” notion (1) in a [pjlaintiff commodity public utility. [dealt] of what amounts notion generally which the a whole is approach public as cases use a functional These (2) interested, actually underly- engaged it [was] on the nature concentrate in supplying commodity there is a suffi- to some of and whether ing service (3) See, publicf, served a sub- e.g., [i]t regulation. and] need for cient Comm’n, public. portion stantial Gas Co. v. Pub. Indus. Utils. (1939) 166, 168 St. 21 N.E.2d
Ohio
Yet,
suggested
Northern Natural
serves such a
(holding
corporation that
“[a]
I
anticipated expansion
large
Gas
*14
as to make
part
public
substantial
may
numbers
determine
outcome. See
rates, charges,
opera-
methods of
and
id.
concern, welfare
public
a matter of
tions
in
justices
Three
dissented
Northern
subjects
regulation”);
to
interest
itself
(Stuart, J.,
119
Natural
I. Id. at
dis-
Gas
Serv-Yu,
(applying
whereby it pay upfront would the expenses SolarCity, customer. Docket No. E- associated with construction of the solar 20690A-09-0346, at 24-25. It noted that facility. Id. at 5-6. The customer would the purpose of the relationship was to sell pay SolarCity installation, “for design, the provide or electricity. reject- Id. at 24. It system and maintenance of the based on ed the notion that the language contractual the electricity produced.” amount of Id. at relating ownership of electricity was PPAs, ordinary 6. Unlike explicit- the SSA transaction, material to evaluation of the ly provided that the customer was the noting SolarCity cannot “own” the “owner” of all electricity produced by the equipment for tax purposes and then claim system. Id. SolarCity structured it did not “own” the electricity pur- agreement in comply order to with federal poses of regulation. Id. The commission tax SolarCity first, law and allow to take advan- found that at “the SSA transaction (8)Actual competition potential meet textual definition appear
may corporations other whose business under the corporation service public of a public clothed with the interest. “However, at So- Constitution.” selling not business larCity is Id. at 1244. rather, in the business of
electricity, but factors, Applying Serv-Yu the Ari- financing, installing, and moni- designing, Corporation zona concluded Commission systems residential and solar toring SolarCity not “clothed with a was customers” and therefore commercial interest” to draw within sufficient “[fjurther given must be consideration regulation. SolarCity, Docket scope entity’s primary interest E-20690A-09-0346, at No. 52-53. methods of purpose, activities and conclusion, business reaching Commission (1) operation.” Id. SolarCity not noted did “affect so public,” did considerable fraction next turned to consider- The commission place seek to “stand in the analysis, in second ing the underlying utility,” and did entity’s business and namely, whether (Serv-Yu service the customer continued sufficiently “clothed with were activities (2) 1); activity of SolarCity factor was trigger regulation. interest” to (Serv- integral large” “not Here, ap- the commission Id. at 25-53. (3) 2); SolarCity’s Yu factor articles of SWTC, Id. In plied the Serv-Yu factors. reflect an intent to incorporation did “not Supreme acknowledged the Arizona Court (Serv- corporation” act as a service Serv-Yu, Supreme the Arizona 3); (4) generated never Yu factor SSAs eight announced factors to be con- Court fifty power than percent more whether an determining sidered of a host and ramifications shutdown a public “clothed with interest” was far less that of a regulated were than they regulation because were (Serv-Yu (5) 4); SolarCity factor did *17 “indispensible population.” [the] not hold itself out to all customers was and eight P.3d at 1245. The factors are: comprehensive capable providing into a expand monopoly service could (1) corporation actually What does. (6) (Serv-Yu 5); SolarCity factor must (2) to public A dedication use. compete suppliers other thus did most, accept requests if not all for (3) Articles of authoriza- incorporation, (Serv-Yu (7) 6); SolarCity service factor tion, purposes. used contracts counterbal- individualized (4) Dealing with of a com- the service (Serv- by broad solicitation anced business modity in which has been 7); (8) although SolarCity factor Yu held to generally have interest. displaced by sales incum- providers power utilities, they replace existing bent did not (5) Monopolizing intending monop- or reach utilities and assist them to distribut- territory olize the with a service (Serv-Yu 8). generation goals ed factor commodity. 37, 42, 46, 48, 30-31, 36, 49-50, id. at See (6) Acceptance substantially all re- 52. service. quests for a PPA question of whether involv (7) Service under and reserv- regulation contracts solar was ing ing right utility” to discriminate is not al- was also “public as a confronted controlling. Regulation the New Mexico Public ways by generally See In re a placed Commission. De advertisements the Albuquerque claratory Regarding Third-Party Order Journal and elsewhere did not constitute Arrangements Energy Renewable “holding general out” to the public and for Generation, Comm’n, N.M. Reg. Pub. was therefore insufficient to clothe their No. request Case 09-00217-UT. operations with the interest. Id. at order, declaratory for a New Mexico . Regulation Public Commission considered Finally, the commission held that a “under what circumstances ... a develop party “third developer who owns renewa- contracting er with an cus generation ble equipment, which is install- tomer to supplemental electricity ed on a utility premises, customer’s an electric become[s] within the equipment uses this multiple to serve cus- meaning Mexico An [New Statute 62-3-3(0(1) tomers (2009) portion for a of each customer’s notated section ].” and, electricity at 7. The payments commission determined the use key which are meaning to this was the of the based on a charge, kilowatt-hour is not a phrase statute, public” “to the public utility subject regulation by “ provided ‘public that a utility3 or Commission.” Id. at 13. ‘utility’ every person means ... may 3. States resolving the through issue own, operate, lease or control ... any legislative action. A number of states plant, property facility or generation, have resolved the status of third-party ... sale or furnishing to or for the public PPAs enacting legislation explicitly ad- electricity.” Id. The reject commission dressing the issue. For example, in Cali- bright-line ed a test based on the number fornia, Public Utilities Code section 218 of customers. Id. at 7-8. specifically exempts regulation from
Relying on a Supreme case of the Court (which of New Mexico heavily itself relied corporation person or employing co- I), on Northern Natural Gas the commis- generation technology producing pow- sion stated that in order to be considered er from other than a conventional power public utility statute, under the the sales generation source for the must involve ‘“sufficient solely for.... use of or [t]he sale to not clothe the operation with a inter- more than two other corporations or ” est.’ Id. at 9 (quoting v. N.M. Griffith persons solely for use on the real prop- Comm’n, Pub. Serv. 86 N.M. 520 P.2d *18 erty on electricity which the generat- is 269, (1974)). It relied on New Mexico ed. caselaw, however, to conclude that in order 218(b)(2) (West § Cal. Pub. UtiLCode interest, to be clothed with a creat- 2004). California has been a in leader ing expectation an legal of “a right development PPAs, of third-party includ- demand and receive ... services” is the ing significant government-owned projects, principle determinative feature of public like the Moscone in Center San Francisco. utility. Id. at 10 (quoting El Vadito de los Center, See Moscone Sustainability, Cerrillos Water Ass’n v. New Mexico Pub. Comm’n, 784, https://www.moscone.com/community/ Serv. 115 N.M. 858 P.2d (2009) (last 1263, (1993) removed)). 10, sustain.html (emphasis July visited 2014) (“One of the largest the commission nation’s noted that munici- PPAs only pally-owned were providing supplemental generation solar ser- installations vice. Id. at 11. Additionally, operates now commis- from the roof of the Moscone Center.”). sion noted that the fact that developers chapter, util- “public in this As used Jersey legislated has also
New statutes, any person, partner- shall include ity” its area. Under association, corpora- an business or provider” ship, service generation “basic tion, or foreign, owning provided “to domestic or service generation electric any for: has not chosen an alter- facilities operating any customer N.J. Stat. power supplier.” native electric by distribu- Furnishing gas piped (West Supp.2014). § “Elec- Ann. 48:8-51 system electricity tion or “provision of generation service” is the tric compensation. for energy capacity which is electric retail § Id. If that the facts 476.1. we conclude the location generated from off-site declaratory presented proceeding consumption such electric Point is a utili- establish and, retail capacity is metered es- ty, must next consider whether it added). (emphasis billing purposes.” Id. capes regulation exception as a result an Revised Statute sec- Similarly, Colorado This provided in Iowa section 476.1. provides that tion 40-1-103 chapter regulation exception removes from ... electricity from solar supply [t]he types certain electric utilities: on the site generating equipment located chapter not ... to a apply This does which is property, of the consumer’s person to five or furnishing electricity by owned an other operated or secondary either fewer customers consumer, a public than the not utili- [is energy produc- line or from an alternate ty generated provided supply is] facility hydro facility, from tion small twenty per- no than one hundred more electricity produced primarily average cent consumption of the annual person’s own use. [from site]. 40-l-103(2)(c) (2013). added). § § (emphasis Colo.Rev.Stat. 476.1 If “public utility” Point is a and does Iowa, has legisla- In there been recent scope exemption, come within 2013, activity tive related to the issue. arrangement will run afoul of the proposed H.F. which explicitly 226 was introduced territory provisions exclusive of section third-party stated that PPAs related to 476.25(3): energy aggregation projects” “alternate “public would not be considered utilities” or offer An electric shall serve and would not violate the exclusive territo- in an exclu- to serve electric customers ry provisions of section 476.25. H.F. assigned sive service area to another (Iowa Assemb., Reg. 85th Gen. Sess. utility, an utili- electric nor shall electric 2013). however, legislation, was not construct electric ty facilities serve enacted. exclusive area customers service assigned another Legal
E. Overview Issues in This *19 three legal present- Case. There are issues 476.25(3). exclusive-territory § Id. The ed in for our this case de novo review. As provision encourage is “to designed case, often layered is the issues are development of coordinated statewide elec- and interconnected. retail, or avoid tric service eliminate utility legal Eagle unnecessary first issue is whether of electric duplication economical, facilities, public utility Point should be and to effi- promote considered cient, adequate under Iowa Code section 476.1. This electric service to Code provides: public.” section 476.25. itself, Eagle
If we determine that Point should the transaction plainly in- public utility electricity. volves the sale of quali- not be considered exemption, fies for the we must applicable b. Potential expansion. The IUB Eagle then next consider whether Point is position takes the that even one transac- utility an electric under Iowa section Code involving tion electricity the sale of makes provides: 476.22. This section Eagle public utility. event, Point a In any (ex- the IUB notes that there is As used in sections 476.23 to no limitation to 476.26 potential Eagle activities of Point territory provisions), clusive unless the marketing that its materials indicate a de- requires, context otherwise “electric ” sire expand its business. The IUB utility public utility includes a furnish- stresses that commercial retailers as well ing electricity as defined in section 476.1 government may entities use the PPA utility and a city as defined in section model to reduce costs and reduce 390.1. their environmental footprint. The IUB argument Id. The is that electric believes the green light in the district could be broader than the term court order could lead to a dramatic ex- utility because the context of the exclusive pansion third-party PPAs that would be provisions compels territorial a broader “clothed with the interest.” Fur- gloss on generally the term than is ap- ther, the district court order could even plied. Eagle If Point is allow deregulation back-door by allowing 476.22, under Iowa Code section pro- its generation. behind-the-meter fossil fuel posed third-party PPA would run afoul of c. Misapplication Serv-Yu’s territory provisions the exclusive of Iowa factors. The IUB maintains the district court section 476.25. application erred its of the Serv-Yu Eagle Utility Is IV. Point a Public IUB, According factors. to the selling Under Iowa Code Section 476.1? electricity per on a kWh basis is an under- superior standable test to the vague appli- A. Positions of the Parties. cation Serv-Yu factors. The IUB 1. The IUB. recognizes Northern Natural Gas I, this court cited the Serv-Yu factors in a.Plain language analysis. The IUB determining whether gas sales of natural maintains Point public utility is a scope came within the “public of the term plain under the language of Iowa Code utility.” I, See Northern Natural Gas Point, section 476.1. It that Eagle *20 erroneously focused on the end results of the analysis ignored claims district court’s energy efficiency rather than the nature of the fact that the activities of PPAs reduce price. at an Fur- regulated power the of electric affordable product
the demand
thereby
the utilities’
reducing
ther,
Power,
monopolies,
Interstate
as the exclusive
costs of
the reasonable
ability to recover
territory,
in the
of electric
provider
power
re-
to
As a
public.
the
service
providing
city,
includes the
has made invest-
which
contend,
must be
the shortfall
sult, they
its status
a
upon
ment decisions based
as
customers in
other retail
from
recovered
addition, allowing
In
regulated monopoly.
higher rates.
of
the form
arrangement
third-party PPA
would
the
coverage.
Exception demonstrates
d.
of
unnecessary duplication
to an
ser-
lead
exception to
that the
The IUB notes
vices, with both the exclusive territorial
in Iowa
public utility
of
definition
providing
and the PPA
facilities
provider
ar-
It
supports
position.
section 476.1
to
generation
power
electric
for the
of
from
exception excludes
that the
gues
customer.
same
person
a
furnish-
public utility
definition
customers if
electricity to five or fewer
that
ing
support
argument
In
produced
person’s
is
“for the
power
project
Point
the exclusive
offends
§ 476.1. The
use.” See Iowa Code
own
territory policy underlying Iowa Code sec-
exception
that
demon-
asserts
IUB
476.25,
parties support-
tion
IUB and
legislature considered the
strates
Ventures, Inc.,
it,
ing
point
PW
generation
of whether on-site
case,
at 281.
that
PW Ventures
So.2d
deliberately
regulated,
should be
construct, own,
operate
proposed to
provision that
a narrow
does not
crafted
“cogeneration project”5 on land leased
generation
the elec-
on-site
where
include
resulting
Pratt and
electric
from
sell the
it
to the host.
tricity is sold
regulation. regulate seek solar in behind-the-meter Application Proper by that are the host C. of North stallations owned or operate pursuant ern Natural Gas and Serv-Yu Factors. which to a standard true, examining Before the Serv-Yu factors indi lease.6 If this is the actual issue here vidually, generally supplying two through note different facilities, types give of considerations which could behind-the-meter solar but the Yet, public financing. financing rise to interest transaction. method of re hand, energy something the one there could methods is not public On be a newable that regulating required interest the transaction be utilities are to do. Elec., in a See developer-owner third-party tween Iowa-Illinois Gas & N.W.2d type pointed by and the This As the Consum pub PPA consumer. 753-54. out case, providing interest er in this if fi- usually pro- lic arises because the Advocate Interestingly, arrangement in city and have lease order Point PPA to standard relationship converted their financial in con- legal to remove the shadow of the cloud gen- nection with the behind-the-meter solar case. raised facility erating third-party in this case from nancing for renewable is not re transaction —it owes nothing unless the utilities, quired the converse contraption on its rooftop actually pro- true, namely, also be that providing electricity. should duces valuable financing for solar activities should not The sixth and seventh Serv-Yu factors fly trap draw into ability relate to the accept all requests regulation. and, conversely, for service the ability to respect to the
With second Serv-Yu fac- discriminate among public. members tor, we agree with the district court that it See id. These twin factors cut favor of cannot panels be said the solar on the finding is not a city’s rooftop are dedicated to utility. Eagle use. Point is not producing a I, See Northern Natural fungible commodity Gas N.W.2d everyone needs. at 115. The installation is no more dedi- producing It is not a substance like water cated to public use than the thermal win- everyone drink, or young old will layers dows or extra of insulation in the gas natural *25 necessary to run the farms building itself. The behind-the-meter so- throughout county. the specifically, More generating facility lar represents private Eagle Point is not providing electricity to a transaction Eagle between Point and the grid may that all plug into to power their city.7 or, devices and “aps,” associated pro- more saically, ovens, their refrigerators, factor, On the fourth Serv-Yu it seems lights. provisions clear that the of on-site solar indispensable Instead, are not an service Eagle Point providing is a cus- ordinarily that public cries out for regula- tomized service to individual customers. tion. All Eagle See id. Point’s custom- Eagle Whether Point can even ers remain connected to the grid, so service will depend factors, on a number of fails, if for some reason the system solar including the size and structure of the goes no one without electric service. Al- rooftop, presence of shade or obstruc- so, though may tions, some wish it behind-the- and the electrical profile use equipment meter solar is not an essential potential Further, customer. if Eagle commodity required by all members the Point engage decides not to in a transac- is, instead, public. It option customer, for those tion with a the customer is not who seek to lessen their high bills or who left dry, may but seek another promote desire to “green” energy. You vendor while continuing to be served it, and, far, can seems, take it or leave regulated so utility. These are not many leave it. ordinarily characteristics associated with activity “clothed interest.”
The fifth Serv-Yu factor relating to mo- nopoly clearly against cuts a finding eighth that The Serv-Yu perhaps factor is Eagle Point is a utility. See id. interesting. factor, most eighth Under the There simply nothing is in the record to the actual potential or competition with suggest Eagle Point is a six hundred corporations other whose business is pound gorilla economic that has cornered clothed with the interest is consid- city defenseless in Dubuque. Here, leaders In- ered. See id. strenuously IUB deed, the third-party nature of the argues PPA that allowing third-party PPAs will suggests the opposite, city as the decidedly has en- have negative impacts regu- on tered into what amounts to be a low risk lated electric charged utilities with provid- court, pass 7. Like the district over the third Serv-Yufactor as inconclusive. sup- replace the traditional electric to seek to price at a fair
ing reliable Al- view, but to reduce demand. plier only the IUB support public. pro- sale though an Point brochure Eagle The issue in fighting PWcites Ventures. record, there moting its services is eight factor case is whether will nothing suggest fac- its services litany trumps preceding Serv-Yu to, to, many practical even Point be attractive be requires tors suppli- of the traditional electric ser- customers utility providing treated as a third-party parties er. public. vices then- ability have convert PPAs the IUB has considera- position into conventional arrangements business Certainly, case can be appeal. ble regu- scope outside the leases are Eagle Point is allowed to made that if case, Indeed, in this lation. profitable custom- the most “cream skim” city just to avoid have done ers, regulated may impacts there unnecessary entanglements. legal Co. v. E. Shore Natural Gas See Comm’n, factors, there mitigating A.2d In addition to Pub. Serv. Del. countervailing positive impacts. are also (recognizing that (Del.Sup.Ct.1993) solar facilities tend industrial Behind-the-meter gas service select providing electricity during hours generate peak public interest because customers affected grid greatest pres- under the competition”); when potentially “destructive *26 476.8 Ventures, Iowa Code section (public at 283 sure. PW 533 So.2d regulated pro- electric requires interest where revenue that utilities implicated service, regulat- reasonably adequate and such gone have vide “otherwise would cus- unregulated programs service must “inelude[ ] ed is “diverted to utilities” Co., encourage energy of Jersey re S. 226 tomers use producers”); In Gas 402, 327, efficiency energy renewable sources.” N.J.Super. 544 A.2d 406 Thus, pro- one (using third-party a cream- PPAs like the (N.J.Sup.Ct.App.Div.1988) Co., one skimming by actually 21 Point further analogy); posed Eagle Indus. Gas compa- (finding goals regulated electric N.E.2d at 168 business seeks of nies, namely, of energy industrial cus- the use efficient service select See, utility). e.g., tomers is a If the third- and renewable sources. public Iowa, E-20690A-09-0346, SolarCity, No. party-PPA gets legs movement Docket 37, 39. is conceivable that demand for materially from traditional utilities will be end, an suffi- activity In the whether is noth- impacted long run. There entity of scope cient to draw an within the ing in the record this administrative regulation assessing a utilities is matter however, to proceeding, gauge likeli- a strength of the Serv-Yu factors on impact, hood or of material degree and case-by-case The of Serv- weighing basis. suggestion integrity there was no Yu factors a exercise is not mathematical grid regulated or economic health of practical but instead a poses providers adversely has affected in been II, Northern judgment. See Natural Gas California, Nevada, Arizona, states such as view, N.W.2d at 633. In our in this 679 Colorado, where PPAs are third-party case, away point balance factors purposes not considered utilities for PPA finding third-party from a regulation. fa- generation solar for behind-the-meter cility sufficiently There factors. “clothed with the mitigating are also As Point, regulation. by Eagle trigger it does not interest” pointed out
469 Utility Eagle Is Point an Electric V. did not address the issue. The ar- IUB under Iowa Code 476.22? Section gues that because its interpretation of law Renda, is entitled to deference under it is A. Positions of the Parties. issue, entitled to a first crack at the argues 1. The The that un IUB. IUB should not be appellate decided an Renda, the legislature der intended to vest court appeal. authority with the IUB to determine Eagle Eagle Point. Point counters utility whether an is an electric un that there is no basis for concluding that der Iowa Code section 476.22. The IUB the definition of utility electric in Iowa notes that provision provides this Code Code section 476.22 is broader than otherwise,” “unless the provides context Indeed, utility. Eagle argues Point utility “includes purpose of the phrase “unless con- furnishing electricity as defined section text requires” otherwise is a term of limi- 476.1.” Iowa Code 476.22. The IUB view, tation. Eagle Under Point’s notes that the statute uses the term “in utility furnishing cludes,” electricity under Iowa therefore suggesting that there Code section 476.1 might not be an electric might be situations where an entity which 476.22, under Iowa Code section a public utility is not could be an electric depending upon context. Eyecare See v. Dep’t Human Servs., 832, (Iowa 2009) city notes that various might utilities which 837 N.W.2d be drawn into Iowa (“Generally ‘the verb Code section 476.22 imports “includes” class, plainly are general particular some of whose electric utilities —such as waterworks, sanitary specified sewage systems, instances are those in the defini etc. ” (quoting Helvering phrase tion.’ v. “unless Morgan’s, requires the context Inc., 121, n.1, otherwise,” Point, U.S. 55 S.Ct. according al- (1934))). n.1, escape 79 L.Ed. 235 n.1 lows an for city utilities that plainly *27 nothing have to do with the provision of reprises The IUB then much argu- of its electricity. cross-appeal Point’s ment regarding importance the of exclusiv- challenges language the of the district ity in the provision power. of electric The conceivable, court indicating order it is emphasizes statutory goal IUB the circumstances, under some that the term avoiding services, duplication of which will utility” “electric is broader than the term if occur third-party PPAs are not consid- “public utility.” ered electric scope utilities within the Iowa Code section 476.22. The IUB theo- Eagle Point also raises an issue of issue rizes that if such genera- behind-the-meter preservation. It notes that no one before allowed, tion is public utility the will be left the argued IUB that the term “electric generation capability excess which utility” was broader “public utility.” than represents a cost that passed must be on It suggests that this court should not be ratepayers. The argues IUB that be- swayed by what “post amounts to hoc ra cause of goals the nature and of the exclu- tionalizations” appeal. counsel on See sivity provisions, Eagle Point should be Lines, Burlington Truck Inc. v. United an utility considered electric under Iowa States, 156, 168, 239, 246, 371 U.S. 83 S.Ct. 476.22, Code section even if it is not a (1962). event, L.Ed.2d In any public utility under section 476.1. Eagle Point sees no basis for an extraordi event,
In any urges nary interpretation IUB of the term “electric matter be remanded utility” to the Commission. under the facts and circumstances It notes that in ruling, its earlier IUB this case. All MANSFIELD justices except concur Merits. Discussion
B. WATERMAN, JJ., who dissent statute, language of upon Based ZAGER, J., part. who takes no phrase that believe inclined are requires” otherwise the context “unless MANSFIELD, (dissenting). Justice designed ensure of limitation a term uphold I dissent and would respectfully not elec- that do furnish city utilities of the Iowa Utilities the determination inadvertently drawn into the are tricity Board) (the Point Solar Board however, true, that the term It is statute. Point) To (Eagle public utility. my is a imply that there generally can “includes” mind, majority opinion good is a case outside the literal lan- situations are other study judicial competence limits of on the descriptors statute guage us to why legislature wanted de- scope. within its might be fer, regulatory agency. large part, my col- majority opinion, As I read the IUB, however, is for the problem The leagues substituting to be their appear explanation a clear that it has offered for that expertise utility regulation on why Eagle Point should be consid- as to following ex- Board. Consider if even it is not a ered an cerpts: asserts that the The IUB are, however, barri- significant There territory provisions require exclusive of on-site solar ers to installation of electric should be the definition capital facilities. initial The public utility, than but we do not broader quite often high, costs remain argument presented by IUB agree. po- millions of dollars more. Some evade application to be an effort to seems averse are skepti- tential risk customers We of the Serv-Yu factors. decline to ability cal about the of solar facilities to interpretation.8 adopt such regular predictable sources of energy....
VI. Conclusion. no suspect any ... There is reason to reasons, For all above the decision From potential unusual for abuse. of the district court is affirmed. protection standpoint, there is consumer impose no regulation reason to AFFIRMED. *28 law, ques agency’s interpretation it the 8. The IUB notes that did rule on this urges agency's and remand if we review is issue determine tion on whether the inter erroneous, may public utility. pretation We was we Point is not substi agency's.”). interpretation consider if we tute the would a remand determined our " '[wjhere legal [agency] determinations of the were the has not IUB deference, they they entitled to but are certain because were because reached issues not, unnecessary deciding there is to us decision under no obstacle deemed invoke, Renda, legal may in appeal. issue See 784 it elected we raised rationale judicial ("Normally, at 11 the interpretation N.W.2d interest of sound administration de they fully pure question a statute is the issues where have been of law over cide " Burress, IBP, agencies delegated argued.' any special which Inc. v. are not briefed 210, 2010) so, (Iowa powers by Assembly (quoting 218 General a court is 779 N.W.2d to, does, judg Chauffeurs, Helpers, usually free Teamsters & Local Union substitute its Comm'n, Rights agency....” ment de novo that of the No. v. Iowa Civil Bonfield, (Iowa 1986)). 62)); Meyer, (quoting The addition N.W.2d ("If findings fully al here was before the at 219 of fact are not chal issue briefed complete. lenged, agency and the factual record is but claim of error lies with the type customers; negotiated multiple individualized and basis to that this elec- tricity transaction. displace electricity would normally
provided by utility required to territory; serve that and that such an ... provisions of on-site solar [T]he arrangement would undermine the trade- energy indispensable are an service off whereby regulated the local utility has ordinarily public regu- cries out for obligation every serve customer that lation. All of Eagle Point’s customers wants service but in return receives remain connected to the grid, so if territory. exclusive As the Board points fails, for some reason the solar system appeal, out on if Eagle Point is allowed to goes no one without electric service. Al- take electricity sales away from Interstate so, though may some wish behind the (Interstate Light Power), Power and meter solar equipment is not an essen- long-term has made investments based on commodity tial required by all members projections of customer demand and which public.... authorized law to recover its costs plus return, a reasonable rate of Interstate factors, mitigating addition to there Power’s other ratepayers could be forced are countervailing positive also impacts, to make up difference. too. Behind the meter solar facilities tend to generate electricity during peak These arguments be wrong. My could grid hours when the great- is under the colleagues they believe wrong. are IBut pressure. est do not believe we should be deciding them. (Citations omitted.) In Renda v. Rights Iowa Civil Commis- statements, For each of these major- sion, we undertook a comprehensive re- ity provides either no supporting authority view of the administrative law or citations to material that majority that underlies this appeal. See 784 presumably independent found its own (Iowa 2010). Thus, N.W.2d 10-15 research.9 Is it the proper role of courts length discussed at when courts should to act experts on the delivery of electri- and should not defer under Iowa Code cal energy? I would argue it is not. section 17A.19 to an agency’s interpreta- tion of statutory terms.
The basic issue in this case is whether Point becomes a utility under Renda, emphasized As we “when the (2011) Iowa Code section 476.1 when it statutory provision being interpreted is a goes into the business of installing on-site substantive term special within the expér- solar facilities on various entities’ tise of the agency, we have concluded that properties selling the resulting elec- agency has been vested the au- tricity to those entities. I can see reason- thority interpret provisions.” Id. at arguments able on both sides. *29 fact, In among 14. the cases we cited with Board,
The
after extensive proceedings,
approval in Renda after making this state-
concluded that
Point would become ment
City
was
Coralville v. Iowa Utili-
of
public utility.
Among
Renda,
other things,
12,
ties Board.
think it would 476.1. energy under section special more within the term substantive True, Energy the Board than whether Resources expertise of in NextEra Board, oper- electric service is providing v. this court company LLC Iowa Utilities utility.” ating “public interpreta- declined to the Board’s to defer supply “electric needs” as tion of the term another situation also discussed Renda )(2). 476.53(4)(c used in 815 section historically has agency where deference 2012). (Iowa 30, We indicated N.W.2d 38 courts. when an been This is granted assembly broadly general did not that “the given rulemaking authori- agency has been delegate interpretive power to the Board ty in is one which the term binding Rely- with the force of law.” Id. necessarily ... interpret “must agency ” ing language, Eagle argued on this carry in out its duties.... See order recently has held here that “this Court Renda, at 12 (citing, N.W.2d inter generally Board is entitled Coralville, alia, 750 N.W.2d City of any of the interpreting provi- deference in 527). chapter sions of Iowa because exist as well. Those circumstances here legislature intended never to confer rulemaking authority, has see The Board power (Emphasis the Board.” 476.2(1), and it must Iowa Code section added.) Likewise, the district court below in determine what order ruled: Hence, its duties. we have an carry out ground favoring additional Renda defer- ... ... court concluded [NextEra ] agency. ence to the assembly did not dele- “general gate interpretive power the Board Furthermore, in a number of instances of law” binding force with re- in have years, recent deferred to Board gard chapter Ac- interpreting interpretations of terms within the Board’s will here the Court examine cordingly, Sys., bailiwick. See Evercom Inc. v. Iowa interpretation the Board’s the rele- 758, (Iowa Bd., Utils. 805 N.W.2d 762-63 476 for chapter vant sections of correc- 2011) (stating interpreta that the Board’s and will give tion at law errors chapter provision tion of a 476 should interpretation. deference to the Board’s “irrational, only illogi be reversed if it is cal, wholly unjustifiable”); Office of (Citation omitted.) Bd., Consumer Advocate v. Iowa Utils. majority helpfully But the here has clar- (Iowa 2008) (same);
N.W.2d 643-44 ified no broad that there is no-deference Midwest, AT Inc. v. & T Commc’ns of (Iowa rule for 476 and that the Board Bd., chapter Iowa Utils. 2004) (same). Evercom, appropriate will be deference given not should be Renda, ed, According majority, cases. “We was decided after but we none *30 statutory provision focus on interpreta particular to the theless deferred Board’s “ I agree at issue in a case.” with this given tion of a ‘substantive term within the NextEra decision. See special agency.’” Ever- clarification of the expertise
473
NextEra,
(Mansfield,
Code,
Public is such a specialized quoted term. beginning dissent, of this Significantly, when the term majority is used else- “practical renders what it calls a Attempting "public to demonstrate that authority. potential It is not a source of utility" general concept extending is a more a different definition. law, majority into other fields of cites largely Iowa Code section 480A.2 provisions three Iowa Code that do not ex- replicates preexisting section 476.l's lan- pressly incorporate chapter 476's definition. 476.1, guage. Compare § Iowa Code with id. 412.5, 422.93, §§ See Iowa Code 480A.2. 480A.2(4). § suggests leg- This that when the However, you when these three examine cited 1998, chapter islature enacted 480A in see provisions, majority’s separate effort to 3-8, §§ 1998 Iowa Acts ch. it did not "public utility” chapter from the 476 context intend independent to establish an definition. proves unsuccessful. Lastly, Iowa Code simply section 412.5 By any plausible reading, Iowa Code sec- chapter clarifies that which deals with implicitly tion incorporates chapter 422.93 municipal utility systems, retirement is limit- public utility. 476's explains definition of It "managed, ed to operated, utilities nothing chapter 422 "shall be con- by municipality.” owned See Iowa Code require strued to to allow [Board] § demonstrating 412.5. pub- Rather than require any particular the use of method of accepted meanings lic has other out- accounting by any public utility” for rate- context, chapter side the regulation section 412.5 purposes. See id. 422.93. This is, effect, legislature indicates the reference to the believed the normal Board's author- ity chapter savings under chapter 476 and a clause qualified. 476 definition needed to be
474 majority opin- in the judg- Another assertion majority’s practical judgment.” the disagree following: is ion with I public a Eagle Point is not ment is observing that be- begin with we We determining the for lieve standard judg- talking practical are about If we a gas provider a electric whether or we to the Board? ments, defer shouldn’t the statute must be public under IV(C) majority opinion Reading part public of utili- same. The definition we in mind that are my reinforces merely in Iowa section 476.1 from its ty Code experts as ourselves. trying to act to applied gas in both and inception Gas, in Northern Natural Furthermore, in providers. We see no basis electric in factors eight emphasized we gas one test for applying the statute for to down one: really test boil providers and for suppliers another question What does the The real is: electricity. statutory phrase public” “to the mean? omitted.) Why cannot the stan- (Citations to it means sales sufficient We conclude electricity? and gas be different for dard operation with public to clothe the Contrary majority’s to the claim that there interest does not mean public a treating gas in is “no basis the statute” every to sell to each and one
willingness electricity differently, the noted Board public without discrimination. ruling “significant” statutory two dif- in its First, provides entity selling chapter at 115.11 ferences. 161 N.W.2d Is for electric utilities energy (gas electricity) to exclusive territories enough or utilities, legislative on a gas inter- based operation public with a but “clothe should to of determination that there paradigm est”? This seems me the See facilities. Iowa duplication that should electric something be decided Second, § 476.25.12 con- agency such matters section 476.1 regulatory that sees to specific a exclusion limited certain every day position and is a better to tains See id. § electricity. 476.1. public providers “the interest.” assess says, jurisdiction majority proach” that of the commission 11. The “In order to determine “only necessary ad- pub- should be extended to the sales were with the whether clothed interest, implicated.” dress the interest Id. On eight lic we utilized the factor ... grounds, upheld these we the Board's asser- disagree encourage I test.” would jurisdiction. tion of its own Id. 634—35. Gas, to look at Natural reader Northern Again, qualifications I of courts eight actually at 115. We recited N.W.2d "practical apply approach” regulation to then "clothed with factors but turned to the job electricity. We should leave to the public interest” standard. experts at the Board. Notably, subsequent case of Northern Board, part: provides v. This section Natural Gas Co. Iowa Utilities we primarily relied "clothed with It is to be in the interest declared standard, eight-factor test. interest” not the encourage development of co-ordi- 2004). (Iowa We See retail, service at nated statewide electric said, generally interpreted [section "We have unnecessary duplication eliminate avoid mean that Board facilities, the Utilities has 476.1] promote electric and to of economical, efficient, jurisdiction regulate a business adequate electric gas by piped pub- distribution to furnishes public. In order effect that service interest, interest may lic in such a manner that the the board establish ser- Although mentioned specified affected.” Id. vice areas within which “variety previous of factors” from the North- shall electric service to cus- utilities case, apply on an basis. Natural Gas we did not those tomers exclusive ern ap- "practical but instead Iowa Code 476.25. factors followed
475 the statutory differences favor the treatment But here definition is Both these largely utility” of elec- circular. “Public includes competitive suppliers of small-scale any entity owning or operating facilities utilities. tricity electricity to for furnishing “public” for Board, statutory by the As noted 476.1(1). § See Iowa compensation. Code “a public utility per- of excludes definition Eagle It is not that owns disputed Point furnishing electricity to five or fewer son furnishing com- electricity facilities for by secondary either or from customers line pensation. The is its whether facility or energy production an alternate large activities on a enough are scale hydro facility, electricity small from that is serving the re- “public.” considered primarily for the own produced person’s 476.1(1) solving question, the this section clear, Point, it in- use.” Id. seems definition little help. offers electricity tends to furnish than more Indeed, majority implicitly concedes (the City just five customers Dubuque point by relying statutory not on the first), with the not produced public utility definition of but on a rather primarily Point’s own use. “practical approach” that the ma- features Hence, Eagle operations Point’s will be on sundry jority’s observations on economics larger anything a scale than covered energy. Contrary majority, to the I being the section 476.1 exclusion. That we can do believe use the existence case, logical regard Eagle it a statutory definition as a reason not to legislature as a When the agency defer interpretation to an unless exclude, spells out what it intended to we are prepared apply statutory often infer that it intended to what include definition. Jimenez, See Mgmt. remains. v. 839 Staff Hawkeye Land Co. v. Iowa Utilities (Iowa 2013) (noting N.W.2d Board is a different case from the present legislature’s persons list of excluded under my point. and illustrates There issue compensation a did not workers’ definition company was whether transmission con- include undocumented workers and supplied electricity only to utili- electrical cluding, expressio under the doctrine of “public utility” ties was a itself. See alterius, legisla- unius exhisio est “[iff (Iowa 2014). 199, 201 N.W.2d We decided ture intended the definition of a worker “plain language” under the employee to exclude work- undocumented statute, company provided power ers, by adding have un- would done so only to was not serving public. utilities list”). documented workers to the excluded Id. at 215-16. We also declined to defer to me gets majority’s This second interpretations Board’s section for not argument deferring to the Board. (1) (the statute) crossing 476.27 because majority points out that is al there legislature provided had defi- relevant ready statutory definition (2) nitions, operated the statute in an area 476.1. (eminent domain) section See Iowa 476.1. that was con- term, legislature when the (3) And defines requirements, stitutional the Board presents we have often found this an “in decisionmaking authority shared under surmountable obstacle” to a determination Department statute with Iowa agency with in has been vested Transportation. at 208-09. None of authority terpretive over that term. applies same those circumstances here. There Div., authority See Iowa Dental Ass’n v. Iowa Ins. is no between the Board shared (Iowa 2013). 138, 145 else, anyone the Board’s N.W.2d actions do *33 rate of plus those costs a reasonable implications, coup have constitutional Instead, I from its customers. return legislative definition relying are affirm reverse the district court and question. would plain language deciding ruling this mat- declaratory the Board’s Rather, substituting prac- our own arewe ter. Board’s. judgment tical Thus, second-guess the I would J., WATERMAN, joins dissent. Point’s
Board’s determination are clothed sales take potential of their
interest because unpredictably from Interstate away
sales
Power, required long- make so can serve all cus-
term investments is entitled to re-
tomers at all times and N.W.2d at 14. notes Office of Bd., 744 v. Iowa Utils. N.W.2d Advocate “public utility” that term is used in (Iowa 2008) (interpreting the “un- other of the and that it sections is provisions in authorized-change-in-service” important meaning have a uniform es- 476.103); & T Commc’ns section AT judicial through decision rather tablished Midwest, Bd., Inc. v. Iowa Utils. 687 than specialized a differentiated mean- 2004) (Iowa curiam) (per N.W.2d ing by the See id. determined IUB. interpretation (holding the IUB’s of sec- Analysis C. of Deference Issue. We 476.101(9) deference). tion was entitled begin analysis recognition our with a Point3 the IUB not Eagle believes principles suggest established in Renda we in its interpretation entitled deference give interpretive should not deference to in statutory terms involved this in this case. IUB Renda states that as points case. It to our statement in Renda general are not proposition, agencies giv- “‘[njormally, interpretation of a by en this to an interpre- deference court pure statute is law over tation of law without some clear indication agencies delegated any spe- are general assembly intended this ” Assembly.’ powers cial the General addition, at 11. In result. Id. noted at 11 E. (quoting 784 N.W.2d Arthur Bon- Renda and a number of other cases that field, Amendments to Iowa Administra- general assembly provides an where Act, Report Procedure tive Selected agency legal terms with definition of in a Provisions Iowa State Bar Association statutory provision, the use of definitions (1998) Iowa State Government 62 factor significant weighing against Bonfield]). addition, Ea- [hereinafter interpretation requiring deference. See gle vesting Point contends 12; Hawkeye v. id. at Land Co. Iowa authority with rulemaking IUB does not (Iowa Bd., 199, 208 Utils. necessarily mean that the IUB inter- has 2014); Ass’n, Dental Iowa N.W.2d at pretive power under See statute. 145; Sherwin-Williams, 789 N.W.2d at NextEra, 815 at 38. N.W.2d Renda, Finally, in we noted 423-24. statutory Point that are Eagle legislature further notes use of terms specific are used other provided highly specialized, definitions util- but aligned parties opinion. will with it collectively be referred to as Point in
Notes
notes claims, N.W.2d at 114-15. The IUB how- under proposed agreement with the ever, that the furnishing electricity utilities city, install, own, maintain, will “operate, have exclusive providers territories while and finance” the facility. solar It further gas natural do not. The IUB thus notes that Point compensated seeks to sever Serv-Yu factors from con- upon production based sideration of what a utility is in the arising facility. from the solar According context of providing electricity under Iowa IUB, that should be the end of the Code section 476.1. story under the terms of the statute: Ea- gle “furnishing” electricity event, any “to the argues the IUB compensation.” See Iowa Code Serv-Yu factors were misapplied by the § 476.1. It asserts that the district court district court. example, For the IUB
notes production overall strategy, and indepen- court in Northern Natural IGas cited the efforts, dent energy alternate may eight-factor test in Serv-Yu to assist it in planning undermine the reg- inherent in a making its determination. See 161 N.W.2d short, ulated monopoly setting. at 115. It further pro- cites administrative conservation proposals arising from alter- Arizona, ceedings Mexico, New and Ha- IUB, nate energy, according to the must waii proposition for the that such third- generally integrated regulated with the party financing trigger regulation does not monopoly in order to allow for the coordi- of the offering entity as a public utility. nated, planned provision of electricity to customers. Eagle Point notes that the IUB case “per focused on the kWh” nature as 2. Eagle Point. “key factor in determining a. Emphasis practical evaluation Point would be a public utility under sec- nature “sales to public” requiring tion 476.1.” But in Northern Natural Gas protection I, customers rather than there was no that sales of gas “fur-
state notes are “behind meter” and therefore not emphasized that the of Ea- IUB activities involve use and no “dedicated” rates, gle higher Point will lead to (Serv-Yu 2); factor infrastructure unnecessary reregulation, back-door and intent the record shows no evidence of duplication of services. (Serv-Yu 3); factor public utility Eagle supporters Point and its assert provision panels equipment solar is simply that the evidence in the does record “indispensible not an service” and does not support The dire these assertions. customers, involve captive but instead in- Point, according Eagle have predictions, voluntary private volves choices in com- in the that allow manifested states (Serv-Yu 4); petitive market factor there that financing. Eagle PPA Point asserts monopoly is no natural in the market for no there is evidence record to show (Serv-Yu 5); solar factor the obvi- facilities PPAs On higher utility cause rates. fact Eagle ous Point cannot serve all contrary, Point Eagle suggests because of environmental customers rooftop significant solar benefits provides (Serv-Yu 6); rooftop conditions factor Ea- dur- grid provides power to the because it gle through indi- provides services ing “peak” periods shining when sun vidually private contracts with negotiated, conditioning running. and air variable terms and site specific services (Serv-Yu 7); Experience other factor Point’s ca- d. states. city argues experience in other pacity provide electricity to the is Point city supports position. limited will states PPAs its allowing remain connected (Serv-Yu 8). in Ari- grid regulatory factor It notes commissions support zona and New Mexico view that Compare 476.1. Iowa Code 476.22-.26
notes
the IUB itself in ad-
sized that
public”
“to the
meant “sales to
ministrative proceedings and in its brief in
public”
sufficient of the
to “clothe the oper-
recognized
case has
that “reducing
ation with a public interest.” 161 N.W.2d
energy and capacity demands on [Inter-
at 115. In order to determine whether the
system
state
Power’s]
is the core of
sales
interest,
were clothed with
efficiency.”
eight-factor
utilized the
Serv-Yu test.
Apply
B. Failure to
Northern Natu-
See id. at 114-15.
ral Gas and Serv-Yu Factors. We now
consider whether the
applied
IUB
the cor-
Past precedent of the IUB reveals that
legal
rect
standard when it determined
the IUB too has endorsed the Northern
proposed
Point’s
third-party Natural
I
Hawkeye
Gas
test.
Land
PPA with the city
bring
would
it within the
Midwest,
Co. v. ITC
the IUB cited North-
term
utility under Iowa Code sec-
ern Natural Gas I as the “appropriate”
tion 476.1.
test in a
involving
case
the construction of
electric transmission lines.
In re Hawk-
begin
observing
We
with
that we
eye
LLC,
Land
v.Co.
ITC Midwest
Iowa
believe the
standard for determining
Bd.,
Utils.
Docket
FCU-2009-0006,
No.
at
gas
whether a
provider
electric
is a
30, 2011),
(Sept.
available
https://efs.
at
public utility under the statute must be the
iowa.gov/efs. This court subsequently ap-
same. The
“public
definition of
utility” in
plied the Northern Natural
IGas
test
Iowa Code section 476.1
inception
from its
when the decision of the IUB was appeal-
in 1963 applied both to gas and electric
Co.,
Hawkeye
ed.
Land
847 N.W.2d at
providers. See 1963 Iowa Acts ch. 286.
216.
see no
We
basis in the statute for applying
gas suppliers
one test for
and another for
A review of the IUB decision in this case
providers
electricity.
reveals that the IUB did not undertake the
true,
course,
It is
points
as the IUB
analysis required by Northern Natural
out, that electric
utilities are
factors,
Gas I
Serv-Yu
but instead
exclusive territorial provisions of Iowa
sought
apply
test,
bright-line
different
26,
Code sections 476.22-
gas
while
suppli- namely, a test that
entity
whenever an
sold
note, however,
ers are not. We
per
basis,
be,
on a
kWh
it would
definition of
part
was
law,
as a matter
original
legislation
while the provi-
relating
sions
We decline to
exclusive
introduce such an
territories for
innova-
providers
tion into
was added in
our
very
established law. The
Compare
286,
purpose
1963 Iowa
ch.
of Northern
Acts
Natural
I Gas was to
(1977).
Iowa Code
escape
rigid
476.22-.26
At
test
required
a finding
exclusivity
time the
language was
added to that an
was involved in providing a
code,
change
no
was made in the defi- commodity in a fashion that gave rise to a
provision
nitional
of Iowa
duty
Code section
to serve all
public.
members of the
to the na-
public utility,
vider of the
due
rigid test influenced
Having abandoned
barriers
law,
ture
the service and the
we do
think
the common
by
bargain-
entry,
vastly superior
often in a
to substitute another
approach
proper
ing position compared
at the other end of
to the consumer.
rigid test
equally
Co.,
Indeed,
ap-
Packing
under
IUB
262 U.S. at
See Chas.
spectrum.
Wolff
solar generat-
at 1110. On
a behind-the-meter