In re Petition of New Haven GLC Solar, LLC

         APPEALED FROM: Public Service Board DOCKET NO. NMP6369

          James Volz, Chair.

          Cindy Ellen Hill of Hill Attorney PLLC, Middlebury, for Appellant.

          Leslie A. Cadwell of Legal Counselors & Advocates, PLC, Castleton, for Appellee.

          PRESENT: Reiber, C.J., Dooley, Skoglund, Robinson and Eaton, JJ.

         ENTRY ORDER

         In the above-entitled cause, the Clerk will enter:

         Reversed and remanded for further consideration as set forth herein.

          Concurring: John A. Dooley, Associate Justice, Marilyn S. Skoglund, Associate Justice, Beth Robinson, Associate Justice, Harold E. Eaton, Jr., Associate Justice.

          Paul L. Reiber, Chief Justice.

         ¶ 1. The Town of New Haven appeals the Public Service Board's issuance of a certificate of public good (CPG) to New Haven GLC Solar, LLC (GLC) to construct a net-metered solar array within the Town. The Town asserts that the Board acted arbitrarily and in excess of its lawful authority by issuing the CPG without holding a hearing on significant issues raised by the Town, without giving due consideration to the Town's recommendations or the town plan, and without following its own mandatory regulations regarding interconnection procedures. We reverse the Board's issuance of the CPG and remand the matter for the Board to consider the Town's comments that it deemed to be untimely filed and to hold a technical hearing, at minimum, on the interconnection issue discussed below.

         ¶2. We first provide some helpful background information before examining the procedural history of this particular case. A net-metering system is an electric generator that is powered by renewable (e.g., solar, wind, water) energy and is interconnected with the local utility electric distribution network. The primary purpose of a net-metering facility is to offset the electric usage of a utility customer by either turning the customer's electric meter backwards for each kilowatt hour of electric energy produced or giving utility bill credits that are calculated by multiplying the customer's electric retail rate by the kilowatt hour of energy the net-metering facility produces. Because these systems are electric generators that interconnect with the local electric utility, they are subject to the Board's jurisdiction under 30 V.S.A. § 248 with respect to the issuing of CPGs.

         ¶ 3. In 1998, the Legislature first authorized the Board to implement a net-metering program "by rule or order standards and procedures governing application for, and issuance or revocation of a certificate of public good" pursuant to the provisions of § 248. 1997, No. 136 (Adj. Sess.), § 2(c).^[1] Act 136 authorized the Board to waive the requirements of §248 that are inapplicable to net-metering systems and to "modify notice and hearing requirements" of § 248 as the Board "deems appropriate." Id. § 2(c)(1)-(2). In addition, Act 136 required the Board to "seek to simplify the application and review process as appropriate." Id. § 2(c)(3). The Board adopted the standards and procedures required by Act 136 by order dated April 21, 1999, and codified them by adopting Board Rule 5.100 in 2001.

         ¶ 4. In 2011, the Legislature increased the maximum capacity of net-metering systems from 250kW to 500kW. 2011, No. 47, § 1. In response, the Board modified the review and approval procedures for these larger net-metering systems by amending Rule 5.100, effective January 27, 2014. It is that version of Rule 5.100 that governs GLC's application in this case. Board Rule 5.110(C) established a 45-day advance notice requirement for net-metering projects, similar to the notice requirement required by § 248(f), and a 21-day comment period on net-metering applications.

         ¶ 5. In this case, on May 29, 2015, GLC sent parties entitled to notice under Board Rule 5.110(C) 45-day advance notice of its intent to file a CPG application to install a 500kW net-metered solar array at a specified address on Vermont Route 7 within the Town of New Haven on property locally known as the Russell Farm. On July 10, the Town submitted a response asserting, among other things, that the proposed project would interfere with the orderly development of the region, would be inconsistent with the land conservation measures within the town plan, would result in a negative economic impact and negative net social benefits for the town, and would have a negative impact on soil and water. The Town also argued that the proposed project did not comprise a net-metering system under Board rules and thus could not be considered under net-metering systems procedures.

         ¶ 6. On July 13, GLC filed with the Board an application seeking a CPG for the project pursuant to 30 V.S.A. §§ 219a and 248. On July 18, the Town filed a notice of appearance and statutory party status.^[2] On July 20, GLC filed supplemental materials consisting of a revised site plan and supporting testimony. On August 3, the Department of Public Service filed a comment on the application stating that its review of the proposed project did not reveal any significant issues with the substantive criteria of § 248 upon which it typically made recommendations, including orderly development of the region, system stability and reliability, and aesthetics. The Department noted, however, that the project's access road, as indicated in the 45-day notice, had been relocated in the application to another property immediately north of the Russell Farm, presumably to avoid adversely impacting the historical significance of the Russell Farm complex, which was listed in the state register of historic places. The Department recommended that GLC confirm on the record that the relocation of the access road would not significantly impact the applicable § 248 criteria. The Department also recommended that GLC confirm that the project would not be visible from nearby residences and that the CPG be conditioned on GLC filing a copy of a Fast Track Interconnection Analysis (FTA) completed by the local utility, Green Mountain Power (GMP), demonstrating GMP's agreement that a system impact study was not necessary and that the project would not adversely affect system stability and reliability.^[3]

         ¶ 7. On August 6, the Town filed comments in which it incorporated by reference its earlier comments, acknowledged that notice to adjoining landowners had been adequate, and stated that GLC's application should include an analysis of any visual or noise impacts of the project on nearby residences and should list changes to the project from the 45-day advance notice, including relocating the access driveway. The Town also indicated that it was reserving its right to comment further and present evidence on any changed components of the project after town staff had sufficient time to review them. On August 10, the Town filed a response to the Department's comments, and requested a technical hearing. The Town asserted that GLC's new proposal to construct a twelve-foot wide, 1150-foot gravel access road from a separate parcel was a substantial change that required a new 45-day notice. The Town also stated that, as requested by the Department, GLC should be required to analyze the visual impacts of the project on neighbors. The Town further expressed its disagreement with the Department that the project did not present any significant concerns under the § 248 criteria, insofar as it was in direct contravention of a provision of the town plan that suggested limiting electrical generation facilities to those under 300kW.

         ¶ 8. On September 8, GLC filed a second revised site plan and a response to comments from the Department, the Town, and the Agency of Natural Resources. GLC stated that the proposed design changes were minor and would not have any significant impact with respect to the criteria set forth in § 248. As for the Department's comments, GLC stated that reports from various experts demonstrated that the changes would not significantly impact the § 248 criteria, that an attached updated aesthetics review indicated there would be little to no visibility of the project from adjoining residences, and that GMP's attached FTA demonstrated the project would not have an undue adverse impact on system stability and reliability. With respect to the Town's comments, GLC stated that none of the changes to its proposal had the potential to significantly impact any of the applicable § 248 criteria, that using the property adjoining the project parcel to the north did not require further notice because the adjoining property is completely surrounded by previously noticed properties, and that the plain language of the town plan concerning the size of solar projects is suggestive rather than mandatory and does not set absolute limitations. GLC asserted that a hearing was not necessary for the Board to reach a final determination in this matter.

         ¶ 9. On September 14, the Town filed a letter stating that GLC had not provided notice regarding the revised site plan to a newly affected adjoining landowner. In response to the Board's request, GLC filed letters stating that it had provided a copy of the application to the newly affected adjoining ...