Case Title: In re Establishing the Solar Generation Fund Rider

Citation: 2022-Ohio-4348

Docket Number: 2021-1374

State: ohio

Court: Ohio Supreme Court

Date: 2022-12-07T00:00:00Z

Document:
[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as In 
re Establishing the Solar Generation Fund Rider, Slip Opinion No. 2022-Ohio-4348.] 
 
 
 
 
 
NOTICE 
This slip opinion is subject to formal revision before it is published in an 
advance sheet of the Ohio Official Reports.  Readers are requested to 
promptly notify the Reporter of Decisions, Supreme Court of Ohio, 65 
South Front Street, Columbus, Ohio 43215, of any typographical or other 
formal errors in the opinion, in order that corrections may be made before 
the opinion is published. 
 
 
SLIP OPINION NO. 2022-OHIO-4348 
IN THE MATTER OF ESTABLISHING THE SOLAR GENERATION FUND RIDER 
PURSUANT TO R.C. 3706.46; 
OHIO MANUFACTURERS’ ASSOCIATION ENERGY GROUP, APPELLANT; PUBLIC 
UTILITIES COMMISSION, APPELLEE; OHIO POWER COMPANY, INTERVENING 
APPELLEE. 
[Until this opinion appears in the Ohio Official Reports advance sheets, it 
may be cited as In re Establishing the Solar Generation Fund Rider, Slip 
Opinion No. 2022-Ohio-4348.] 
Public utilities—R.C. 3706.46—Public Utilities Commission’s order authorizing 
solar-generation-fund rider affirmed in part and reversed in part and cause 
remanded for clarification. 
(No. 2021-1374—Submitted July 12, 2022—Decided December 7, 2022.) 
APPEAL from the Public Utilities Commission, No. 21-447-EL-UNC. 
____________________ 
 
 
SUPREME COURT OF OHIO 
 
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O’CONNOR, C.J. 
{¶ 1} This appeal arises from an order of the Public Utilities Commission 
that authorized a recovery mechanism referred to as the solar-generation-fund rider 
(“Rider SGF”).  Ohio electric-distribution utilities charge Rider SGF each month 
to their retail customers, but they do not retain the money recovered through it.  
Instead, they pass the money through to the solar generation fund, which is then 
used to subsidize the operations of qualifying solar-resource generators in Ohio. 
{¶ 2} The Ohio Manufacturers’ Association Energy Group (“OMAEG”), 
filed this appeal raising various challenges to the amount and structure of Rider 
SGF. 
{¶ 3} For the reasons discussed below, we affirm in part and reverse in part 
the commission’s order and remand the cause to the commission for clarification 
on one issue. 
I.  FACTS AND PROCEDURAL BACKGROUND 
A.  2019 Am.Sub.H.B. No. 6 and 2021 Am.Sub.H.B. No. 128 
{¶ 4} In October 2019, Am.Sub.H.B. No. 6 (“H.B. 6”) went into effect.  
Among other things, the bill authorized payments to subsidize the operations of 
certain in-state nuclear-energy- and renewable-energy-resource facilities.  H.B. 6 
established a “nuclear generation fund” that would allow for total disbursements of 
$150 million annually to qualifying nuclear generators and a “renewable generation 
fund” that would allow for annual disbursements of $20 million to “qualifying 
renewable resource” facilities.  Former R.C. 3706.46, 2019 Am.Sub.H.B. No. 6.  
To generate revenue for both funds, the bill required each Ohio electric-distribution 
utility to collect a monthly charge from all customers.  Id. 
{¶ 5} In June 2021, the General Assembly enacted Am.Sub.H.B. No. 128 
(“H.B. 128”), which repealed certain portions of H.B. 6, including those related to 
the creation of the nuclear generation fund, but left in place the renewable 
generation fund, which was renamed the “solar generation fund.”  H.B. 128 retained 
January Term, 2022 
 
 
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from H.B. 6 the requirement that disbursements from the solar generation fund 
would be capped at $20 million annually.  R.C. 3706.46.  It also retained the 
requirement that revenue for the solar generation fund would be generated through 
a monthly retail charge to customers that would be billed and collected by the Ohio 
electric-distribution utilities.  Id. 
{¶ 6} The commission has discretion to determine “the method by which 
the revenue is allocated or assigned to each electric distribution utility for billing 
and collection,” with certain limits that are not relevant here.  R.C. 3706.46(A)(2).  
And the commission is authorized to determine “the level and structure of any 
charge to be billed and collected by each electric distribution utility,” but there are 
specific limits on the monthly amounts that residential and certain nonresidential 
customers may be charged.  R.C. 3706.46(B). 
B.  The commission’s proceedings 
{¶ 7} In April 2021, the commission opened a case for the purpose of 
establishing a new recovery mechanism under R.C. 3706.46 that would be used to 
meet the annual revenue requirement for the solar generation fund.  The 
commission staff filed comments and recommendations regarding the proposed 
Rider SGF.  Several parties filed comments for and against the commission staff’s 
recommendations. 
{¶ 8} On July 14, 2021, the commission issued an order establishing Rider 
SGF as the recovery mechanism that would be used to provide revenue for the solar 
generation fund.  OMAEG filed an application for rehearing, which the commission 
denied. 
{¶ 9} OMAEG appealed to this court.  The commission has filed a brief in 
defense of its order.  The Ohio Power Company has intervened as an appellee to 
oppose reversal. 
 
 
SUPREME COURT OF OHIO 
 
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II.  STANDARD OF REVIEW 
{¶ 10} “R.C. 4903.13 provides that a [Public Utilities Commission] order 
shall be reversed, vacated, or modified by this court only when, upon consideration 
of the record, the court finds the order to be unlawful or unreasonable.”  
Constellation NewEnergy, Inc. v. Pub. Util. Comm., 104 Ohio St.3d 530, 2004-
Ohio-6767, 820 N.E.2d 885, ¶ 50.  We will not reverse or modify a commission 
decision as to questions of fact when the record contains sufficient probative 
evidence to show that the commission’s decision is not manifestly against the 
weight of the evidence and is not so clearly unsupported by the record as to show 
misapprehension, mistake, or willful disregard of duty.  Monongahela Power Co. 
v. Pub. Util. Comm., 104 Ohio St.3d 571, 2004-Ohio-6896, 820 N.E.2d 921, ¶ 29.  
The appellant bears the burden of demonstrating that the commission’s decision is 
against the manifest weight of the evidence or is clearly unsupported by the record.  
Id. 
{¶ 11} Although this court has “complete and independent power of review 
as to all questions of law” in appeals from the Public Utilities Commission, Ohio 
Edison Co. v. Pub. Util. Comm., 78 Ohio St.3d 466, 469, 678 N.E.2d 922 (1997), 
we may rely on the expertise of a state agency in interpreting a law when “highly 
specialized issues” are involved and when “agency expertise would, therefore, be 
of assistance in discerning the presumed intent of our General Assembly,” 
Consumers’ Counsel v. Pub. Util. Comm., 58 Ohio St.2d 108, 110, 388 N.E.2d 1370 
(1979). 
III. DISCUSSION 
{¶ 12} OMAEG raises five propositions of law.  As will be discussed, we 
remand this matter to the commission for clarification of the issue addressed in 
OMAEG’s fourth proposition of law, but the remaining propositions lack merit. 
 
 
January Term, 2022 
 
 
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A.  Proposition of law No. I: Whether the commission erred by establishing an 
annual revenue requirement of $20 million for Rider SGF 
{¶ 13} In its first proposition of law, OMAEG argues that the commission 
erred when it established a fixed annual revenue requirement of $20 million for 
Rider SGF.  The provision at issue here is R.C. 3706.46(A)(1), which provides: 
  
Beginning for all bills rendered on or after January 1, 2021, 
by an electric distribution utility in this state, such electric 
distribution utility shall collect from all of its retail electric 
customers in this state, each month, a charge which, in the aggregate, 
is sufficient to produce a revenue requirement of twenty million 
dollars annually for total disbursements required under section 
3706.55 of the Revised Code from the solar generation fund. 
 
{¶ 14} OMAEG asserts that in enacting R.C. 3706.46(A)(1), the General 
Assembly tied the annual revenue requirement to R.C. 3706.55, which  remits 
money from the solar generation fund to qualifying-solar-resource operators based 
on their generation output.1  Under OMAEG’s reading of R.C. 3706.46(A)(1), the 
amount collected from customers each year through the Rider SGF cannot exceed 
what is needed to pay the disbursements earned each year by solar-resource 
operators under R.C. 3706.55, up to a maximum amount of $20 million. 
{¶ 15} The commission and Ohio Power argue that R.C. 3706.46(A)(1) 
clearly establishes a fixed annual revenue requirement of $20 million and does not 
condition the collection of funds through Rider SGF on the generation output of the 
 
1. R.C. 3706.55 requires the Ohio Air Quality Development Authority to direct the state treasurer 
to remit monies from the solar generation fund to qualifying-solar-resource operators in an amount 
that is based on the number of solar energy credits earned for each megawatt hour the resource 
produced and reported to the authority under R.C. 3706.45. 
SUPREME COURT OF OHIO 
 
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solar resources.  For the reasons explained below, we agree with the commission 
and Ohio Power and therefore reject OMAEG’s first proposition of law. 
1.  The plain language of R.C. 3706.46(A)(1) establishes a fixed annual 
revenue requirement of $20 million 
{¶ 16} As with any question involving statutory construction, our analysis 
must begin with the language of the statute.  In re Application of Duke Energy Ohio, 
Inc., 150 Ohio St.3d 437, 2017-Ohio-5536, 82 N.E.3d 1148, ¶ 19.  R.C. 
3706.46(A)(1) requires the commission to establish a recovery mechanism that “is 
sufficient to produce a revenue requirement of twenty million dollars annually for 
total disbursements required under section 3706.55 of the Revised Code from the 
solar generation fund.” 
{¶ 17} As noted, OMAEG argues that R.C. 3706.46(A)(1) does not 
automatically fix the annual revenue requirement at $20 million.  OMAEG 
maintains that when the word “sufficient” in R.C. 3706.46(A)(1) is read in 
conjunction with the phrase “for total disbursements required under section 
3706.55 of the Revised Code,” it is clear that the revenue required is the amount 
necessary to fund the disbursements committed to be paid out of the solar 
generation fund, up to $20 million. 
{¶ 18} OMAEG invokes the statute’s use of the word “sufficient” but never 
discusses the words that immediately follow it.  OMAEG ignores the words “to 
produce a revenue requirement of twenty million dollars annually.”  Thus, when all 
the words in the statute are read in context, R.C. 3706.46(A)(1) plainly requires the 
recovery mechanism to be set at an amount that is “sufficient to produce a revenue 
requirement of twenty million dollars annually.” 
{¶ 19} OMAEG likewise reads out of context the phrase “for total 
disbursements required under section 3706.55 of the Revised Code” in R.C. 
3706.46(A)(1).  Contrary to OMAEG’s assertion, this phrase is not a reference to 
how much money must go into the fund each year.  Instead, when read in 
January Term, 2022 
 
 
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conjunction with the phrase “sufficient to produce a revenue requirement of twenty 
million dollars annually,” the phrase “for total disbursements” refers to the fact that 
annual expenditures from the fund are limited to $20 million. 
{¶ 20} Stated differently, OMAEG interprets R.C. 3706.46(A)(1) as though 
it included the italicized words in the following sentence: 
 
[A]n electric distribution utility in this state * * * shall collect * * * 
a charge which * * * is sufficient to produce a revenue requirement 
of up to twenty million dollars annually for total disbursements 
required under section 3706.55 of the Revised Code from the solar 
generation fund. 
 
But the General Assembly did not write R.C. 3706.46(A)(1) that way.  And in 
construing a statute, a court may not add or delete words.  State ex rel. Cincinnati 
Bell Tel. Co. v. Pub. Util. Comm., 105 Ohio St.3d 177, 2005-Ohio-1150, 824 
N.E.2d 68, ¶ 32. 
2.  The commission did not violate R.C. 4903.09 
{¶ 21} OMAEG additionally argues under its first proposition of law that 
the commission’s decision to set the annual revenue requirement at $20 million 
lacked any citation to the record, in violation of R.C. 4903.09.  Under R.C. 4903.09, 
an order of the commission in a contested case must provide, in sufficient detail, 
the facts in the record upon which the order is based and the reasoning behind the 
commission’s conclusion.  MCI Telecommunications Corp. v. Pub. Util. Comm., 
32 Ohio St.3d 306, 312, 513 N.E.2d 337 (1987).  According to OMAEG, the 
commission erred in failing to cite evidence that demonstrates (1) the number of 
qualifying solar resources in Ohio that have applied to receive disbursements from 
the solar generation fund, (2) the generation output of those qualifying resources, 
(3) the number of solar energy credits earned by each qualifying solar resource, and 
SUPREME COURT OF OHIO 
 
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(4) a calculation of the amount of revenue needed to pay the disbursements from 
the fund for the solar energy credits that were earned.  OMAEG maintains that 
without these findings of fact, the commission was unable to establish an annual 
revenue requirement that complies with R.C. 3706.46(A)(1). 
{¶ 22} But it was not necessary for the commission to cite evidence 
supporting its decision, because, as we hold above, R.C. 3706.46(A)(1) itself 
establishes the fixed annual revenue requirement.  The question is one of law, not 
fact.  OMAEG’s argument to the contrary hinges on its claim that R.C. 
3706.46(A)(1) does not establish a fixed annual revenue requirement of $20 
million.  Having rejected that argument, we also reject OMAEG’s argument that 
the commission violated R.C. 4903.09. 
B.  Proposition of law No. II: Whether the commission violated R.C. 3706.46(B) 
when it established Rider SGF on a per-account basis 
{¶ 23} OMAEG argues under its second proposition of law that the 
commission erred by establishing Rider SGF on a per-account basis because the 
plain language of R.C. 3706.46(B) unequivocally directs the commission to 
implement the charge on a per-customer basis.  To generate revenue for the solar 
generation fund, R.C. 3706.46(B) requires the commission to implement the “per-
customer monthly charge” that each electric-distribution utility is to bill and collect 
from its residential and nonresidential customers.  According to OMAEG, this 
means that electric-distribution utilities must treat a customer with multiple billing 
accounts as a single customer and charge Rider SGF only once per month, instead 
of charging the rider for each account a customer maintains. 
1.  The commission’s interpretation of “per customer” 
{¶ 24} The commission rejected OMAEG’s argument that it was required 
to implement Rider SGF on a per-customer basis.  The commission determined that 
the word “customer” in R.C. 3706.46(B) is clear and unambiguous.  Therefore, the 
commission determined that “Rider SGF will be collected in the same manner that 
January Term, 2022 
 
 
9 
all other riders are collected by [electric-distribution utilities]–in connection with 
each billing account established in accordance with the applicable contract or 
tariff.”  Pub. Util. Comm. No. 21-447-EL-UNC, 2021 WL 3036724, ¶ 16 (July 14, 
2021).  As a result, the commission concluded that “nonresidential customers shall 
not be permitted to aggregate or group their billing accounts in order to avoid 
paying Rider SGF amounts.”  Id. 
{¶ 25} The commission based its decision on Ohio Adm.Code 4901:1-10-
01(I), which defines “customer” as “any person who has an agreement, by contract 
and/or tariff with an electric utility * * * to receive service.”  The commission cited 
a prior decision, In re Establishing the Nonbypassable Recovery Mechanism for 
Net Legacy Generation Resource Costs Pursuant to R.C. 4928.148, Pub. Util. 
Comm. No. 19-1808-EL-UNC, ¶ 27 (Nov. 21, 2019), and rehearing entry, 2020 
WL 12813040, ¶ 12 (Jan. 15, 2020), in which it had applied this definition in 
rejecting the same argument by OMAEG in relation to a different rider.  The 
commission determined in that case that based on the definition in Ohio Adm.Code 
4901:1-10-01(I), “customer” status depends on the contract or tariff relationship 
between an electric-distribution utility and the party that receives electric services, 
and that relationship attaches responsibility for payment to an account or accounts.  
Consistent with this definition and the historic utility practices used to collect on 
charges in connection with each billing account in accordance with the applicable 
tariff or contract, the commission determined that “customer” is synonymous with 
“account.” 
2.  OMAEG has not shown that the commission erred in establishing Rider 
SGF on a per-account basis 
{¶ 26} OMAEG’s primary argument on this issue is that the commission 
“cannot lawfully construe the meaning of ‘per-customer’ to mean ‘per-billing 
account.’ ”  According to OMAEG, because no ambiguity exists in the phrase “per-
customer monthly charge” in R.C. 3706.46(B), the only reasonable interpretation 
SUPREME COURT OF OHIO 
 
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is that Rider SGF must be charged once per month to each electric-distribution-
utility customer, regardless of how many accounts the customer has.  OMAEG has 
failed to demonstrate error. 
{¶ 27} It is well established that in construing statutes, when a word has a 
technical definition that is different from its dictionary definition, it must be 
construed according to the former.  Hoffman v. State Med. Bd. of Ohio, 113 Ohio 
St.3d 376, 2007-Ohio-2201, 865 N.E.2d 1259, ¶ 26, citing Youngstown Sheet Tube 
Co. v. Lindley, 56 Ohio St.2d 303, 309, 383 N.E.2d 903 (1978); see also R.C. 1.42 
(“Words and phrases that have acquired a technical or particular meaning, whether 
by legislative definition or otherwise, shall be construed accordingly”). 
{¶ 28} We presume commission orders to be reasonable, and OMAEG, as 
the appellant, must overcome that presumption.  In re Application of Columbus S. 
Power Co., 129 Ohio St.3d 271, 2011-Ohio-2638, 951 N.E.2d 751, ¶ 17.  OMAEG, 
however, completely ignores the commission’s legal rationale for finding that Rider 
SGF should be applied on a per-account basis.  In its main brief, OMAEG does not 
even mention, let alone offer an argument against, the definition of “customer” in 
Ohio Adm.Code 4901:1-10-01(I), which formed the legal basis for the 
commission’s determination. 
{¶ 29} A rule adopted by an administrative agency is valid and enforceable 
unless it is unreasonable or in conflict with the statutory enactment covering the 
same subject matter.  Wymsylo v. Bartec, Inc., 132 Ohio St.3d 167, 2012-Ohio-
2187, 970 N.E.2d 898, ¶ 39.  Yet OMAEG has failed to challenge the commission’s 
application of the Administrative Code’s definition of “customer.”  This defeats 
OMAEG’s argument that the commission violated R.C. 3706.46(B) in applying 
Rider SGF on a per-account basis.  See Lycourt-Donovan v. Columbia Gas of Ohio, 
Inc., 152 Ohio St.3d 73, 2017-Ohio-7566, 93 N.E.3d 902, ¶ 51; In re Fuel 
Adjustment Clauses of Columbus S. Power Co. & Ohio Power Co., 140 Ohio St.3d 
352, 2014-Ohio-3764, 18 N.E.3d 1157, ¶ 41. 
January Term, 2022 
 
 
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{¶ 30} OMAEG does mount a challenge to the administrative rule’s 
definition of “customer” in its reply brief.  OMAEG, however, is barred from 
raising new arguments for the first time on reply.  Util. Serv. Partners, Inc. v. Pub. 
Util. Comm., 124 Ohio St.3d 284, 2009-Ohio-6764, 921 N.E.2d 1038, ¶ 54.  
OMAEG is also barred from raising this argument because it did not specify the 
argument in its application for rehearing before the commission as R.C. 4903.10 
requires. 
{¶ 31} In the end, it is established doctrine that a party who contends that 
rates and charges are unreasonable or unlawful bears the burden of demonstrating 
reversible error on appeal.  In re Application of Columbus S. Power Co., 128 Ohio 
St.3d 512, 2011-Ohio-1788, 947 N.E.2d 655, ¶ 56.  OMAEG cannot prevail on a 
challenge that the commission misinterpreted the word “customer” if it does not 
challenge the definition that the commission applied to that word.  See Columbus 
S. Power, 129 Ohio St.3d 271, 2011-Ohio-2638, 951 N.E.2d 751, at ¶ 19; Duke 
Energy, 150 Ohio St.3d 437, 2017-Ohio-5536, 82 N.E.3d 1148, at ¶ 25.  We 
therefore reject OMAEG’s second proposition of law. 
C.  Proposition of law No. III: Whether the commission violated R.C. 
3706.46(B) by failing to limit application of the $242 monthly cap on Rider 
SGF to industrial customers eligible to become self-assessing purchasers 
{¶ 32} In its third proposition of law, OMAEG argues that the commission 
violated R.C. 3706.46(B), which limits the amounts that electric-distribution 
utilities can bill residential and nonresidential customers each month for Rider SGF.  
R.C. 3706.46(B) provides: 
 
In authorizing the level and structure of any charge to be 
billed and collected by each electric distribution utility, the 
commission shall ensure that the per-customer monthly charge for 
residential customers does not exceed ten cents and that the per-
SUPREME COURT OF OHIO 
 
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customer monthly charge for industrial customers eligible to 
become self-assessing purchasers pursuant to division (C) of section 
5727.81 of the Revised Code does not exceed two hundred forty-two 
dollars.  For nonresidential customers that are not self-assessing 
purchasers, the level and design of the charge shall be established in 
a manner that avoids abrupt or excessive total net electric bill 
impacts for typical customers. 
 
(Emphasis added.) 
{¶ 33} The commission rejected OMAEG’s argument that the $242 
monthly rate cap under this provision applied only to industrial customers eligible 
to become self-assessing purchasers.  The commission instead accepted its staff’s 
recommendation to cap the rate for all nonresidential customers that are eligible to 
become self-assessing purchasers. 
{¶ 34} OMAEG maintains that R.C. 3706.46(B) expressly applies the $242 
monthly cap only to industrial customers that are eligible to become self-assessing 
purchasers and that the commission erred by extending the rate cap to all 
nonresidential customers that are eligible to become self-assessing purchasers.  
OMAEG additionally argues that the commission’s application of the rate cap to 
nonindustrial customers violates the statutory interpretation canon “expressio unius 
est exclusio alterius.”2 
{¶ 35} As will be discussed, OMAEG fails to show that the commission 
erred or to explain how its members were prejudiced or harmed by the 
commission’s decision. 
 
2. The interpretive cannon “expressio unius est exclusio alterius” provides that the expression of 
one item in an associated group or series excludes unmentioned items.  Natl. Labor Relations Bd. v. 
SW Gen., Inc., 580 U.S. 288, __, 137 S.Ct. 929, 940, 197 L.Ed.2d 263 (2017), citing Chevron U.S.A. 
Inc. v. Echazabal, 536 U.S. 73, 80, 122 S.Ct. 2045, 153 L.Ed.2d 82 (2002); see also Summerville v. 
Forest Park, 128 Ohio St.3d 221, 2010-Ohio-6280, 943 N.E.2d 522, ¶ 35-36.   
January Term, 2022 
 
 
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1.  What is an eligible self-assessing purchaser? 
{¶ 36} Before addressing OMAEG’s arguments, we discuss R.C. 
5727.81(C), which is cross-referenced in R.C. 3706.46(B).  R.C. 5727.81(C) sets 
forth the requirements and process to become a self-assessing purchaser. 
{¶ 37} R.C. 5727.81 concerns the excise tax that is imposed on electric-
distribution utilities for distributing electricity to Ohio consumers.  In most 
circumstances, the electric-distribution utility pays the excise tax to the tax 
commissioner or the state treasurer and then passes the tax on to its customers by 
increasing its rates.  R.C. 5727.81(A).  But R.C. 5727.81(C) allows certain 
purchasers of electricity to “self-assess” the excise tax and pay that amount directly 
to the taxing authority, thereby relieving the utility of its obligation to pay the excise 
tax to the taxing authority.  The benefit of self-assessing is that the purchaser is 
taxed at a lesser rate than it would be if the utility paid the excise tax.  See R.C. 
5727.81(A), (C)(2), and (C)(6). 
{¶ 38} Under R.C. 5727.81(C)(2), only nonresidential customers that fall 
into certain categories may become self-assessing purchasers.  One category is 
made up of commercial and industrial customers that received or consumed more 
than 45 million kilowatt hours of electricity at one location in the preceding year.  
Another category is made up of “qualified end users”3 that consumed more than 45 
million kilowatt hours of electricity in the preceding year for purposes other than 
their qualifying manufacturing process. R.C. 5727.81(C)(2). 
{¶ 39} For a customer to operate as a self-assessing purchaser, R.C. 
5727.81(C)(6) requires (1) submission of an annual application, (2) payment of an 
annual $500 fee, (3) approval from the tax commissioner, and (4) payment of the 
 
3. A “qualified end user” is an end user that (1) uses more than three million kilowatt hours of 
electricity at one in-state manufacturing location for a calendar day for use in a qualifying 
manufacturing process or (2) uses electricity at an in-state manufacturing location during a chlor-
alkali manufacturing process.  R.C. 5727.80(F).  A “qualifying manufacturing process” means an 
electrochemical or chlor-alkali manufacturing process.  R.C. 5727.80(I). 
SUPREME COURT OF OHIO 
 
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self-assessed excise tax.  See also R.C. 5727.80(J) (defining a “self-assessing 
purchaser” as “a purchaser that meets all the requirements of, and pays the excise 
tax in accordance with,” R.C. 5727.81(C)). 
2.  OMAEG fails to challenge the specific ground cited by the commission in 
support of its decision 
{¶ 40} OMAEG claims that the commission erred when it interpreted the 
$242-monthly-cap language in the first sentence of R.C. 3706.46(B) as applying to 
all nonresidential customers that are eligible to become self-assessing purchasers, 
rather than to only industrial customers.  OMAEG, however, misconstrues the 
commission’s order.  The commission did not cite the first sentence of R.C. 
3706.46(B) as authority to extend the rate cap beyond eligible industrial customers.  
Instead, the commission found that applying the rate cap to all eligible 
nonresidential customers “avoids rate shocks and unreasonable bill outcomes, 
consistent with the legislative direction in this area.”  Pub. Util. Comm. No. 21-
447-EL-UNC, 2021 WL 3036724, at ¶ 15 (July 14, 2021).  This language tracks 
the second sentence of R.C. 3706.46(B): “For nonresidential customers that are not 
self-assessing purchasers, the level and design of the charge shall be established in 
a manner that avoids abrupt or excessive total net electric bill impacts for typical 
customers.” 
{¶ 41} A party who challenges rates and charges approved by the 
commission has the burden on appeal under R.C. 4903.13 of showing that they are 
unjust, unreasonable, or unlawful.  In re Application of Columbus S. Power Co., 
128 Ohio St.3d 512, 2011-Ohio-1788, 947 N.E.2d 655, at ¶ 56.  OMAEG fails to 
carry its burden here.  At no point under its third proposition of law does OMAEG 
challenge, or even mention, the commission’s reliance on the second sentence of 
R.C. 3706.46(B) as a ground for extending the rate cap.  It is well-settled that we 
presume that commission orders are lawful and reasonable and that it falls on the 
appellant to overcome that presumption.  See Columbus v. Pub. Util. Comm., 170 
January Term, 2022 
 
 
15 
Ohio St. 105, 163 N.E.2d 167 (1959), paragraph two of the syllabus.  As a result, 
OMAEG’s failure to directly challenge the commission’s determination as 
substantively unlawful or unreasonable is fatal to its argument that the commission 
violated R.C. 3706.46(B).  See In re Comm. Rev. of Capacity Charges of Ohio 
Power Co., 147 Ohio St.3d 59, 2016-Ohio-1607, 60 N.E.3d 1221, ¶ 47. 
3.  OMAEG also fails to demonstrate prejudice or harm stemming from the 
decision 
{¶ 42} OMAEG also overlooks a basic prerequisite to reversing a 
commission order: the party seeking reversal must show that it has been or will be 
harmed or prejudiced by the order, In re Application of Ohio Power Co., 140 Ohio 
St.3d 509, 2014-Ohio-4271, 20 N.E.3d 699, ¶ 31; In re Complaint of Buckeye 
Energy Brokers, Inc. v. Palmer Energy Co., 139 Ohio St.3d 284, 2014-Ohio-1532, 
11 N.E.3d 1126, ¶ 19.  OMAEG does not even attempt to show how its members 
suffered harm or prejudice from the rate cap’s extension beyond industrial 
customers that are eligible to become self-assessing purchasers to eligible 
commercial customers and qualified end users.  This provides an independent 
ground for us to reject OMAEG’s third proposition of law. 
D.  Proposition of law No. IV: Whether the commission violated Ohio law by 
including the Commercial Activity Tax in Rider SGF 
{¶ 43} OMAEG argues that the commission erred when it determined that 
customers must also pay the commercial activity tax (“CAT”) through Rider SGF.  
OMAEG maintains that there is no language in R.C. 3706.46 that allows the 
commission to gross up, i.e., adjust upward, the monthly Rider SGF charge to 
account for the CAT.  OMAEG alternatively asserts that even if the statute is 
ambiguous on this point, customers should not be required to pay the CAT, because 
Rider SGF merely collects subsidies to support private solar-energy generators and 
does not recover costs for any goods or services provided to customers by the 
electric-distribution utilities. 
SUPREME COURT OF OHIO 
 
16 
{¶ 44} In response, the commission asserts that OMAEG fundamentally 
misunderstands how the commission’s order treats the CAT.  The commission 
denies that the order grosses up the revenue in Rider SGF to account for the CAT.  
According to the commission, the order follows R.C. 3706.46 in setting the amount 
of annual revenue from Rider SGF at $20 million and expressly disallows any 
adjustment to the rider to account for the CAT. 
{¶ 45} For its part, Ohio Power contends that OMAEG unnecessarily 
challenges the commission’s decision regarding the CAT.  According to Ohio 
Power, the Rider SGF funds it collects are not subject to the CAT and, in turn, Ohio 
Power is not grossing up the amount of Rider SGF to offset its CAT liability and 
pass it on to customers.  Arguing that OMAEG has not raised a valid controversy, 
Ohio Power urges this court to affirm the commission’s CAT determination. 
{¶ 46} For the reasons explained below, we remand the case to the 
commission for clarification on this issue. 
1.  Background on the commission’s CAT determination 
{¶ 47} The CAT is levied “on each person with taxable gross receipts for 
the privilege of doing business in this state.”  R.C. 5751.02(A).  See also R.C. 
5751.01(A) (defining “person” for purposes of the CAT as including companies 
“and any other entities”).  R.C. 5751.02(A) defines “doing business” as “engaging 
in any activity, whether legal or illegal, that is conducted for, or results in, gain, 
profit, or income, at any time during a calendar year.”  The statute specifies that the 
CAT is “imposed on the person receiving the gross receipts and is not a tax imposed 
directly on a purchaser.”  R.C. 5751.02(A).  Likewise, R.C. 5751.02(B) prohibits 
the CAT from being “billed or invoiced to another person.”  However, the taxpayer 
is permitted to recoup its CAT liability by including it in the price it charges for 
goods or services.  R.C. 5751.02(B)(1). 
January Term, 2022 
 
 
17 
{¶ 48} In the proceedings below, the commission’s staff recommended that 
the CAT be included in the monthly Rider SGF charge to residential and 
nonresidential customers of the Ohio electric-distribution utilities. 
{¶ 49} OMAEG objected to the commission staff’s recommendation that 
customers be responsible for paying the CAT through Rider SGF.  OMAEG argued 
that electric-distribution utilities are responsible for paying the CAT under R.C. 
5751.02 and that CAT liability cannot be shifted to customers, because Rider SGF 
is not recovering costs for any services provided by the utilities.  OMAEG also 
argued that R.C. 3706.46 contains no language that allows electric-distribution 
utilities to pass the CAT through to its customers. 
{¶ 50} Two electric-distribution utilities weighed in as well.  Like OMAEG, 
Ohio Power maintained that the revenues recovered by the electric-distribution 
utilities through Rider SGF are not subject to the CAT.  Conversely, the Dayton 
Power and Light Company maintained that electric-distribution utilities will be 
subject to the CAT on revenues collected via Rider SGF and that failing to gross 
up rider revenues by the amount of the CAT liability will result in electric-
distribution utilities incurring CAT costs without offsetting revenue. 
{¶ 51} Against this backdrop, the commission made conflicting, or at a 
minimum confusing, rulings.  In one part of its order, the commission expressly 
determined that “[e]ach [electric-distribution utility] will charge its residential 
customers $0.10 per month, including CAT.”  Pub. Util. Comm. No. 21-447-EL-
UNC, 2021 WL 3036724, at ¶ 19(a) (July 14, 2021).  The commission, however, 
made no mention in this part of its order whether the nonresidential-customer 
charge would include the CAT. 
{¶ 52} In another part of the order, the commission offered a confusing 
discussion regarding its authority to adjust the Rider SGF to account for any CAT 
offset.  The commission determined that R.C. 3706.46 required that the solar 
generation fund be established “without consideration of any CAT adjustment, at 
SUPREME COURT OF OHIO 
 
18 
an annual amount of $20,000,000.”  Id. at ¶ 14.  The commission reasoned that “had 
the legislature intended to establish the [solar generation fund] at an adjusted 
amount to account for any CAT offset, it would have expressly done so.”  Id.  
Accordingly, the commission held that electric-distribution utilities “should collect 
the fixed amount required by the solar generation fund without regard to any CAT 
offset.”  Id. 
{¶ 53} On rehearing, the commission reaffirmed its analysis and clarified: 
 
Relative to whether CAT amounts are properly included for 
recovery in Rider SGF, we again reject OMAEG’s claimed error.  
Consistent with our analysis earlier herein, the legislature was aware 
of our prior statutory interpretation as to this issue, which disfavored 
reducing rider recoveries to account for any CAT offset, when it 
enacted H.B. 128.  We clarify that the residential customer charge 
of $0.10 per month is the fixed amount required by the statute 
without regard to any CAT offset and is not subject to further 
adjustment.  Subject to this clarification, we affirm that the 
enactment of H.B. 128 without any modification regarding CAT 
recoveries speaks to the legislative intent as to this issue. 
 
Pub. Util. Comm. No. 21-447-EL-UNC, rehearing entry, 2021 WL 4149861, ¶ 14 
(Sept. 8, 2021). 
2.  The commission’s CAT determination requires clarification 
{¶ 54} As we understand the commission’s argument in this appeal, it 
claims that under its order, no CAT amounts are to be included in Rider SGF, 
because R.C. 3706.46 does not allow the commission to adjust the revenue 
recovered under the rider to account for the CAT.  While the order may be read the 
way the commission suggests, that is not the only plausible reading. 
January Term, 2022 
 
 
19 
{¶ 55} The commission’s order can just as easily be read as holding that the 
CAT may properly be included in the rider.  As noted above, the commission held 
on rehearing that it lacked authority to reduce Rider SGF recoveries to offset the 
CAT.  But if the CAT were not included in the monthly rider charge, there would 
be no reason to determine whether the commission had authority to reduce the rider 
charge to “offset” the CAT. 
{¶ 56} In our view, the commission had the analysis backwards.  The 
commission considered whether it had authority to either gross up or reduce the 
rider to offset the CAT.  What the commission should have asked instead was (1) 
whether the revenue collected by electric-distribution utilities through Rider SGF 
was subject to the CAT and (2) if so, whether it was appropriate to shift the CAT 
liability from electric-distribution utilities onto customers by including CAT 
amounts in the rider. 
{¶ 57} Because the commission’s CAT determination can be read two 
ways, we remand this case to the commission for clarification on this issue.  On 
remand, the commission is instructed to expressly determine whether the revenue 
recovered by Rider SGF is subject to the CAT and billable to customers. 
E.  Proposition of law No. V: Whether the commission erred in failing to 
require refund language in the tariffs to Rider SGF 
{¶ 58} OMAEG argues that the commission erred when it failed to require 
refund language in the tariffs implementing Rider SGF.  OMAEG acknowledges 
that R.C. 3706.55(B) provides for a refund to customers of “any amounts remaining 
in the [solar generation] fund as of December 31, 2027, minus the remittances that 
are required to be made between that date and January 21, 2028.”  But it asserts that 
the commission should have ordered electric-distribution utilities to include the 
necessary refund language in the Rider SGF tariffs to effectuate the refund 
provision contained in R.C. 3706.55(B).  According to OMAEG, without refund 
language in the tariffs, R.C. 4905.32 and the rule against retroactive ratemaking 
SUPREME COURT OF OHIO 
 
20 
may prevent customers from receiving refunds they may otherwise be entitled to 
under R.C. 3706.55(B). 
{¶ 59} OMAEG overlooks that all Ohio electric-distribution utilities have 
included language in their Rider SGF tariffs to effectuate the refund and 
reconciliation processes required by R.C. 3706.46(C) and 3706.55(B).  Therefore, 
OMAEG’s argument is moot.  See In re Application of Ohio Edison Co., 157 Ohio 
73, 2019-Ohio-2401, 131 N.E.3d 906, ¶ 51 (plurality opinion). 
IV.  CONCLUSION 
{¶ 60} For the foregoing reasons, we affirm the commission’s order in part, 
reverse it in part, and remand this case for clarification. 
Order affirmed in part 
and reversed in part 
and cause remanded. 
FISCHER, DONNELLY, STEWART, and KILBANE, JJ., concur. 
DEWINE, J., concurs in part and dissents in part, with an opinion joined by 
KENNEDY, J. 
MARY EILEEN KILBANE, J., of the Eighth District Court of Appeals, sitting 
for BRUNNER, J. 
_________________ 
DEWINE, J., concurring in part and dissenting in part. 
{¶ 61} The General Assembly set up a fund to subsidize solar power and 
tasked the Public Utilities Commission of Ohio (“PUCO”) with establishing the 
amounts that ratepayers must pay into the fund.  In doing so, the General Assembly 
placed caps on the amounts that could be assessed “per customer.”  PUCO, though, 
decided that when the General Assembly said “per customer,” it didn’t really mean 
it.  It held that the “per-customer” cap does not actually cap the amount that may 
be charged to each customer.  Instead, it determined that the “per-customer” cap 
January Term, 2022 
 
 
21 
limits the amount that may be billed to an account.  So, under its order, a single 
customer with multiple accounts may be assessed the “per-customer monthly” cap 
amount multiple times. 
{¶ 62} PUCO’s interpretation is contrary to the ordinary meaning of the 
word “customer.”  It is also at odds with the definition of “customer” contained in 
the Ohio Administrative Code.  The construction of a statutory term is a pure 
question of law over which this court has independent power of review.  Yet the 
majority signs off on the commission’s contra-textual interpretation without any 
analysis of the statutory language at all.  Thus, I respectfully dissent from that 
portion of the majority’s judgment.  I concur in the rest of its judgment. 
I. The General Assembly Establishes a Per-Customer Cap 
{¶ 63} In tasking PUCO with setting the solar fund rider (“Rider SGF”), the 
General Assembly placed limits on the amount that a customer could be billed.  
R.C. 3706.46(B) provides:   
 
In authorizing the level and structure of any charge to be 
billed and collected by each electric distribution utility, the 
commission shall ensure that the per-customer monthly charge for 
residential customers does not exceed ten cents and that the per-
customer monthly charge for industrial customers eligible to 
become self-assessing purchasers * * * does not exceed two hundred 
forty-two dollars. 
 
(Emphasis added.) 
{¶ 64} The issue here concerns the application of these per-customer caps.  
In establishing Rider SGF, PUCO found that the “legislative use of the word 
‘customer’ in R.C. 3706.46(B) is clear and unambiguous” and requires that the cap 
be applied “in connection with each billing account established in accordance with 
SUPREME COURT OF OHIO 
 
22 
the applicable contract or tariff.”  Pub. Util. Comm. No. 21-447-EL-UNC, 2021 
WL 3036724, ¶ 16 (July 14, 2021).  The Ohio Manufacturers’ Association Energy 
Group (“the OMA”) challenges PUCO’s holding that “customer” doesn’t mean 
customer but, rather, means account.  It complains that because of PUCO’s ruling, 
customers who have multiple accounts and meters and customers with multiple 
facilities are being forced to pay up to the capped amount for each account. 
{¶ 65} In support, the OMA points to the ordinary meaning of the word 
“customer.”  It contends that the meaning of “customer” is unambiguous, but it 
suggests that if the court finds the term to be ambiguous, it should look at legislative 
history.  In this vein, it points out that earlier versions of the legislation contained 
a “per account” cap but the legislature replaced that language with a “per customer” 
cap. 
II. The Majority’s Flawed Analysis 
{¶ 66} The majority never takes on the plain-reading argument.  (And who 
can blame it—it’s pretty hard to argue that “customer” doesn’t mean customer.)  
Instead, it comes up with a convoluted rationale for just ignoring plain meaning.  
That rationale goes like this: 
1. 
When a term has a technical meaning, we should apply that meaning rather 
than the term’s plain meaning. 
2. 
We presume PUCO orders to be reasonable, and the OMA must overcome 
that presumption. 
3. 
PUCO said it relied on the definition of “customer” in Ohio Adm.Code 
4901:1-10-01(I) as establishing that the technical meaning of “customer” is 
account.  The OMA failed to challenge PUCO’s application of the 
administrative code’s definition of “customer.”  And “[t]his defeats [OMA’s] 
argument that the commission violated R.C. 3706.46(B) in applying Rider 
SGF on a per-account basis.”  Majority opinion, ¶ 29. 
What a load of tautological nonsense.  Let’s start at the top. 
January Term, 2022 
 
 
23 
A.  Technical meaning 
{¶ 67} It is true that sometimes the context in which words are used can 
demonstrate that a technical meaning is intended rather than an ordinary meaning.  
See Scalia & Garner, Reading Law: The Interpretation of Legal Texts 73 (2012); 
see also R.C. 1.42 (“[w]ords and phrases that have acquired a technical or particular 
meaning * * * shall be construed accordingly”).  But nothing here demonstrates 
that the legislature was using “customer” in any way other than its ordinary 
meaning of “one that purchases some commodity or service,” Webster’s Third New 
International Dictionary 559 (2002).  Moreover, as explained below, the majority 
fails to identify any technical meaning of “customer” applicable here that is 
different from the word’s ordinary meaning.  Instead of simply assuming that a 
technical meaning exists for “customer” and that it is controlling, the majority 
should have asked (1) is there a technical meaning of “customer” that is different 
from the word’s ordinary meaning and, if so, (2) does context demand that the 
technical meaning control over the ordinary meaning?  
B.  Presumption 
{¶ 68} Next, the majority repeats the shibboleth that “[w]e presume 
commission orders to be reasonable,” majority opinion at ¶ 28.  This “presumption” 
goes back to E. Ohio Gas Co. v. Pub. Util. Comm., where this court stated that the 
presumption existed specifically with respect to whether the commission’s 
“findings and orders are just and reasonable,” 137 Ohio St. 225, 249, 28 N.E.2d 
599 (1940).  But the presumption applies only to factual questions—the types of 
questions that require us to look at the record and determine whether the evidence 
supports the commission’s decision on a matter.  See id. at 248-249; Indus. Energy 
Consumers of Ohio Power Co. v. Pub. Util. Comm., 68 Ohio St.3d 559, 563, 629 
N.E.2d 423 (1994) (distinguishing between factual questions, to which the 
presumption applies, and questions of law). 
SUPREME COURT OF OHIO 
 
24 
{¶ 69} This court has “complete and independent power of review” when it 
comes to questions of law in appeals from the commission.  Ohio Edison Co. v. 
Pub. Util. Comm., 78 Ohio St.3d 466, 469, 678 N.E.2d 922 (1997).  The meaning 
of the word “customer” in a statute is purely a question of law.  And as a simple 
question of the legal interpretation of a commonly used term, it is one that we 
answer without deference to PUCO.  See In re Application of Ohio Edison Co., 157 
Ohio St.3d 73, 2019-Ohio-2401, 131 N.E.3d 906, ¶ 62-63 (DeWine, J., concurring 
in judgment only); In re Application of Black Fork Wind Energy, L.L.C., 156 Ohio 
St.3d 181, 2018-Ohio-5206, 124 N.E.3d 787, ¶ 43 (Kennedy, J., concurring).  
Indeed, since the days of Marbury v. Madison, it has been clear that it is for judges, 
not bureaucrats, to say what the law is.  5 U.S. 137, 2 L.Ed. 60 (1803). 
C.  Not Challenged 
{¶ 70} The majority saves its best trick for last.  It says PUCO relied on the 
definition of “customer” in the Ohio Administrative Code as establishing the 
technical meaning of “customer” and the OMA never challenged PUCO’s reliance 
on that definition until its reply brief, so, voila, PUCO wins.  Almost magically, 
PUCO carries the day without the court even having to look at whether the 
legislature meant to ascribe a technical meaning to “customer” different from the 
ordinary meaning or even examining the technical meaning applied by PUCO. 
{¶ 71} The problem is that the OMA did challenge PUCO’s understanding 
of the word “customer” in its opening brief.  It argued that based on the plain 
language of R.C. 3706.46(B), as well as the statute’s legislative history, the 
ordinary meaning of “customer” applied.  As it explained, “The plain language of 
R.C. 3706.46(B) (Appx. 66) unequivocally directed the PUCO to implement the 
Rider SGF monthly cost caps on a per-customer basis.  The PUCO cannot lawfully 
construe the meaning of ‘per-customer’ to mean ‘per-billing account.’ ”   
{¶ 72} The majority seems to think that the OMA had some obligation in 
its initial brief to specifically debunk PUCO’s contention that the administrative-
January Term, 2022 
 
 
25 
code provision supported PUCO’s reading of the statute.  It didn’t.  The OMA’s 
argument was much more basic: there was no need to consider the administrative-
code provision because the language of the statute is clear.  The majority should 
have assessed the OMA’s argument and decided whether to apply the plain 
language of the statute or whether context demanded that a different technical 
meaning of “customer” be applied.  Instead, it threw together an unwarranted 
assumption, a legally incorrect presumption, and a mischaracterization of the 
OMA’s argument to completely avoid any textual analysis of the statute. 
III. The Administrative-Code Provision Doesn’t Support 
PUCO’s Reading of the Statute 
{¶ 73} So let us do what the majority refuses to do: answer the proposition 
of law in front of us and determine whether PUCO properly held that as used in 
R.C. 3706.46(B), “customer” really means “account.” 
{¶ 74} There is no good-faith argument that the ordinary meaning of 
“customer” is anything other than what the OMA says it is—a person or entity who 
contracts for utility services.  The only question is whether there is a technical 
meaning of “customer” different from its ordinary meaning that should be applied 
in this context. 
{¶ 75} PUCO does not set forth any argument that the legislature meant the 
word “customer” in anything but the ordinary sense of the word.  It simply points 
to the existence of an administrative provision, Ohio Adm.Code 4901:1-10-01(I), 
which PUCO itself promulgated, and asks this court to defer to its reading of the 
provision. 
{¶ 76} But turn to that definition.  A “customer” is “any person who has an 
agreement, by contract and/or tariff with an electric utility * * * to receive service.”  
Id.  “Person” means “an individual, corporation, business trust, estate, trust, 
partnership, and association.”  Ohio Adm.Code 4901:1-10-01(Y); R.C. 
4928.01(A)(24); R.C. 1.59(C).  Any plain reading of the definition is fatal to 
SUPREME COURT OF OHIO 
 
26 
PUCO’s argument that “customer” means “account.”  Under the definition, a 
“customer” is simply a person or entity that has an agreement to receive service.  
Nothing in the definition suggests that one customer cannot have multiple 
agreements or have multiple accounts.  So even if we do what PUCO asks and look 
to the administrative-code definition, we end up exactly where we started.  
“Customer” means customer; it doesn’t mean account. 
{¶ 77} Tellingly, despite saying that the administrative-code provision 
controls, PUCO does not make any argument about the actual language of the 
administrative-code provision.  Instead, it points to its own caselaw interpreting 
that administrative-code provision.  PUCO brief at 8-9, citing In re Establishing the 
Nonbypassable Recovery Mechanism for Net Legacy Generation Resource Costs 
Pursuant to R.C. 4928.148, Pub. Util. Comm. No. 19-1808-EL-UNC, ¶ 27 (Nov. 
21, 2019).  In essence, it reasons: the administrative-code provision means what we 
say it means because that is what we have said. 
{¶ 78} But of course, it’s up to the legislature, not PUCO, to make the law.  
And it’s up to this court to say what the law is.  The fact that PUCO may have 
gotten the law wrong in the past does not grant it license to do so in the future. 
{¶ 79} Here, both the plain language of the statute and the plain language 
of the administrative-code provision relied upon by PUCO point in the same 
direction: “customer” means customer.  And because the statute is unambiguous, 
there is no need take up the OMA’s legislative-history argument. 
IV. Conclusion 
{¶ 80} Because neither ordinary meaning nor the administrative code 
support the commission’s interpretation of “per-customer” in R.C. 3706.46(B), I 
dissent from the majority’s judgment affirming PUCO’s order on proposition of 
law No. II.  I would remand the case to PUCO to apply the Rider SGF on a per-
customer basis as dictated by the statute.  I concur in the remainder of the majority’s 
judgment. 
January Term, 2022 
 
 
27 
KENNEDY, J., concurs in the foregoing opinion. 
_________________ 
 
Carpenter Lipps & Leland, L.L.P., Kimberly W. Bojko, Jonathan 
Wygonski, and Thomas V. Donadio, for appellant. 
 
Dave Yost, Attorney General, and John H. Jones, Jodi J. Bair, and Thomas 
M. Shepherd, Assistant Attorneys General, for appellee. 
 
Steven T. Nourse, for intervening appellee. 
_________________