the issue of the voided costs which is central to this appeal and thankful to this case has been a an issue that has dogged the courts the government really everybody involved in it since purple was originated in  seventy eight for the entire forty years and it started with a statute that seemed to only set a ceiling but a regulation that was a few years later approved by the supreme court that also created a floor so that we then got the term full of what it costs but then the utilities never like that they fought that regulation last and then they've been struggling against it ever since and trying to find ways to make the avoided cost less than the full of what it costs and frequently it has boiled down to arguments like where do you include capital costs and what are capital costs they use the term capacity cost because that's a little bit narrow than capital costs capital costs include capacity but can include other things then they got into the argument about multi tiered and there's been a considerable amount of adjudication about that and has argued the court ruled that my clients could have gotten a q f contract if they wanted it but we presented plenty of evidence that my clients tried for years pleading with p g and e to give them  a contract but they were forced into the nonprofit and they were never given a choice and so evidence being the way it has to be evaluated on summary judgment the evidence of the plaintiff has to be believed  the leave them and issue but the district court has indicated that that there's a lack of evidence in the record to support some of your claims can you let's talk about them one by one and i want to make sure that i understand your arguments because i was really struggling to go through to figure out like judge marble which program are you talking about in what way was the full of void it cost calculation only s and where in the record is there support for your position that it should be calculated  differently so can we start with the with the capacity cost issue with because with regard to the number zero grab what are you saying was wrong with the calculation of avoid a cost in the number zero grams because they did not distinguish between their capacity costs don't in any way distinguish between the different types of energy that are involved and so in other words they're not talking about capacity for non renewable energy that they would have to implement if they did not get the nonrenewable energy most of the nam the six hundred thousand almost all of them are people who have solar panels this is renewable energy if six if the six hundred thousand nam participants suddenly were erased they were no longer producing you'd have a fairly significant amount of energy involved if they had to replace that with a solar capacity not gas turbine not fossil fuels the cost difference would be significantly different because they can rely on older facilities for the fossil fuels or slightly upgrading them in order to produce that to do to replace those six hundred thousand nam participants they would have to do a fairly substantial but they would have to also provide the data which they haven't done there tiered and so there is no way of knowing what it would actually be because the law presupposes that information would come from the utilities they would say ok if we had to replace all of these w non renewable energy sources i solar what would it cost them to do it and the in no where in any of the analysis that is done by either the state or by the court do they address that misnomer that's a mistake it's not their capacity that matters it is the capacity of the utility that would have to be added created by the utility to replace the capacity of the of the supplier avoided cost is this is the capital cost of the utility if if there was an absence of the capacity of the supplier so it doesn't matter what it cost care to to create their solar panels or the six hundred thousand to do it the question is is what would the the the utility have to spend to replace that capacity using their own money and raising and building the capacity that they don't have as of now in order to provide that energy that is being supplied by other people as i understand the district court's analysis it said that the next hour plus that's generated by number to spend really have capacity value because the participants don't have to provide any energy utility that there's no obligation on behalf of all of these homeowners with solar panels to provide any energy chill ity where is the air and that analysis because again he's talking about what their capacity is he's the judge was talking about the kid the capacity costs of the of the suppliers but they've already spent the money when they join the nam program they've already put the solar panel on on on their on their physical either residence or business it is already done but that's not the issue the issue is not the capacity costs of the supplier the issue is if you eliminated the six hundred thousand right now tomorrow and they suddenly had to supply the balance what would it cost them to have to supply that balance and you can't say that they don't have to provide the information about what it would cost because nobody else can do that and if the p c doesn't require here's one of the funny things about the purple law when you have a regulated utility in the states where you have regulated utilities you cannot sue the utility for not providing you this and not providing you that you can only sunia regulating you the regulating agency they hate the they did it as a kind of federalism concept only in states where there is no regulating agency can you go directly at the utility on a purple violation so all we can do is say to the p c you've got to enforce these rules you've got to make buteux these provide this information and you have to approach it from the multi tiered approach they're rejecting the multi tiered approach and that is the problem approach calculating avoiding cost we discussed that at rather great length actually in our opening read and gave us a series of quotes and there was a case where the court scene suggested i mean she's made the first seem to suggest that maybe it's not mandatory but and that same case though they struck the use of the gas turbines in that case as the capacity cost basis they said we're not going to let you use this one in this particular case and so you have to look at it with the underlying policy is of what purposes one of the underlying policies of purpose is nonrenewable energy versus renewable energy and it isn't just a green concept it was it was also a concept that was based on the assumption that it is we are trying to avoid having to be dependent on fossil fuels that have a terminal borne out of potential fuel the nonrenewable is the term that in another itself tells you what the policy is excuse me renewal energy tells you what the policy is we want to use renewal energy as a strategic decision to make more energy available in the american market that won't make us dependent on foreign sources that won't make us dependent on depleted fossil fuel sources and we even within our country so if you don't do the multi tiered you're not going to encourage the renewable energy by doing that the intent was to encourage the renewable energy now i've already downed less than my five minutes and i'm going to use another minute or so because i want to make another point i don't know if we get past this point they keep using the term market concepts in their terms you cannot have market concepts and of what it costs at the same time some possible of what it cost me what it cost you market says what the market will bear that's why businesses go out of business when you have a free market because they can't get their costs recovered when somebody is able to do it cheaper than that when you start talking about market you are already talking about something that is not just where did it cost you and you got to pay what it cost you regardless of the markets and this market concept is what is in is also undermining the deal voided cost as a as us as a floor is not a pure market concept that was because the statute sort of determines that a certain percentage will or mandates of certain percentage we you interview you will be renewable energy but not all of correct but the point regulated market correct but when you're just talking about of what it costs you're still talking about what were your costs not what it might cost me i mean the only thing that the market comes into that is you might use the market to figure out what it would cost for that in a multi tiered for that particular item but you don't talk about the market cost of the energy you talk about the market cost of the capital cost so that's a distinction i'm going to let it run down to two minutes and i'll say that for the for the rebuttal i don't know if we'll get past all these problems in get to the remedy that was dismissed under the motion to dismiss but it is one of the supreme ironies in this case is that in our first appeal we lost our forty two u s c nine hundred eighty three arguments because there was a comprehensive remedy comprehensive remedy to bounce us out of nine hundred eighty three and now we don't have any remedies whatsoever virtually beyond just asking this court to order the district court to order p u c to order the utilities to follow the  good morning your honor his name please the court costing him and for the california public utilities commission your honor so i think it will be helpful to clarify the law on purpose and to answer judg against the generation generated on their rooftops that any excess energy delivered to the utility and it's only if there is any excess energy delivered to the utility that cost of energy on the day had market i mean the times of seven am and five pm and these are the times that would be expected that rooftop solar generators would be expected to deliver the sea also found and the district court correctly found that there is really no capacity value that these rooftop solar generators offer to the utility that's because under the number program  the size of the rooftop generator is supposed to match the expected demand of that customer and that's based on that customer's actual history of taking from the utility that being the case there's very little expectation that that customer would deliver any excess electricity to the utility so speaking about avoided cost rates just taking a step back here the united states supreme court and this court in one thousand nine hundred four in the case of independent energy producers association found that the c p u c is entitled to broad discretion to set avoided cost prices rate making is an area that is very fact specific and it's an area where even for itself a rate making authority is reluctant to second guess states when states set avoided cost price the cost data that a utility is required to provide and that avoided cus rates should be based on the utilities costs that's true in part if you read the definition of avoided cost und nation it does speak about the cost that the utility of voids paying an alternative energy source i e from a third party generator or the costs a utility voids when it builds its own it's either or it can it can be it can be either one historically the utilities had been the primary owners of generation resources with deregulation and with the federal energy regulatory commission  toward deregulation utilities have become less and less players owners of generating facilities in the market it is true that  designed to accomplish two primary things to reduce the nation's reliance on fossil fuels and to promote the the new construction of small power production or q us these are often renewable generators now the numbers in california bear out california's commitment to purpose and success in implementing purpose so the commission found for instance by the early ninety's there were six hundred contract perfectly contracts the three largest electric utilities in california had been committed to by the early ninety's even though california was responsible for one third of the energy demand in the west eighty five percent of q f capacity under contract in the west was in california in terms of promoting the developer development of small power production the record demonstrates that by year end two thousand and fifteen there were over six hundred thousand customers although not in the record more recent legislative reports demonstrate that at the present time there are approximately eight hundred and twenty five thousand name customers in california can overlap some degree and the state has purple programs which we have that are discussed in the district court's order that are part of the renewables portfolio standard for instance the remote program avoided cost issue ok here if we're talking about avoided cost as i understand you were looking at the cost but the menu that the utility avoids cross if a state like california has or has then r p s and they're required to get a certain amount of energy that's alternative energy as it as a general matter for has determined that avoided cost pricing should be based on all sources available to the utility including fossil fuel generation and that was the subject matter in in the order that cares council has referred to that is the first order c p u see if it's entitled c p c it's one thirty three for sixty one zero five to come up with an alternative avoided cost pricing where there is actually a segment of procurement that's imposed on the utilities and in that case the state of health the state legislature said we want you to really target highly efficient cogeneration and the c p c requested that for interpret that language all source available to a utility to need in the case of this segment of procurement to refer only to that kerman which is the highly efficient cogeneration so going back to the broad discretion afforded states states can choose as being mandatory but with the opinion was somewhat duplicitous was because you know the purpose of purple was not altogether to encourage renewable energy but it's certainly focused on the development of renewable energy and so you know we can read it both ways can't i think you have to read purple but in this with this image heinously and challenging goals in conjunction with each other it is a challenge it has been very difficult we have been involved in decades of litigation but states states like california have been successful highly successful in promoting queue up development and in small power production that is really knoebels it is not always used not always using purpose but so i think there's there's two things that we have to consider here one is in general the utilities have to meet certain targets it could be meeting the renewables portfolio standard which for the most part is done outside of the context of purpose because the generators that are participating there mostly are non human us so that is consistent with the first statement that avoid a cost price and should be based on all sources available to the utility in the now i'm kind text where i look you have or a facility that delivers a net excess of electricity to the excuse me sorry so ok this is a complicated it is very complicated because there are very complicated case then the next increment of in the known context the next increment of procurement that the utility would be otherwise avoiding by taking this excess electricity is actually so de minimus and it will happen on a moment's notice because like i said the facility is sized to meet the demand of the customer there's no expectation that utility would have to go out and procure any excess electricity to serve that customer's needs when it does avoided cost to a q f for part of the part part of the alternative energy that is required to be purchased by the state like in california under their r f s but that we should be able to get with what the utility would have to pay to get that alternative schools and let me explain when an end customer is generating solar on its rooftop the utility doesn't get credit to meet its r p s schools it is just reducing customer demand by reducing customer demand the utility commensurately reduces its overall procurement requirements to meet its overall r p s portfolio targets secondly for the most part as i mentioned a utilities procurement of renewable power to meet its r p s goals does not happen in the context of them in part because which the state of california does with multiple per programs not just one as is the case in many states not too there's three presently we could put those forward in our  briefs the c p c presently has another rule making open at the present time it's not in the record here but it is to design another avoided cost contract i do want to address your honor's the issue of two issues appellants counsel has talked about the lack of remedies available to two q s such as themselves except in federal court purposed self talks about a dual right dual enforcement scheme there are perfect implementation claims which this case is there are also as applied plans implementation claims go to a state's implementation of purpose and whether or not the states are properly taking the basic guidelines that are contained in the first regulations and designing their programs consistent with those regulations those are perfect implementation claims and those plans belong in federal court there are as applied claims and those belong in state court so if a utility is actually not complying with the state's implementation rules that you can take the utility to state court and seek relief there are ample we're taking you over your time so little i'm sorry to have any  i think the question about whether or not in theory the name for customers are required to produce if you they want to boast about having six hundred thousand and now eight hundred fifty thousand you're no longer dependent on whether just one would stop doing it you're talking about whether eight hundred fifty thousand would suddenly zero out and that's not going to happen and they all know that but more importantly the record is clear that my clients try to get a contract which would have bound them to provide their energy they were forced into now am if they for some reason the court stated that they were and they could have gotten a contract and he didn't but the record is clearly established that they try try try it and were denied it so they can't make that argument given that refusal of the utility to give them the q f contract that they wanted which would have made them bound to provide the energy and then go back to the large scale of the six hundred to eight hundred fifty thousand brings us to a different matter secondly we laid out our response the facts that we laid out about their various programs at pages twenty two through twenty five of our opening brief we went through them line by line chart by chart why they were not including the cap asadi she's me capital costs in the end they practically admitted they're just saying they don't have to do it but i do think they are required at least when they want to take it presented as being a program for renewable energy they have to count the costs that would be to replace the energy of those eight hundred fifty thousand they want to say now that's what they have to establish they have failed to do that one last thing purple was amended in two thousand and eight because of their claims they said they're doing a wonderful job purple was amended so that the avoided cost requirement wasn't there anymore for the ones above twenty megawatts and just left it with the smaller ones so they got the relief that they wanted for doing a great job but the congress decided not to change it for the smaller ones and that needs to stay the law today thank you i thank you very much complicated interesting case