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### STATE OF MICHIGAN

COURT OF APPEALS

_________________________________________ In re Application of D ETROIT EDISON COMPANY to Increase Rates.

DAVID SHELDON,

Appellant, UNPUBLISHED July 21, 2015

v No. 319194 MPSC MICHIGAN PUBLIC SERVICE COMMISSION, LC No. 00-015768

Appellee,

and

DETROIT EDISON COMPANY,

Petitioner-Appellee.

Before: R ONAYNE K RAUSE , P.J., and M URPHY and S ERVITTO , JJ.

P ER C URIAM

. Appellant David Sheldon, appeals as of right from an order of the Michigan Public Service Commission (PSC) allowing Detroit Edison Company (Ediso n) to begin deployment of its Advanced Meter Infrastruct ure (AMI) program. We affirm. 1

Edison began the implementation of a “smart grid” system sever al years ago. A smart grid system uses improvements to technology to increase the rel iability of the electric grid. The AMI system is one component of a smart grid system. An AMI sys tem records power

1 Appellant argues that he has standing to bring this appeal bec ause he was aggrieved by the PSC’s order. We agree. The fact that appellant seeks to raise issues that the PSC found to be beyond the scope of the remand does not mandate a conclusion th at appellant is not a party in interest and lacks standing t o bring this appeal. MCL 462.26(1 ).-2- consumption data in near-real-t ime, and reports usage to the ut ility at frequent intervals. An AMI meter is also known as a smart meter.

The PSC approved a rate increase and a continuation of Edison’ s pilot program to implement an AMI system in its service territory. In In re Applications of Detroit Edison Co
, 296 Mich App 101; 817 NW2d 630 (2012), this Court affirmed in p art, reversed in part, and remanded for further proceedings. This Court found that the PS C’s decision to approve funding for Edison’s AMI program “was not supported by competent, mater ial, and substantial evidence on the whole record.” Id . at 114 (quotation marks and citations omitted). This Court s tated:

On the record before the PSC and, perforce, before us, the PSC’ s decision was erroneous. Accordingly, we remand this matter for the PSC to c onduct a full hearing on the AMI program, during which it will consider, amon g other relevant matters, evidence related to the benefits, usefulness, and pote ntial burdens of the AMI, specific information gleaned from pilot phases of the prog ram regarding costs, operations, and customer response and impact, an assessm ent of similar programs initiated here or in other states, risks associated wi th AMI, and projected effects on rates. In o ther words, a real record, wit h solid evidence, should support whatever decisi on the PSC makes on remand. [ Id . at 116.]

Appellant filed a petition to i ntervene in the case on remand, noting that this Court remanded the case to the PSC for, among other things, the risks and potential burdens associated with the AMI program. Appellant contended that he and other pe rsons who might have sought to intervene when the case was o riginally filed did not have a fair opportunity to do so because the public notice did not make clear that Edison “was, in effec t, seeking approval from the Commission for a radically new technology that will intimately and directly impact the lifestyles of all customers.”

The Administrative Law Judge (AL J) denied appellant’s petition to intervene, finding that the original public notice was sufficient, that the petiti on to intervene was untimely because this proceeding was a continuati on of the original case and not a new matter, that no good cause existed for the failure to intervene for more than three years, and that the scope of the issues addressed in appellan t’s petition were be yond the scope of the Court of Appeals’ remand.

The PSC affirmed the denial of the petition to intervene, find ing that the petition was untimely and that the issues on remand were to be limited in or der to respond to the Court of Appeals’ remand order.” The PSC noted that two other potential intervenors had been admitted as parties in another case, and would have an opportunity to ra ise issues of health, privacy, and other concerns voiced by persons who did not wish to receive an AMI meter in that case. 2

2 In In re Application of Detroit Edison Company to Implement Opt Out Program , unpublished per curiam opinion of the Court of Appeals, issued February 19, 2015 (Docket Nos. 316728, 316781), this Court addressed issu es raised by these and other intervenors, and found the issues to be without merit or beyond the scope of the proceeding.-3- The PSC entered an order finding that the costs of Edison’s AM I pilot program were just and reasonable, and granting Edison’ s request to recover those costs.

The standard of review for PSC or ders is narrow and well defin ed. Pursuant to MCL 462.25, all rates, fares, charges, c lassification and joint rat es, regulations, pract ices, and services prescribed by the PSC are presum ed, prima facie, to be lawful a nd reasonable. Michigan Consol Gas Co v Public Serv Comm , 389 Mich 624, 635-636; 209 NW2d 210 (1973). A party aggrieve d by an order of the PSC has t he burden of proving by clear and c onvincing evidence that the order is unlawful or unreasonable. MCL 462.26(8). To establish that a PSC order is unlawful, the appellant must show that the PSC “failed to follow some mandato ry provision of the statute or was guilty of an abuse of discre tion in the exercise of its jud gment.” In re MCI Telecom Complaint , 460 Mich 396, 427; 596 NW2d 164 (1999) (citations and quotati ons omitted). “[A]n order is unreasonable if it is not supported by the evidence.” In re Complaint of Consumers Energy Co. , 255 Mich App 496, 501, 660 NW2d 785, 787 (2002).

A final order of the PSC “must be authorized by law and be sup ported by competent, material, and substantial eviden ce” on the whole record. Const 1963, art 6, § 28; Attorney General v Public Serv Comm , 165 Mich App 230, 235; 418 NW2d 660 (1987).

“This Court gives due deference to the PSC’s administrative ex pertise and is not to substitute its judgment for that of the PSC.” Attorney General v Public Serv Comm No 2 , 237 Mich App 82, 88; 602 NW2d 225 (1999). We give respectful consi deration to the PSC’s construction of a statute that the PSC is empowered to execute, and we will not overrule that construction absent cogent reasons. If the language of a statu te is vague or obscure, the PSC’s construction serves as an aid to determining the legislative in tent, and will be given weight if it does not conflict with the langua ge of the statute or the purpo se of the Legislature. However, the construction given to a statute by the PSC is not binding on us

. In re Complaint of Rovas Against SBC Mich , 482 Mich 90, 103-109; 754 NW2d 259 (2008). “Whether the PSC exceeded the scope of its authority is a question of law that we review de novo.” In re Complaint of Pelland Against Ameritech Mich , 254 Mich App 675, 682; 658 NW2d 849 (2003).

We review de novo the question whether a lower court followed an appellate court’s ruling on remand. Schumacher v Dep ’ t of Natural Resources , 275 Mich App 121, 127; 737 NW2d 782 (2007).

On appeal, appellant argues that the PSC erred by concluding t hat the scope of this Court’s remand order was limited to the question of rates assoc iated with Edison’s AMI program. We disagree.

In In re Detroit Edison Co , this Court found that the PSC erred by approving funding for Edison’s AMI project. In re Detroit Edison Co , 296 Mich App at 114. Thi s Court found that the PSC’s decision was not supported by competent, material, and su bstantial evidence on the whole record, and that the evidence Edison produced to support the ra te increase was “aspirational” and that it was “optimistic” and “speculative.” Id . at 114-115. This Court concluded that the PSC could not support a rate increas e “without an informed assessme nt supported by competent, material, and substantial evidence.” Id . at 115. For that reason this Court remanded the case to the PSC for development of the record. Id . at 116. Appellant correct ly notes that this Court-4- made reference to another case in which the PSC sought to addre ss various concerns, including those related to health and privacy, related to AMI meters. Id . at 115 n 3. How ever, no language in the remand order indicates t hat this Court intended to have the parties in this case address all of those same issues on remand. Rather the remand language ind icates that the evidence on which the PSC relied to approve E dison’s rate increase for the AMI program was lacking. Id . at 116. The PSC did not violate the remand order by limiting the scope of the remand proceedings to the issue of the rates to be charged by Edison for the AMI p rogram. No error occurred; thus, appellant’s argument that the PSC’s error was not harmless is m oot.

Finally, appellant argues that the PSC’s authority extended be yond ratemaking in this case because interested parties filed written complaints expres sing concerns about AMI meters. The PSC’s authority to investigate and enter appropriate orders was not constrained by the management prerogatives doctrine. We disagree.

The PSC has broad authority to regulate rates for public utili ties. MCL 460.6a(1). This authority “does not include the power to make management decisi ons” for a public utility. Consumers Power Co v Public Serv Comm , 460 Mich 148, 157-158; 596 NW2d 126 (1999) (PSC lacked authority t o order utilities to transport electrici ty produced and sold by other utilities to consumers); Union Carbide Corp , 431 Mich 135, 148-150; 428 NW2d 322 (1998) (PSC lacked authority to forbid the operation of a facility).

MCL 460.58 reads in pertinent part:

Upon complaint in writing that a ny rate, classification, regula tion or practice charged, made or observed by any public utility is unjust, inac curate, or improper, to the prejudice of the complainant, the commission shall proce ed to investigate the matter.

In the past several years munici pal officials and individuals have begun expressing concern about AMI meters. In response, the PSC initiated a cas e and directed regulated electric utilities to submit information regarding the utility’s plans t o deploy AMI meters, etc. The case was not initiated pursuant to a “complaint in writing” as seemi ngly alleged by appellant. The resolutions expressing concer n about AMI meters passed by vario us municipalities were not filed with the PSC and thus did not constitute the type of “complaint in writing” referred to in statutes such as MCL 460.58. Similarly, the comments submitted by indiv iduals when the PSC opened the case for comments did not c onstitute complaints.

Edison initiated this case by s eeking a rate increase and appr oval for continuation of the AMI pilot program. The case was not initiated by the filing of a complaint. No error occurred.

Affirmed.

/s/ Amy Ronayne Krause /s/ William B. Murphy /s/ Deborah A. Servitto