This opinion is subject to revision before final

publication in the Pacific Reporter

2019 UT 43

IN THE

SUPREME COURT OF THE STATE OF UTAH

MONTICELLO WIND FARM, LLC,

Petitioner,

v.

PUBLIC SERVICE COMMISSION OF UTAH,

Respondent.

No. 20180572

Filed August 12, 2019

On Petition for Review of Agency Decision

Attorneys:

Mary Anne Q. Wood, Stephen Q. Wood, Salt Lake City,

for petitioner

Michael J. Hammer, Salt Lake City, for respondent

Public Service Commission

Sean D. Reyes, Att’y Gen., Justin Jetter, Asst. Att’y Gen.,

Salt Lake City, for respondent Division of Public Utilities

Sean D. Reyes, Att’y Gen., Robert J. Moore, Asst. Att’y Gen.,

Salt Lake City, for respondent Office of Consumer Services

R. Jeff Richards, Yvonne R. Hogle, D. Matthew Moscon,

R. Chad Pugh, Salt Lake City, for respondent PacifiCorp d/b/a 

Rocky Mountain Power

JUSTICE PEARCE authored the opinion of the Court in which

CHIEF JUSTICE DURRANT, ASSOCIATE CHIEF JUSTICE LEE,

JUSTICE HIMONAS, and JUSTICE PETERSEN joined.

JUSTICE PEARCE, opinion of the Court:

INTRODUCTION

¶1 PacifiCorp entered into an agreement with Monticello Wind 

Farm, LLC (MWF) for the purchase of wind energy. Under Utah and 

federal law, PacifiCorp and MWF could set the terms for that 

agreement in one of two ways. They could follow the procedure set 
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Opinion of the Court

2

by the Public Service Commission (Commission) and fix pricing 

based on PacifiCorp’s avoided costs; that is, what it would cost 

PacifiCorp to produce the energy itself or obtain it from another 

source. In this event, the Commission, pursuant to its procedure,

would review any executed agreement to ensure it did not exceed 

those costs. Or PacifiCorp and MWF could operate outside the 

Commission’s framework. They could negotiate their own pricing 

terms and contractually limit the scope of the Commission’s review. 

This case requires us to decide which type of contract MWF and 

PacifiCorp signed.

¶2 PacifiCorp submitted the agreement to the Commission for 

approval. The Commission reviewed the pricing to ensure 

consistency with PacifiCorp’s avoided costs. The pricing, however, 

was based on a methodology the Commission had discontinued. 

And the information underlying that methodology had not been 

updated for several years. For those reasons, the Commission 

concluded the pricing could not be deemed consistent with 

PacifiCorp’s avoided costs. The Commission denied the application.

¶3 On appeal, MWF asks us to review the Commission’s order. 

MWF primarily asserts the parties opted out of the Commission’s 

framework and, as a result, the Commission was obligated to 

approve the agreement unless its terms would seriously harm the 

public interest. This case turns on a question of contract 

interpretation and asks what type of contract the parties penned. We 

conclude the agreement was one negotiated within the 

Commission’s framework. And was therefore an agreement the 

Commission could reject if it obligated PacifiCorp to purchase 

energy at a price higher than its avoided costs. The remainder of 

MWF’s challenges are not properly before us and therefore do not 

provide MWF a path to victory. We affirm.

BACKGROUND

¶4 This is not the first time we have seen these parties or been 

asked to weigh in on a conflict between the two. PacifiCorp1 and 

MWF share a contentious history, more fully outlined in an opinion 

_____________________________________________________________

1 PacifiCorp does business in Utah as Rocky Mountain Power. 

PacifiCorp engaged in some conduct relevant to this opinion as 

PacifiCorp and in other conduct relevant to this opinion as Rocky 

Mountain Power. For purposes of this opinion, we do not 

differentiate between the two.
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Opinion of the Court

3

addressing a prior chapter in this litigation.2 See Ellis-Hall Consultants 

v. Pub. Serv. Comm’n, 2016 UT 34, ¶¶ 1–16, 379 P.3d 1270 (Ellis-Hall 

II). We relate only the facts relevant to this stage of the proceedings.

Regulatory Background

¶5 “To encourage the development of alternative energy 

resources, federal law requires a utility to purchase wind energy and 

other forms of alternative power from qualifying facilities at its 

avoided cost—what it would have cost the utility to generate the 

power itself or purchase it from another source.”3 Ellis-Hall II, 2016 

UT 34, ¶ 3 (footnote omitted) (citing 16 U.S.C. § 824a–3; 18 C.F.R. 

§ 292.101). The Federal Energy Regulatory Commission prescribes 

rules governing these transactions, including rules ensuring that the 

rates for such purchases “shall be just and reasonable to the electric 

consumers of the electric utility and in the public interest.”4 16 U.S.C.

_____________________________________________________________

2 In the earlier litigation, Ellis-Hall Consultants was the entity 

embroiled in a dispute with PacifiCorp. See Ellis-Hall Consultants v. 

Pub. Serv. Comm’n, 2016 UT 34, ¶¶ 1–2, 379 P.3d 1270. Based on the 

record before us, it is our understanding that Ellis-Hall Consultants 

is the parent, owner, and developer of MWF. For purposes of this 

opinion, we do not distinguish between the two.

3 Under our state code, a “qualifying power production facility” 

is a facility that “produces electrical energy solely by the use . . . of 

biomass, waste, a renewable resource, a geothermal resource, or any 

combination of the preceding sources;” “has a power production 

capacity that . . . is no greater than 80 megawatts;” and “is a 

qualifying small power production facility under federal law.” UTAH 

CODE § 54-2-1(25). Whether MWF is a qualifying facility is not at 

issue in this proceeding.

4 “Under the Federal Power Act, 16 U.S.C. § 791a et seq., the 

Federal Energy Regulatory Commission (‘FERC’) is responsible for 

regulating ‘public utilities’ that offer electric power in interstate 

commerce.” Crossroads Cogeneration Corp. v. Orange & Rockland Utils., 

Inc., 159 F.3d 129, 132 (3d Cir. 1998) (emphasis omitted). And “in

1978, Congress modified the Federal Power Act by enacting the 

Public Utility Regulatory Policies Act (‘PURPA’), 16 U.S.C. § 823a et 

seq.,” to “control power generation costs and ensure long-term 

economic growth by reducing the nation’s reliance on oil and gas 

and increasing the use of more abundant, domestically produced 

fuels.” Id. (emphasis omitted) (citation omitted). Under PURPA, 

FERC prescribes rules “to encourage cogeneration and small power 

(continued . . .)
MONTICELLO WIND FARM v. PSC

Opinion of the Court

4

§ 824a–3(a), (b)(1). And state regulatory agencies are required to 

implement those rules. Id. § 824a–3(f)(1).

¶6 The Utah Code contains similar provisions.5 Utilities are 

required to “offer to purchase power from qualifying power 

producers.” UTAH CODE § 54-12-2(1). And pursuant to section 54-12-

2, the terms for agreements between utilities and qualifying facilities 

are set in one of two ways. Under subsection (2), the Commission 

creates the process for determining the agreement’s terms and 

conditions, including the power purchase rates: “The commission 

shall establish reasonable rates, terms, and conditions for the 

purchase or sale of electricity or electrical generating capacity, or 

both, between a purchasing utility and a qualifying power 

producer.” Id. § 54-12-2(2).

¶7 “In establishing these rates, terms, and conditions, the 

commission shall either establish a procedure under which 

qualifying power producers offer competitive bids . . . or devise an 

alternative method which considers the purchasing utility’s avoided 

costs.” Id. And Utah law defines “avoided costs” in the same manner 

as federal law—the cost to the utility of generating the power itself 

or purchasing it from another electrical corporation. See id. § 54-2-

1(1). Thus, under subsection (2), a utility fulfills its must-purchase 

obligation by agreeing to purchase power from a qualifying facility 

in accordance with the terms, conditions, and methodology the 

Commission sets.

¶8 Under subsection (3), in contrast, the Utah Code provides 

for contracts formed outside of the Commission’s framework. See id.

§ 54-12-2(3). Rather than agreeing to the purchase or sale of power 

pursuant to the Commission’s process and conditions, a utility and 

 

production,” which “require electric utilities to offer to” “purchase 

electric energy” from “qualifying cogeneration facilities and 

qualifying small power production facilities.” 16 U.S.C. § 824a3(a)(2).

5 Utah Code section 54-12-1 codifies the legislature’s intent to, 

e.g., “promote the more rapid development of new sources of 

electrical energy,” “remove unnecessary barriers to energy 

transactions involving independent energy producers and electrical 

corporations,” “encourage the development of independent and 

qualifying power production and cogeneration facilities,” and 

“promote a diverse array of economical and permanently sustainable 

energy resources in an environmentally acceptable manner.” 
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Opinion of the Court

5

qualifying facility may reach an agreement on their own terms. See 

id. And they may set the pricing: “Purchasing utilities and qualifying 

power producers may agree to rates, terms, or conditions for the sale 

of electricity or electrical capacity which differ from the rates, terms, 

and conditions adopted by the commission under Subsection (2).” Id.

¶9 Subsection (3) thus mirrors a federal regulatory provision 

addressing “the regulation of sales and purchases between 

qualifying facilities and electric utilities.” See 18 C.F.R. § 292.301(a).

The federal regulation provides that “[n]othing in this subpart . . . 

[l]imits the authority of any electric utility or any qualifying facility 

to agree to a rate for any purchase, or terms or conditions relating to 

any purchase, which differ from the rate or terms or conditions 

which would otherwise be required by this subpart.” Id. 

§ 292.301(b)(1).

¶10 Section 54-12-2 does not further define the Commission’s 

role with respect to these agreements. It merely provides that “[t]he 

commission may adopt further rules which encourage the 

development of small power production and cogeneration facilities.” 

UTAH CODE § 54-12-2(4). But other provisions of state law vest the 

Commission with “power and jurisdiction to supervise and regulate 

every public utility in this state,” “to supervise all of the business of 

every such public utility in this state, and to do all things, whether 

herein specifically designated or in addition thereto, which are 

necessary or convenient in the exercise of such power and 

jurisdiction.” Id. § 54-4-1. And state law requires that “[e]very public 

utility shall . . . provide . . . service . . . as will be in all respects 

adequate, efficient, just and reasonable,” and that “[a]ll rules and 

regulations made by a public utility affecting or pertaining to its 

charges or service to the public shall be just and reasonable.” Id. § 54-

3-1.

¶11 Under this framework, the Commission thus administers 

the state and federal laws requiring utilities to purchase power from 

qualifying facilities. Ellis-Hall Consultants, LLC v. Pub. Serv. Comm’n, 

2014 UT 52, ¶ 21, 342 P.3d 256 (Ellis-Hall I). Accordingly, “[t]he 

Commission establishes the methodology for determining avoided 

cost. It also promulgates regulatory tariffs establishing the rules for 

the negotiation and approval of power purchase agreements.” EllisHall II, 2016 UT 34, ¶ 3. And, as noted above, the Commission 

operates under “a statutory mandate to set a rate that is in the public 

interest.” Ellis-Hall I, 2014 UT 52, ¶ 21 (citation omitted).

¶12 In our earlier opinion, we addressed the regulatory process 

the Commission used in its administration of must-purchase 
MONTICELLO WIND FARM v. PSC

Opinion of the Court

6

agreements. Ellis-Hall II, 2016 UT 34, ¶¶ 1–16, 34–42. We examined 

the Commission’s regulatory tariff Electric Service Schedule No. 38

(Schedule 38), which governs negotiations between a qualifying 

facility and PacifiCorp. Id. ¶ 4. And as we noted there, under 

Schedule 38, a party seeking to enter into a power purchase 

agreement with PacifiCorp must first request and obtain “indicative 

pricing,” which “is aimed at allowing the producer to make 

determinations regarding project planning, financing, and 

feasibility.” Id. ¶¶ 1, 5 (citation omitted) (internal quotation marks 

omitted). PacifiCorp is required to provide indicative pricing to a 

qualifying facility “once the facility submits certain information 

regarding a proposed project.” Id. ¶ 5. After a party receives the 

indicative pricing, that party should take “specific subsequent steps 

[identified by the Commission] . . . to be entitled to receive a draft 

power purchase agreement and to proceed toward final 

negotiation.” Id. ¶ 6.

Prior Litigation

¶13 Sometime in 2012 or early 2013, MWF requested indicative 

pricing from PacifiCorp. Id. ¶¶ 2, 9. At that time, the Commission 

authorized “a ‘market proxy’ methodology for determining the 

avoided cost for wind power projects.” Id. ¶ 8. And in early 2013, 

MWF received indicative pricing based on that methodology. Id.

¶ 12.

¶14 But before MWF executed a power purchase agreement 

with PacifiCorp, the Commission changed its approach. Id. The 

Commission issued an order discontinuing use of the market proxy 

method in favor of a new method, “which allowed [PacifiCorp] to 

determine its avoided cost based on current energy production cost 

rather than the cost of the most recently executed proposal” for the 

supply of wind energy. Id. ¶¶ 8, 12. “This new methodology was 

expected to lower [PacifiCorp’s] avoided costs.” Id. ¶ 12.6 PacifiCorp 

then rescinded its indicative pricing proposal with MWF “on the 

ground that the [Commission] had since issued an order adopting a 

new pricing methodology.” Id. ¶ 2.

¶15 MWF challenged PacifiCorp’s decision. Id. The Commission 

denied the challenge. Id. We reversed. Id. In Ellis-Hall II, we reviewed 

_____________________________________________________________

6 As we noted in Ellis-Hall II, “This seems to be undisputed. . . . 

[MWF] asserts” it would not be “economically feasible for [MWF] to 

proceed under the new methodology.” 2016 UT 34, ¶ 12 n.2.
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Opinion of the Court

7

Schedule 38’s provisions setting out the process by which a 

qualifying facility may obtain indicative pricing from PacifiCorp. Id.

¶¶ 4–7. We also examined two orders the Commission issued that 

are relevant to that process, including the “Phase Two” order 

providing that the market proxy method would be discontinued. Id.

¶¶ 11–12, 34–42. And we concluded that MWF was “not required to 

submit a request for new indicative pricing.” Id. ¶ 43. MWF was 

“entitled to proceed in reliance on the methodology set forth in the 

indicative pricing proposal it received from [PacifiCorp].” Id. In so 

holding, we opined that those documents “yield a right to a wind 

power developer to rely on the methodology set forth in the 

‘indicative pricing proposal’” it had received from PacifiCorp. Id.

¶ 37. 

¶16 We explicitly and pointedly did not reach other conclusions

about the process. We expressly left open whether MWF would have 

“a right to require [PacifiCorp] to enter into a power purchase 

agreement” and whether the Commission would be “require[d] . . . 

to approve such an agreement.” Id. ¶ 44. “Those questions [were] not 

properly presented for our review,” and we “decline[d] to reach 

them.” Id. We likewise concluded that the scope of PacifiCorp’s 

discretion, if any, not to enter into such an agreement was “not 

properly presented” for resolution. Id. ¶¶ 45–46.

¶17 Moreover, we expressly left unresolved the Commission’s 

assertion that any agreement reached on “a now-outdated indicative 

pricing proposal [would] ultimately be thwarted by an inevitable 

decision by the Commission to decline to approve a power purchase

agreement based on such methodology.” Id. ¶ 47. “The Commission 

ha[d] not as yet declined to approve a power purchase agreement,”

and we declined “to offer an advisory opinion on a matter that [was] 

not yet ripe for our review.” Id.

¶18 Accordingly, we reiterated that “we [were] in no position to 

decide whether [MWF] ha[d] an ultimate right to enter into a power 

purchase agreement with [PacifiCorp] or to secure approval from the 

Commission.” Id. ¶ 48. We concluded only that, “for now,” MWF 

was “entitled . . . to rely on the indicative pricing proposal it was 

provided” and “ha[d] no obligation to submit a request for new 

indicative pricing as it move[d] forward in negotiations over a 

power purchase agreement with [PacifiCorp].” Id.

Revisions to Schedule 38

¶19 Nearly a year before we issued our opinion in Ellis-Hall II, 

and while that case was pending before this court, the Commission 

revised Schedule 38 (Revised Schedule 38). See Rocky Mountain Power 
MONTICELLO WIND FARM v. PSC

Opinion of the Court

8

Electric Service Schedule No. 38 (2015).7 Before the revision, Schedule 

38 did not include a specified timeframe for the expiration of 

indicative pricing proposals. See Rocky Mountain Power Electric Service 

Schedule No. 38 (2012).8

¶20 In addition, Schedule 38 stated that “such prices are merely 

indicative and are not final and binding.” Id. I.B.3. Schedule 38 

further provided: “Prices and other terms and conditions are only 

final and binding to the extent contained in a power purchase 

agreement executed by both parties and approved by the 

Commission.” Id.

¶21 Following the changes, however, Revised Schedule 38 

included a set six-month timeframe for the parties to execute a 

power purchase agreement using a particular pricing proposal. “The 

prices in the proposed power purchase agreement . . . shall be 

recalculated . . . using the most recent available pricing inputs and 

methods approved by the Commission” if a power purchase 

agreement has not been executed “within six (6) months after 

indicative pricing was provided.” Rocky Mountain Power Electric 

Service Schedule No. 38 I.B.9 (2015).

¶22 Revised Schedule 38 retained language indicating that 

pricing is not final and binding until “contained in a power purchase 

agreement executed by both parties and approved by the 

Commission.” Id. I.B.4. And it expressly authorized the Commission 

to “at any time make changes to this Schedule, [qualifying facility] 

pricing methods and inputs, or terms and conditions applicable to 

[qualifying facility] pricing and power purchase agreements.” Id.

_____________________________________________________________

7 See UTAH PUB. SERV. COMM’N, DOCKET NO. 15-035-T10 (In the 

Matter of Rocky Mountain Power’s Filing to Comply with the 

Commission’s Order Issued on June 9, 2015, in Docket No. 14-035-140);

UTAH PUB. SERV. COMM’N, DOCKET NO. 14-035-140 (In the Matter of the 

Review of Electric Service Schedule No. 38, Qualifying Facilities 

Procedures, and Other Related Procedural Issues).

8 See UTAH PUB. SERV. COMM’N, DOCKET NO. 12-035-T14 (In the 

Matter of Tariff Revisions in Compliance with the Commission’s Report 

and Order in Rocky Mountain Power’s 2012 General Rate Case, Docket 11-

035-200 dated September 19, 2012 . . . .); UTAH PUB. SERV. COMM’N,

DOCKET NO. 11-035-200 (In the Matter of the Application of Rocky 

Mountain Power for Authority to Increase Its Retail Electric Utility 

Service Rates in Utah and for Approval of Its Proposed Electric Service 

Schedules and Electric Service Regulations).
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Opinion of the Court

9

Current Dispute

¶23 We issued our opinion in Ellis-Hall II in July of 2016. More 

than a year later, in late 2017, MWF and PacifiCorp entered into a 

power purchase agreement (PPA). In that agreement, MWF 

expressed its intent to operate as a qualifying facility. And 

PacifiCorp agreed to purchase the wind energy MWF generated as 

well as any associated green tags.9

¶24 The PPA provided that “[t]he rates, terms[,] and conditions 

in [the PPA] [were] in accordance with the rates, terms, and 

conditions approved by the Commission in Docket No. 03-035-14 for 

purchases from Qualifying Facilities.” That docket includes several 

orders issued by the Commission between 2003 and 2013, including 

the Commission’s 2005 order “resolv[ing] differences . . . regarding 

methods by which . . . indicative prices are determined for the 

purpose of negotiating agreements pursuant to Schedule No. 38.” See 

UTAH PUB. SERV. COMM’N, DOCKET NO. 03-035-14 (In the Matter of the 

Application of PacifiCorp for Approval of an IRP-based Avoided Cost 

Methodology for QF Projects Larger than One Megawatt), Oct. 31 2005 

Report and Order, at 7. In that order, the Commission approved the 

“market price proxy [method] for determination of avoided costs” 

for certain wind facilities “up to [PacifiCorp’s] . . . target megawatt 

level of wind resources.” Id. at 33.

_____________________________________________________________

9 Generally speaking, a green tag or “renewable energy 

certificate, or REC . . . , is a market-based instrument that represents 

the property rights to the environmental, social and other non-power 

attributes of renewable electricity generation. RECs are issued when 

one megawatt-hour (MWh) of electricity is generated and delivered 

to the electricity grid from a renewable energy resource.” Green 

Power Partnership, EPA, https://www.epa.gov/greenpower/

renewable-energy-certificates-recs (last visited August 5, 2019).

Along those lines, the PPA defined “green tags” as “(a) the 

Environmental Attributes associated with all Output, together with 

(b) the Green Tag Reporting Rights associated with such energy and 

Environmental Attributes, however commercially transferred or

traded under any or other product names, such as ‘Renewable 

Energy Credits,’ ‘Green-e Certified,’ ‘Carbon Credits[,]’[] or 

otherwise. One Green Tag represents the Environmental Attributes 

made available by the generation of one MWh of energy from 

[MWF].”
MONTICELLO WIND FARM v. PSC

Opinion of the Court

10

¶25 The PPA also expressly provided that it would not become 

effective until the Commission approved it: “This Agreement shall 

become effective when it is executed and delivered by both Parties 

and has been approved by the Commission . . . .”

¶26 And in a provision addressing the rights of the parties if 

PacifiCorp were to default, the PPA provided that MWF could “seek 

a new power purchase agreement with PacifiCorp . . . , though 

PacifiCorp shall not be obligated to provide in such power purchase 

agreement avoided cost prices that are higher than the avoided cost 

prices contained in this Agreement.”

¶27 In addition, the PPA included a Mobile-Sierra clause, 

providing that the power purchase rates would “remain in effect . . . 

absent agreement of the parties” and that “the standard of review for 

changes hereto . . . shall be the ‘public interest’ application of the 

‘just and reasonable’ standard . . . set forth” in federal case law:10

Rates Not Subject to Review. The rates for service 

specified herein shall remain in effect until expiration 

of the Term, and shall not be subject to change for any 

reason, including regulatory review, absent agreement 

of the parties. Neither Party shall petition FERC 

pursuant to the provisions of Sections 205 or 206 of the 

Federal Power Act (16 U.S.C. § 792 et seq.) to amend 

such prices or terms, or support a petition by any other 

person seeking to amend such prices or terms, absent 

the agreement in writing of the other Party. Further, 

absent the agreement in writing by both Parties, the 

standard of review for changes hereto proposed by a 

Party, a non-party or the FERC acting sua sponte shall 

be the “public interest” application of the “just and 

reasonable” standard of review set forth in United Gas 

Pipe Line Co. v. Mobile Gas Service Corp., 350 U.S. 332 

(1956) and Federal Power Commission v. Sierra Pacific 

_____________________________________________________________

10 As the United States Supreme Court has explained, “Under 

th[e] Court’s Mobile–Sierra doctrine, FERC must presume that a rate 

set by a freely negotiated wholesale-energy contract meets the 

statutory just and reasonable requirement” applicable to such 

contracts. NRG Power Mktg., LLC v. Me. Pub. Utils. Comm’n, 558 U.S. 

165, 167 (2010) (citation omitted) (internal quotation marks omitted). 

“The presumption may be overcome only if FERC concludes that the 

contract seriously harms the public interest.” Id. (citation omitted).
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Opinion of the Court

11

Power Co., 350 U.S. 348 (1956) and clarified by Morgan 

Stanley Capital Group. Inc. v. Public Util. Dist. No. 1 of 

Snohomish, 554 U.S. 527, 128 S. Ct. 2733 (2008).

¶28 Finally, the PPA included a provision indicating that it 

constituted the “entire agreement” between the parties: “Entire 

Agreement[:] This Agreement supersedes all prior agreements, 

proposals, representations, negotiations, discussions or letters, 

whether oral or in writing, regarding the subject matter hereof. No 

modification hereof shall be effective unless it is in writing and 

executed by both Parties.”

¶29 PacifiCorp submitted the PPA in an application to the 

Commission, requesting an order approving the PPA and finding

the terms “just and reasonable and in the public interest.” The 

application noted that “PacifiCorp is obligated to purchase power 

from qualifying facilities,” and “[i]n accordance with” Ellis-Hall II, 

“the [PPA] uses the proxy method for pricing the energy produced” 

by MWF.11

¶30 MWF intervened in the proceeding. Two other entities also 

made appearances,12 each arguing that the application should be 

denied. The Division of Public Utilities (DPU) moved for summary 

judgment asserting the PPA did not comply with Revised Schedule 

38’s timelines. And the Office of Consumer Services (OCS) moved 

for summary judgment asserting the avoided cost calculations 

_____________________________________________________________

11 To the extent PacifiCorp’s application suggests that, under 

Ellis-Hall II, PacifiCorp was obligated to purchase power in 

accordance with indicative pricing it had provided under the 

Commission’s market proxy methodology, we note that issue is not 

directly before us. And that conclusion implicates questions we did 

not resolve, and expressly left open, in Ellis Hall II. See Ellis-Hall II, 

2016 UT 34, ¶¶ 44–48.

12 See UTAH CODE § 54-4a-1(1)(a) (providing that the Division of 

Public Utilities may “appear as a party” and “otherwise participate 

in proceedings before the Public Service Commission”); id. § 54-10a203(2) (providing for the Office of Consumer Services to be 

represented “at a hearing or other proceeding affecting the services, 

rates, or charges of an applicable public utility”); id. § 54-10a-301 

(setting out the Office of Consumer Services’ power and duty to 

advocate positions advantageous to residential and small 

commercial consumers).
MONTICELLO WIND FARM v. PSC

Opinion of the Court

12

contained in the PPA were not timely calculated as required by 

federal regulations. See 18 C.F.R. § 292.304(d) (providing that, with 

respect to qualifying facilities, power purchase rates “shall” be based 

on the purchasing utility’s avoided costs “calculated at the time of 

delivery” or “at the time the obligation is incurred”). PacifiCorp 

stayed mute, taking “no legal position” on the motions and leaving 

MWF to defend the application on its own.

¶31 In response, MWF asserted, in relevant part, that Revised 

Schedule 38 could not be applied retroactively. MWF claimed that 

the Commission lacked authority to apply orders retroactively, both 

as a general principle and in this particular circumstance, because

MWF had, in its own estimation, “submitted every document and 

complied with every provision under Original Schedule 38 before 

[the revised schedule] took effect.” According to MWF, it had 

“begun the Schedule 38 process and would have executed a PPA” 

under the earlier version of Schedule 38 “had PacifiCorp not refused 

to proceed with negotiations . . . under its earlier indicative pricing.”

¶32 In addition, MWF pointed to Ellis-Hall II and asserted it had 

a right to rely on the market proxy methodology for purposes of the 

PPA. MWF also claimed that it had incurred a legally enforceable 

obligation13 with PacifiCorp, prior to execution of the PPA and prior 

to the Commission’s Phase Two order altering the method for 

calculating avoided costs. On those grounds, MWF alleged, the 

Commission could not reject the PPA based on its reliance on the 

market proxy methodology.

¶33 Finally, MWF threw in a reference to subsection (3) of 

section 54-12-2. Citing that provision, MWF briefly asserted that 

_____________________________________________________________

13 Qualifying facilities have the option of providing energy to a 

purchasing utility “pursuant to a legally enforceable obligation.” 18 

C.F.R. § 292.304(d). FERC has explained that “[s]ection 292.304(d) 

and the requirement that a [qualifying facility] can sell and a utility 

must purchase pursuant to a legally enforceable obligation were 

specifically adopted to prevent utilities from circumventing the 

requirement of PURPA that utilities purchase energy and capacity 

from [qualifying facilities].” Cedar Creek Wind, LLC, 137 FERC 

¶ 61006, ¶ 32 (Oct. 4, 2011). “Thus, . . . if the electric utility refuses to 

sign a contract, the [qualifying facility] may seek state regulatory 

authority assistance to enforce the PURPA-imposed obligation on 

the electric utility . . . and a non-contractual, but still legally 

enforceable, obligation will be created . . . .” Id.
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Opinion of the Court

13

PacifiCorp and MWF were “not limited” to the rates, terms, and 

conditions the Commission set, but had “negotiated” their own 

terms, and “nothing in the PPA require[d] the [Commission] to first 

find that the rates, terms, and conditions [were] consistent with any 

order of the [Commission] before approving the PPA.”

¶34 The Commission granted both motions for summary 

judgment. The Commission noted that, for purposes of the parties’ 

agreement, the “prices [PacifiCorp] agree[d] to pay in the PPA are 

the same as those it provided in [its] 2013 Indicative Pricing 

[Proposal].” And the Commission concluded that, “on its face,” the 

application “fails to comply with Schedule 38 and uses outdated 

avoided cost pricing that is not reflective of [PacifiCorp’s] Must 

Purchase Obligation under applicable law.”

¶35 To reach that conclusion, the Commission first noted that 

PacifiCorp sought an order approving the PPA. The Commission 

observed that “[t]he requested relief [was] consistent with Schedule 

38[,] which articulates a requirement for [Commission] approval 

prior to the agreements becoming effective.” The Commission then

opined on its role with respect to approval of the PPA. Citing much 

of the regulatory background noted above, the Commission 

characterized its “primary role” in evaluating the application as 

determining “whether the rates are in the ‘public interest’ and, more 

specifically, do not exceed avoided costs.”

¶36 The Commission then turned to the calculation of avoided 

costs the PPA used. Applying Revised Schedule 38, the Commission 

noted that “avoided cost pricing for [qualifying facilities’] PPAs in 

Utah is ordinarily calculated at the time the [qualifying facility] 

receives indicative pricing, provided the [qualifying facility] enters 

[into] a PPA within six months.” Because MWF did not enter into a 

power purchase agreement within that timeframe, but sought 

approval of an agreement executed in 2017, which incorporated 

pricing methodology discontinued in 2013, the application 

“foreclose[d]” the Commission from “finding the PPA’s pricing 

accurately reflects avoided costs under Schedule 38.”

¶37 And with respect to MWF’s reliance on Ellis-Hall II as a basis 

for those pricing terms, the Commission highlighted the questions 

we expressly left open in that opinion, and concluded that Ellis-Hall 

II did “not necessarily . . . require[]” PacifiCorp to enter into the PPA 

or require that the Commission approve such an agreement. The 

Commission suggested that a contrary interpretation of Ellis-Hall II

would conflict with federal law.
MONTICELLO WIND FARM v. PSC

Opinion of the Court

14

¶38 With regard to “whether [Revised] Schedule 38’s six-month 

time period for execution is applicable to the PPA,” the Commission 

concluded that it “plainly [was].” “There is nothing retroactive about 

applying tariff provisions that have been effective since August 2015 

to a PPA executed in December 2017.”

¶39 But, notably, the Commission also concluded that “it ma[de] 

no difference” which version of Schedule 38 applied. “[N]othing in 

Former Schedule 38 vested a [qualifying facility], who had obtained 

indicative pricing, to compel [PacifiCorp] to enter a contract years 

later based on stale pricing.” The terms of “Former Schedule 38 

expressly provided [that PacifiCorp] ‘will update its pricing 

proposals at appropriate intervals to accommodate any changes to 

[its] avoided-cost calculations.’” (Second alteration in original.) And 

the Commission’s “role in applying Schedule 38 (in any of its 

iterations) and approving PPAs is to ensure . . . [PacifiCorp] pays no 

more than its avoided cost.” Accordingly, the Commission 

concluded, “[w]hether we apply Former Schedule 38 or current 

Schedule 38, we cannot find that [the PPA’s] pricing reflects the 

avoided cost rates [PacifiCorp] must pay to satisfy its Must Purchase 

Obligation.”

¶40 The Commission did not reach any conclusion “as to 

whether MWF may demonstrate a [legally existing obligation] prior 

to the execution of its PPA in December 2017” and left open the 

opportunity for MWF to do so.14 In addition, the Commission did 

not expressly address MWF’s fleeting assertion that under

subsection (3) of section 54-12-2, the Commission could approve the 

PPA even if it did not comply with the Commission’s pricing 

methodology.

¶41 MWF petitioned the Commission for reconsideration and 

rehearing. MWF asserted that by June of 2013, it had established a 

_____________________________________________________________

14 The Commission opened a separate docket “for the purpose of 

adjudicating [MWF’s] assertion that a legally enforceable obligation 

(‘LEO’) existed as of June 25, 2013.” But MWF asked the Commission 

to terminate that docket, explaining that it planned to seek judicial 

review of the Commission order at issue here. In response to MWF’s 

request, the Commission stayed the docket, stating that it would not 

take “further action on the matter . . . until and unless a party 

requests otherwise.” No questions regarding the existence of a 

legally existing obligation have been raised in this proceeding, and 

we do not address that issue here. 
Cite as: 2019 UT 43

Opinion of the Court

15

legally existing obligation with PacifiCorp for the purchase of wind 

energy, and MWF “elected to administer the legally enforceable 

obligation” through the PPA executed in 2017. On that basis, MWF 

asked that the Commission alter its order.

¶42 In support, MWF asserted two claims. First, MWF asked for 

summary approval of the application based on the existence of a 

legally enforceable obligation and a negotiated-rate contract.

According to MWF, the Commission had erred by “rejecting a 

negotiated rate contract that [was] fully[ ]compliant with federal law, 

as the PPA . . . fairly administer[ed] the legally enforceable 

obligation . . . [PacifiCorp] incurred in 2013 to purchase [energy] 

from [MWF] at an avoided-cost rate computed on the Market Proxy 

methodology.” MWF asserted that the PPA—permitting PacifiCorp 

to purchase energy from MWF, obtain the associated green tags, and 

avoid “substantial litigation expenses”—“represent[ed] a resolution 

to a complex case,” and “nothing in federal law” restricted 

PacifiCorp’s “ability to agree to pay . . . a rate in excess of an avoided 

cost proxy methodology.” Therefore, in MWF’s view, “[t]he factual 

record, clearly establishing a legally enforceable obligation was 

incurred on or before June 25, 2013, provide[d] a sufficient basis for 

the [Commission] to summarily approve” the application.

¶43 In the alternative, “[i]f the [Commission] decline[d] to 

summarily affirm the . . . contract that set[] forth the terms and 

conditions by which the legally enforceable obligation . . . [would] be 

administered, then [MWF] request[ed] that the [Commission] grant 

rehearing and issue findings of fact and conclusions of law” in 

MWF’s favor. MWF requested that the Commission conclude, as a 

matter of law, that “[MWF] established a legally enforceable 

obligation on or about June 25, 2013,” that “[a]s of June 25, 2013, 

[PacifiCorp] was obligated to calculate the avoided cost by reliance 

on the Market Proxy methodology,” and that “[PacifiCorp] [was]

obligated to purchase the output from [MWF] pursuant to the terms 

and conditions of [the PPA].”

¶44 In the context of this alternative argument, asserting a 

legally enforceable obligation requiring PacifiCorp to purchase 

power from MWF under the market proxy methodology, MWF 

briefly addressed the Commission’s application of Revised Schedule 

38. “[MWF] request[ed] that the [Commission] reconsider its 

conclusion that the Schedule 38 Tariff put into effect in June 2015 

governs either the negotiated-rate contract voluntarily executed by 

the parties in 2017 or the legally enforceable obligation incurred by 

[PacifiCorp] in June 2013.” MWF claimed the application of Revised 

Schedule 38 constituted an impermissible collateral attack on Ellis-
MONTICELLO WIND FARM v. PSC

Opinion of the Court

16

Hall II and was “arbitrary, capricious, inconsistent with reasoned 

decisionmaking and violate[d] the rule against retroactive 

rulemaking.” MWF did not address the portion of the Commission’s 

order concluding it was inconsequential whether it applied the 

revised or earlier version of Schedule 38.

¶45 The Commission denied MWF’s petition. The Commission 

did not delve into the arguments MWF raised, but stated that “[f]or 

all of the reasons enumerated” in its prior order, the Commission 

“affirm[ed] [its] conclusion that the PPA . . . failed to comply with 

Schedule 38 and employed outdated avoided cost pricing . . . not 

reflective of [PacifiCorp’s] obligation to purchase power from 

qualifying facilities under applicable law.” MWF filed a petition for

review with this court.

STANDARD OF REVIEW

¶46 “[A]gency decisions premised on pure questions of law are 

subject to non-deferential review for correctness.” Ellis-Hall II, 2016 

UT 34, ¶ 27.

ANALYSIS

¶47 MWF raises a number of challenges to the Commission’s 

order denying PacifiCorp’s application for approval of the PPA. 

MWF first asserts PacifiCorp and MWF “had an unambiguous right 

to enter into the PPA without adhering to [the Commission’s] 

regulations regarding avoided costs.” On that basis, MWF claims the 

Commission could reject the PPA’s pricing terms only upon a 

showing that they would seriously harm the public interest. And

according to MWF, no such showing was made. Second, MWF 

asserts the Commission erred in its interpretation and retroactive 

application of Revised Schedule 38. Finally, MWF asserts a number 

of constitutional violations with respect to Revised Schedule 38.

I. MWF Fails to Demonstrate That the PPA’s Pricing

Terms and Avoided Cost Methodology Were Not

Subject to Commission Review and Approval

¶48 The central issue on appeal asks whether the Commission 

exceeded the scope of its authority in reviewing and rejecting 

PacifiCorp’s application for approval of the PPA. And that question 

turns on whether we view the application as containing pricing 

settled on as a result of the parties’ negotiations, pursuant to Utah 

Code section 54-12-2(3), or as dictated by the Commission’s 

regulatory framework, pursuant to Utah Code section 54-12-2(2) and 

Schedule 38. The Commission treated the application as falling into 

the latter category and rejected the application because it did not 
Cite as: 2019 UT 43

Opinion of the Court

17

find the PPA’s pricing terms to be equal to or less than PacifiCorp’s 

avoided costs. For that reason, the Commission did not find the 

PPA’s pricing terms to be in the “public interest.”

¶49 With respect to the kind of contract the parties’ submitted 

and the review it warranted, the Commission explained that it 

reviewed the PPA under a provision of Schedule 38 providing that 

“[p]rices and other terms and conditions” of agreements executed 

between PacifiCorp and qualifying facilities “are only final and 

binding to the extent . . . approved by the Commission.” See Rocky 

Mountain Power Electric Service Schedule No. 38 I.B.4 (2015).15

¶50 This review was appropriate, the Commission explained, 

because PacifiCorp had submitted the PPA to the Commission

requesting an order approving the PPA and finding its terms and 

conditions “just and reasonable and in the public interest.” The 

Commission observed that this “requested relief [was] consistent 

with Schedule 38[,] which articulates a requirement for 

[Commission] approval prior to [an agreement between PacifiCorp 

and a qualifying facility] becoming effective.” And when reviewing 

contracts submitted in accordance with Schedule 38, the Commission 

reasoned, its “primary role is to find whether the rates are in the 

‘public interest’ and, more specifically, do not exceed avoided costs.” 

The Commission thus reviewed the PPA under a Schedule 38 

provision providing for approval of contracts negotiated within that 

framework.

¶51 Schedule 38 outlines the Commission-approved process for 

negotiating power purchase agreements between PacifiCorp and 

qualifying facilities. See Rocky Mountain Power Electric Service Schedule 

No. 38. Under that schedule, a qualifying facility may obtain 

indicative pricing from PacifiCorp and then, based on that pricing, 

proceed toward execution of a final agreement. Id. I.B. PacifiCorp 

calculates indicative pricing based on a Commission-approved 

methodology aimed at capturing PacifiCorp’s avoided costs. See id.

I.B.4. As noted above, Schedule 38 provides that indicative pricing 

_____________________________________________________________

15 In a separate argument, MWF asserts the Commission should 

have reviewed the PPA under an earlier version of Schedule 38. See 

infra ¶ 75. But whether the PPA is subject to Commission review 

pursuant to Schedule 38 does not depend on which version of the 

schedule we reference. And for purposes of our review here, we cite 

to the revised schedule.
MONTICELLO WIND FARM v. PSC

Opinion of the Court

18

does not become final until the parties execute an agreement and the 

Commission approves. Id.

¶52 MWF challenges the Commission’s order, arguing the 

Commission erroneously invoked Schedule 38 as a basis for 

reviewing the PPA. And therefore, according to MWF, the 

Commission applied the wrong type of review. MWF claims that the 

level of review in which the Commission engaged applies only when 

a utility and qualifying facility enter into an agreement incorporating 

the rates, terms, and conditions the Commission specifies in 

Schedule 38. In contrast, when parties operate outside of the 

Commission’s rules and negotiate their own terms, an agreement 

cannot be rejected, MWF asserts, unless its terms would seriously 

harm the public interest or the parties contractually grant the 

Commission greater review authority. According to MWF, 

PacifiCorp and MWF negotiated outside Schedule 38’s framework 

and, as a result, the PPA provides for limited Commission review.

¶53 Utah Code section 54-12-2 lends the backbone of MWF’s 

argument. Subsection (1) provides that “[p]urchasing utilities shall 

offer to purchase power from qualifying power producers.”

¶54 Under subsection (2), the Commission controls the process:

The commission shall establish reasonable rates, terms, 

and conditions for the purchase or sale of electricity or 

electrical generating capacity, or both, between a 

purchasing utility and a qualifying power producer. In 

establishing these rates, terms, and conditions, the 

commission shall either establish a procedure under 

which qualifying power producers offer competitive 

bids for the sale of power to purchasing utilities or 

devise an alternative method which considers the 

purchasing utility’s avoided costs. The capacity 

component of avoided costs shall reflect the purchasing 

utility’s long-term deferral or cancellation of 

generating units which may result from the purchase 

of power from qualifying power producers.

UTAH CODE § 54-12-2(2).

¶55 MWF’s argument focuses on subsection (3), under which a 

qualifying facility and purchasing utility may negotiate their own 

terms. “Purchasing utilities and qualifying power producers may 

agree to rates, terms, or conditions for the sale of electricity or 
Cite as: 2019 UT 43

Opinion of the Court

19

electrical capacity which differ from the rates, terms, and conditions 

adopted by the commission under Subsection (2).” Id. § 54-12-2(3).16

When parties negotiate pricing pursuant to subsection (3), MWF 

asserts, those terms may be set aside by the Commission only upon a 

showing that they seriously harm the public interest, unless the 

parties contractually agree to grant the Commission greater review 

authority.

¶56 MWF’s initial premise is largely undisputed. The 

Commission agrees that PacifiCorp may, and often does, enter into 

power purchase agreements that are not based on the Commission’s 

methodology for calculating avoided costs and are not subject to 

Commission approval for compliance.17 And we agree with MWF

that the parties could operate outside of the Commission’s 

framework and enter into an agreement containing rates, terms, and 

conditions that differ from those the Commission prescribes. Heavily 

contested, however, is whether that is what PacifiCorp and MWF

actually did.

¶57 The problem with MWF’s argument is that it largely ends

here. Having demonstrated that parties may negotiate power 

purchase rates outside of Schedule 38, the next step in MWF’s 

argument would be to establish, as a matter of contract

interpretation, that the parties did exactly that. But in its principal 

brief, MWF takes this issue almost entirely for granted. In other 

words, to paraphrase Dr. Ian Malcolm, MWF’s brief is so 

preoccupied with whether or not it could enter into such an 

agreement, it doesn’t stop to demonstrate that it did.

¶58 With respect to this central question of contract 

interpretation, MWF gives us the following line: “There can be no 

doubt that the Commission lacked the authority to enforce its tariff, 

Schedule 38, against the PPA, because the PPA was entered into by 

[PacifiCorp] and [MWF] under 18 C.F.R. § 292.301(b) and Utah Code 

Ann. § 54-12-2(3).” Examining MWF’s brief for further development 

of this point, we find precious little.

_____________________________________________________________

16 See also 18 C.F.R. § 292.301(b)(1) (“Nothing in this subpart . . . 

[l]imits the authority of any electric utility or any qualifying facility 

to agree to a rate for any purchase, or terms or conditions relating to 

any purchase, which differ from the rate or terms or conditions 

which would otherwise be required by this subpart . . . .”).

17 The record before us does not provide visibility into how often 

PacifiCorp enters into these types of contracts.
MONTICELLO WIND FARM v. PSC

Opinion of the Court

20

¶59 Whether PacifiCorp and MWF negotiated an agreement 

outside of the Commission’s Schedule 38 framework is a question of 

contract interpretation. And when interpreting contracts, “we first 

look at the plain language [of the contract] to determine the parties’ 

meaning and intent.” Brady v. Park, 2019 UT 16, ¶ 53, --- P.3d ---

(alteration in original) (citation omitted). “If the language within the 

four corners of the contract is unambiguous, the parties’ intentions 

are determined from the plain meaning of the contractual language, 

and the contract may be interpreted as a matter of law.” Id. (citation 

omitted). “[W]here a contractual term or provision is ambiguous as 

to what the parties intended, the question becomes a question of fact 

to be determined by the fact-finder.” Id.

¶60 The PPA provided that “[t]he rates, terms[,] and conditions 

in [the PPA] [were] in accordance with the rates, terms, and 

conditions approved by the Commission in Docket No. 03-035-14 for 

purchases from Qualifying Facilities.” That docket includes the 

Commission’s 2005 order “resolv[ing] differences . . . regarding 

methods by which . . . indicative prices are determined for the 

purpose of negotiating agreements pursuant to Schedule No. 38.” See 

UTAH PUB. SERV. COMM’N, DOCKET NO. 03-035-14 (In the Matter of the 

Application of PacifiCorp for Approval of an IRP-based Avoided Cost 

Methodology for QF Projects Larger than One Megawatt), Oct. 31, 2005 

Report and Order, at 7.

¶61 And in that 2005 order, the Commission approved the 

“market price proxy [method] for determination of avoided costs” 

for certain wind facilities “up to [PacifiCorp’s] . . . target megawatt 

level of wind resources.” Id. at 33. The PPA thus purported to be 

consistent with pricing principles the Commission set as part of its 

process for obtaining an executed agreement under Schedule 38.

¶62 The PPA also expressly provided, consistent with Schedule 

38, that it would not become effective until the Commission

approved: “This Agreement shall become effective when it is 

executed and delivered by both Parties and has been approved by 

the Commission . . . .”

¶63 Moreover, in an approach again consistent with Schedule 38 

and the Commission’s methodology for determining pricing, the 

PPA expressly characterized its pricing terms as being based on 

avoided costs. The PPA provided that MWF could “seek a new 

power purchase agreement with PacifiCorp . . . , though PacifiCorp 

shall not be obligated to provide in such power purchase agreement 

avoided cost prices that are higher than the avoided cost prices 

contained in this Agreement.” (Emphasis added.)
Cite as: 2019 UT 43

Opinion of the Court

21

¶64 Finally, the PPA included a provision indicating that it 

constituted the “entire agreement” between the parties: “This 

Agreement supersedes all prior agreements, proposals, 

representations, negotiations, discussions or letters, whether oral or 

in writing, regarding the subject matter hereof. No modification 

hereof shall be effective unless it is in writing and executed by both 

Parties.” As OCS and DPU assert, and MWF appears not to contest, 

this provision indicates the contract is “integrated,” meaning that 

“parol evidence is . . . not admissible to vary or contradict the clear 

and unambiguous terms of the contract.” Tangren Family Tr. v. 

Tangren, 2008 UT 20, ¶ 11, 182 P.3d 326 (citation omitted) (internal 

quotation marks omitted).

¶65 We are therefore presented with an integrated contract that 

expressly relies on, and purports to be consistent with, the 

framework set out in Schedule 38 and the Commission’s 

methodology for determining pricing. The leap MWF’s position 

requires us to make is that this Commission-driven methodology 

and pricing were selected, not because the parties intended to 

operate within the contours of Schedule 38, but because the parties 

intended to operate outside it. And we must reach that conclusion 

even though, consistent with Schedule 38, the PPA expressly 

contemplates Commission approval prior to becoming effective.

¶66 MWF does not discuss these portions of the PPA. Instead,

MWF hones in on three other aspects of the PPA. And MWF uses 

these three provisions to argue that the PPA reflects that the parties 

negotiated outside of the Commission’s Schedule 38 framework.

¶67 First, as MWF points out, the PPA’s pricing terms do not 

reflect the Commission’s current methodology for calculating 

avoided costs. Rather, to calculate the cost, the pricing terms rely on 

a discontinued methodology—albeit one the Commission previously 

endorsed (and the same one we addressed in Ellis-Hall II). That 

discrepancy, MWF asserts, takes the contract outside of Schedule 38 

and demonstrates an agreed-upon intent to depart from a 

Commission-controlled process. In other words, because the PPA 

incorporates an allegedly out-of-date methodology for capturing 

avoided costs, MWF alleges the parties must have intended pricing 

not reflective of avoided costs or subject to robust Commission 

review.

¶68 But MWF’s reading has the potential to nullify the 

Commission’s role in approving agreements entered into under 

subsection (2). Particularly if, as the Commission stated in its order 

and no one has disputed here, the Commission’s “primary role” in 
MONTICELLO WIND FARM v. PSC

Opinion of the Court

22

reviewing such contracts is to determine that the pricing terms “do 

not exceed avoided costs.” Under MWF’s approach, if the 

Commission reviewed what appeared to be a subsection (2) contract, 

but concluded the agreement’s power purchase rates were not 

consistent with Schedule 38 and the Commission’s avoided-cost 

methodology, the Commission should simply conclude that the 

parties intended a subsection (3) contract.

¶69 Moreover, MWF’s interpretation falls apart in light of the 

abundance of other provisions that demonstrate the parties intended 

to operate consistent with Schedule 38’s framework. For example, 

MWF offers no explanation for the PPA provisions that call for 

Commission approval, characterize the pricing as based on avoided 

costs, and profess compliance with the Commission-approved 

methodology generated in accordance with the process Schedule 38 

outlines. Perhaps an argument might be crafted that would 

reasonably explain why all of these terms would exist in an 

agreement reached by parties who have no intention of operating in 

a Schedule 38 world. But we do not have that argument before us, 

and we are not at liberty to make it for MWF.

¶70 MWF next cites the PPA’s Mobile-Sierra clause. That 

provision provides that the power purchase rates would “remain in 

effect . . . absent agreement of the parties” and “the standard of 

review for changes hereto . . . shall be the ‘public interest’ application 

of the ‘just and reasonable’ standard . . . set forth” in federal case 

law. Under that standard, MWF proposes, a regulatory body—

including the Commission—may review the PPA’s power purchase 

rates only to determine if they would seriously harm the public 

interest.

¶71 The Commission and PacifiCorp, as well as OPC and DPU, 

disagree with MWF’s reading of that provision, however, and

provide an alternative explanation of its meaning. They assert the 

Mobile-Sierra clause becomes effective only after the Commission 

approves the PPA, and it applies only to any subsequent review of 

the agreement by federal regulatory bodies. This interpretation is 

supported by the provision’s text, which twice mentions potential 

review by a federal regulatory body—not the Commission—and 

refers to the PPA’s rates as “remain[ing] in effect,” which, as noted 

above, may occur only after Commission approval.

¶72 When read in light of the PPA’s other provisions, which tie 

the agreement to the Commission’s methodology for determining 

avoided-cost pricing and require approval consistent with Schedule 

38, we would be hard-pressed to read the Mobile-Sierra clause as
Cite as: 2019 UT 43

Opinion of the Court

23

taking the PPA outside the realm of Schedule 38 and subjecting it to 

a remarkably different review process. Were we to read the MobileSierra clause in the manner MWF advocates, we would still lack any 

attempt from MWF to harmonize that interpretation with the PPA’s 

remaining provisions. In contrast, Respondents’ interpretation of the 

Mobile-Sierra clause is consistent with its language and the PPA’s 

other terms.

¶73 Finally, MWF asserts that because it agreed to transfer any 

associated green tags to PacifiCorp, that, “by itself, was enough to 

take the PPA outside the standard ‘avoided cost’ rules.” We 

disagree. Many of the PPA’s terms may have some effect on the total 

cost to PacifiCorp of acquiring energy from MWF. But those 

peripheral effects on total cost do not alter the question before us: 

whether the parties entered into an agreement not to be bound by 

Schedule 38 or Commission review of whether the power purchase 

rates were consistent with PacifiCorp’s avoided costs. Moreover, the 

Commission’s 2005 order issued in Docket No. 03-035-14 instructs 

that green tag ownership is a contractual issue between the 

qualifying facility and PacifiCorp. See UTAH PUB. SERV. COMM’N, 

DOCKET NO. 03-035-14 (In the Matter of the Application of PacifiCorp for 

Approval of an IRP-based Avoided Cost Methodology for QF Projects 

Larger than One Megawatt), Oct. 31 2005 Report and Order, at 34. In 

other words, negotiation of green tag ownership is as consistent with 

an agreement reached within the Schedule 38 framework as it would 

be with an agreement reached by parties negotiating their own 

terms. 

¶74 Accordingly, we find no ambiguity about what the parties 

intended the PPA to be. MWF has failed to establish that the PPA’s 

avoided-cost methodology was not subject to Commission review

pursuant to Schedule 38. MWF has also failed to establish that the 

PPA’s pricing terms could be rejected by the Commission only upon 

a showing that they would seriously harm the public interest.

II. MWF Protests the Commission’s Application of

Revised Schedule 38, But Left Unaddressed the

Alternative Basis of the Commission’s Order

¶75 MWF next claims that if the PPA’s pricing terms and 

methodology are subject to Commission review under Schedule 38, 

the Commission should have applied the earlier version of that 

schedule. In addition, according to MWF, the terms of Revised 

Schedule 38 did not support rejection of the PPA. As MWF puts it, 

“it was error to apply the 2015 Schedule 38 retroactively. And, even 
MONTICELLO WIND FARM v. PSC

Opinion of the Court

24

if the 2015 Schedule 38 were applicable retroactively, it was error to 

read it to require rejection of” the PPA.

¶76 The Commission did not, however, merely reject the PPA 

based on its conclusion that Revised Schedule 38 applied. Under a 

heading in the Commission’s order entitled, “The PPA is subject to 

Schedule 38, but the outcome would not be different were Former 

Schedule 38 applicable,” the Commission concluded that “it makes 

no difference whether Schedule 38 or Former Schedule 38 applies 

because nothing in Former Schedule 38 vested a [qualifying facility], 

who had obtained indicative pricing, to compel [PacifiCorp] to enter 

a contract years later based on stale pricing.” The Commission 

continued, “Our Order Revising Schedule 38 provided greater 

specificity to the process, but it did not . . . alter [the Commission’s] 

role or the underlying law.” “Whether we apply Former Schedule 38 

or current Schedule 38, we cannot find that [the PPA’s] pricing 

reflects the avoided costs [PacifiCorp] must pay to satisfy its Must 

Purchase Obligation.”

¶77 To reach these conclusions, the Commission addressed the 

questions we expressly left open in Ellis-Hall II: whether MWF 

would have “a right to require [PacifiCorp] to enter into a power 

purchase agreement” based on market proxy indicative pricing and 

whether the Commission would be “require[d] . . . to approve such 

an agreement.” Ellis-Hall II, 2016 UT 34, ¶ 44; see also id. ¶ 47 

(reaching no conclusion as to the assertion that any agreement 

reached based on “a now-outdated indicative pricing proposal 

[would] ultimately be thwarted by an inevitable decision by the 

Commission to decline to approve a power purchase agreement 

based on such methodology”). The Commission ultimately 

concluded that the result would be the same under the earlier or 

revised version of Schedule 38—the Commission would not approve 

the PPA.

¶78 MWF does not, in its opening brief, acknowledge this 

alternative basis for the Commission’s decision to reject the PPA. A 

party challenging an agency order “bear[s] the burden of adequately 

briefing all independent bases of the order from which they appeal.” 

Living Rivers v. Exec. Dir. of the Utah Dep’t of Envt’l Quality, 2017 UT 

64, ¶ 25, 417 P.3d 57 (citing Simmons Media Grp. v. Waykar, LLC, 2014 

UT App 145, ¶ 32, 335 P.3d 885 (“This court will not reverse a ruling 

of the [district] court that rests on independent alternative grounds 

where the appellant challenges only one of those grounds.” 

(alteration in original) (citation omitted))). Here, however, MWF has 

failed to address the Commission’s alternative ground for its order—

that the result would have been the same under the earlier version of 
Cite as: 2019 UT 43

Opinion of the Court

25

Schedule 38 for which MWF advocates. Thus, even were MWF to 

prevail on its argument, it would not be entitled to the relief it seeks, 

as an alternative basis for the Commission’s order would remain 

intact.

¶79 MWF’s only response to this portion of the Commission’s 

order appears in its reply brief: a few cursory sentences asserting

that the Commission simply got it wrong. But whether MWF’s 

conclusory argument is too little is beside the point—the argument 

comes too late.

¶80 “It is well settled that issues raised . . . in the reply brief that 

were not presented in the opening brief are considered waived and 

will not be considered by the appellate court.” Allen v. Friel, 2008 UT 

56, ¶ 8, 194 P.3d 903 (citation omitted) (internal quotation marks 

omitted). Our appellate rules provide an opportunity “to respond[] 

to the facts and arguments raised” in an appellee’s or respondent’s 

“principal brief.” UTAH R. APP. P. 24(b). But the opportunity to 

“respond” is not a license to gap-fill missing arguments. When a 

respondent’s brief points out that an issue is unpreserved or an 

alternative ground is unchallenged, a petitioner may not “respond” 

with newly crafted substantive arguments as to that issue or ground. 

The timely presentation of arguments is essential to providing an

opposing party with a fair opportunity to respond.

¶81 That principle is fully at play here. Until its reply brief, 

MWF had provided no substantive argument as to the Commission’s 

authority to reject the PPA under the earlier version of Schedule 38. 

No argument as to the Commission’s role, under that schedule, in 

reviewing an agreement that incorporated years-old pricing based 

on methodology the Commission deemed out-of-date. Thus, other 

than MWF’s argument that the PPA was not subject to any version of 

Schedule 38, which we addressed above, no argument regarding the 

earlier version of Schedule 38 appears in MWF’s principal brief. 

Because MWF’s argument on this issue appears for the first time in 

its reply brief, we do not consider its merits.18

_____________________________________________________________

18 Still, we note that MWF’s conclusory response on reply, that 

the Commission’s approach is inconsistent with the earlier version of 

Schedule 38 and constitutes “nothing but a rehash of the arguments” 

in Ellis-Hall II, does little to illuminate the issue. Which version of 

Schedule 38 would apply to a later-executed agreement was not at 

issue in Ellis-Hall II. And broad questions pertaining to the 

Commission’s authority to approve an agreement incorporating 

(continued . . .)
MONTICELLO WIND FARM v. PSC

Opinion of the Court

26

III. MWF Raises Constitutional Challenges to the Application of 

Revised Schedule 38, None of Which Are Properly Before Us

¶82 MWF also raises a number of constitutional challenges to 

Revised Schedule 38. MWF claims Revised Schedule 38 “was aimed 

squarely and exclusively at [MWF]” and therefore constitutes 

“special legislation” in violation of Utah Constitution article VI, 

section 26. See UTAH CONST. art. VI, § 26 (“No private or special law 

shall be enacted where a general law can be applicable.”). MWF also 

claims Revised Schedule 38 “will sometimes,” but not always,

“apply retroactively,” and is therefore “not uniform in its operation”

in violation of Utah Constitution article I, section 24. See id. art. I, § 24 

(“All laws of a general nature shall have uniform operation.”). 

Finally, MWF asserts Revised Schedule 38 is unconstitutionally 

vague because it “typically” applies to projects already under 

development, leaving it within PacifiCorp’s or the Commission’s 

“unfettered discretion” whether to apply the revised schedule 

“retroactively.”

¶83 But as OCS and DPU point out, these constitutional 

challenges were not presented to the Commission in MWF’s petition 

for rehearing. They have made their first appearance in MWF’s 

briefing on appeal. And as a result, MWF’s constitutional challenges

are not properly before us.

¶84 Utah Code section 54-7-15 provides that “[b]efore seeking 

judicial review of the commission’s action, any party . . . who is 

dissatisfied with an order of the commission shall meet the 

requirements of this section.” UTAH CODE § 54-7-15(1). Section 54-7-

15 then provides for a process of rehearing before the Commission: 

“After any order or decision has been made by the commission, any 

party . . . may apply for rehearing of any matters determined in the 

action or proceeding.” Id. § 54-7-15(2)(a). And a party’s opportunity 

to seek judicial review is tied to its participation in the rehearing 

process: “An applicant may not urge or rely on any ground not set 

forth in the application [for rehearing] in an appeal to any court.” Id.

§ 54-7-15(2)(b).

¶85 We have stated that this preservation rule applies as a 

matter of statutory mandate, e.g., ABCO Enters. v. Utah State Tax 

Comm’n, 2009 UT 36, ¶ 10, 211 P.3d 382, and is a requisite step in 

“exhaust[ing] all administrative remedies” before being “allowed to 

 

“outdated” pricing terms were left unresolved in that opinion. See 

Ellis-Hall II, 2016 UT 34, ¶¶ 44, 47.
Cite as: 2019 UT 43

Opinion of the Court

27

seek judicial review of an agency decision,” In re Questar Gas Co., 

2007 UT 79, ¶ 47, 175 P.3d 545. Accordingly, a party must raise a 

ground of error on petition for rehearing before the Commission or 

“it has waived its right to raise th[ose] arguments in this court.” 

Westside Dixon Assocs. LLC v. Utah Power & Light Co./PacifiCorp, 2002 

UT 31, ¶ 23, 44 P.3d 775.

¶86 MWF filed a petition for rehearing before the Commission, 

and asserted that its petition was filed pursuant to section 54-7-15. 

But MWF’s petition did not raise any of these constitutional 

challenges. Accordingly, MWF has waived its right to present these 

arguments to this court. See id.

¶87 MWF nevertheless asserts we may consider these challenges 

under the plain error and exceptional circumstances exceptions to 

our general rule of issue preservation. See Salt Lake City v. Kidd, 2019

UT 4, ¶ 31, 435 P.3d 248 (noting that “[a]s a general rule, claims not 

raised before [a] trial court may not be raised on appeal” unless the 

complaining party “can demonstrate that exceptional circumstances 

exist or plain error occurred” (citations omitted) (internal quotation 

marks omitted)). OCS and DPU disagree, asserting that section 54-7-

15 operates as a jurisdictional requisite, leaving us no room to apply 

those exceptions here. We do not resolve that question because it is 

immaterial to the outcome; MWF’s briefing falls far short of 

persuading us that either doctrine has application to the 

unpreserved challenges it raises.

¶88 To demonstrate plain error, an appellant must establish that 

an error exists, it should have been obvious to the trial court, and the 

error was harmful. State v. Holgate, 2000 UT 74, ¶ 13, 10 P.3d 346. 

Demonstrating error that “should have been obvious to the trial 

court” does not always require recitation of case law directly on 

point. But it does require a showing of error that was, nonetheless, 

plain. And the alleged constitutional missteps MWF claims are not 

“plain” by a long stretch.

¶89 In addition, we apply the exceptional circumstances 

doctrine sparingly, “to reach an unpreserved issue where a rare 

procedural anomal[y] has either prevented an appellant from 

preserving an issue or excuses a failure to do so.” State v. Johnson, 

2017 UT 76, ¶ 29, 416 P.3d 443 (alteration in original) (citation 

omitted) (internal quotation marks omitted). Failure to raise an 

argument in a petition for rehearing does not constitute such a 

circumstance. Accordingly, MWF’s constitutional challenges are not 

properly before us.
MONTICELLO WIND FARM v. PSC

Opinion of the Court

28

CONCLUSION

¶90 MWF has failed to demonstrate that the PPA’s avoided cost 

methodology was not subject to Commission review. MWF has 

likewise failed to demonstrate that the Commission was required to 

approve the PPA unless its pricing terms would seriously harm the 

public interest. MWF did not timely raise the remainder of its 

challenges. We affirm.