Court Opinion

ID: 9665085
Source: CourtListenerOpinion
Date Created: 2023-08-24 00:39:11.530093+00
Date Added: 2024-06-11T18:15:12.793341
License: Public Domain

CARTER, Justice
(concurring specially).
I agree with the court’s conclusion that neither federal nor state law requires that Midland utilize net metering. I join in the court’s opinion. I also write separately to point out that federal law actually prohibits the use of net metering.
Section 210(b) of the Public Utility Regulatory Policies Act, 16 U.S.C. § 824a-3(b), provides:
No such rule prescribed [by the Federal Energy Regulatory Commission (FERC)] ... shall provide for a rate which exceeds the incremental cost to the electric utility of alternative electric energy.
The Supreme Court in American Paper Institute, Inc. v. American Electric Power Service Corp., 461 U.S. 402,103 S.Ct. 1921, 76 L.Ed.2d 22 (1983), has determined that the term “full avoided costs” as used in the regulations is the equivalent of the term “incremental cost of alternative electric energy, used in § 210(d) of [the Act].” Am. Paper Inst., Inc., 461 U.S. at 406,103 S.Ct. at 1924, 76 L.Ed.2d at 28.
In a regulation adopted to implement this provision, FERC has required that utilities purchase electricity from qualified cogenerators “at a rate equal to the utility’s full avoided cost.” 18 C.F.R. *310§ 292.304(b)(2) (1982). The utility’s full avoided cost is defined as “the cost to the electric utility of the electric energy which, but for the. purchase from such cogenerator or small power producer, such utility would generate or purchase from another source.” Id. § 292.101(b)(6).
There is no way that net metering will produce a reimbursement to the cogenerator that is reflective of the utility’s full avoided cost. Instead, net metering in every instance reimburses the cogenerator on the basis of the utility’s retail rate for electricity. This is manifestly not the cost to the utility of the electric energy that, but for the purchase from such cogenerator, the utility would generate or purchase from another source.