Summary
The Michigan Court of Appeals reviews an October 10, 2024 Michigan Public Service Commission order implementing 2023 Public Act 233, which governs certification and siting of certain wind, solar, and energy storage facilities. The court holds that the Commission incorrectly interpreted one statutory timeline and improperly narrowed the definition of an affected local unit, but otherwise upholds its interpretations, including its construction of compatible renewable energy ordinances and hybrid facilities. The court also concludes that the Administrative Procedures Act rulemaking requirements did not apply to the Commission’s order, affirming in part and reversing in part.
Topics
Practice areas
Questions Presented
- Whether the appellants' challenge to the PSC's implementation order was ripe for judicial review.
- Whether the PSC correctly interpreted the statutory definition of a compatible renewable energy ordinance under 2023 PA 233.
- Whether the PSC improperly limited the statutory definition of an affected local unit to local governments exercising zoning jurisdiction.
- Whether the PSC properly recognized hybrid energy facilities and applied the applicable statutory capacity thresholds.
- Whether the PSC correctly interpreted the 30-day timeline for notification that an affected local unit has a compatible renewable energy ordinance.
- Whether the PSC's implementation order was a rule requiring formal promulgation under Michigan's Administrative Procedures Act.
Holdings
- The challenge was ripe because the PSC's order made threshold determinations regarding the meaning and operation of Public Act 233 that had present real-world implications and did not depend on a further PSC decision.
- A compatible renewable energy ordinance may contain only requirements expressly outlined in MCL 460.1226(8) and may not add requirements or categories of requirements that are more restrictive than those provisions.
- The PSC improperly limited an affected local unit to a local government exercising zoning jurisdiction. Under MCL 460.1221(a) and (n), an affected local unit includes every county, township, city, or village in which all or part of a proposed energy facility will be located.
- The PSC did not exceed its authority by recognizing hybrid energy facilities and applying the higher applicable capacity threshold when multiple technology types are combined.
- The PSC incorrectly changed the statutory 30-day period. The period begins after the actual meeting between the developer and the chief elected official or designee, not upon receipt of the developer's written offer to meet.
- The PSC's order was not subject to the APA's formal rulemaking requirements because it interpreted statutes and exercised permissive statutory authority rather than establishing a regulation or policy having the force and effect of law.
Key quotations
“We hold that (1) the PSC incorrectly interpreted PA 233 with respect to a statutory timeline, (2) the PSC improperly expanded the statutory definition of an affected local unit (ALU), but did not otherwise err in its interpretations of PA 233, and (3) the rulemaking requirements within the Administrative Procedures Act of 1969 (APA), MCL 24.201 et seq., do not apply to the PSC’s order.” (2)
“The statutory definition of ALU is plain and unambiguous: it includes all local units of government where a proposed energy facility will be located.” (14)
“The PSC thus incorrectly interpreted PA 233 with respect to the statutory timeline.” (15)
“Through this order the PSC did not establish a regulation or policy having the force and effect of law.” (17)
Factual background
Public Act 233 of 2023 added Part 8 to Michigan's Clean and Renewable Energy and Energy Waste Reduction Act, authorizing the PSC to certify certain large wind, solar, and energy-storage facilities. The PSC issued an implementation order interpreting the terms compatible renewable energy ordinance and affected local unit, recognizing hybrid facilities, establishing application procedures, and setting a timeline for local officials to notify developers of a compatible ordinance. The appellant townships and counties challenged the PSC's interpretations and argued that the order was an unpromulgated rule under the Administrative Procedures Act.
Procedural history
The Michigan Public Service Commission opened a docket on its own motion to implement Public Act 233, held eight public meetings, received staff recommendations and more than 100 comments, and issued an order on October 10, 2024. The affected townships and counties appealed as of right to the Michigan Court of Appeals. The Court of Appeals affirmed in part, reversed in part, and remanded.
Remand instructions
The matter was remanded for further proceedings consistent with the opinion, including correction of the PSC's affected-local-unit interpretation and statutory timeline. The court did not retain jurisdiction.