The Court ruled that utility regulators could not grant themselves a time extension to decide whether to approve wind farm applications.

The Court ruled that utility regulators could not grant themselves a time extension to decide whether to approve wind farm applications.

The Supreme Court of Ohio ruled today that public utility regulators cannot issue orders that grant the regulators an extension of time to decide applications for rehearing.

A Supreme Court majority found the Public Utilities Commission of Ohio (PUCO) issued an order that improperly granted itself an extension to consider whether to allow six out-of-state wind farms to sell electricity in Ohio. The Ohio legislature had passed a law requiring that the PUCO must decide an application for rehearing within 30 days, but the PUCO had a practice of circumventing the law by granting a rehearing for the sole purpose of giving itself more time to consider an application for a rehearing. The Court today found this practice improper.

Writing for the Court majority, Justice R. Patrick DeWine explained that once the PUCO issues an order in a case, a party can request a rehearing. The PUCO can deny it, grant it, and affirm or modify the original PUCO order. If the PUCO takes no action on the rehearing request, the application is denied by “operation of law.” Only after an application is denied – either affirmatively by the PUCO or by operation of law --  can an opponent appeal a commission decision to the Supreme Court.

Under state law, the PUCO must grant or deny an application for a rehearing within 30 days. In November 2023, the PUCO granted Carbon Solutions Group LLC (CSG) a rehearing application “for the limited purpose of further consideration of the matters specified within the application for rehearing.” The Court ruled today that by not making an affirmative decision on the application within the 30-day timeframe, the PUCO effectively denied the application for rehearing.

“Nowhere did the General Assembly grant PUCO the authority to extend the statutory deadline. PUCO’s gloss on the statute effectively removes the 30-day deadline from the statute, allowing PUCO to grant itself unlimited amounts of time to decide whether to grant or deny rehearing,” Justice DeWine wrote.

Today’s decision allowed CSG to continue its appeal, which contests the certification of the out-of-state wind farms, before the Supreme Court

Chief Justice Sharon L. Kennedy and Justices Patrick F. Fischer and Michael P. Donnelly joined the decision.

In a dissenting opinion, Justice Melody Stewart wrote the PUCO followed the law and granted a rehearing within the 30 days allotted by state law. The Court should deem that CSG’s case was still pending before the commission and that the Court could not hear the company’s appeal until the case concluded before the PUCO. Because the PUCO denied CSG a rehearing in February 2024, Justice Stewart noted that the Supreme Court would have jurisdiction to consider the company’s appeal of the wind farm certifications if it appealed after the February order.

Justice Jennifer Brunner dissented without a written opinion.

Justice Joseph T. Deters did not participate in the case.

Company Appeals Order It Opposed
Ohio law requires electric utilities to obtain part of their electricity from renewable energy sources such as solar and wind power. The resources can be purchased from out-of-state renewable energy generating facilities, but those suppliers must be certified by the PUCO to supply power to Ohio utilities.

Six out-of-state wind farms, including Moraine Wind, applied for certification. CSG, which represents some Ohio-based renewable energy suppliers, opposed the application. In September 2023, the PUCO approved the applications.

CSG filed for a rehearing in October 2023. Within 30 days, the commission issued an entry in November 2023 stating it was granting the application “for the limited purpose of further consideration of the matters specified” in the application.

In January 2024, as the PUCO considered CSG’s application for a rehearing, CSG appealed the original September order certifying the wind farms to the Supreme Court. The PUCO asked the Court to dismiss the case, arguing the Court did not have jurisdiction to hear CSG’s appeal because the rehearing application was still pending before the PUCO.

Supreme Court Analyzed Rehearing Law
R.C. 4903.11 establishes when an opponent to a PUCO order can appeal to the Supreme Court. The law states an appeal can be filed within 60 days after the PUCO denies an application for a rehearing “by operation of law.” Or an appeal can be filed after the PUCO issued an order to deny the rehearing or by conducting a rehearing and then deciding the matter.

CSG filed its appeal to the Supreme Court, arguing that when the PUCO said it granted a rehearing for the sole purpose of deciding whether to grant a rehearing, the order, in reality, did not grant or deny a rehearing. Because the PUCO did not decide within 30 days whether to grant or deny a rehearing, the rehearing was denied by operation of law. That gave the company the right to appeal to the Court, the company maintained.

Justice DeWine explained that the PUCO argued it had the authority to grant a rehearing for the purpose of extending the time to review CSG’s application. In its request to dismiss CSG’s case,  the PUCO noted the commission’s general practice has been to use this type of entry to give it more time to review a case before an appeal to the Supreme Court.

CSG argued the PUCO had 30 days by law to decide whether to grant or deny a rehearing. If the PUCO decided to grant a rehearing, it could have taken the time it needed to evaluate the matter, but it could not simply grant a rehearing to extend its 30-day deadline, the company asserted.

The Court agreed.

“The statute mandates that PUCO grant or deny an application for rehearing within 30 days. And while PUCO may have labeled its November 16 entry as an entry granting rehearing, the entry did nothing of the sort,” the opinion stated.

The Court noted that under R.C. 4903.10, if the PUCO does not grant or deny a rehearing within 30 days, the rehearing is “denied as a matter of law.” The opinion noted that the PUCO does not need to rule on the objections raised in the application within 30 days. But it does have to make a substantive decision whether or not to grant rehearing. Although PUCO stated in its order it was  “granting” CSG a rehearing, the order itself made clear that it was not ruling on the merits of CSG’s request but simply granting itself more time to consider the application.

“And an order that on its face simply grants PUCO more time to consider an application for a rehearing is not a grant of a rehearing, no matter the label attached. Calling a duck a rabbit doesn’t make it one,” the opinion stated.

Company’s Appeal Premature, Dissent Maintained
In her dissent, Justice Stewart wrote the Court can only consider appeals from PUCO orders that follow the process stated in R.C. 4903.10 and R.C. 4903.11. Under those laws, the PUCO granted CSG a rehearing, and therefore, the Court does not have jurisdiction over CSG’s January 2024 appeal.

Justice Stewart wrote that a court speaks through its entries, and the same should be true of administrative agencies. The Court should examine the PUCO entry to determine if CSG had the right to appeal. The dissent stated the November 2023 entry was “simple and clear, and no amount of scrutiny can change the facts.”

The dissent noted the entry met the law’s requirements because it granted the application, identified the purpose for granting the rehearing, and specified any additional evidence that was required. The Court cannot conclude that the application was denied by operation of law because the commission ruled on it within 30 days, “regardless of how the majority opinion chooses to interpret” the November 2023 entry, the dissent concluded.

2024-0098. In re Application of Moraine Wind LLC, Slip Opinion No. 2024-Ohio-3224.

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