The Supreme Court of Ohio today affirmed the certification of six wind farms located in noncontiguous states in the Upper Midwest as renewable energy resource generating facilities eligible to sell renewable energy in Ohio.

In a 5-2 decision, the Supreme Court upheld the Public Utilities Commission of Ohio’s (PUCO) approval of six facilities owned by Avangrid Renewables.

Carbon Solutions Group (CSG), whose clients include Ohio-based renewable energy developers and facilities, challenged the PUCO ruling. CSG argued that the record did not support the commission’s findings that the Avangrid wind facilities met the necessary criteria for certification and that the PUCO failed to adequately address CSG’s claim that the record lacked sufficient evidence. In a second proposition of law, CSG also argued the commission failed to follow certain statutes and rules governing the proceeding. 

Tenth District Court of Appeals Judge Julia L. Dorrian, sitting for Justice Jennifer Brunner, wrote the Court’s majority opinion.

“We hold that the commission’s determination as set forth in its order that the applicants’ generation resources are ‘deliverable into this state’ is not against the manifest weight of the evidence,” she wrote.

The majority opinion also concluded that the PUCO set forth its reasoning consistent with the requirements of R.C. 4903.09.  The opinion further concluded that procedural issues prevented the Court from reaching the merits of CSG’s second proposition of law.

Chief Justice Sharon L. Kennedy and Justices R. Patrick DeWine, Daniel R. Hawkins, and Megan E. Shanahan joined Judge Dorrian’s opinion.

In an opinion concurring in part and dissenting in part, Justice Patrick F. Fischer wrote that the PUCO must include sufficient evidence to support its orders. In this case, the reports delivered by the wind farms indicated it was hypothetically possible to transmit electricity to Ohio, and Justice Fischer found the commission fell short of explaining how the wind farms’ power meets the state’s definition of being “deliverable into this state.” He stated the matter should be remanded to the PUCO to address CSG’s challenge to the reliability of the reports indicating that farms can deliver power to the state.

Third District Court of Appeals Judge John R. Willamowski, sitting for Justice Joseph T. Deters, joined Justice Patrick F. Fischer’s separate opinion.

Farms Seek to Sell Electricity in Ohio
Ohio law requires electric distribution utilities and electric services companies that supply retail electric services in Ohio to provide a portion of their electricity from a “qualifying renewable energy resource” such as wind or solar power. These utilities may purchase renewable energy from both in-state and out-of-state qualifying facilities. The PUCO certifies facilities seeking to supply renewable energy in Ohio. One criterion for facilities located in states noncontiguous to Ohio is to demonstrate that renewable energy generated “can be shown to be deliverable into this state.”

In 2011, the PUCO adopted a test to determine whether electricity is deliverable into the state from sources outside of Ohio or a contiguous state. Known as the Koda test based on the name of the PUCO decision in which the test was adopted, the commission used distribution-factor or power-flow studies known as “DFAX” studies conducted by the two regional transmission organizations —  that at the time of Koda managed electricity flow in Ohio — PJM Interconnection and Midcontinent Independent System Operator (MISO). Currently, PJM is the sole manager of the wholesale-electricity market in Ohio, and the Avangrid wind facilities are located in the region in which MISO now operates.

The test developed in Koda must show that a generating facility located in a noncontiguous state has a “significant impact” on a transmission line in Ohio, determined by a specific formula.

For each wind farm, Avangrid provided the PUCO staff with a DFAX study conducted by PJM. The staff reviewed the reports and determined that each facility met the deliverability requirements for certification. The staff recommended that the wind farms be certified.

CSG challenged the staff recommendation, arguing the company provided insufficient evidence to demonstrate the wind farms’ power could be delivered to Ohio. CSG argued that because the farms are in the MISO region, the companies were required to submit evidence detailing how their renewable energy is delivered into transmission lines in the MISO region, then into the PJM region and Ohio. Specifically, CSG argued that the commission should have required a DFAX report from MISO or used another method to demonstrate the power flowed from the MISO region to the PJM region and Ohio. CSG questioned the reliability of the DFAX reports, noting that a cover letter from PJM reported “if they were to deliver their energy to PJM,” then the wind farms would have an impact on a transmission line in Ohio.

The PUCO rejected CSG’s challenge and certified the facilities in September 2023. CSG appealed the decision to the Supreme Court.

Supreme Court Analyzed Commission Decision
Judge Dorrian explained that the Court will only overturn a commission decision if it is “unlawful or unreasonable,” and the burden to prove that is on the challenger, CSG. In determining whether a commission order is unreasonable, the opinion observed the Court would not disturb the commission’s factual determinations when the record contains sufficient probative evidence to show that the commission’s order was not “manifestly against the weight of the evidence and is not so clearly unsupported by the record as to show misapprehension, mistake or willful disregard of duty.”

The opinion noted the PUCO conducted a hearing in December 2022 where the PJM power flow studies were presented as evidence that the wind farms meet the standards for certification. No party, including CSG, contested the impact values from the studies showing the wind farms met the requirements, and the staff used the reports to conclude that the farms should be certified. CSG argued the staff should not have relied on the studies because they do not show “real transmission line impacts,” but only hypothetical impacts.

The opinion first explained that the Court did not find merit to CSG’s contention that the evidence in the record did not support the staff’s deliverability findings and recommendations.  The commission’s record noted that the staff not only reviewed the DFAX studies but also conducted their own analysis based on the full DFAX study rather than the one-to-two-page narrative to determine if the farms met the deliverability requirements. Another staff member, under questioning by CSG’s attorney, explained that PJM can obtain the information it needs to complete its report from other regional operators such as MISO.

The Court concluded that, on the facts of this case, the commission correctly applied the Koda test and that it was not against the manifest weight of the evidence or contrary to law for the commission to determine that the deliverability criteria was met without a MISO DFAX study or other evidence. The Court observed, however, that it did not preclude the commission in future cases from requiring DFAX studies from multiple RTOs, evidence in the form of an alternative affected system study or other evidence as it determines necessary when considering whether the deliverability standard is met. 

The Court also concluded that the commission’s order met the requirements of R.C. 4903.09, which requires the commission to set forth the reasons for its orders.

Finally, the Court rejected CSG’s second proposition of law because CSG had not objected to the denial of a motion for subpoena during the evidentiary hearing and, therefore, waived that argument on appeal.  CSG also failed to raise in its application for rehearing its argument that the commission had relied on inadmissible hearsay evidence and, therefore, the Court lacked jurisdiction to hear the claim on appeal. 

Commission Must Fully Explain Its Orders, Dissent Maintained
Justice Fischer joined the majority in rejecting one of CSG’s arguments, but agreed with the company that the PUCO did not provide a sufficient explanation in its order certifying the wind farms. Instead, he argued the majority did its own fact-finding by relying on testimony that the commission did not cite in its order.

In objecting to the staff recommendation, CSG challenged how the DFAX studies were conducted and, under the Koda decision, asserted there must be evidence showing the transmission line impacts along the entire delivery path from the source of generation into Ohio. CSG argued the DFAX reports contained no evidence showing the path from the wind farms through MISO, into PJM, and into Ohio.

Justice Fischer wrote that by not addressing CSG’s claims, the commission never answered whether PJM assumed the out-of-state energy would be delivered or whether the Koda decision requires the evidence of the study to cover the entire delivery path. Because the commission failed to address CSG’s challenges to the DFAX study, it was not possible for the Court to determine if the PUCO order was reasonable.

The dissent noted that the majority opinion affirmed the PUCO’s order by assessing the testimony of PUCO staff members who assured the DFAX reports were correct. Justice Fischer stated that the PUCO order did not include the staff members' testimony. The commission, in its role as the fact-finder, must provide the evidence it relied on to make its decision. The Court's role is not to search the record for evidence to support the PUCO’s decision that the PUCO itself has failed to include, the dissent maintained.

2024-0098. In re Application of Moraine Wind LLC, Slip Opinion No. 2026-Ohio-3103.

View oral argument video of this case.

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