Hommrich v. Commonwealth
| Decision Date | 12 May 2020 |
| Docket Number | No. 674 M.D. 2016,674 M.D. 2016 |
| Parties | David N. HOMMRICH, Petitioner v. Commonwealth of Pennsylvania, PENNSYLVANIA PUBLIC UTILITIES COMMISSION, Respondent |
| Court | Pennsylvania Commonwealth Court |
A. Michael Gianantonio, Pittsburgh, for Petitioner.
Kris E. Brown, Assistant Counsel, Harrisburg, for Respondent.
Kevin J. Moody, Harrisburg, for Amicus Curiae Pennsylvania Independent Oil and Gas Association.
BEFORE: HONORABLE MARY HANNAH LEAVITT, President Judge, HONORABLE MICHAEL H. WOJCIK, Judge, HONORABLE BONNIE BRIGANCE LEADBETTER, Senior Judge
OPINION BY JUDGE WOJCIK
Before this Court for disposition, in our original jurisdiction, are the parties' cross Applications for Summary Relief to Petitioner David N. Hommrich's (Hommrich) "Amended Petition for Review in the Nature of a Complaint for Declaratory and Injunctive Relief" (Amended Petition) under the Declaratory Judgments Act (DJA).1 Specifically, Hommrich seeks a declaration that Respondent Pennsylvania Public Utility Commission's (PUC)2 regulations on alternative energy projects are invalid and unenforceable. In turn, the PUC seeks the dismissal of Hommrich's Amended Petition because the regulations are valid and enforceable or, alternatively, an evidentiary hearing. For the reasons that follow, we grant in part and deny in part the parties' cross Applications for Summary Relief.
In January 2017, Hommrich filed his Amended Petition challenging the PUC's regulations3 pertaining to net metering as unauthorized under the Alternative Energy Portfolio Standards Act (AEPS Act),4 and seeking a declaration of invalidity in addition to other relief. The PUC responded by filing preliminary objections, which this Court sustained in part and overruled in part, thereby leaving only the issue of whether the challenged regulatory provisions are invalid and unenforceable under the AEPS Act. See Hommrich v. Pennsylvania Public Utilities Commission , 2017 WL 3203437 (Pa. Cmwlth., No. 674 M.D. 2016, filed July 28, 2017).5 The PUC then filed an Answer and New Matter to the Amended Petition, to which Hommrich responded. Thereafter, the parties filed the cross Applications for Summary Relief now before us.
Hommrich asserts that the PUC does not have statutory authority to promulgate certain regulations establishing eligibility criteria for net metering. Even if it did, Hommrich contends that the regulations run afoul of the AEPS Act and this Court's holding in Sunrise Energy, LLC v. FirstEnergy Corp. , 148 A.3d 894, 901 (Pa. Cmwlth. 2016), appeal denied , 169 A.3d 1025 (Pa. 2017). Specifically, Hommrich challenges the following regulations:
Hommrich maintains that there are no issues of material fact that would serve to preclude this Court from determining that these regulations are invalid, even when viewing the evidence in a light most favorable to the PUC. For these reasons, Hommrich asks this Court to declare the challenged regulations as invalid and unenforceable.
The PUC counters that Hommrich has failed to prove on the pleadings that the PUC lacked authority to promulgate the challenged regulations or that the challenged regulations are unreasonable. The PUC's authority derives from the AEPS Act as well as the Public Utility Code (Code).6 The PUC argues that its regulations reflect a reasonable interpretation of the AEPS Act and that it is entitled to great deference as the administrative agency with expertise on the subject. Accordingly, the PUC asks this Court to dismiss Hommrich's Amended Petition or, in the alternative, hold an evidentiary hearing to establish material facts.
Rule 1532(b) of the Pennsylvania Rules of Appellate Procedure provides that "the court may on application enter judgment if the right of the applicant thereto is clear." Pa. R.A.P. 1532(b) ; see Scarnati v. Wolf , 643 Pa. 474, 173 A.3d 1110, 1118 (Pa. 2017) ( ) (footnote omitted). "Summary judgment is appropriate where, after the close of pleadings, ‘there is no genuine issue of any material fact as to a necessary element of the cause of action or defense which could be established by additional discovery or expert report.’ " Scarnati , 173 A.3d at 1118 (quoting Pa. R.C.P. No. 1035.2(a) ). Conversely, "[w]here there are material issues of fact in dispute or if it is not clear that the applicant is entitled to judgment as a matter of law, the application will be denied." Sherman v. Kaiser , 664 A.2d 221, 225 (Pa. Cmwlth. 1995). "A fact is considered material if its resolution could affect the outcome of the case under the governing law." Hospital & Healthsystem Association of Pennsylvania v. Commonwealth , 621 Pa. 260, 77 A.3d 587, 602 (2013).
Hommrich maintains that there are no genuine issues of material fact in dispute and that this matter is ripe for summary relief. However, in its alternative request for relief, the PUC suggests that an evidentiary hearing may be necessary to establish material facts. The dispute centers over whether the PUC has the authority to enact the challenged regulations and whether those regulations contradict the AEPS Act. Such issues may be resolved based on comparison of statutory and regulatory provisions as a matter of law. See Marcellus Shale Coalition v. Department of Environmental Protection , 193 A.3d 447, 460 (Pa. Cmwlth.), appeal quashed , 649 Pa. 663, 198 A.3d 330 (2018). Thus, we conclude that the parties' cross Applications for Summary Relief seeking a determination as to whether the regulations are unlawful and unenforceable are ripe for disposition without an evidentiary hearing.
Section 7533 of the DJA states:
Any person interested under a deed, will, written contract, or other writings constituting a contract, or whose rights, status, or other legal relations are affected by a statute , municipal ordinance, contract, or franchise, may have determined any question of construction or validity arising under the instrument, statute , ordinance, contract, or franchise, and obtain a declaration of rights, status, or other legal relations thereunder.
42 Pa. C.S. § 7533 (emphasis added). The DJA was enacted "to curb the courts' tendency to limit the availability of judicial relief to only cases where an actual wrong has been done or is imminent." Bayada Nurses, Inc. v. Department of Labor and Industry , 607 Pa. 527, 8 A.3d 866, 874 (2010). The purpose of the DJA is "to settle and to afford relief from uncertainty and insecurity with respect to rights, status, and other legal relations" and, accordingly, the DJA should "be liberally construed and administered." 42 Pa. C.S. § 7541(a) ; accord Office of Governor v. Donahue , 626 Pa. 437, 98 A.3d 1223, 1229 (2014) (citation omitted); Funk v. Wolf , 144 A.3d 228, 251 (Pa. Cmwlth. 2016), aff'd , 638 Pa. 726, 158 A.3d 642 (2017). As we previously determined in Hommrich , "[a] DJA action is the appropriate means to settle and afford relief from uncertainty and insecurity with respect to the regulations and [Hommrich's] putative status as a customer generator." Slip op. at 16.
In 2004, the Pennsylvania legislature recognized the need for environmentally cleaner alternatives to fossil fuel energy production, and as a result, it passed the AEPS Act. The AEPS Act incentivizes alternative energy producers to generate their own energy utilizing one of the approved alternative energy production methods, such as wind and solar power, and sell any excess energy not used to the Electric Distribution Companies (EDCs). Section 2 of the AEPS Act, 73 P.S. § 1648.2. Section 5 of the AEPS Act requires EDCs to purchase any net energy produced by these alternative energy providers at the full retail value. Section 5 of the AEPS Act, 73 P.S. § 1648.5. Colloquially speaking, this provision allows the meter to run backwards. Of particular import here, Section 5 of the AEPS Act further provides:
The [PUC ] shall develop technical and net metering interconnection rules for customer-generators intending to operate renewable onsite generators in parallel with the electric utility grid, consistent with rules defined in other states within the service region of the regional transmission organization [(RTO) ] that manages the transmission system in any part of this Commonwealth . The [PUC] shall convene a stakeholder process to develop Statewide technical and net metering rules for customer-generators. The [PUC] shall develop these rules within nine months of the effective date of this act.
73 P.S. § 1648.5 (emphasis added). Pursuant to this legislative rule-making authority, the PUC adopted the regulations establishing technical and net metering interconnection rules for customer-generators that are subject to this litigation.
The Supreme Court of Pennsylvania "has long recognized the distinction in administrative agency law between the authority of a rule adopted pursuant to an agency's legislative rule-making power and the authority of a rule adopted pursuant to interpretive rule-making power." Popowsky v. Pennsylvania Public Utility Commission , 589 Pa. 605, 910 A.2d 38, 53 (2006) (citations omitted). "Legislative rule-making is an exercise of legislative power by an administrative agency, pursuant to a grant of legislative power by the legislative body, and is valid and is as binding upon a court as a statute if it is: (a) within the granted power, (b) issued pursuant to proper procedure, and (c) reasonable....
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