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                                       SUPERIOR COURT OF NEW JERSEY
                                       APPELLATE DIVISION
                                       DOCKET NO. A-4408-15T2






              Argued January 23, 2018 – Decided March 14, 2018

              Before Judges Yannotti, Carroll and Leone.

              On appeal from the New Jersey Board of Public
              Utilities, BPU Docket No. EC1311051.

              John J. Coughlin           argued    the    cause    for

              Sheree L. Kelly, Assistant General Regulatory
              Counsel, argued the cause for respondent PSE&G
              (PSE&G Services Corporation Law Department,
              attorneys; Sheree L. Kelly, on the brief).

              Veronica A. Beke, Deputy Attorney General,
              argued the cause for respondent New Jersey
              Board of Public Utilities (Gurbir S. Grewal,
              Attorney   General,   attorney;  Andrea   M.
              Silkowitz, Assistant Attorney General, of
            counsel; Yao Xiao, Deputy Attorney General,
            on the brief).


     Mark Napier appeals from a final determination of the Board

of Public Utilities (Board), which rejected his challenge to the

methodology by which Public Service Electric and Gas Co. (PSE&G)

receives credit for the power generated by its pole-mounted solar

panels and Solar Renewable Energy Certificates (SRECs). We affirm.


     The Electric Discount and Energy Competition Act (EDECA),

N.J.S.A. 48:3-49 to -98.5, was enacted in 1999 to restructure the

electric power industry in New Jersey. In re Ownership of Renewable

Energy Certificates, 
389 N.J. Super. 481, 487 (App. Div. 2007).

Among other things, EDECA provides that an electric public utility

may invest in renewable energy programs on a regulated basis,

N.J.S.A. 48:3-98.1(a)(2), and file a petition with the Board for

cost recovery, 
N.J.S.A. 48:3-98.1(b).

     To further encourage "the development of renewable sources

of electricity and new, cleaner generation technology," the Board

adopted "Renewable Energy Portfolio Standards" (REPS), N.J.A.C.

14:8-1.1 to -2.12, which require suppliers of electricity to retail

customers    "to   annually   increase   their   reliance   on   renewable

energy" by generating a predetermined percentage of electricity

                                    2                              A-4408-15T2
by means of renewable sources, including solar power. 

48:3-87(d); see also N.J.A.C. 14:8-2.1(a); N.J.A.C. 14:8-2.3.

      In   its    regulations,     the   Board      created   "Renewable    Energy

Certificates" (RECs), and each REC "represents the environmental

benefits or attributes of one megawatt-hour of generated renewable

energy." Renewable Energy, 
389 N.J. Super. at 484. A supplier may

satisfy its renewable energy requirements by either generating

renewable energy directly or purchasing an appropriate number of

RECs or SRECs in the case of solar energy, from other energy

producers.       Id.   at   488;   N.J.A.C.     14:8-2.3(c);    N.J.A.C.     14:8-


      Through its designee PJM Interconnection, LLC (PJM), the

Board issues SRECs to solar energy producers based on the amount

of solar electricity generated. N.J.A.C. 14:8-2.9(a); N.J.A.C.

14:4-1.2. PJM is a Regional Transmission Organization (RTO) that

coordinates the movement of wholesale electricity in all or parts

of   thirteen      states,    including       New   Jersey.   PJM-Environmental

Information Services (PJM-EIS), a subsidiary of PJM, oversees the

SREC market for New Jersey.

      PJM-EIS oversees the issuance, tracking, and sale of SRECs

through the Generation Attribute Tracking System (GATS). PJM-EIS

also issues manuals that provide rules for measuring energy output

and participating in SREC markets. N.J.A.C. 14:8-2.9(a). Energy

                                          3                                A-4408-15T2
suppliers who participate in the wholesale PJM markets must comply

with the operating rules for GATS and the PJM Manuals pursuant to

contracts called Wholesale Market Participation Agreements (WMPA).

     On February 10, 2009, PSE&G filed with the Board a petition

for approval of a program for investment in solar generation

facilities called the "Solar 4 All Program." As part of the

program, PSE&G proposed a "Neighborhood Solar" plan, in which

forty megawatts (MW) of solar capacity would be produced by pole-

mounted solar panels located in PSE&G's service territory. PSE&G

proposed to install up to 200,000 panels.

     In its petition, PSE&G indicated it would meter the solar

energy generated by the panels by using a sampling methodology.

PSE&G noted that "each unit may not be individually metered."

According to PSE&G, the hourly output of the solar systems would

be determined through the use of "a calculated load profile, which

will be created by metering a sample of these systems with interval


     At the Board's direction, a BPU commissioner conducted six

public   hearings   on   PSE&G's   petition.   Thereafter,   PSE&G,   the

Board's staff, the Division of Rate Counsel, and several parties

who had intervened in the matter, entered into a Settlement

Agreement (SA) regarding the program, which the Board approved by

order dated August 3, 2009. Among other things, the SA and order

                                    4                            A-4408-15T2
recognized that the output from the pole-mounted solar panels

would be metered and verified pursuant to the requirements and

monitoring standards established by PJM.

     Thereafter, PSE&G worked with PJM to establish the metering

system for the solar panels. PSE&G entered into a WMPA, which

indicated it would submit to PJM hourly generation data for fifty

groups of pole-mounted panels. Each group includes a sample panel

with a PSE&G revenue-grade meter. PSE&G uses the metering data to

place daily aggregate production information into hourly bins.

     PSE&G sends this information to PJM, and the PJM Settlement

Group uses it to issue payments for energy sales for the pole-

mounted units. At the end of each month, the PJM Settlement Group

provides the data to PJM-EIS, which determines the amount of SRECs

that should be issued. By September 24, 2014, PSE&G had installed

approximately 174,366 pole-mounted solar panels.

     In January 2013, Napier filed a complaint in the Law Division

against   PSE&G.   He   asserted   claims   on   his   own   behalf   and    as

representative of a putative class of persons who had a financial

stake in New Jersey's SREC market from 2009 to 2012. Napier claimed

that in the relevant period, PSE&G had received more SRECs than

it was entitled to receive because it had not complied with certain

energy-reporting requirements.

                                     5                                A-4408-15T2
     Napier alleged that as a result, the value of "legitimately-

obtained" SRECs had been devalued, causing him and other members

of the putative class to sustain economic losses. Napier sought

damages   under   theories       of   unfair      competition    and    unjust


     In lieu of an answer, PSE&G filed a motion to dismiss the

complaint pursuant to Rule 4:6-2(e), arguing that Napier failed

to state a claim upon which relief could be granted. The trial

court   granted   the   motion    and       dismissed   the   complaint    with

prejudice. Napier appealed.

     While the appeal was pending, Napier filed a petition with

the Board seeking to bar PSE&G from receiving SRECs for its pole-

mounted solar panels. Napier alleged that PSE&G's panels have not

been metered, as required by the Board's rules and regulations;

and that PSE&G was receiving "far more energy credit" for solar

power than its system was actually producing. Napier asked the

Board to deny PSE&G any SRECs and solar energy credits going back

to 2009, when it approved PSE&G's "Solar 4 All Program." The Board

referred the matter to the Office of Administrative Law (OAL) for

a hearing as a contested case.

     On July 15, 2014, we affirmed the trial court's dismissal of

Napier's civil action, but modified the court's order to state

that the dismissal was without prejudice to claims Napier may

                                        6                              A-4408-15T2
present to the Board on any viable legal theory and any causes of

action he might in good faith assert. Napier v. Pub. Serv. Elec.

& Gas Co., No. A-4532-12 (App. Div. July 15, 2014) (slip op. at


       On October 1, 2014, PSE&G filed a motion in the OAL for

summary decision pursuant to N.J.A.C. 1:1-12.5. PS&G argued that

Napier failed to allege sufficient facts to support his allegations

that    PSE&G   was     not   complying      with    the       Board's    rules     and

regulations, and his claim that PSE&G was not accurately measuring

the solar power generated by the pole-mounted panels. In support

of the motion, PSE&G submitted a certification from Todd Hranicka,

its Director of Solar Energy.

       On   October     20,   2014,   Napier     filed     a    motion    to    compel

discovery. In the motion, Napier reviewed his discovery requests

and the answers that PSE&G had provided. He asserted it was not

possible to substantiate his allegations without the information

he was seeking from PSE&G. PSE&G opposed the motion for discovery.

In a separate submission, Napier argued that PSE&G's motion for

summary decision should be denied.

       After    hearing       oral    argument       on        the   motions,       the

Administrative Law Judge (ALJ) issued an initial decision. The ALJ

found that further discovery was not warranted, and that there was

no   genuine    issue    of   material    fact      as    to    whether   PSE&G     was

                                         7                                     A-4408-15T2
authorized to use a sampling methodology to determine the solar

power generated by the pole-mounted panels and the appropriateness

of that methodology. The ALJ therefore concluded that PSE&G's

motion for summary decision must be granted and Napier's petition

dismissed. Napier filed exceptions to the ALJ's initial decision,

and PSE&G filed a response.

     On April 27, 2016, the Board issued its final decision and

order dismissing Napier's petition. The Board noted that in its

petition   for   approval   of   the       "Solar   4   All   Program,"     PSE&G

indicated, among other things, that it planned to use a sampling

methodology to determine the solar power generated by the pole-

mounted panels. The Board stated that it did not reject the use

of a sampling methodology. The Board observed that the WMPA

required PSE&G to use metering equipment for the pole-mounted

panels, and that PSE&G had installed the panels in accordance with

the PJM Manuals.

     The Board also noted that PJM had been designated as the

Regional Transmission Authority and, as such, has responsibility

for ensuring the reliability of electric power supply in numerous

states. The Board commented that PJM had accepted the data produced

by sampling PSE&G's pole-mounted panels. PJM also had accepted the

use of modeling algorithms to determine the amount of power

                                       8                                  A-4408-15T2
generated collectively by all of the solar panels and the amount

of SRECs that should be issued.

     The Board accepted the ALJ's finding that there was no genuine

issue of material fact regarding the regulatory authority for

PSE&G's sampling methodology, the sufficiency of that methodology,

and the SRECs created on that basis. The Board therefore concluded

that PSE&G was entitled to summary decision. This appeal followed.


     On appeal, Napier argues that the Board erred by granting

PSE&G's motion for summary decision. He contends there were at

least three unresolved issues of material fact that precluded the

grant of PSE&G's motion.

     The   scope   of   our   review    of   a   final   decision   of     an

administrative agency is limited and we will not reverse such a

decision unless it is "arbitrary, capricious, or unreasonable, or

[] not supported by substantial credible evidence in the record

as a whole." In re Stallworth, 
208 N.J. 182, 194 (2011) (citing

Henry v. Rahway State Prison, 
81 N.J. 571, 579-80 (1980)). In

making that determination, we consider:

           (1) whether the agency's action violates
           express or implied legislative policies, that
           is, did the agency follow the law; (2) whether
           the record contains substantial evidence to
           support the findings on which the agency based
           its action; and (3) whether in applying the
           legislative policies to the facts, the agency

                                   9                                A-4408-15T2
               clearly erred in reaching a conclusion that
               could not reasonably have been made on a
               showing of the relevant factors.

               [Ibid. (citing In re Carter, 
191 N.J. 474,
               482–83 (2007)).]

       We note, however, that a court is "in no way bound by [an]

agency's interpretation of a statute or its determination of a

strictly legal issue." Carter, 
191 N.J. at 483 (quoting Mayflower

Sec. Co. v. Bureau of Sec., 
64 N.J. 85, 93 (1973)). "Because an

agency's       determination     on     summary    decision      is        a     legal

determination, [appellate] review [of that decision] is de novo."

L.A. v. Bd. of Educ. of City of Trenton, 
221 N.J. 192, 203 (2015)

(citing Contini v. Bd. of Educ. of Newark, 
286 N.J. Super. 106,

121–22 (App. Div. 1995); Manalapan Realty, LP v. Twp. Comm., 
140 N.J. 366, 378 (1995)).

       The standard for motions for summary decision under N.J.A.C.

1:1-12.5 is "substantially the same as that governing a motion

under Rule 4:46-2 for summary judgment in civil litigation." L.A.,

221 N.J. at 203 (citing Contini, 
286 N.J. Super. at 121–22). Thus,

an    agency    must   ascertain      "whether    the    competent        evidential

materials presented, when viewed in the light most favorable to

the    non-moving      party   in     consideration       of   the        applicable

evidentiary       standard,    are    sufficient    to    permit      a    rational

factfinder to resolve the alleged disputed issue in favor of the

                                        10                                     A-4408-15T2
non-moving party." Id. at 204 (quoting Brill v. Guardian Life Ins.

Co. of Am., 
142 N.J. 520, 523 (1995)).

     Here, Napier argues there were at least three unresolved

issues that precluded the Board from granting PSE&G's motion for

summary decision. He contends: (1) the Board never specifically

approved PSE&G's method for determining the solar energy generated

by its pole-mounted panels; (2) the Board's regulations do not

permit PSE&G's sampling methodology; and (3)      PSE&G failed to show

there was no genuine issue of material fact and it was entitled

to summary decision as a matter of law.

     We note that Napier did not specifically raise the first two

issues before the ALJ and the Board. In his petition, Napier

claimed that PSE&G's panels were not metered as required, and

PSE&G was receiving credit for more solar power than its system

was actually producing. He asked the Board to deny PSE&G credit

for the solar power generated by pole-mounted panels from 2009 to


     Ordinarily, we will not consider issues raised for the first

time on appeal unless the issues are jurisdictional in nature or

have a substantial effect upon the public interest. N.J. Div. of

Youth & Family Servs. v. M.C. III, 
201 N.J. 328, 339 (2010). The

issues Napier has raised for the first time on appeal are not

jurisdictional   and   do   not   substantially   affect   the    public

                                  11                             A-4408-15T2
generally. Nevertheless, we have decided to consider the issues

that Napier has raised.

     Napier first argues that the Board never approved the manner

by which PSE&G measures the solar energy generated by the pole-

mounted panels. We disagree.

     As we have explained, PSE&G petitioned the Board for approval

of its "Solar 4 All Program," and in its petition, PSE&G indicated

that it planned to measure the solar power generated by the panels

by metering samples of the panels and using modeling algorithms.

As noted, the Board approved PSE&G's petition under the terms and

conditions set forth in the SA.

     By approving PSE&G's petition, the Board sanctioned the use

by PSE&G of the sampling and modeling algorithms to measure the

solar power generated collectively by all of the pole-mounted

panels. In its decision on Napier's petition, the Board found that

PSE&G had regulatory authority to use a sampling method         and

modeling algorithms to measure the power generated by the pole-

mounted units, and SRECs had been validly issued on that basis.

There is sufficient credible evidence in the record to support the

Board's findings.

     Next, Napier argues that PSE&G's sampling methodology is not

permitted by the Board's regulations. In support of this argument,

Napier cites N.J.A.C. 14:8-2.9(c), which states:

                               12                          A-4408-15T2
           Beginning December 4, 2012, in measuring
           generation to determine the number of RECs or
           SRECs to issue, the Board or its designee
           shall accept only readings of a meter that
           records    kilowatt-hour     production    of
           electrical energy, and which meets all
           applicable requirements at (c)1 and 2 below.
           The readings may be taken or submitted by any
           person, but shall be verified by the Board or
           its designee:

                 1. The American National Standards
                 Institute (ANSI) Standard C12.1-2008,
                 Electric Meters Code for Electricity
                 Metering,   incorporated  herein    by
                 reference, as amended or supplemented;

                 2.   Any additional requirements in the
                 PJM-EIS Generation Attribute Tracking
                 System Operating Rules, Revision 6,
                 September   2010;   and    the   PJM-EIS
                 Generation Attribute Tracking System
                 Terms of Use, last modified on January
                 3, 2011; which are incorporated herein
                 by    reference,    as    amended    and
                 supplemented, and can be found at

                 [N.J.A.C. 14:8-2.9(c).]

     As we stated previously, by approving PSE&G's "Solar 4 All

Program," the Board recognized that the output from PSE&G's pole-

mounted solar panels would be metered using a sampling methodology

and the data would be verified         pursuant to the requirements

established by PJM. The regulation Napier relies upon does not

preclude   the   use   of   a   sampling   methodology.   The   Board's

interpretation and application of the rule is consistent with its

                                  13                            A-4408-15T2
plain language. Moreover, the record shows that PSE&G's sampling

method uses readings from meters that comply with the rule's


     Napier further argues that PSE&G failed to establish that its

sampling method complies with "the monitoring standards in the PJM

Manuals." However, in his certification, Hranicka stated that

PSE&G worked with PJM to establish an acceptable monitoring system.

Furthermore,    Hranicka    stated      that   PJM    has    accepted      PSE&G's

methodology and the data collected to determine hourly output from

all of PSE&G's solar-mounted panels.

     In addition, Napier argues that Hranicka's certification

failed to establish that there was no genuine issue of material

fact and PSE&G was entitled to summary decision. He contends that

in certain respects, statements in the certification are not

consistent with PSE&G's responses to his discovery requests.

     We are convinced, however, that Hranicka's certification

provided    sufficient   facts    to    support      the    ALJ's    and   Board's

decisions    that   PSE&G   was   entitled     to     summary       decision.     In

responding to PSE&G's motion, Napier had the burden of presenting

evidence that raised a genuine issue of material fact regarding

PSE&G's compliance with the Board's 2009 order, the applicable

regulations, and the PJM monitoring standards. The ALJ and the

Board correctly found that he had not carried that burden.

                                       14                                  A-4408-15T2

       Napier argues that the ALJ erred by failing to refusing to

grant his motion for discovery. He contends the ALJ did not comply

with    N.J.A.C.   1:1-10.1,   which     states,     "[i]n   considering     a

discovery motion, the judge shall weigh the specific need for the

information, the extent to which the information is within the

control of the party and matters of expense, privilege, trade

secret and oppressiveness." Napier argues the ALJ failed to weigh

his specific need for the information he was seeking.

       We note that in his motion to compel discovery, Napier asked

the ALJ to order PSE&G to produce: (1) the Smart Energy Platform

information for all metered pole-mounted panels; (2) the full

report of energy output from the panels; (3) the reports for so-

called "aggregators" that reflect production data from 38,000

pole-mounted units; (4) data reported by certain sample meters;

(5) installation information and technical data regarding the

panels; (6) information regarding the location of the panels; (7)

maintenance    records   regarding     panels      that   were   damaged    or

inoperable; and (8) evidence showing that PSE&G used competitive

bidding to acquire the panels. In his motion, Napier noted that

PSE&G had provided some of the information he requested, but

claimed its responses were incomplete.

                                  15                                 A-4408-15T2
     We are convinced that the ALJ did not err by refusing to

order further discovery. The ALJ noted that PSE&G had provided

reasonable responses to Napier's discovery requests and further

discovery was not warranted. The Board agreed.

     The additional discovery that Napier requested would not

support his claim that PSE&G did not have regulatory authority to

use the sampling method to measure the solar energy generated by

the pole-mounted units. The discovery also would not show that

PSE&G was calculating the solar energy generated by its pole-

mounted units in a manner that was not permitted by the Board or

its regulations. Therefore, the ALJ and the Board did not err by

refusing to grant Napier's motion to compel discovery.


     Napier also argues that we should not defer to the Board's

decision because the Board allegedly did not use its expertise

when it dismissed his petition. He contends PSE&G failed to present

the documentation and information that the ALJ and the Board needed

to make an informed decision on his petition. We disagree.

     "The Legislature has endowed the BPU with broad power to

regulate public utilities . . . . [and] considerable discretion

in exercising those powers." In re Public Serv. Elec. & Gas Co.'s

Rate Unbundling, 
167 N.J. 377, 384-85 (2001) (quoting In re

Elizabethtown Water Co., 
107 N.J. 440, 449-50 (1987)). The Board's

                               16                            A-4408-15T2
decisions are presumed to be valid "and will not be disturbed

unless [the court] find[s] a lack of 'reasonable support in the

evidence.'" Id. at 385 (quoting In re Jersey Cent. Power & Light

85 N.J. 520, 527 (1981)).

     In this matter, there is sufficient credible evidence in the

record to support the ALJ and Board's decisions. We reject Napier's

contention that the ALJ and the Board lacked sufficient evidence

to make an informed decision in this matter. We also conclude that

the Board used its regulatory expertise in deciding the issues

before it.

     Napier further argues that PSE&G's method for calculating the

solar energy produced by the pole-mounted panels is inconsistent

with the State's policy to increase the production of solar energy.

He contends PSE&G's method of estimating the power generated by

its pole-mounted panels hinders the State's policy by artificially

inflating the market price of solar facilities.

     There is, however, no evidence in the record to support these

allegations.   The    Board   determined   that   PSE&G's    metering

methodology is consistent with the Board's 2009 order approving

the "Solar 4 All Program," the applicable regulations, and PJM

requirements. The    Board's decision is supported   by     sufficient

                                 17                            A-4408-15T2
credible   evidence   in   the   record,   and   it   is   not   arbitrary,

capricious, or unreasonable.


                                   18                               A-4408-15T2

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