CHESTERTOWN — Maryland’s high court issued a ruling in July sinking the hopes of some who, in their efforts to fight large-scale solar development on Kent County’s prime farmland, sought to elevate local zoning over state authority in such matters.

On July 15, Judge Brynja M. Booth issued the Court of Appeals opinion in Board of County Commissioners of Washington County, Maryland v. Perennial Solar LLC, detailing the Maryland Public Service Commission’s role in approving utility projects and why it pre-empts local land use regulations.

Meanwhile, Gov. Larry Hogan has announced plans to designate a panel to review how and where renewable energy facilities are developed in Maryland, as the state continues to move forward with its goals of a 40% reduction in greenhouse gas emissions by 2030 and 100% reliance on clean energy in 2040.

Utility companies and the like, including solar developers, are required to obtain a Certificate of Public Need and Convenience from the PSC to build an energy-generating facility. The Court of Appeals opinion reinforces that under state law, county and municipal governments are to be included in that process, with the PSC giving due consideration to a number of site-specific issues as well as local land use plans and zoning.

“Under the plain language of the statute, local government is a significant participant in the process, and local planning and zoning concerns are important in the PSC approval process. However, the ultimate decision-maker is the PSC, not the local government or local zoning board,” Booth, an Easton attorney who was seated on the high court earlier this year, concluded in the opinion.

The Washington County case stems from the application of Perennial Solar to develop a 10-megawatt solar energy generating system on 86 acres of farmland. Because the project was on two separate but contiguous properties, Perennial sought and received a special use exception and a variance from the county’s Board of Zoning Appeals in 2015.

As described in the court opinion, “aggrieved landowners” took the matter to Circuit Court. The Circuit Court held that under state law, the PSC has authority over counties when it comes to site locations for utilities. The lower court went so far as to order the Board of Zoning Appeals to “vacate its opinion and the grant of a special use exception and variance,” according to the Court of Appeals opinion.

The county and the landowners appealed, lost and appealed again to Maryland’s supreme court. Kent and Queen Anne’s counties filed amicus briefs with the Court of Appeals in the matter, making them parties to the case without signing on as complainant or defendant. As stated in the court opinion, both voiced support for Washington County’s position.

The PSC also filed an amicus brief. It supported Perennial’s argument.

Local Concerns

The case is significant in Kent County, as numerous solar projects are under construction or under review by the PSC.

Tom Yeager, Kent’s county attorney, announced the Court of Appeals decision to the Kent County commissioners the day after it was issued. At the time, Yeager said that while county zoning and local opinion on a solar developer’s application is to be considered in the CPCN process, the PSC is the final decision maker.

Yeager said his reading of the opinion is Perennial solar should not have even gone through the Washington County Board of Zoning Appeals.

“So that’s not good,” said Commissioner Bob Jacob upon hearing the news at the July 16 county meeting.

When asked to further speak about their stances on the decision at an Aug. 6 meeting, the commissioners and staff used the example of Morgnec Road Solar as cause for concern. Developers for that project are seeking approval from the PSC to build a solar array just outside of Chestertown on privately owned farmland off Morgnec Road.

County Administrator Shelley Heller, while not referencing the project by name, spoke about how it is proposed in the growth area for Chestertown and has received opposition from the county and the town. She said the PSC’s potential approval of the project shows how the state board could pre-empt local zoning.

“I can see it if we didn’t have any plans for that land. We’ve already set it aside for a purpose,” Jacob said.

Yeager said at the Aug. 6 meeting that the court’s decision has a disproportionate effect on rural counties like Kent. He said urban areas do not have the land available for large-scale solar and wind projects. He said the General Assembly had the opportunity to pass legislation giving counties control over these types of projects.

“The real issue is, in Kent County, we’ve been held up in high regard as a county that really saved its agricultural industry. And there’s not a one of us in Kent County that hasn’t had to pay that price: not being able to do something that we wanted to do and been told no all in the name of preserving ag land, only for some court to be able to say, ‘Now we’ll take over and we’ll decide what’s going to happen with your ag land.’ I think it’s very very unfair,” Commissioner Ron Fithian said at the meeting.

Tom Mason, president of the commissioners, looked at the issue of Morgnec Road Solar from a practical land use perspective, saying that if the PSC approved the project, residential or business growth would have to “leap-frog” over the facility.

The Precedent

The Howard County v. Potomac Electric Power Co. case from 1990 reportedly was cited in Perennial’s arguments. That case focused on PEPCO’s efforts to run a 10.5-mile 500,000-volt transmission line.

While the ruling went PEPCO’s way, enshrining the PSC as the body with final approval, local attorney Mitch Mowell, representing the Kent County commissioners, argued against the precedent’s applicability in a case that set off the fight against utility-scale solar facilities in Kent County.

When Apex Clean Energy sought to build a development called Mills Branch Solar in the Chesterville area several years ago, Mowell issued a trial brief in opposition of the project. Citing Howard v. PEPCO, Mowell argued that, among other issues, the ruling in that case involved a public service company, PEPCO, dealing with “a construction company that builds alternative energy projects for sale to investors.”

In the opinion regarding the Washington County case, Booth wrote in a lengthy footnote “(i)t is undisputed that Perennial is not a public service company” as defined by law. She referenced arguments by Kent and Queen Anne’s counties in the Washington County case.

“Queen Anne’s County and Kent County argue that the PSC lacks jurisdiction over companies like Perennial, which undertake large scale solar projects because they do not fall within the definition of ‘public service companies.’ We do not read the statute so narrowly,” Booth wrote. “Perennial is ‘a person’ seeking to construct a generating station in Maryland and therefore, is required to obtain a CPCN from the PSC.”

Janet Christensen-Lewis is chairman of the Kent Conservation and Preservation Alliance, originally named Keep Kent Scenic and formed in opposition of Apex’s development plans here.

In discussing the Court of Appeals decision, Christensen-Lewis said earlier this month that the hope in renewing arguments about the applicability of Howard v. PEPCO was that the judges would treat the matter differently because solar facilities take up so much land as compared to the overhead transmission lines sought in the precedent-setting 1990 case. She worries that the state’s increased push for renewable energy will see the amount of land sought grow even more.

“These are big footprints that are taking up huge amounts of land. With the increase in the renewable portfolio standard that will even become greater,” she said.

Booth wrote that in reading the law, size and scope did not matter.

“While it is true that transmission lines may be different from generating stations as far as their scope, size, coverage area, environmental impact, and purpose, the General Assembly has enacted a statute creating the same approval process for both types of structures, with the PSC as the final approving authority for their siting and location,” the opinion states. “The General Assembly has chosen to treat the approval of transmission lines and generating stations, including large scale solar projects, in the same manner, and it is not within our province to change it.”

In the court opinion, Booth wrote that the law and the state legislature are clear about the PSC preempting local government. She wrote that the plain text of the statute also spells out how local planning and zoning is to be considered in the application process for a CPCN.

“For example, as part of the CPCN application process, the PSC holds public hearings within each local jurisdiction where the construction is proposed, with the governing body of the local jurisdiction invited to jointly preside over and participate in those hearings. Local land use interests are also designated by statute as a factor requiring ‘due consideration’ by the PSC in evaluating and approving generating stations,” the opinion states.

Booth also argues that if local government sign-off on such a project were required side-by-side with PSC approval, it would create a “two-tiered regulatory process” with disconcerting consequences. Citing another case that states such a process would “engender chaos and confusion,” Booth wrote that issues could arise if the PSC approves a project but a local government board fails to issue a required special use exception or variance.

The General Assembly has been clear in its intent, according to Booth, who used as examples recent legislative efforts to amend the law.

She wrote that in reviewing a pair of bills during the 2017 legislative session, the General Assembly could have moved forward with one that would have “significantly restricted” the PSC’s authority to preempt local government. She said lawmakers instead passed a bill requiring the PSC give due consideration to “the comprehensive plan and zoning laws of the applicable local jurisdiction.”

“By enacting the 2017 Amendment, the General Assembly recognized the importance of the local comprehensive plan and zoning regulations in considering the placement of SEGS. However, the 2017 Amendment fell short of shifting the final approving authority from the PSC to the local government for the siting and location of SEGS,” the opinion states.

Due Consideration

At the Aug. 6 commissioners meeting, Heller talked about that “due consideration.”

“That is their catch phrase. And in the Apex Solar, they gave Kent County due consideration. They listened to the governments, to the people and we felt as though we were making progress,” Heller said. “Because of the due consideration, they did not give the Certificate of Public Need and Necessity.”

In rejecting Apex’s application for a CPCN for Mills Branch Solar, Public Utility Law Judge Dennis H. Sober wrote that “the weight of the evidence” for the project’s location in the Chesterville area fell heavier on the negative side of the scale.

“Local control over the amount, location, and type of development must be respected by the Commission when there is no weight of evidence of need or benefit to outweigh the local opposition. The weight of the evidence of harm being caused, if the Project is built, was significant and was a major factor in my decision to deny the application,” Sober wrote in his concluding opinion of the hotly contested Mills Branch Solar development.

Lewis-Christensen offered other examples of the PSC giving that due consideration, such as requiring a solar developer that got the green light in Kent County for a much smaller project to still have to comply with the Forest Conservation Act. The developer argued against having to pay what it called a “tree tax,” especially since the project was going on already cleared land. The PSC still required compliance.

For Lewis-Christensen, the Court of Appeals decision means that, at least for now, local governments and organizations like Kent Conservation and Preservation Alliance will have to continue spending money to fight unwanted projects at the state level, while hoping the PSC gives that due consideration.

Siting Development

An executive order signed by Gov. Larry Hogan Aug. 14 may provide a ray of hope for those seeking to retain local control. Hogan’s order establishes a panel to review how renewable energy facilities are developed in Maryland.

The chairman of the Governor’s Task Force on Renewable Energy Development and Siting will be Greg Snook, who served as president of the Washington County Commissioners from 1990 to 2006 and is now the president and CEO of the Hagerstown–Washington Industrial Foundation. Snook was not a party to the Court of Appeals case or PSC deliberations regarding his home county.

Additional members are to include the secretaries of agriculture, commerce, the environment, natural resources, planning and transportation and the director of the Maryland Energy Administration, or their designees.

Also invited to join are the director of Maryland Environmental Service and the chairman of the PSC or their designees, two representatives of the agriculture industry as selected by the Maryland Farm Bureau, a county government official picked by the Maryland Association of Counties, a municipal government official chosen by the Maryland Municipal League, and one representative each for the wind and solar industries.

“In my most recent State of the State address, I pledged my strong support for clean and renewable energy solutions that are affordable, reliable, and produce jobs right here in Maryland,” Hogan said in a statement. “That is exactly what these announcements will help us to achieve. These innovative initiatives will provide millions of dollars in benefits to Marylanders and lower energy and maintenance costs, all while creating clean energy and green jobs opportunities.”

The executive order reiterates Maryland’s renewable energy portfolio goal for reduced greenhouse gas emissions and complete reliance on clean energy generation, noting the “(t)he State must work aggressively to diversify, expand, and sustain its clean and renewable energy capabilities while balancing, enhancing, and safeguarding Maryland’s cultural heritage, economy, environment, natural resources, and view-sheds.”

The task force is to submit an interim report to the governor’s office by Dec. 1. It is to include legislative recommendations for the 2020 General Assembly session. The final report is due Aug. 14, 2020.

Hogan’s executive order follows up on an effort launched by the Nature Conservancy last fall. The organization held a series of listening sessions throughout the state to hear about issues associated with renewable energy development.

“In communities across Maryland, conflicts between solar energy development and other land uses, particularly agriculture, have arisen. However, these conflicts can be greatly reduced, if not avoided entirely, with better targeting of solar energy development towards areas that are not highly valued for other land uses,” states the Nature Conservancy’s report out from those sessions.

The Nature Conservancy listed three recurring takeaways from the sessions: looking at development on “marginal and low-conflict lands,” incentivizing development on such sites and getting state and local government on board.

“Participants highlighted negative impacts due to the amount of land required for renewable energy production and provided examples of lands that are directly in conflict with this kind of development,” the report states.

Such concerns focused on prime agricultural land, natural areas and wildlife habitat and cultural heritage. Preferred sites included public facilities, with Chesapeake College’s overhead parking lot array held up as a good example, and degraded lands like brownfield and vacant industrial sites.

Citing a PSC-commissioned study, the Nature Conservancy report states that increasing solar production could have a $3.8 billion economic impact in Maryland with 20,000 new jobs.

“If Maryland incorporates a greater proportion of energy from renewable sources into its energy generation portfolio, both a reduction in greenhouse gas emissions, and along with it the opportunity to increase economic and human health benefits will follow,” the Nature Conservancy report states.

Lewis-Christensen was pleased to see the Nature Conservancy delving into the issue of siting renewable energy facilities, saying there is a need to create incentives to push development to no-conflict lands.

“I’m excited about what the Nature Conservancy is doing and will follow them very closely. They’re doing basically what we were asking the legislature to do,” she said.

During the 2019 General Assembly session, the Kent Conservation and Preservation Alliance sought a bill that would create a “Commission on the Development of a Blueprint for Solar Energy in Maryland.” It had bipartisan backing, including state Sen. Steve Hershey, R-36-Upper Shore, but failed to get out of committee.

“This last legislative session, we tried to put forward a commonsense legislation to get a committee put together to look at no-conflict land — if you could identify where solar could go without interfering with forests, without interfering with prime farmland, without interfering with towns’ ability to expand their borders. You’d be better off if you could end all these fights,” Christensen-Lewis said.

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