State ex rel. Utilities Commission v. Environmental Defense Fund

Under North Carolina’s statutory Renewable Energy and Energy Efficiency Portfolio Standards (REPS), N.C. Gen. Stat. § 62-133.8, public electric utilities in North Carolina were required to meet certain renewability and efficiency standards. Any public electric utility that wanted to generate tradable renewable-energy credits to comply with REPS had to register its facility with the North Carolina Utilities Commission (the commission) (defendant). Facilities that generated electric power using a “renewable energy resource”—defined in § 62-133.8(a) to include “a biomass resource, including agricultural waste, animal waste, wood waste,” and other substances—were considered renewable-energy facilities. In March 2010, Duke Energy Carolinas, LLC (Duke) applied to the commission to register two of its thermal-electric-generating stations as renewable-energy facilities. Duke planned to use wood chips and coal as fuel at the generating stations. The commission approved Duke’s application after determining that wood fuel from primary-harvest whole trees was a biomass resource that qualified as a renewable-energy resource for purposes of REPS. The commission, in reaching its determination, relied on the definition of biomass in the North Carolina Biomass Council’s North Carolina Biomass Roadmap. That definition indicated that a biomass is a renewable or recurring organic resource, including trees, wood, and wood wastes. Environmental Defense Fund and the North Carolina Sustainable Energy Association (collectively, the environmental groups) (plaintiffs) challenged the commission’s decision, asserting that wood fuel from primary-harvest whole trees was not a biomass resource as defined in § 62-133.8(a). The environmental groups asserted that the statutory definition of biomass resource was an exhaustive list of all biomass materials and, thus, that wood fuel from primary-harvest whole trees was not a biomass resource because it was not specifically listed in the statute. The environmental groups also contended that the doctrine of ejusdem generis limited the term biomass resources to only biomass material of the same kind as the listed resources.