A24-1454 A24-1455 A24-1700 A24-1741 A24-1750

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A24-1450
A24-1454
A24-1455
A24-1700
A24-1741
A24-1750

In the Matter of the Petition of Northern States Power Company, d/b/a Xcel Energy, for
Approval of Its Proposed Community Solar Garden Program.

Filed August 4, 2025
Affirmed
Schmidt, Judge

Minnesota Public Utilities Commission
File No. E-002/M-13-867

Curtis P. Zaun, Minnesota Solar Energy Industries Association, St. Paul, Minnesota; and

Scott F. Dunbar (pro hac vice), Keyes & Fox LLP, Denver, CO (for relator Joint Solar
Associations)

Micah J. Revell, Zachary J. Wright, Stinson LLP, Minneapolis, Minnesota (for relator
United States Solar Corporation)

Andrew P. Moratzka, Marc A. Al, Eden A. Fauré, Stoel Rives LLP, Minneapolis,
Minnesota (for relator Standard Solar, Inc.)

Keith Ellison, Attorney General, Jeffrey K. Boman, Susan C. Gretz, Assistant Attorneys
General, St. Paul, Minnesota (for respondent Minnesota Public Utilities Commission)

Eric F. Swanson, Kyle R. Kroll, Robert B. Grimsley, Winthrop & Weinstine, P.A.,
Minneapolis, Minnesota; and

James R. Denniston, Assistant General Counsel, Xcel Energy, Minneapolis, Minnesota (for
respondent Northern States Power Company, d/b/a Xcel Energy)

2
Keith Ellison, Attorney General, Richard Dornfield, Assistant Attorney General, St. Paul,
Minnesota (for respondent Minnesota Department of Commerce)

Keith Ellison, Attorney General, Peter G. Scholtz, Assistant Attorney General, St. Paul,
Minnesota (for Office of theAttonrey General-Residential Utilities Division)

David A. Assaf, Morgan K. Azbill, Christopher M. Hood, Flaherty & Hood, P.A., St. Paul,
Minnesota (for amicus curiae City of Winona)

Considered and decided by Cochran, Presiding Judge; Reyes, Judge; and Schmidt,
Judge.
NONPRECEDENTIAL OPINION
SCHMIDT, Judge
Relators Standard Solar, Inc., United States Solar Corporation, and Joint Solar
Associations (collectively, relators) challenge a decision by respondent Minnesota Public
Utilities Commission ( the commission) that transitioned the method used by respondent
Northern States Power Company d/b/a Xcel Energy to calculate bill credits for subscribers
of certain Community Solar Gardens. Relators raise eight arguments, contending that the
commission: (1) exceeded its statutory authority, (2) impermissibly engaged in retroactive-
ratemaking, (3) issued an order that was arbitrary and capricious, (4) should have ordered
a contested-case hearing, (5) violated the Contract Clauses of the United States and
Minnesota Constitutions, (6) violated the federal and state constitutional Takings Clauses,
(7) violated the Mobile-Sierra
1 doctrine, and (8) issued an order that violated the doctrine
of promissory estoppel. We affirm.

1 United Gas Pipe Line Co. v. Mobile Gas Serv. Corp., 350 U.S. 332 (1956); Fed. Power
Comm’n v. Sierra Pac. Power Co., 350 U.S. 348 (1956).
3
FACTS
This appeal requires us to review the commission’s decision as to how Xcel should
calculate bill credits for subscribers of certain Community Solar Gardens (CSGs). To
provide context, we summarize the history of the CSG statute (Minn. Stat. § 216B.1641
(2024)), Xcel’s CSG program, and pertinent commission orders related to that program.
The CSG statute was enacted in 2013 to promote solar energy growth in the state
by providing individual customers and communities the opportunity to support the
development of solar energy by subscribing to a solar garden. See 2013 Minn. L. ch. 85,
art. 10, § 2 (codified at Minn. Stat. § 216B.1641, subd. 1).2 The statute defines a solar
garden as “a facility that generates electricity by means of a ground-mounted or roof-
mounted solar photovoltaic device whereby subscribers receive a bill credit for the
electricity generated in proportion to the size of their subscription.” Id., subd. 1(b). A CSG
generates solar energy and delivers the energy to Xcel . Id., subd. 1(b), (d). The CSGs
obtain revenue from subscribers, which includes individuals, municipalities, schools,
hospitals, and other entities. Id., subd. 1(h). CSG subscribers receive a discount —in the
form of a bill credit—on their Xcel energy bill in proportion to the size of their subscription.
Id., subd. 1(d), (h). Xcel recovers the costs of the program from all ratepayers.
The CSG statute requires Xcel to purchase the energy generated by approved CSGs
and provides that “[t]he purchase shall be at the rate calculated under section 216B.164,

2 In 2023, the legislature amended the statute, segregating its original provision in
Minnesota Statutes section 216B.1641 to govern CSGs approved by the commission before
January 1, 2024. Minn. Stat. § 216B.1641, subd. 1(i). At issue in this appeal is Xcel’s
legacy program.
4
subdivision 10, or, until that rate for the public utility has been approved by the
commission, the applicable retail rate.” Id., subd. 1(d). The rate calculated under Minn.
Stat. § 216B.164, sub. 10, is referred to as the value of solar (VOS) rate. The VOS rate is
calculated under a methodology approved by the commission that accounts for benefits of
distributed solar generation, such as avoiding the costs of fuel, operations-and-
maintenance, generation-capacity, transmission and distribution, and environmental
expenses. See Minn. Stat. § 216B.164, subd. 10 (2024). The statute does not define the
“applicable retail rate” (ARR), but the commission has interpreted the term to mean “the
full retail rate, including the energy charge, demand charge, customer charge, and
applicable riders, for the customer class applicable to the subscriber receiving the credit.”
In September 2013, Xcel filed the statutorily-required proposal for a CSG program
for the commission’s approval. Id., subd. 1(a). The commission received many comments
on the proposed plan. Based on this feedback, the commission issued an order rejecting
the proposal and requiring Xcel to file a revised plan.
Xcel timely filed a revised plan. The commission issued an order (2014 Order)
approving Xcel’s modified plan, which required Xcel to “purchase solar-garden energy at
the [ARR] until the commission approved a VOS rate.” The 2014 Order also allowed
CSGs to sell renewable energy credits (RECs) to Xcel at a rate intended to help make the
CSGs financeable. The 2014 Order further required Xcel to modify its proposed tariff and
add language in the standard CSG form contract that was included in the tariff.
Consistent with the 2014 Order, the standard form contract included language that
required the RECs price for CSG gardens to “remain fixed for the entire 25-year contract
5
period.” The contract specified that “[s]ubsequent Commission approved REC prices shall
only apply to new garden applications.” But the contract further provided that “[i]n the
event of any conflict between the terms of this Contract and Company’s electric tariff, the
provisions of the tariff shall control.” The standard form contract also stated that the
contract is, at all times, subject to “all rules and orders issued by the Commission or other
government agency having jurisdiction over the subject matter of this Contract.” It further
noted that the contract “shall be modified and amended if required to comply with any
order or regulation of the Commission, applicable state or federal laws or regulations, or
other government agency having jurisdiction over the subject matter of this Contract.”
In September 2016, the commission issued an order (the 2016 Order) that approved
the VOS rate— which was less than the ARR—for all solar garden applications filed after
December 31, 2016. 3 The 2016 Order stated that: “Parties unanimously recommend that
any change to the bill -credit rate be applied prospectively so as not to undermine the
viability of existing applications. The Commission concurs[.]” Following the 2016 Order,
CSGs for which applications were filed on or before December 31, 2016, operated under
the ARR rate (ARR-era CSGs) and CSGs for which applications were filed on January 1,
2017, or later operated under the VOS rate.
In July 2023, the commission ordered Xcel to “develop and file a detailed
proposal . . . for switching ARR-era gardens to the appropriate VOS rate.” Xcel submitted
a timely proposal. After receiving voluminous comments from stakeholders who provided

3 Xcel did not support transitioning to the VOS rate without adjustments to the VOS
methodology. The commission rejected Xcel’s position.
6
input on the proposal, the commission issued an order on May 30, 2024 (2024 Order)
approving the rate-transition proposal, with modifications.
The 2024 Order approved “Xcel’s compliance filing and authorize[d] a transition
from the [ARR] to the [VOS rate] for all existing CSGs,” which effectively impacted only
ARR-era CSGs. The commission found that “circumstances have evolved since the CSG
program rollout” that required the transition. The commission reasoned that the change
was necessary “due to the cost of ARR-era community solar gardens’ bill credits to non-
subscribing ratepayers.” The commission found that the “[ARR] rates for purchasing CSG
energy [from ARR-era CSGs] are significantly higher than the market price of non-CSG
energy, and the entire above-market cost of purchased CSG energy is recovered from
Xcel’s Minnesota customers.” The 2024 Order also noted that, “most importantly, there
now exists nearly a decade’s worth of data related to the CSG program’s operation that
support a shift to the VOS.”
To facilitate a successful transition to the VOS rate, the commission modified Xcel’s
proposal by including temporary “adders”— additional credit above the VOS rate—for
subscribers of ARR-era CSGs who would be affected by the rate reduction from the ARR
rate to the VOS rate. The commission intended the adders to gradually transition the bill
credits from the ARR to the VOS rate. The commission also delayed implementation of
the transition until April 1, 2025 to allow subscribers and CSGs to adjust their operations.
The relators filed petitions requesting reconsideration of the 2024 Order. The
commission denied the petitions, finding that they “do not raise new issues, do not point to
new and relevant evidence, and do not expose errors in the Commission’s decisions.”
7
Standard Solar, 4 U.S. Solar,5 and Joint Solar Associations (JSA )6 each filed a
certiorari appeal. We consolidated the three appeals. We granted a motion to stay the
appeal to allow the commission to consider relators’ second petition for reconsideration. 7
After the commission denied the second request for reconsideration, we lifted the stay.
DECISION
Relators argue that the commission lacked the statutory authority to transition the
rates to VOS, that the 2024 Order was arbitrary and capricious, and that the commission
violated the United States and Minnesota Constitutions’ Contract Clauses. Standard Solar
and U.S. Solar argue that the transition effects an unconstitutional taking. Standard Solar
argues that the commission engaged in impermissible retroactive ratemaking. JSA argues
the commission should have held a contested-case hearing. Finally, U.S. Solar argues the
commission’s 2024 Order should be reversed under the Mobile-Sierra and promissory
estoppel doctrines. We begin by setting forth our standard of review.
“Any party to a proceeding before the commission or any other person, aggrieved
by a decision and order and directly affected by it, may appeal from the decision and order
of the commission in accordance with [the Minnesota Administrative Procedure Act ].”

4 Standard Solar operates 11 AAR and 28 VOS-rate solar gardens in Minnesota.

5 U.S. Solar has 95 CSGs in Minnesota, many of which are ARR-era gardens.

6 JSA is an organization that includes the Coalition for Community Solar Access—a
community-solar-industry-nonprofit organization—and the Minnesota Solar Energies
Association—a nonprofit trade association representing Minnesota’s solar industry.

7 We denied a motion that sought to stay the 2024 Order pending appeal.
8
Minn. Stat. § 216B.52 (2024). “On writ of certiorari, we determine whether the
Commission violated the constitution, exceeded its authority, engaged in unlawful
procedure, erred as a matter of law, issued a decision unsupported by substantial evidence,
or acted arbitrarily or capriciously.” In re Investigation into Intra- LATA Equal Access &
Presubscription, 532 N.W.2d 583 , 588 (Minn. App. 1995), rev. denied (Minn. Aug. 30,
1995). An agency’s decision is presumed correct, and we defer to the agency’s expertise
in factfinding. Id. Agency decisions are entitled to deference in areas requiring an
agency’s technical training, education, and experience. In re Petition of N. States Power
Co., 676 N.W.2d 326, 331 (Minn. App. 2004). “When reviewing questions of law,
however, we are not bound by the agency’s decision and need not defer to the agency’ s
expertise.” In re Investigation into Intra-LATA Equal Access, 532 N.W.2d at 588. The
party challenging the commission’s decision bears “the burden of proof when appealing.”
In re Petition of Excelsior Energy Inc., 782 N.W.2d 282, 289 (Minn. App. 2010).
The commission’s 2024 Order transitioning from ARR to VOS rates involves both
quasi-legislative and quasi-judicial decision-making. An agency engages in quasi-judicial
decision-making when it receives evidence to make factual findings and weighs that
evidence as a judge would in a court trial. St. Paul Area Chamber of Com. v. Minn. Pub.
Serv. Comm’n, 251 N.W.2d 350, 358 (Minn. 1977). For quasi-judicial decisions, we
review the commission’s decision and we
may affirm the decision of the agency or remand the case for
further proceedings; or it may reverse or modify the decision if
the substantial rights of the petitioners may have been
prejudiced because the administrative finding, inferences,
conclusion, or decisions are:
9

(a) in violation of constitutional provisions; or

(b) in excess of the statutory authority or jurisdiction
of the agency; or

(c) made upon unlawful procedure; or

(d) affected by other error of law; or

(e) unsupported by substantial evidence in view of
the entire record as submitted; or

(f) arbitrary or capricious.
Minn. Stat. § 14.69 (2024). See also Minn. Stat § 216B.52 (providing that a decision and
order of the commission may be appealed in accordance with chapter 14) . This court
cannot substitute its judgment for that of an agency when the agency’s findings are properly
supported by the evidence. Vicker v. Starkey, 122 N.W.2d 169, 173 (Minn. 1963).
In contrast, the commission acts in a quasi-legislative function “when it balances
cost and noncost factors and makes choices among public policy alternatives.” In re
Qwest’s Wholesale Serv. Quality Standards, 678 N.W.2d 58, 62 (Minn. App. 2004), aff’d,
678 N.W.2d 58 (Minn. 2004). We grant deference to the commission when it exercises its
quasi-legislative powers. See id. We will affirm an agency’s decision when acting in a
legislative function “unless it is shown, by clear and convincing evidence, to be in excess
of statutory authority or to have unjust, unreasonable, or discriminatory results.” Id.
10
I. The commission had the statutory authority to transition the rate.
Relators argue that the commission lacked the statutory authority to transition CSGs
that were operating under the ARR to a VOS rate. As a creature of statute, an agency only
has the authority granted to it by the legislature. In re Hubbard, 778 N.W.2d 313, 318
(Minn. 2010). Whether an administrative agency “acted within its statutory authority is a
question of law” that appellate courts review de novo. Id. We look to the plain language
of the authorizing statute to determine whether an agency acted within its power. In re
Valley Branch Watershed Dist., 781 N.W.2d 417, 421-22 (Minn. App. 2010). “An
agency’s authority may be stated either expressly in statute or implied from the express
powers given to the [agency] by the Legislature.” In re Application of Otter Tail Power
Co., 942 N.W.2d 175, 179 (Minn. 2020).
A. The statutes empowered the commission to change the rate.
1. The commission’s action does not violate Minnesota Statutes
sections 216B.1641 or 216B.164, or Minnesota Rule 7835.4023.

Relators argue that the commission exceeded its statutory authority in the 2024
Order. Statutory interpretation begins by determining “whether the statute’s language, on
its face, is clear or ambiguous.” Am. Fam. Ins. Grp. v. Schroedl, 616 N.W.2d 273, 277
(Minn. 2000). A statute is ambiguous when the language “is subject to more than one
reasonable interpretation.” Amaral v. Saint Cloud Hosp., 598 N.W.2d 379, 384 (Minn.
1999). We construe words and phrases “according to their plain and ordinary meaning.”
Schroedl, 616 N.W.2d at 277. “[N]o word, phrase, or sentence should be deemed
superfluous, void, or insignificant[,]” and each statute must be construed as a whole and
11
interpreted “in light of the surrounding sections to avoid conflicting interpretations.” Id.
at 277 (quotation omitted). This court should “avoid absurd results and unjust
consequences.” Id. at 278; see also Minn. Stat. § 645.17 (2024). The “goal is to ascertain
and effectuate the intention of the legislature.” Schroedl, 616 N.W.2d at 278; see also
Minn. Stat. § 645.16 (2024).
The CSG statute requires the purchase rate for energy generated by a solar garden
to “be at the rate calculated under section 216B.164, subdivision 10, or, until that rate for
the public utility has been approved by the commission, the applicable retail rate.” Minn.
Stat. § 216B.1641, subd. 1(d). And Minnesota Statutes section 216B.164,
subdivision 10(e), required the commission to approve methodology for calculating the
VOS rate. Subdivision 10(a), provides a process for Xcel to seek approval of an alternative
tariff for customers “operating solar photovoltaic resources interconnected to the utility
system and operating by customers primarily for meeting their own energy needs.” This
alternative tariff must be calculated with reference to the methodology approved by the
commission within subdivision 10, and, if approved, would only apply to customers’
interconnections occurring after the date of approval. Minn. Stat. § 216B.164, subd. 10(b),
(e), (f); see also Minn. R. 7835.4023 (2023) (“If a public utility has received commission
approval of an alternative tariff for the value of solar . . . the tariff applies to new solar
photovoltaic interconnections effective after the tariff approval date.”). Xcel has not
sought approval for an alternative tariff, but the VOS rate calculated under section
216B.164, subdivision 10, is nevertheless pertinent because the CSG statute incorporates
that rate.
12
Relators argue that the commission violated Minnesota law because the 2024 Order
violates the plain language of the statutes that provide the c ommission with the authority
to set rates for the purchase of energy from CSGs. The commission counters that section
216B.1641, subdivision 1(e), grants the commission the express authority to modify Xcel’s
CSG program if it is consistent with the statutory requirements. Minn. Stat. § 216B.1641,
subd. 1(e) (stating that any plan the commission approves must “reasonably allow for the
creation, financing, and accessibility of community solar gardens” and “be consistent with
the public interest”). Xcel concurs, arguing that the legislature gave the commission the
express authority to modify CSG programs, and required the commission to transfer all
ARR-era CSGs to the VOS rate after the commission approved the VOS rate. Minn. Stat.
§ 216.1641, subd. 1(d), (e). We agree with the commission and Xcel.
Section 216B.1641, subdivision 1(d), states that VOS rate applies once it has been
approved. Minn. Stat. § 216B.1641, subd. 1(d) (“The purchase shall be at the [VOS rate],
or, until that rate for the public utility has been approved by the commission, the applicable
retail rate.”). The statutory language shows the legislature only intended the ARR to be an
interim rate. Id. The commission’s 2024 Order brings the rates in compliance with the
legislative intent by transitioning the rate for ARR-era CSGs to the VOS rate. And the
commission has express authority to adopt rates and modify them if the plan “reasonably
allow[s] for the creation, financing, and accessibility of community solar gardens” and is
“consistent with the public interest.” Minn. Stat. § 216B.1641, subd. 1(e)(1), (4).
Relators insist that section 216B.164, subdivision 10(b) mandates that VOS-based
bill credits for CSGs apply only to CSGs interconnected after January 1, 2017, the effective
13
date of the VOS rate approved in the 2016 Order. Section 216B.164, subdivision 10(b)
provides that “[i]f approved, the alternative tariff shall apply to customers’
interconnections occurring after the date of approval.” Relators also argue that the CSG
statute—specifically the word “until” in subdivision 1(d) in section 216B.1641—only
authorizes a single, prospective, and program- wide rate transition. According to relators,
the commission transitioned prospective CSGs—those that filed applications on or after
January 1, 2017— to the VOS rate through the 2016 Order, which means another transition
is not possible under the statute. Relators contend that any CSG that applied for the
program before January 1, 2017, and completed its interconnection process is entitled to
maintain the ARR rate. We disagree.
Contrary to relators’ argument, the plain language of section 216B.164, subdivision
10(b) applies only if Xcel adopts an alternative tarrif and then only to “customers”
interconnections. Minn. Stat. § 216B.164, subd. 10(b) (“If approved, the alternative tariff
shall apply to customers’ interconnections occurring after the date of approval.”) ; Minn.
Stat. § 216B.164, subd. 2a(f) (“‘Customer’ means the person who is named on the utility
electric bill for the premises.”). The customer language demonstrates that subdivision 10
only applies to situations in which a customer of Xcel connects a power generation source
directly to the utility, like roof top solar. It does not apply to CSGs because CSG owners
interconnect the solar gardens to the electricity system, not the individual subscribers who
are customers of Xcel. And a CSG owner by definition is not a “customer” of Xcel because
it is not “named on the electric bill for the premises.” Thus, subdivision 10(b) of section
216B.164 does not limit the commission’s authority to modify the rates.
14
Even if the single prospective-change interpretation is correct such that all CSGs
should have been changed to the VOS rate as a result of the 2016 Order, the commission
is statutorily empowered to correct its past error. The Minnesota Legislature gave the
commission the power to “rescind, alter, or amend any order fixing rates, tolls, charges, or
schedules, or any other order made by the commission.” Minn. Stat. § 216B.25 (2024). If
the commission exercises this power, the statute provides that the new order has “the same
effect as an original order.” Id. See also Minn. Transitions Charter Sch. v. Comm’r of
Minn. Dep’t of Educ., 844 N.W.2d 223, 235 (Minn. App. 2014) (holding agency may
correct errors and take a course of action that corresponds with the statute’s plain meaning),
rev. denied (Minn. May 28, 2014). Thus, even if relators are correct that the statute only
authorized a one-time transition for all rates, the commission had the power to correct the
2016 Order that retained the ARR for ARR- era CSGs. The commission exercised that
power in the 2024 Order by bringing all CSG rates in compliance with the legislative intent.
We conclude the commission had the authority to modify the program—or correct
the 2016 Order—so long as the 2024 Order met the statutory requirements of financing,
accessibility, and being in the interest of the public. Minn. Stat. § 216B.1641, subd. 1(e).
2. The 2024 Order contemplated the financing and accessibility of
CSGs and addressed the public interest.

The statute empowers the commission to modify rates for the CSG program so long
as the modification reasonably allowed “for the creation, financing, and accessibility of
community solar gardens.” See Minn. Stat. § 216B.1641, subd. 1(e)(1). The commission’s
actions must also “be consistent with the public interest.” Id., subd. 1(e)(4).
15
Relators argue the 2024 Order violates Minn. Stat. § 216B.1641, subd. 1(e)(1), (4),
by decreasing the financeability of existing and future CSGs and by failing to be within the
interest of the public. This argument attacks the commission’s decision that exercised its
quasi-legislative function because these factors invoke the commission balancing “cost and
noncost factors” and making “choices among public policy alternatives.” In re Qwest’s
Wholesale, 678 N.W.2d at 62. As such, the commission’s decision must be “affirmed
unless it is shown, by clear and convincing evidence, to be in excess of statutory authority
or to have unjust, unreasonable, or discriminatory results.” Id.
Relators contend that the ARR-era CSGs that have financing agreements will be
detrimentally impacted by the 2024 Order “resulting in steep penalties, defaults[,]” and
even foreclosure. Thus, relators argue the transition order should be reversed because
substantial evidence is lacking that the transition is financeable. We disagree.
The CSG statute does not require that the commission guarantee that all CSGs will
be financeable. Instead, the statute requires that the program as a whole, “reasonably allow
for the creation, financing, and accessibility of” CSGs. Minn. Stat. § 216B.1641, subd. 1
(emphasis added). Within its legislative function, the commission reasonably allowed for
financing in the 2024 Order transitioning all CSGs to VOS rates and included protections
to ensure a smooth transition. For example, the commission incorporated temporary adders
for ARR-era CSGs to gradually transition bill credits from the ARR to the VOS rate. In
addition, the commission delayed implementation of the transition until April 1, 2025, to
allow subscribers and CSGs to adjust to the new financial reality. The commission added
these provisions specifically to allow for financing in compliance with its statutory duty.
16
Relators further argue that the commission failed to comply with the public-interest
requirement. See Minn. Stat. § 216B.1641, subd. 1(e)(4) (noting commission action must
“be consistent with the public interest”). Standard Solar, for example, argues that the
transition is contrary to public interest because “70% of subscribers to ARR-era CSGs are
governments, public schools, hospitals, clinics, churches, private schools, and residential
customers” and these subscribers will be forced to pay more for their energy. 8
But, as we held earlier, the legislature required all CSGs to transition from ARR to
VOS rates. Minn. Stat. § 216B.1641, subd. 1(d). By implementing the will of the
legislature, the commission acted in furtherance of the public interest. To the extent
relators disagree with the commission’s decision to fully comply with the legislature’s
express intent, relators’ remedy is to request that the legislature amend the statute.
Beyond complying with the legislature’s intent, the commission is also required to
act in the best interests of all ratepayers. See Minn. Stat. § 216B.03 (2024) (requiring rates
to be “reasonable” and stating that “[a]ny doubt as to reasonableness should be resolved in
favor of the consumer”); Minn. Stat. § 216B.1641, subd. 1(e)(4) (requiring commission’s
decision to “be consistent with the public interest”) ; see also Minnegasco v. Minn. Pub.
Utils. Comm’n, 549 N.W.2d 904, 908 (Minn. 1996) (noting the commission’s “objective
is to set just and reasonable rates and to protect the ratepayers”) . The commission found
that the ARR had the effect of requiring Xcel customers who are not CSG subscribers—

8 The City of Winona filed an amicus brief a s a subscriber receiving bill credits from the
CSG program. The City asserted that the change will reduce “by more than 50% the City’s
anticipated, and contracted for benefits, by an estimated $1.8 million over the life of the
City’s 25-year CSG Subscriber Contracts.”
17
the majority of Xcel customers—to over subsidize the credit that CSG subscribers—a small
subset of Xcel customers—received on their Xcel energy bills. The 2024 Order noted that
the transition to VOS “will also meaningfully reduce the level of cross-subsidization by
non-subscribing ratepayers of ARR-era gardens while aligning the CSG program’s
continued operation consistent with the public interest.” The CSG subscriber s will,
according to the commission, still receive credit on their energy bill under the VOS rate,
especially given the protections discussed above that the commission included in the 2024
Order. The 2024 Order sought to balance the interests of subscribers and nonsubscribers.
Rate allocation is the commission acting in its legislative capacity and “[t]he careful
balancing of public policies and private needs is not a matter for the courts, unless statutory
authority has been exceeded or discretion abused.” St. Paul Area Chamber of Com.,
251 N.W.2d at 357. Relators have not met their burden of showing “by clear and
convincing evidence” that the transition will lead to “unjust, unreasonable, or
discriminatory results.” In re Qwest, 678 N.W.2d at 62.
B. The commission’s 2024 Order was not retroactive ratemaking.
Standard Solar argues that the commission impermissibly engaged in retroactive
ratemaking by transitioning ARR-era CSGs to the VOS rate. “[T]he Public Utility Act
expressly prohibits retroactive ratemaking.” Peoples Nat. Gas Co. v. Minn. Pub. Utils.
Comm’n, 369 N.W.2d 530, 533 (Minn. 1985). The commission “shall determine and by
order fix reasonable rates, tolls, charges, schedules, or joint rates to be imposed, observed,
and followed in the future in lieu of those found to be unreasonable or unlawful.” Minn.
Stat. § 216B.23, subd. 1 (2024) (emphasis added).
18
Standard Solar first argues the commission did not meaningfully address the
retroactive ratemaking concerns. But the commission found that retroactive ratemaking
was not implicated because “these rates will only apply prospectively to sale and purchases
of subscribed energy generated after the updated tariff is filed and becomes effective.”
Although brief, the commission did provide adequate reasoning for its decision “with a
reasonable degree of specificity to provide an adequate basis for judicial review.” Hibbing
Taconite Co. v. Minn. Pub. Serv. Comm’n, 302 N.W.2d 5, 12 (Minn. 1980).
Second, Standard Solar contends that the ARR-to-VOS transition constituted
retroactive ratemaking because it changed rates in existing contracts between Xcel and
CSG owners. Standard Solar argues that because this transition modified existing
contracts— meant to last for 25 years—the commission violated Minnesota Statues section
216B.23, subdivision 2 (2024). We disagree.
The Minnesota Supreme Court has stated that “the statutory scheme tends to allow
only for rate orders that operate prospectively, rather than remedially.” In re Application
of Minnegasco, 565 N.W.2d 706, 712 (Minn. 1997). We have held that the commission
does not engage in retroactive ratemaking to “establish reasonable rates for future
imposition.” Hanna Min. Co. v. Internorth, Inc., 379 N.W.2d 663, 668-69 (Minn.
App. 1986), rev. denied (Minn. Mar. 14, 1986). Here, the commission changed the rate in
a prospective manner. In addition, the commission delayed implementation of the VOS
rate by one year, making the rate effective as of April 1, 2025.
Finally, Standard Solar argues the commission failed to make the required statutory
findings to change the ARR to the VOS rate. Standard Solar contends that the commission
19
failed to make the statutorily required finding that the prior framework was “unjust,
unreasonable, insufficient, or unjustly discriminatory or preferential or otherwise
unreasonable or unlawful.” Minn. Stat. § 216B.23, subd. 1.
Section 216B.23 requires that if, after an investigation, the commission finds rates
to be “unjust, unreasonable, insufficient, or unjustly discriminatory or preferential or
otherwise unreasonable or unlawful,” it should then determine reasonable replacement
rates. Minn. Stat. § 216B.23, subd. 1. The CSG program has its own statute that provides
the requirements for modification. Minn. Stat. § 216B.1641, subd. 1(e). The commission
may modify a CSG program if it satisfies the statutory criteria. Id. As discussed above,
the commission satisfied the accessibility, financeabiltity, and public interest requirements
for modification. In addition, the commission determined that the VOS rate was reasonable
for CSGs to be financially viable based on the experience of other CSGs operating under
the VOS rate. Thus, the commission did not engage in retroactive ratemaking and
appropriately exercised its authority when requiring CSGs to transition to VOS rates.
II. The commission’s 2024 Order was not arbitrary and capricious.
Relators argue that the commission arbitrarily and capriciously failed to adequately
justify its actions. The arbitrary or capricious standard is “a catchall, picking up
administrative misconduct not covered by the other more specific paragraphs.” In re
Denial of Contested Case Hearing Requests, 993 N.W.2d 627, 646 (Minn. 2023) (quotation
omitted). A “decision is arbitrary or capricious if it represents the agency’s will and not its
judgment.” Id. (quotation omitted). An agency imposes its will when it:
20
(a) relied on factors not intended by the legislature; (b) entirely
failed to consider an important aspect of the problem;
(c) offered an explanation that runs counter to the evidence; or
(d) the decision is so implausible that it could not be explained
as a difference in view or the result of the agency’s expertise.

Citizens Advocating Responsible Dev. v. Kandiyohi County Bd. of Comm’rs, 713 N.W.2d
817, 832 (Minn. 2006). Appellate courts “consider whether a combination of danger
signals suggests that the agency has not taken a hard look at the salient problems and has
not genuinely engaged in reasoned decision- making.” In re Denial , 993 N.W.2d at 646-
47 (quotations omitted). When “there is room for two opinions on the matter, such action
is not ‘arbitrary and capricious,’ even though it may be believed that an erroneous
conclusion has been reached.” Brown v. Wells, 181 N.W.2d 708, 711 (Minn. 1970).
Relators argue that the commission reversed its prior orders without providing a
reasoned explanation for its decision. But the commission provided reasoning in the 2024
Order for why the transition was not a reversal of its earlier orders. The commission noted
that the legislature intended the ARR to be a short-term rate and, with the 2024 Order, the
commission implemented the rate required by the legislature. See Minn. Stat. §§ 216B.164,
subd. 10, .1641, subd. 1(d). By effectuating the express intent of the legislature, the
commission exercised its judgment within the interests of the public.
However, the 2014 Order did state that CSGs “should be credited at the [ARR] in
place at the time of energy generation for the duration of the 25-year contract[,]” and in the
2016 Order the commission agreed that the VOS rate would only apply “to applications
filed after December 31, 2016.” But even though the commission reversed the 2014 and
2016 Order, the commission is not bound by its prior orders and can reverse a prior decision
21
so long as it provides reasoning. See Minn. Stat. § 216B.25. 9 We have consistently
recognized the statutory authority of an agency to reverse, amend, or correct its prior
decisions. See, e.g., In re Applications for Auth. to Provide Alt. Operator Servs. in Minn.,
490 N.W.2d 920, 925 (Minn. App. 1992) (“[W]e have stated that an agency has inherent
authority to correct its prior decisions.”), rev. denied (Minn. Dec. 15, 1992); Minn.
Transitions Charter Sch., 844 N.W.2d at 235 (recognizing an agency’s statutory power to
“correct past errors and adopt a course of action that corresponds to the controlling statute’s
plain meaning”), rev. denied (Minn. May 28, 2014); accord In re Detailing Criteria &
Standards for Measuring, 700 N.W.2d 533, 539 (Minn. App. 2005) (stating that “although
an agency is not bound to follow its past decisions, it must provide a reasonable basis for
departure from precedent”), aff’d, 714 N.W.2d 426 (Minn. 2006).
The commission provided reasoning in both the 2024 Order and in its order denying
reconsideration. For example, in the 2024 Order, the commission reasoned that some
CSGs had been operating under the VOS rate for over a decade. The commission used
data from that experience to assess the impact on the public. The 2024 Order also noted
that the commission had better information related to the effect on Xcel customers who
had not subscribed to CSGs, which were concerns that the CSG developers had
downplayed before the prior orders went into effect.

9 JSA argues this statute only provides that the commission is not subject to the doctrine of
res judicata, citing In re Petition of Peoples Nat. Gas Co., 358 N.W.2d 684, 689 (Minn.
App. 1984), aff’d, 389 N.W.2d 903 (Minn. 1986). But the plain language of the statute is
not limited to res judicata; instead, it states that the commission may alter a rate at any
time, so long as it provides “notice to the public utility” and an “opportunity to be heard”
beforehand. Minn. Stat. § 216B.25.
22
In addition, in its denial of the motions for reconsideration, the commission stated:
The Commission will . . . clarify that to the extent the May 30
Order may be a departure from the 2014 and 2016 orders, the
Commission has authority under § 216B.25 and relevant case
law to depart from its past decisions and finds that it was in the
public[s] interest to do so based on how Xcel’s CSG program
has evolved and the nearly decade’ s worth of data related to
the CSG program ’s operation. The May 30 order details the
changed circumstances informing the Commission’s
consideration of Xcel’s CSG program, particularly the
significant and escalating costs of the ARR- gardens to non-
subscribing ratepayers and the successful operation of CSGs
under the VOS. As explained in the order, transitioning to the
VOS is consistent with the Commission’s fundamental and
overarching duty to establish just and reasonable rates.

The commission also determined that “the escalating rate impact of maintaining the ARR
bill-credit framework and the successful operation of CSG[s] under the VOS justify the
Commission’s current examination of whether the bill- credit framework implemented in
2014 will continue to allow for a CSG program that operates consistent with the public
interest.” Even if the 2024 Order reversed, amended, or corrected the 2014 or 2016 Order,
the commission was empowered to do so and provided sufficient reasoning for its decision.
Relators argue the commission failed to consider all aspects of this issue. But the
commission stated, based on its “experience with the CSG program, the Commission finds
that rates needed to ensure the development and financing of CSGs have changed and that
the higher ARR is not required to ensure continuation of a successful program.”
The commission is required to provide a reasonable basis for its decision. The
commission did so. Relators’ disagreement with the result or the basis that the commission
provided does not make the order arbitrary or capricious. See Brown, 181 N.W.2d at 711.
23
III. The commission did not need to hold a contested-case hearing.

JSA argues that we should reverse because the commission refused to grant a
contested-case hearing despite material facts in dispute. “If a proceeding involves
contested material facts and there is a right to a hearing under statute or rule, or if the
commission finds that all significant issues have not been resolved to its satisfaction, the
commission shall refer the matter . . . for c ontested case proceedings[.]” Minn. R.
7829.1000 (2023); see also Minn. Stat. § 14.57(a) (2024) (“An agency shall initiate a
contested case proceeding when one is required by law.”). The “relator must show that it
is entitled to a contested case hearing under a statute or rule and that there are contested
material facts.” In re Petition of N. State Power Co., 676 N.W.2d at 332 (emphasis in
original).
JSA has identified no statute or rule that provides a right to a contested-case hearing.
And nothing in the CSG statute provides a right to a hearing. See Minn. Stat. § 216B.1641.
JSA insists that the commission, in its discretion, should have ordered a contested-
case hearing because the allegations of harm to CSG subscribers, owners, and developers
were uncontradicted and the commission resolved disputed facts without a hearing. The
commission, however, found that there was no “persuasive evidence that purchasing all
CSG energy at the VOS [rate] fails to reasonably allow for the financing and development
of solar gardens.” And the commission was “satisfied that the detailed and extensive record
developed, which fully reflect[ed] the varied positions of the parties, provide[d] a sufficient
basis on which to make a decision and that no further proceeding [was] warranted.” In
24
other words, the commission found the issues were resolved to its satisfaction based on the
record before it. Consequently, no contested-case hearing was necessary.
IV. Relators’ constitutional challenges fail.
All three relators argue that the commission violated the Contract Clauses of the
United States Constitution and the Minnesota Constitution. Standard Solar and U.S. Solar
also argue that the commission also violated the Takings Clauses of the federal and state
constitutions. We address each argument in turn.
A. The Contract Clause argument fails.
Relators argue the commission violated the Contract Clauses of the federal and state
constitutions. See U.S. Const. art. 1, § 10, cl. 1 (“No State shall . . . pass any . . . Law
impairing the Obligation of Contracts[.]”); Minn. Const. art. 1, § 11 (no “law impairing the
obligation of contracts shall be passed”). A commission order fixing rates is a “law” for
purposes of a Contract Clause analysis. See Louisville & Nashville R.R. Co. v. Garrett ,
231 U.S. 298, 318 (1913) (holding order of Railroad Commission fixing rates has “the
same force as if made by the legislature” and so considered a law under the C ontract
Clause); see also Schermer v. State Farm Fire & Cas. Co. , 721 N.W.2d 307, 313 (Minn.
2006) (discussing the legislative function of fixing public utility rates).
The party asserting a constitutional challenge to the exercise of legislative authority
bears a heavy burden to prevail. Clark v. City of St. Paul, 934 N.W.2d 334, 345 (Minn.
2019). To determine whether the Contract Clause has been violated, appellate courts use
a three-part test: (1) whether the state law substantially impairs a contractual relationship;
(2) if there is a substantial impairment, whether the state has “a significant and legitimate
25
public purpose[;]” and (3) whether the state’s public purpose plan is based on “reasonable
conditions and is of a character appropriate to the public purpose.” Id. (quotations omitted).
1. No substantial impairment.
In determining whether the 2024 Order substantially impairs a contractual
relationship, we consider “the extent to which the law undermines the contractual bargain,
interferes with a party’s reasonable expectations, and prevents the party from safeguarding
or reinstating his rights.” Sveen v. Melin, 584 U.S. 811, 819 (2018). “An important
consideration in evaluating the severity of impairment is whether the activity regulated by
the statute has been regulated in the past.” Minn. Tr. Co. v. Hatch, 368 N.W.2d 372, 375-
76 (Minn. App. 1985) (citation omitted).
As evidence of a substantial impairment, relators argue their revenues will
significantly decrease and they face potential refinancing issues. Relators argue that the
language of the standard contract, prior orders, and statutes locked the commission and
Xcel into the ARR for 25 years. If there is a diminution in value, we must determine
whether it interfered with the parties’ reasonable expectations. Sveen, 584 U.S. at 819.
But utilities are a heavily regulated industry. Minn. Stat. §§ 216B.01-.82 (2024).
The statute provides that the ARR would be in effect until the VOS rate was approved. See
Minn. Stat. § 216B.1641, subd. 1(d). Put another way, the legislature expressly provided
that the VOS rate would eventually control. Id.; Minn. Stat. § 216B.25. Based upon the
statutory regime, it was foreseeable that the rate may change.
Relators were also on notice that the contract terms with Xcel could change. The
standard contract provided that the “rates for sales and purchases of Subscribed Energy
26
shall be changed annually or otherwise as provided by order of the ” commission. The
standard contract also provided:
The Community Solar Garden Operator shall comply with all
of the rules stated in the Company’s applicable electric tariff
related to the Solar*Rewards Community Program and the
tariffed version of this Contract, as the same may be revised
from time to time, or as otherwise allowed by an amendment
to this Contract approved, or deemed approved, by the
Minnesota Public Utilities Commission.

The contract also expressly noted that if there is a conflict between the contract and the
tariff, the tariff controls. Finally, the contract provided:
[T]his Contract shall at all times be subject to all rules and
orders issued by the Commission or other government agency
having jurisdiction over the subject matter of this Contract.
The terms of this Contract shall be modified and amended if
required to comply with any order or regulation of the
Commission, applicable state or federal laws or regulations, or
other government agency having jurisdiction over the subject
matter of this Contract.

The circumstances here are similar to those in Energy Reserves Group, Inc. v.
Kansas Power & Light Co., in which the United States Supreme Court rejected a Contract
Clause argument related to a utility rate change. 459 U.S. 400, 414 -16 (1983). Kansas
Power & Light Company had natural gas supply contracts with Energy Reserves Group.
Id. at 403. A federal law replaced federal price controls for natural gas with price ceilings
that rose monthly. Id. at 405. Energy Reserves Group sought to increase its gas prices
under the federal law, but Kansas Power & Light Company refused their contract precluded
the increased federal rate. Id. at 408. The Supreme Court rejected the Contract Clause
argument and concluded that reasonable expectations had not been impaired because there
27
was extensive and intrusive supervision of the utility industry, the agreements were
structured around regulated gas prices, and the contractual terms were “subject to relevant
present and future state and federal law.” Id. at 416.
As in Energy Reserves, the utility industry in Minnesota is highly regulated. The
statutory regime anticipated the rate change. And the contract recognized that it is subject
to changes from the commission. Because it was reasonably foreseeable that rates would
change, we conclude there was not a substantial impairment to contractual relationships.
Because relators have not met their burden to establish a substantial impact, we do
not need to address the other factors. We do so, however, to thoroughly analyze the issue.
2. The state has a significant and legitimate purpose.
“To justify impairing contractual rights the state must identify a significant and
legitimate public purpose such as the remedying of a broad and general social or economic
problem.” Hatch, 368 N.W.2d at 376 (quotations omitted). Relators argue there is no
justification for this change “after a decade of Commission decisions to the contrary.”
Relators also argue there will be long -term damage from unreliability, emphasizing that
stability in utility agreements is important. See United Gas Pipe Line Co., 350 U.S. at 344
(stating that “preserving the integrity of contracts” permits “the stability of supply
arrangements which all agree is essential to the health of the natural gas industry”).
The commission’s stated purpose behind the 2024 Order was to comply with the
legislative intent that all CSGs operate under the VOS rate. Minn. Stat. § 216B.1641,
subd. 1(d). The commission also addressed the economic concerns of all rate payers, rather
than benefiting a smaller group of interest. See Energy Rsrvs. Grp., 459 U.S. at 417 (“The
28
State reasonably could find that higher gas prices have caused and will cause hardship
among those who use gas heat but must exist on limited fixed incomes.”). The
commission’s reasoning provided a significant and legitimate purpose behind its decision.
And although there is a detriment to the CSG developers, subscribers, and financiers, this
does not negate the legitimate interest in decreasing the hardship to the majority of Xcel’s
Minnesotan ratepayers. We therefore conclude that there is a significant and legitimate
purpose for the 2024 Order.
3. The order is based on reasonable conditions of a character
appropriate to the public purpose.

The final factor requires the commission’s order to be “reasonably and appropriately
tailored to accomplish its goal.” Hatch, 368 N.W.2d at 376. Relators argue the transition
is inappropriate and unreasonable because the commission exceeded its statutory authority
and the change in circumstances the commission relies on is contrary to the record.
The 2024 Order is “based upon reasonable conditions” and “of a character
appropriate to the public purpose.” Id. at 375 (quotations omitted). As noted above, the
VOS rate was required by statute and the commission’s order sought to effectuate the
legislative intent. The commission also sought to protect all ratepayers by transitioning to
the VOS rate. In addition, the commission included reasonable terms, such as a temporary
adder to ease the burden on CSGs and subscribers. The commission also delayed the
effective date of the VOS rate. These reasonable conditions facilitated the transition and
support the public purpose of the order.
29
We conclude that relators have not met their heavy burden to demonstrate that the
2024 Order violates the Contract Clauses. See Clark, 934 N.W.2d at 345.
B. The Takings Clause argument fails.
Standard Solar and U.S. Solar argue the 2024 Order constitutes an improper taking
because it imposes a significant economic impact, undermines investment-backed
expectations, and invalidates promises made by the commission and Xcel. We disagree.
The United States and Minnesota Constitutions prohibit the government from taking
property without just compensation. See U.S. Const. amend V (providing private property
shall not “be taken for public use, without just compensation”); Minn. Const. art. 1, § 13
(“Private property shall not be taken, destroyed or damaged for public use without just
compensation therefor, first paid or secured.”). Because the state and federal Takings
Clauses are similar, Minnesota courts have relied on cases interpreting the federal
constitution to interpret the Minnesota Takings Clause. Wensmann Realty, Inc. v. City of
Eagan, 734 N.W.2d 623, 631-32 (Minn. 2007). “Whether a governmental entity’s action
constitutes a taking is a question of law [appellate courts] review de novo.” Id. at 631.
As a threshold matter, we must determine whether Standard Solar and U.S. Solar
had a protected property interest. See Minn. Sands, LLC v. County of Winona,
940 N.W.2d 183, 200 (Minn. 2020) (“The first question in any takings analysis is to
determine what, if any, property interest is at stake.”). Property interests “are not created
by the Constitution.” Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1001 (1984). “Rather,
they are created and their dimensions are defined by existing rules or understandings that
stem from an independent source such as state law.” Id. If there is a protected property
30
interest, then we consider several factors identified by t he Supreme Court to analyze
whether the government’s action constitutes a taking. Id. Courts analyze the economic
impact of the regulation, particularly “the extent to which the regulation has interfered with
distinct investment-backed expectations.” Wensmann Realty, Inc., 734 N.W.2d at 632
(quoting Penn Cent. Transp. Co. v. City of N.Y., 438 U.S. 104, 124 (1978)). Courts also
consider the “character of the governmental action.” Id. 632-33. “A ‘taking’ may more
readily be found when the interference with property can be characterized as a physical
invasion by government . . . than when interference arises from some public program
adjusting the benefits and burdens of economic life to promote the common good.” Penn
Cent. Transp. Co., 438 U.S. at 124 (citation omitted).
The commission argues that “[w]hen a contract is expressly subject to later
regulation, the contract cannot form the basis of a takings claim.” We agree. The
Minnesota Supreme Court has recognized that “[a] contractual interest that is contingent
upon the discretionary decision of a governmental unit is not a property interest protected
by the Fifth Amendment.” Minn. Sands, LLC, 940 N.W.2d at 205. The supreme court,
therefore, concluded that there is no compensable property interest in a lease where
possessory rights were contingent upon obtaining a conditional use permit. Id. at 206.
Similarly, the Eighth Circuit Court of Appeals has concluded that a business did not
have a “cognizable property interest” based on contracts because the contracts could be
“modified or nullified by the state.” Hawkeye Commodity Promotions, Inc. v. Vilsack ,
486 F.3d 430, 440 (8th Cir. 2007). The Eighth Circuit held that the business’ expectation
that its contracts would not be modified was undermined by the fact that it was involved in
31
a heavily regulated industry (gambling), there was language about potential modification
in the contracts and licenses, and the owner had experience with regulation. Id.
Supreme Court precedent also supports our conclusion. See, e.g., Connolly v.
Pension Benefit Guar. Corp., 475 U.S. 211, 223-24 (1986). The Court acknowledged that
contracts could create property rights but noted that “when contracts deal with a subject
matter which lies within the control of Congress, they have a congenital infirmity.” Id.
The Supreme Court held that “[p]arties cannot remove their transactions from the reach of
dominant constitutional power by making contracts about them.” Id. at 224.
This situation is similar to Minnesota Sands, Hawkeye, and Connolly. The CSGs
operate in a heavily regulated industry. Standard Solar and U.S. Solar knew the rates were
subject to change by the legislature or the commission. In addition, the standard contract
itself contains several terms indicating that the contract may be modified. Because
Standard Solar and U.S. Solar do not have a compensable property interest, we determine
that their takings claims fail. See Minn. Sands, 940 N.W.2d at 206.
V. U.S. Solar’s Mobile-Sierra doctrine and promissory estoppel arguments fail.
U.S. Solar argues that the commission’s order runs afoul of the Mobile-Sierra
doctrine and that the doctrine of promissory estoppel should preclude the transition from
ARR to VOS rates. We disagree and address each argument in turn.
A. The Mobile-Sierra doctrine does not apply.
U.S. Solar argues the commission’s action violates the Mobile-Sierra doctrine.
“Under the Mobile-Sierra doctrine, the Federal Energy Regulatory Commission . . . must
presume that the rate set out in a freely negotiated wholesale-energy contract meets the
32
‘just and reasonable’ requirement imposed by law.” Morgan Stanley Cap. Grp. Inc. v. Pub.
Util. Dist. No. 1, 554 U.S. 527, 530 (2008).
We conclude that the Mobile-Sierra doctrine does not apply for three reasons. First,
the doctrine has not been adopted in Minnesota and, as an error-correcting court, we lack
the authority to do so. Tereault v. Palmer, 413 N.W.2d 283, 286 (Minn. App. 1987) (“[T]he
task of extending existing law falls to the supreme court or the legislature, but it does not
fall to this court.”), rev. denied (Minn. Dec. 18, 1987). Second, the Mobile-Sierra doctrine
has only been applied to rates set by contracts between parties with equal negotiation
powers. NRG Power Mktg., LLC v. Me. Pub. Utils. Comm’n, 558 U.S. 165, 171 (2010).
In contrast, the rates here were neither set by contract, nor freely negotiated by the parties.
Instead, the rates are set by the commission. Minn. Stat. § 216B.1641, subd. 1(d). Finally,
the Mobile-Sierra doctrine has only been applied to the Federal Energy Regulatory
Commission, Morgan Stanley, 554 U.S. at 530, which is not involved in this case.
B. The promissory estoppel argument fails.
U.S. Solar argues that promissory estoppel should preclude the transition from ARR
to VOS rates because the commission’s prior orders constitute clear and definite promises
that ARR-era CSGs would receive the ARR for the duration of their contracts, the
commission intended to induce reliance on its promise, and the promise must be enforced
to prevent injustice. Promissory estoppel “may be applied against the state to the extent
that justice requires.” Christensen v. Minneapolis Mun. Emps. Ret. Bd., 331 N.W.2d 740,
749 (Minn. 1983). But “it is an extraordinarily rare case in which the equitable remedy of
33
promissory estoppel should preclude state action.” Meriwether Minn. Land & Timber,
LLC v. State, 818 N.W.2d 557, 565 (Minn. App. 2012).
“Promissory estoppel is an equitable doctrine that implies a contract in law where
none exists in fact.” Martens v. Minn. Mining & Mfg. Co., 616 N.W.2d 732, 746 (Minn.
2000) (quotation omitted). “It requires proof that 1) a clear and definite promise was made,
2) the promisor intended to induce reliance and the promisee in fact relied to his or her
detriment, and 3) the promise must be enforced to prevent injustice.” Id. “In applying
promissory estoppel, two factors must be kept in mind: (1) What has been promised by the
state? and (2) to what degree and to what aspects of the promise has there been reasonable
reliance on the part of the [promisee]?” Christensen, 331 N.W.2d at 749. Here, we discern
no clear and definite promises in the commission’s orders. In addition, the CSGs have no
agreement with the commission; the CSG’s contract is with Xcel. Thus, there was no
contract or promise of a contract between the commission and U.S. Solar. But even if that
first element were met, we would conclude that U.S. Solar could not have reasonably relied
on those promises for all the reasons that we have explained in relation to relators’ other
arguments on appeal. We therefore reject U.S. Solar’s promissory estoppel argument.
Affirmed.