The Maine Supreme Judicial Court on Thursday ruled utility regulators did not violate state law during budget-making for Maine’s energy efficiency program, Efficiency Maine.

The court determined state law is not clear about how the Maine Public Utilities Commission should develop that budget, which provides subsidies for energy efficiency investments at homes and businesses.

State law bases that budget on the maximum amount of “cost-effective” efficiency investments. That generally means the efficiency investments are cheaper than the price of the power they save over their lifetime.

The Conservation Law Foundation challenged the PUC-approved budget, arguing that it understated potential savings and that the three-year, $187 million budget fell short by about $30 million.

The justices found state law is ambiguous, leading to “significant deference” to the PUC in its budget-setting for the program.

“If you’re challenging an agency and then you hear that the interpretation is entitled to ‘significant deference,’ then you can basically pack your bags,” said Sean Mahoney, executive vice president of the Conservation Law Foundation.

CLF argued that regulators did not apply “regional best practices” by using an energy forecast it commissioned from London Economics International for a separate case.

The foundation argued regulators should have used the Avoided Energy Supply Cost study done annually for New England.

Due to rapid changes in the price of oil, regulators turned to the more recent LEI study to estimate the potential savings. The updated study was also the basis for renegotiating term sheets with two wind projects.

The court’s ruling in the case is the final word on the PUC’s budget approval, but commissioners can amend the spending plan, Mahoney said.

In a separate case, CLF is asking regulators to use the latest version of the regional study to amend Efficiency Maine’s budget.

He said the group will also ask the Legislature to eliminate ambiguity that the court found Thursday, to specify how regulators should determine what efficiency investments are possible.

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Darren Fishell

Darren is a Portland-based reporter for the Bangor Daily News writing about the Maine economy and business. He's interested in putting economic data in context and finding the stories behind the numbers.