BPU Inaction for 20 Months Results in a Remand for the Agency to Act

In re Verified Petition of Retail Energy Supply Ass’n, ___ N.J. Super. ___ (App. Div. 2021). This appeal was from the inaction (not any action) by the Board of Public Utilities (“BPU”). Appellant Retail Energy Supply Association filed a petition in February 2019 asking the BPU to withdraw a January 2019 letter that barred appellant’s members from passing on to certain of their customers price increases that allegedly were caused by a statutory cost change required by operation of law.

As the opinion of Judge Haas described, the BPU failed to act on that petition for over 18 months. In December 2020, the BPU announced that it had reached a settlement with other energy suppliers related to the January 2019 letter. The BPU had told appellant’s counsel in October 2020 that negotiations with those other suppliers were occurring, but appellant was not invited to participate in those discussions.

In January 2020, appellant filed its appeal of the BPU’s inaction on appellant’s petition. Judge Haas explained the standards applicable to an appeal of agency inaction, which implicate the arbitrary, capricious, and unreasonable standard of review also applicable to agency actions.

The Appellate Division “concluded that the Board’s unexplained failure to address appellant’s petition for over twenty months was arbitrary, capricious, and unreasonable. The Board does not deny that it never acted on appellant’s petition or the requests of other parties to intervene in the matter. Instead, it apparently offered a ‘resolution’ of the issues raised in the petition to unidentified entities in a separate docket item without providing notice and an opportunity to be heard to the parties to appellant’s petition.”

Judge Haas noted that the substantive question presented entailed de novo review, as it was a matter of statutory interpretation. But since the BPU had not acted, the Appellate Division would not address the issue. “[O]ur function as an appellate court is to review the decision of the Board, not to decide the legal issue tabula rasa.” The panel remanded the matter to the BPU to resolve appellant’s petition within 60 days or, if the matter was deemed a contested case and transferred to the Office of Administrative Law, it was to be “heard on an expedited basis” there.