Case Background
On December 3, 2018, Petitioner, Tesla, LLC
(Tesla), filed a petition for a declaratory statement (Petition). Tesla asks the
Commission to declare that based on the facts presented by Tesla:
(1)
Tesla’s leasing of solar electric equipment to
residential lessees, pursuant to Tesla’s standard form lease known as Tesla’s
SolarLease, does not constitute a sale of electricity;
(2)
Tesla’s offering to lease solar electric equipment to
residential electricity users will not cause Tesla to be deemed a public
utility under Florida Law; and
(3)
The residential solar equipment lease described in its
Petition (Tesla’s SolarLease) will not subject either Tesla or Tesla’s
customer-lessees to regulation by the Commission.
The Commission’s recent decisions in Order
No. PSC-2018-0251-DS-EQ, issued May 17, 2018, in Docket No. 20170273-EQ, In re: Petition of Sunrun Inc. for a
declaratory statement concerning the leasing of solar equipment (Sunrun) and Order No.
PSC-2018-0413-DS-EQ, issued August 21, 2018, in Docket No. 20180124-EQ, In re: Petition of Vivint Solar Developer,
LLC. for a declaratory statement concerning the leasing of solar equipment
(Vivint), state the Commission does
not have jurisdiction over an individual company that
offers residential leases for solar equipment when the lease payments do not
vary based on generation.
Pursuant to Rule 28-105.0024, Florida
Administrative Code (F.A.C.), a Notice of Declaratory Statement was published
in the December 4, 2018, edition of the Florida Administrative Register,
informing interested persons of the Petition. There were no requests to
intervene filed. This recommendation addresses Tesla’s Petition for Declaratory
Statement. The Commission has jurisdiction pursuant to Section 120.565, F.S.,
and Chapter 366, F.S.
Discussion
of Issues
Issue 1:
Should the Commission grant Tesla’s Petition for
Declaratory Statement?
Recommendation:
(4) Yes.
Based on the facts presented by Tesla, the Commission should grant Tesla’s
Petition and declare: (1) Tesla’s proposed residential solar equipment lease,
as described by its Petition, will not be deemed to constitute a sale of
electricity; (2) Offering its solar equipment lease, as described in its Petition,
to consumers in Florida will not cause Tesla to be deemed a public utility; and
(3) The residential solar equipment lease described in its Petition will not
subject Tesla or Tesla’s customer-lessees to regulation by this Commission. The
Commission should also state that its declaration is limited to the facts
described in Tesla’s Petition and would not apply to different, alternative
facts. However, for those with an identical fact pattern to Sunrun’s, Vivint’s,
or Tesla’s Petitions, these declarations have precedential significance and individual
declaratory statements are not necessary. (Harper, Crawford)
Staff Analysis:
Tesla’s
Petition asks the Commission to declare that Tesla’s solar leasing program as
described in Tesla’s Petition will not make Tesla or its lease customers a
public utility subject to the Commission’s jurisdiction under Section
366.02(1), F.S. Tesla’s Petition also asks the Commission to apply Rule
25-6.065, F.A.C., which allows
leases for solar equipment that include a maintenance agreement so long as the
lease payments do not depend on electric generation. According to
Tesla’s facts, the customer will be the end-user, and the lease payments do not depend on electric generation. Tesla’s
proposed solar equipment lease program shows that the lease customers must
utilize their utility’s service and interconnection and net metering
provisions.
Tesla’s
Petition also states that it is aware that the facts in Sunrun’s and Vivint’s
Petitions are substantively the same as the facts in Tesla’s request for
declaratory statement. According to Tesla, the Sunrun and Vivint orders
were limited only to the specific facts described in Sunrun and Vivint’s petitions
and are therefore not binding or applicable to Tesla.
Staff believes that the Sunrun and Vivint orders
are applicable to any individual entity where the alleged facts show that the company offers residential solar lease
programs with lease payments that do not vary based on generation. Both of
these orders applied the facts presented in the petitions to Rule 25-6.065,
F.A.C, which states that “[t] customer-owned renewable generation does
not preclude the customer of record from contracting for the purchase, lease,
operation, or maintenance of an on-site renewable generation system with a
third-party under terms and conditions that do not include the retail purchase
of electricity from the third party.” The notice provision in Section 120.565, F.S., suggests
that a declaratory statement, although not binding as precedent, has precedential
significance. Chiles v. Dep't of State, Div. of Elections, 711 So. 2d 151, 155 (Florida
1st DCA 1998).
Tesla also
states that requirements of investors who will provide financing for Tesla’s
SolarLease program in Florida compel Tesla to seek the declaratory statement. Tesla’s
Petition states it is requesting a declaratory statement as a “real-world
business necessity” to meet the “requirements of investors.” The purpose of a
declaratory statement is to resolve questions or doubts as to how the statutes,
rules, or orders may apply to the petitioner’s particular circumstances. Staff
believes that there is no controversy because the facts in Tesla’s Petition are
virtually identical to the facts set forth in both the Sunrun’s and Vivint’s Petitions.
Thus, a company’s financing or investor requirements are irrelevant to the
determination of whether a declaratory statement should be granted.
Nonetheless,
an agency has
an obligation to issue a declaratory statement explaining how a statute or rule
applies in the petitioner's particular
circumstances even if the explanation would have a broader application than to
the petitioner. Soc'y for Clinical &
Med. Hair Removal, Inc. v. Dep't of Health, 183 So. 3d 1138, 1144 (Fla. 1st
DCA 2015). Thus, staff believes that Tesla’s petition for declaratory
statement should be granted.
Conclusion
For the reasons set forth above, staff recommends that the
Commission grant Tesla’s Petition for Declaratory Statement and declare: (1) Tesla’s
leasing of solar electric equipment to residential lessees, pursuant Tesla’s
standard form lease known as Tesla’s SolarLease, and as described in its
Petition, will not be deemed to constitute a sale of electricity; (2) Tesla’s
offering to lease solar electric equipment to residential electricity users, as
described in its Petition, will not cause Tesla to be deemed a public utility
under Florida Law; and (3) The residential solar equipment lease as described
its Petition (Tesla’s SolarLease) will not subject either Tesla or Tesla’s
customer-lessees to regulation by the Commission. The Commission should also
state that its declaration is limited to the facts described in Tesla’s
Petition and would not apply to different, alternative facts. However, for those
with an identical fact pattern to Sunrun’s, Vivint’s, or Tesla’s Petitions,
these declarations have precedential significance and individual declaratory
statements are not necessary.
Issue 2:
Should this docket be closed?
Recommendation:
Yes, if the Commission votes to either grant or deny
the Petition for Declaratory Statement, the docket should be closed. (Harper)
Staff Analysis:
Whether the Commission grants or denies Tesla’s
Petition, a final order will be issued. Upon issuance of the final order, the
docket should be closed.
