[¶24] In an appeal from a decision of the Public Utilities Commission, our review is deferential, and “[o]nly when the Commission abuses the discretion entrusted to it, or fails to follow the mandate of the legislature, or to be bound by the prohibitions of the constitution” will we intervene. Dunn v. Pub. Utils. Comm’n, 2006 ME 4, ¶ 5, 890 A.2d 269 (quotation marks omitted). We apply a two-part inquiry when reviewing the Commission’s interpretation of a statute that it administers and is within its expertise. Competitive Energy Servs., 2003 ME 12, ¶ 15, 818 A.2d 1039. First, we determine de novo whether the statute is ambiguous. Id. “An ambiguous statute has language that is reasonably susceptible of different interpretations.” Dep’t of Corr. v. Pub. Utils. Comm’n, 2009 ME 40, ¶ 8, 968 A.2d 1047 (2009) (quotation marks omitted). Second, if the statute is not ambiguous, we determine whether the Commission misconstrued the statute’s plain meaning. Id. If the statute contains any ambiguity, however, we review the Commission’s construction for reasonableness, according “great deference to the Commission’s interpretation.” Id. (quotation marks omitted); see also Competitive Energy Servs., 2003 ME 12, ¶ 15, 818 A.2d 1039.
A. Does Section 3204(5) Impose a Blanket Prohibition Against Maine T&D Utilities Sharing an Affiliate with Maine Generation and Generation-related Assets?
[¶25] All parties agree that the proposed transactions involving Emera, First Wind, and APUC would result in Emera—a company with an affiliated interest in Maine T&D utilities Bangor Hydro and MPS—also holding what would constitute an “affiliated interest” in subsidiaries engaged in electric generation in Maine if that term applied to generators. See 35-A M.R.S. § 707(1)(A)(1)(a) (defining “affiliated interest” with respect to a T&D utility to include “[a]ny person who owns directly, indirectly or through a chain of successive ownership 10% or more of the voting securities of a public utility”). Specifically, the Commission found that “Emera would have a greater than 10% ownership interest in APUC, NE Wind and JV Holdco.”
[¶26] The intervenors argue that the Commission’s interpretation of the Restructuring Act as not expressly prohibiting affiliate-type ownership of Maine electric generation assets is unreasonable and inconsistent with the intent of the Restructuring Act. They contend that the Commission’s interpretation is contrary to the plain language of section 3204(5) and violates rules of statutory interpretation.
[¶27] The intervenors are correct that the Act unambiguously required that owners of T&D utilities initially divest themselves of the generation assets that they owned. See 35-A M.R.S. § 3204(1) (requiring, with some exceptions, that “on or before March 1, 2000, each investor-owned electric utility shall divest all generation assets and generation-related business activities”). The Act does not, however, expressly prohibit a parent company from owning both generation and T&D assets after divestiture. Instead, the Act prohibits any T&D utility from having certain interests in generation assets: “Ownership of generation prohibited. Except as otherwise permitted under this chapter, on or after March 1, 2000, an investor-owned transmission and distribution utility may not own, have a financial interest in or otherwise control generation or generation-related assets.” Id. § 3204(5).
[¶28] Thus, the statute does not expressly prohibit affiliation between a parent company that owns and operates generation assets and a T&D utility. See id. The Legislature used the terms “affiliate,” “affiliated,” or “affiliated interest” in other parts of section 3204, see, e.g., id. § 3204(1), (8), and in other parts of the Restructuring Act, see, e.g., id. §§ 3201(1), 3202(4)(A), 3205 to 3206-A, 3212(2)(C). It could easily have drafted section 3204(5) to prohibit the owners of T&D utilities from having any “affiliation” or “affiliated interest” with generation companies after divestiture. For example, as first introduced, the bill provided that “a large, investor-owned transmission and distribution utility may not have an affiliated interest in a competitive generation provider.” L.D. 1804 § 1 (118th Legis. 1997) (emphasis added) (proposed as section 3204(4)).
[¶29] After multiple amendments, however, the Legislature chose not to use “affiliate” language in section 3204(5), but instead directed that T&D utilities “may not own, have a financial interest in or otherwise control generation or generation-related assets.” 35-A M.R.S. § 3204(5). Thus, construing the plain and unambiguous language of the statute, and consistent with our prior rulings, we conclude that section 3204(5) does not explicitly prohibit all affiliation, as defined by the Restructuring Act, between a T&D utility’s corporate owner and entities that own generation or generation-related assets. See id. §§ 707(1)(A), 3201(1); Dep’t of Corr., 2009 ME 40, ¶ 8, 968 A.2d 1047. Whether any specific proposed affiliation runs afoul of the prohibition against a T&D utility having ownership of, a financial interest in, or otherwise exercising control over a generator must therefore be addressed individually.
B. Must a T&D Utility Have Control of Generation Assets or Generation-Related Assets for It to Have a “Financial Interest” in Them Pursuant to Section 3204(5)?
[¶30] Section 3204(5) provides that, after divestiture, T&D utilities “may not own, have a financial interest in or otherwise control generation or generation-related assets.” 35-A M.R.S. § 3204(5). The proposed transactions will not result in Bangor Hydro or MPS directly owning generation companies or assets. The question, therefore, is whether the Commission’s approval of the proposed transactions contravenes section 3204(5) by permitting Bangor Hydro and MPS to “have a financial interest in or otherwise control” electric generation by virtue of the mutual relationship with the parent company, Emera. See id.
[¶31] The Commission construed “financial interest in or otherwise control” to require the T&D utility “to have some type of control over the affiliates’ generation assets” for the restructuring to be barred by section 3204(5). In so doing, the Commission reasoned that “financial interest” must mean “something more than the interest that any corporate entity would have in the financial success of its affiliates.” As an example, the Commission explained that such control would arise if a T&D utility “owned a subsidiary that own[ed] and operat[ed] generation assets.”
[¶32] The language of section 3204(5) is ambiguous. Given the grammatical structure of the sentence, it is not clear whether the Legislature intended the word “otherwise” to result in the concept of control being imported into each of the first two prohibited acts: ownership and financial interest. “An agency’s interpretation of an ambiguous statute it administers is reviewed with great deference and will be upheld unless the statute plainly compels a contrary result.” Competitive Energy Servs., 2003 ME 12, ¶ 15, 818 A.2d 1039 (quotation marks omitted).
[¶33] Read in the context of the Act’s expressly stated goals, and its limitations on relationships between and among generators and T&D utilities, however, we conclude that each of the three types of relationships set forth in section 3204(5)—to own, to have financial interest, or to otherwise control—must be interpreted to have independent meaning. See Carrier v. Sec’y of State, 2012 ME 142, ¶ 12, 60 A.3d 1241 (stating that, in construing a statute based on its plain meaning, we are “attempting to give all of [the statute’s] words meaning”). Although the Commission interpreted the term “otherwise” to suggest that all three types of relationship required that the T&D utility have control over generation or generation-related assets, we do not interpret the statute in that manner because such a reading would run completely contrary to the goal of the act to preserve the independence of T&D utilities from generators. See Competitive Energy Servs., 2003 ME 12, ¶ 18, 818 A.2d 1039 (stating that we “avoid statutory constructions that create absurd, illogical or inconsistent results” (quotation marks omitted)).
[¶34] For instance, using the Commission’s interpretation, a T&D utility could own a large percentage of non-voting shares in generation or generation-related assets as long as the T&D utility did not have control of the governance of those assets. Despite the absence of controlling ownership, the T&D utility would be highly motivated to enhance the success of its asset, the generator, thus providing a competitive advantage to that generator. Such an interpretation would run entirely counter to the Act’s purpose to separate T&D from generation sufficiently to ensure competition among electricity generators and developers of electricity generation projects, and prevent incentives that would favor one or more of those developers or generators over others in obtaining the services of a T&D utility.
[¶35] Because the Commission’s interpretation is not reasonable when considered in light of the explicit goals of the Act, we conclude that a T&D utility may be prohibited from having a financial interest in generation assets or generation-related assets even without exercising control over those assets. We therefore hold that a T&D utility has a prohibited “financial interest” in generation assets or generation-related assets pursuant to section 3204(5) if there exists a sufficient financial interest in the assets of a generator that the interest is likely to produce incentives for favoritism that would undermine the purpose of the Act.
[¶36] This financial interest may, but need not, arise from a parent company’s affiliate-type relationship with both T&D utilities and generation or generation-related assets. See 35-A M.R.S. §§ 707(1)(A), 3201(1). Although the statute uses language other than “affiliate,” there is no indication that the Legislature thereby intended to authorize or prohibit all affiliate-type relationships between a parent company and its T&D and generation or generation-related assets. We interpret the statute to prohibit a T&D utility from having a “financial interest” in generation or generation-related assets, which may or may not involve relationships similar to utility affiliation as defined in section 707(1)(A). If the financial relationship is sufficient to create an incentive for the T&D utility to favor certain generation assets or generation-related assets over others, whether through affiliate-type or other relationships, the Act’s prohibition comes into effect. Thus, although a parent company of a T&D utility is not flatly prohibited from having the kind of affiliated interest defined in section 707(1)(A) with an entity possessing generation or generation-related assets, if the relationship among the entities results in the T&D utility having a financial interest that would provide an incentive to favor certain generators over others,5) the proposed corporate restructuring is prohibited pursuant to section 3204(5).
[¶37] In sum, we conclude that the statute requires an interpretation of section 3204(5) that is contrary to that of the Commission. See Dep’t of Corr., 2009 ME 40, ¶ 8, 968A.2d 1047. The Commission’s interpretation too strictly requires a financial interest that is tantamount to a controlling interest. Because the Commission misinterpreted the statute to prohibit a T&D utility’s financial interest only if that interest gives the T&D utility control of the generation or generation-related assets, the Commission must reexamine the transactions proposed here, applying section 3204(5) as construed herein.
[¶38] Finally, the intervenors argue that the Commission did not have the authority to impose the more than fifty separate conditions, many of which appear to “re-regulate” the unregulated generation of electricity. Moreover, the imposition of this substantial number of conditions could be seen as an indication that the financial relationships between the regulated T&D utilities and the “unregulated” generators run afoul of section 3204(5). We are cognizant of our role as an appellate body, however, and we therefore decline to make such determinations. We are confident that, with guidance on the meaning of the statute, the Commission will undertake a thoughtful and thorough reexamination of the proposals to determine whether the Act permits the reorganization proposed in this case. Accordingly, we vacate the Commission’s decision and remand for
further consideration consistent with this opinion.