# Opinion

> District Court, D. Maine · February 17, 2026

URL: https://www.frixlaw.com/law-library/cases/11261869

## Case

- **Full name:** Gray Yarmouth Road Solar LLC, et al. v. Maine Public Utilities Commission, et al.
- **Court:** District Court, D. Maine
- **Decided:** February 17, 2026
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

UNITED STATES DISTRICT COURT
DISTRICT OF MAINE

GRAY YARMOUTH ROAD SOLAR LLC, )
et al., )
)
Plaintiffs, )
) 1:25-cv-00592-SDN
v. )
)
MAINE PUBLIC UTILITIES )
COMMISSION, et al., )
)
Defendants. )

ORDER DENYING MOTION FOR PRELIMINARY INJUNCTION
In this matter, over 140 organizations involved in community solar development
(the “Plaintiffs”) have sued the Maine Public Utilities Commission (“PUC”) and various
Commission officers (collectively, the “Defendants”) over the implementation of Maine
public law LD 1777, codified at 35-A M.R.S. § 3209-F. Specifically, Plaintiffs challenge LD
1777’s “Project Charge,” which is a monetary assessment charged to community solar
developers participating in the State’s Net Energy Billing (“NEB”) Program. Plaintiffs
argue that LD 1777 constitutes an unconstitutional per se taking of private property and
request the Court enjoin enforcement of the law. On Friday, January 23, 2026, the Court
held a hearing to address the Plaintiffs’ pending motion for a preliminary injunction. For
the reasons discussed herein, the Court now DENIES the Plaintiffs’ motion.
BACKGROUND
I. Energy Distribution Overview
Prior to discussing the NEB Program and the relevant statutory changes at issue
here, an over-simplified explanation of energy distribution in Maine may be helpful. Solar
power is often generated using resources such as solar installations or solar “farms.”
These large-scale installations can be quite substantial, sometimes covering an area the
size of multiple football fields. Private utility companies, also known as transmission and
distribution utility companies, supply and distribute energy produced by energy
producers, including both solar and all other types of energy.
Once collected, energy is delivered to consumers via the electrical grid. That task

falls exclusively to the utility companies, which manage the “transmission”—the process
of moving electricity across the broader grid—and “distribution”—the delivery of that
electricity to individual homes and businesses over the local distribution system. The
utility companies also are responsible for the physical infrastructure required for this
movement of energy, including poles, wires, and substations. In addition, they perform
ongoing maintenance and repairs, such as fixing power lines after severe storms.
The retail electricity rates charged to consumers are composed of two components:
supply rates, which reflect the cost of generating energy, and delivery rates, which reflect
the cost of delivering energy to homes and businesses for consumer use. Decl. Sally Zeh
(“Zeh Dec.”), ECF No. 33 at ¶¶ 10, 15. Delivery rates themselves are composed of both
transmission and distribution rates, as described above. Id. at ¶ 16. Transmission rates

are set by the Federal Energy Regulatory Commission, while distribution rates are set by
the Defendant Maine PUC. Id. at ¶¶ 18, 20. Utility companies recover their transmission
and distribution costs through both “fixed charges”—a set charge regardless of specific
electricity usage—and “volumetric charges”—a variable charge based on the actual
amount of a customer’s electricity usage. Id. at ¶¶ 21–22.
II. History of NEB Program
The NEB Program is a state subsidy program designed to “encourage the adoption
of small-scale, renewable energy generation” in the State of Maine. Decl. Heather Sanborn
(“Sanborn Dec.”), ECF No. 34 at ¶ 5. At its inception, the NEB Program allowed individual
owners of qualifying renewable generation facilities (e.g., rooftop solar panels) to receive
a one-kilowatt hour (“kWh”) credit on their electric bill for every one kWh of energy
supplied to the electrical grid. Id. ¶ 6. This one-to-one credit on NEB participants’ utility
bills is based solely on the energy produced and sent to the electrical grid. However, NEB

participants do not pay any costs related to the utility company’s transmission and
distribution of the energy. Id. ¶ 9. This results in a “cost-shift” to non-NEB participants,
whose utility rates are increased to recover the transmission and distribution costs the
utility companies incur by delivering this energy. Id. Prior to 2019, NEB participants were
almost entirely individual customers who owned small rooftop solar installations on their
own residences. Id. at ¶ 10. The owners of these rooftop “facilities” received credits
directly on their own utility bills and each facility had a limited capacity. See id. Because
of the fewer number of participants and the limited capacity of their rooftop facilities, the
initial “cost-shifting” impact of the NEB Program was relatively minor. Id.
In 2019, the Maine legislature reformed and significantly expanded the NEB
Program by allowing larger “community solar” generators, such as Plaintiffs, to

participate in the NEB Program through a similar “kWh credit program.” See id. at ¶¶ 11–
15. Under the kWh credit program, the owner of an eligible community solar generator
(i.e., a “distributed generation resource” or “DGR”)1 contracts with individual
“subscribers” so that a percentage of the electricity generated by the DGR is credited to
each subscriber’s utility bill, just as if a portion of the solar generator’s panels were located

1 The 2019 NEB Act defines “[d]istributed generation resource” or “DGR” as “an electric
generating facility that uses a renewable fuel or technology . . . and is located in the service
territory of a transmission and distribution utility in the State.” 35-A M.R.S. § 3209-A(1)(B).
on the top of the subscriber’s own roof. See Sanborn Dec. ¶ 13.2 The kWh credit program
differs from the original NEB Program in that individuals may now subscribe to and
receive credits from a large-scale solar installation (i.e., a DGR) located elsewhere, rather
than installing solar rooftops on their own residence.
To participate in the kWh credit program, subscribers pay the DGR directly, not

the utility companies, for the value of their interest in the community solar facility. Zeh
Dec. ¶ 44. In return, subscribers receive a credit for the energy the DGRs generate and are
not charged any additional costs for transmission and distribution of that energy that the
subscriber would otherwise pay to the utility. Id. at ¶ 45. As alleged by Defendants, this
process results in owners of DGRs receiving a twofold benefit from ratepayers. See ECF
No. 32 at 7. First, DGR owners receive from subscribers the full retail rate of electricity,
rather than the wholesale market rate, which increases DGR owners’ revenues. Id.
Second, the rate DGR owners receive from subscribers includes the “volumetric delivery
charge” the utility company would normally receive from the subscriber that includes the
transmission and distribution charges. Id. However, the utility—not the DGR—is still
delivering the electricity, so the utility is still incurring the transmission and distribution

costs. Id. As such, the delivery costs of electricity are shifted to ratepayers through a fixed
monthly charge on each ratepayer’s utility bill. See id.
Since the expansion of the NEB Program in 2019, electricity prices in Maine have
risen dramatically due to factors unrelated to community solar developers, such as the

2 According to Plaintiffs, because the cost of constructing large solar arrays requires significant
upfront investment, the State expanded the NEB Program as a way to induce the construction of
large community solar generators: the DGRs. ECF No. 3 at 1. Plaintiffs assert the DGRs provide
“considerable benefits” to Maine, including “energy price suppression, [] reduced greenhouse gas
emissions[,] and other environmental benefits.” Id. at 2.
2022 Russian invasion of Ukraine and severe winter storms in Maine in 2023 and 2024.
Sanborn Dec. ¶ 39. Additionally, transmission and distribution costs have been impacted
by an increase in investment from utility companies to maintain, modernize, and replace
aging infrastructure. Id. Each of these events caused spikes in the costs of both energy
supply and delivery. See id. Additionally, because the value of the credit given to

subscribers is tied to the total retail rate—which includes these inflated delivery costs that
solar developers do not actually incur—these price hikes have resulted in an unexpected
windfall for larger solar generators. Id. ¶ 40. Consequently, the general public bears the
burden, as utility companies must raise rates for all ratepayers to fund the higher credit
payments triggered by these external costs. See id. ¶¶ 39–40. The scale of this increase is
stark: the total cost of NEB has risen from approximately $8.7 million in 2021 to an
estimated $158.6 million in 2025, with approximately $47 million attributable to the kWh
credit program. See id. ¶ 44; Zeh Dec. ¶ 55. In an effort to rein in the rising costs of NEB,
the Maine legislature has since considered, and enacted, various bills and proposals
amending the NEB Program, including imposing additional requirements and
restrictions on DGRs. See Zeh Dec. ¶¶ 68–71; see also ECF No. 32 at 9–10.

III. LD 1777 (“Project Charge”)
The State’s most recent effort to reduce NEB costs is the enactment of the 2025
NEB Act, or “LD 1777”—the legislation Plaintiffs now challenge. As relevant here, LD 1777
imposes a monthly “Project Charge” on participating DGRs in the kWh credit program to
offset costs associated with the NEB Program.3 Sanborn Dec. ¶ 60. The statute also

3 LD 1777 was signed into law on June 27, 2025, and the Project Charge was scheduled to go into
effect on January 1, 2026. On November 24, 2025, Plaintiffs filed their complaint and motion for
a preliminary injunction against LD 1777. ECF Nos. 1, 3. During the first week of December 2025,
prescribes the amount of the Project Charge and tiers it based on the size and capacity of
the DGR.4 Zeh Dec. ¶ 87. Under LD 1777, if a DGR owner fails to pay the Project Charge,
the utility company is required to cease applying credits to subscribers’ utility bills and
prohibit the application of any credits that accrue during periods of non-payment of the
Project Charge. Id. at ¶ 102. According to Defendants, the legislature enacted LD 1777 to

offset costs imposed by the NEB Program, thus reducing the transmission and
distribution costs otherwise borne by ratepayers. See id. at ¶ 104. However, the revenue
raised by the Project Charge likely will still not fully recover the overall NEB and kWh
credit program costs. For instance, current estimates project the Project Charge will
generate approximately $28 million in 2026, while kWh credit program costs are
expected to reach at least $47 million. Sanborn Dec. ¶ 65.
LD 1777 also provides for an “off-ramp” for DGR owners who may not want to
continue participating in the NEB Program. An owner of a DGR with less than a 75%
subscription rate may exit the NEB Program by entering into a “power purchase
agreement” (“PPA”) with the utility company in its service territory. Id. at ¶ 72; Zeh Dec.
¶ 89. Defendants assert the PPA option cost to ratepayers is less than the continued

participation of DGRs in the NEB Program, while still providing benefit to DGR owners.

the Court held several telephone conferences with counsel for parties to discuss the briefing and
hearing schedule for Plaintiffs’ motion, given the statute’s January 1, 2026, implementation
deadline. ECF Nos. 22, 25, 29. Following these conferences, Defendant PUC postponed collection
of any Project Charges to March 1, 2026. ECF No. 46 at 1 (“By unanimous vote, the [PUC]
determined . . . it will not open, during the time period January 1, 2026 through March 2, 2026,
an investigation into any transmission and distribution utility who is directed by statute or rule
to assess the recently enacted net energy bill project charge but fails to do so.”).
4 Under LD 1777, “the initial monthly charge must be for a distributed generation resource with a
capacity of: (A) Three megawatts or more and less than 5 megawatts, $6.00 multiplied by the
nameplate capacity of the resource in kilowatts; (B) One megawatt or more and less than 3
megawatts, $2.80 multiplied by the nameplate capacity of the resource in kilowatts; and (C) Less
than one megawatt, zero.” Zeh Dec. ¶ 87 (citing 35-A M.R.S. § 3209-F(3)).
See Sanborn Dec. ¶ 74. According to Defendants, these benefits include a guaranteed
contract price for up to twenty years and greater revenue stability by reducing exposure
to fluctuation in electric rates, subscription rates, and any future regulatory changes. See
id. ¶¶ 73–74, 79; Zeh Dec. ¶ 91.
In their motion, Plaintiffs assert they “collectively own—directly or indirectly—84

community solar projects” enrolled in the kWh credit program throughout Maine, “that
were induced by, and constructed in reliance on, the NEB Program’s statutory
framework” as it existed prior to LD 1777. ECF No. 3 at 3. Plaintiffs assert they relied on
the original program structure to secure real property rights, obtain project financing, and
complete construction of their solar facilities. See id. at 3–4. Because NEB participation
was central to project financing, the governing debt instruments for these projects
specifically mandated continued participation in the NEB Program. Id. at 4. Plaintiffs
contend that even if they could exit the NEB to avoid the Project Charge, all but four
projects would be unable to meet their financial obligations by selling energy on the
wholesale power markets. Id. at 5. Plaintiffs argue that such an outcome would trigger
widespread defaults, foreclosure, and the loss of their real property. Id.

DISCUSSION
“To grant a preliminary injunction, a district court must find the following four
elements satisfied: (1) a likelihood of success on the merits, (2) a likelihood of irreparable
harm absent interim relief, (3) a balance of equities in the plaintiff’s favor, and (4) service
of the public interest.” Arborjet, Inc. v. Rainbow Treecare Sci. Advancements, Inc., 794
F.3d 168, 171 (1st Cir. 2015). “The sine qua non of this four-part inquiry is likelihood of
success on the merits: if the moving party cannot demonstrate that [it] is likely to succeed
in [its] quest, the remaining factors become matters of idle curiosity.” New Comm
Wireless Servs., Inc. v. SprintCom, Inc., 287 F.3d 1, 9 (1st Cir. 2002) (citing Weaver v.
Henderson, 984 F.2d 11, 12 (1st Cir. 1993)). However, “[i]njunctive relief is an
extraordinary and drastic remedy that is never awarded as of right.” Carey v. Town of
Rumford, 25-cv-00356, 2025 WL 2978795, at *2 (D. Me. Oct. 22, 2025) (quoting Calvary
Chapel of Bangor v. Mills, 459 F. Supp. 3d 273, 282 (D. Me. 2020)).

I. Arguments
Plaintiffs now move to enjoin the enforcement of LD 1777 and the associated
Project Charge, alleging it constitutes an unconstitutional per se taking under the Fifth
Amendment.5 ECF No. 3 at 6–7. Plaintiffs argue they are likely to succeed on the merits
of their claim based on the application of the “unconstitutional conditions” doctrine to
the Takings Clause. See Koontz v. St. Johns River Water Mgmt. Dist., 570 U.S. 595, 604
(2013); Dolan v. City of Tigard, 512 U.S. 374, 385 (1994); Nollan v. Cal. Coastal Comm’n,
483 U.S. 825, 831 (1987). Plaintiffs’ argument rests on two pillars. First, they contend the
Project Charge is an unconstitutional monetary exaction tied specifically to their real
property: the DGRs. See ECF No. 3 at 8–11. Second, Plaintiffs assert the State cannot
demonstrate either a sufficient nexus or rough proportionality between the Project

Charge and the social impact of their participation in NEB, as is required for such
monetary exactions under the Nollan-Dolan standard. See id. at 11–13.
Plaintiffs next argue LD 1777 cannot be upheld as constitutional on the theory that
participation in the NEB Program—and the resulting assessment of the Project Charge—
is voluntary. Instead, they contend their participation is effectively involuntary due to

5 While Plaintiffs allege three counts against the implementation of LD 1777’s Project Charge—a
per se taking, a regulatory taking, and a violation of the Contracts Clause, see ECF No. 1 at 78–83,
their motion for a preliminary injunction is limited strictly to their per se taking claim, as
confirmed by Plaintiffs’ counsel at the January 23 hearing.
both legal and economic compulsion. Id. at 16–23. First, Plaintiffs assert existing
financing agreements and contracts mandate they maintain their status in NEB to satisfy
debt obligations. Id. at 16. Second, Plaintiffs argue exiting the NEB Program to sell power
on the wholesale market or entering into a PPA are not viable economic options. Plaintiffs
argue selling power on the wholesale market would cause revenues to fall below debt

service requirements, leading to imminent default and the loss of their real property.
Plaintiffs argue this “draconian” consequence makes leaving the NEB Program equivalent
to leaving the energy market entirely, thus making the decision whether to participate in
NEB involuntary. Id. at 17–23. Plaintiffs likewise assert PPAs are only available to DGRs
below a 75% subscription rate and no Plaintiff would qualify for that option based on their
current subscription rates of at least 85%. ECF No. 38 at 12 (citing ECF No. 1 at ¶ 119(a)).6
In response, Defendants maintain that Plaintiffs are unlikely to succeed on the
merits of their claim, primarily because the Project Charge does not fall under either
established Takings Clause exceptions for monetary assessments—the Koontz-Nollan-
Dolan “unconstitutional conditions” exception, or the specific, identifiable fund of money
exception. ECF No. 32 at 20. Defendants further dispute Plaintiffs’ characterization of

participation in the NEB as involuntary and offer multiple alternatives to participation,
including selling solar power on the wholesale market, or entering into a PPA directly with
utility companies, which offer rates for their solar power that are significantly higher than
wholesale market rates. See id. at 13.

6 Defendants assert, by way of a declaration from Heather Sanborn, that Plaintiffs have the option
to either unilaterally terminate subscribers, or consolidate subscribers from one DGR to another,
to allow each DGR to be eligible to enter into a PPA rather than sell solar power on the wholesale
market. Second Heather Sanborn Decl. (“Second Sanborn Dec.”), ECF No. 43 at ¶¶ 4–6.
Plaintiffs further allege they will suffer irreparable harm if LD 1777 is not enjoined
for two reasons: (1) harms flowing from the violation of their constitutional rights under
the Taking Clause are per se irreparable; and (2) should Plaintiffs later prevail on the
merits, Maine’s sovereign immunity would prevent them from recouping any payments
already made under the Project Charge. ECF No. 3 at 26–28. Defendants dispute

Plaintiffs’ argument on irreparable harm, both because no established case law supports
the proposition that Takings Clause violations constitute per se irreparable harm, and
because should Plaintiffs prevail, they could seek reimbursement from utility companies
directly, bypassing any sovereign immunity issues. ECF No. 32 at 28–29.
Finally, Plaintiffs argue the balance of the equities and the public interest both
favor the issuance of an injunction. ECF No. 3 at 28–29. In response, Defendants contend
that LD 1777 and the Project Charge are essential to the sustainability of the NEB Program
and the State’s renewable energy goals, in addition to the State’s need to provide relief to
Maine ratepayers who subsidize these solar projects, each of which outweigh any
“minimal harm” to the Plaintiffs. ECF No. 32 at 28–30.
II. Analysis

A. Likelihood of Success on the Merits
“Likelihood of success is the main bearing wall of the four-factor
framework.” Ross-Simons of Warwick, Inc. v. Baccarat, Inc., 102 F.3d 12, 16 (1st Cir.
1996). On this issue the district court need only make “an estimation of likelihood of
success and ‘need not predict the eventual outcome on the merits with absolute
assurance.’” Corp. Techs., Inc. v. Harnett, 731 F.3d 6, 10 (1st Cir. 2013) (quoting Ross-
Simons, 102 F.3d at 16). Failure to demonstrate a likelihood of success on the merits is
ordinarily dispositive. See New Comm Wireless Servs., 287 F.3d at 9.
The Takings Clause of the Fifth Amendment of the Constitution, made applicable
to the States through the Fourteenth Amendment, see Chi., B. & Q.R. Co. v. City of Chi.,
166 U.S. 226, 239 (1897), provides: “[N]or shall private property be taken for public use,
without just compensation.” U.S. Const. amend. V. The Takings Clause principally serves
“to bar Government from forcing some people alone to bear public burdens which, in all

fairness and justice, should be borne by the public as a whole.” Armstrong v. United
States, 364 U.S. 40, 49 (1960).
The Plaintiffs cannot demonstrate likelihood of success on the merits. The Project
Charge does not fall within either recognized exception to the general rule that monetary
assessments are not takings; neither the unconstitutional conditions exception nor the
specific and identifiable fund of money exception applies here. Moreover, Plaintiffs’
participation in the NEB Program is voluntary, which independently precludes their per
se takings claim. The Court addresses each of these issues below.
1. Exceptions for Monetary Assessments
Federal courts generally reject the notion that the obligation to pay a monetary
assessment constitutes an unconstitutional taking under the Fifth Amendment. See, e.g.,

United States v. Sperry Corp., 493 U.S. 52, 62 n.9 (1989); E. Enters. v. Apfel, 524 U.S.
498, 540 (Kennedy, J., concurring in judgment and dissenting in part) (“The law simply
imposes an obligation to perform an act, the payment of benefits. . . . To call this sort of
governmental action a taking as a matter of constitutional interpretation is both imprecise
and, with all due respect, unwise.”); see also Commonw. Edison Co. v. United States, 271
F.3d 1327, 1340 (Fed. Cir. 2001) (“In short, while a taking may occur when a specific fund
of money is involved, the mere imposition of an obligation to pay money . . . does not give
rise to a claim under the Takings Clause.”). Indeed, “all circuits that have addressed the
issue have uniformly found that a taking does not occur when the statute in question
imposes a monetary assessment that does not affect a specific interest in property.”
McCarthy v. City of Cleveland, 626 F.3d 280, 285 (6th Cir. 2010) (collecting cases).
However, a statutory monetary assessment may alone constitute a taking in
certain, limited circumstances. First, a taking may occur when the government imposes a

“monetary exaction” or obligation as an unconstitutional condition for the grant of a land
use permit. See Koontz v. St. Johns River Water Mgmt. Dist., 570 U.S. 595, 612 (2013);
see Dolan v. City of Tigard, 512 U.S. 374, 386–88 (1994); Nollan v. Cal. Coastal Comm’n,
483 U.S. 825, 831–32 (1987). The Nollan-Dolan line of cases represents a “special
application” of the unconstitutional conditions doctrine in the Takings Clause context,
which “protects the Fifth Amendment right to just compensation for property the
government takes when owners apply for land-use permits.” Koontz, 570 U.S. at 604.
Under the Nollan-Dolan doctrine, the “government may not condition the approval of a
land-use permit on the owner’s relinquishment of a portion of his property unless there
is a ‘nexus’ and ‘rough proportionality’ between the government’s demand and the effects
of the proposed land use.” Id. at 599. Second, a taking may occur when the government

directs payments from a specific and identifiable fund of money. See, e.g., Phillips v.
Wash. Legal Found., 524 U.S. 156, 160 (1998); Webb’s Fabulous Pharms., Inc. v.
Beckwith, 449 U.S. 155, 163–64 (1980); Brown v. Legal Found. Of Wash., 538 U.S. 216.
235 (2003). For the reasons that follow, the Court concludes neither exception applies to
the monetary assessment of LD 1777’s Project Charge.
i. Unconstitutional Conditions Doctrine
Plaintiffs first argue the Project Charge constitutes a per se taking under the
unconstitutional conditions doctrine. ECF No. 3 at 8. The “fairly well-developed” doctrine
of unconstitutional conditions prevents the government from requiring “a person to give
up a constitutional right . . . in exchange for [a] discretionary benefit conferred by the
government where the benefit sought has little or no relationship to the property.” Philip
Morris, Inc. v. Reilly, 312 F.3d 24, 46 (1st Cir. 2002) (quoting Dolan, 512 U.S. at 385).
The Supreme Court has noted “the unconstitutional conditions doctrine forbids

burdening the Constitution’s enumerated rights by coercively withholding benefits from
those who exercise them.” Koontz, 570 U.S. at 606. Here, Plaintiffs contend the Project
Charge unconstitutionally burdens their real property rights and must therefore
withstand scrutiny from the Nollan-Dolan nexus and rough proportionality standard.
However, unlike the instant case, the Koontz-Nollan-Dolan line of cases all
involved Takings Clause challenges where the government conditioned the approval of a
land use permit on a concession or payment by landowners. See id. at 599 (conditioning
approval of construction permit on owner’s deed of conservation easement to district and
landowner’s funding of offsite mitigation projects on public lands); Nollan, 483 U.S. at
827 (conditioning approval of construction of larger house on beachfront property on
public easement across property for beach access); Dolan, 512 U.S. at 378 (conditioning

approval of store expansion and paving of parking lot on dedication of land for public
greenway and for pedestrian/bicycle pathway to relieve traffic congestion). Indeed, the
Koontz Court explicitly stated “Nollan and Dolan ‘involve a special application’ of th[e
unconstitutional conditions] doctrine that protects the Fifth Amendment right to just
compensation for property the government takes when owners apply for land-use
permits.” Koontz, 570 U.S. at 604 (quotation modified); see also Sheetz v. Cnty. of El
Dorado, 601 U.S. 267, 275–76 (2024) (applying Nollan-Dolan to legislatively imposed
development impact fees conditioned on building permit approval).
Plaintiffs argue, both in their pleadings and during oral argument, that the
distinction between the permit approval in Koontz and their NEB Program participation
is “immaterial to the constitutional analysis,” because in both cases, “permission from the
government . . . is conditioned upon giving up a right linked to specific property.” ECF
No. 3 at 10 n.7. However, the Plaintiffs fail to establish the constitutional right they must

give up in exchange for a government benefit so as to constitute a violation of the
unconstitutional conditions doctrine. Put another way, the Court finds Plaintiffs do not
have a constitutional right to continued participation in the NEB Program to sell their
solar power at a specific or preferable rate. Unlike the permit conditions in Koontz and
other cases, LD 1777 does not regulate land use or prevent Plaintiffs from continuing to
develop and generate solar power outside of the NEB Program. The record demonstrates
instead that Plaintiffs may continue to generate and sell solar power through alternative
means, such as on the wholesale market and through PPAs.7 See ECF No. 32 at 13.
The unconstitutional conditions cases Plaintiffs cite do not alter my determination
that LD 1777 does not burden any constitutional right of Plaintiffs, should they continue
to participate in the NEB Program. For instance, in Levin v. City and Cnty. of S.F., 71 F.

Supp. 3d 1072 (N.D. Cal. 2014), the district court held that a city ordinance requiring
property owners who sought to withdraw their rent-controlled property from the rental
market to pay a lump sum payment to displaced tenants, constituted an unconstitutional
taking by “conditioning property owners’ right to withdraw their property on a monetary

7 During the hearing, Plaintiffs argued the alternative options to participation in the NEB Program
are not viable primarily due to economic impact and loss in revenue received under the NEB
Program and kWh credit program. However, for reasons described in further detail below, the
Court finds that a mere loss in economic benefit does not constitute a per se taking. See Section
II.A.2, infra; see also Philip Morris, Inc. v. Harshbarger, 159 F.3d 670, 679 (1st Cir. 1998).
exaction not sufficiently related to the impact of the withdrawal.” Levin, 71 F. Supp. 3d at
1074. In reaching this conclusion, however, the Levin court specifically applied the
“special application” of the Nollan-Dolan cases involving land use permits and monetary
exactions. See id. at 1081. Crucial to the court’s holding was the fact the ordinance at issue
required a property owner who wished to withdraw their property to apply to the city for

an “Ellis Act permit,” which was granted only on the condition that the property owner
would pay any evicted tenant from the withdrawn unit an “enhanced” lump-sum payout.
Id. Unlike the statutory scheme requiring a permit in Levin, LD 1777 here does not require
Plaintiffs to apply for a permit to continue using their land to generate and sell solar
power. Plaintiffs remain free to withdraw from the NEB Program and sell solar power
elsewhere without paying a third party or without applying for a permit. Further, while
the Levin plaintiffs sought to exit a government program without penalty, Plaintiffs here
seek to remain in a government program while avoiding any costs.
Accordingly, because the monetary assessment imposed by LD 1777 does not
constitute an unconstitutional condition on Plaintiffs’ property rights, the Court need not
apply the Nollan-Dolan nexus and proportionality standard. See City of Monterey v. Del

Monte Dunes at Monterey, Ltd., 526 U.S. 687, 702 (1999) (“Although in a general sense
concerns for proportionality animate the Takings Clause . . . we have not extended the
rough-proportionality test of Dolan beyond the special context of exactions—land-use
decisions conditioning approval of development on the dedication of property to public
use.” (internal citation omitted)); Reilly, 312 F.3d at 46 n.20 (declining to apply Dolan
rough-proportionality test in non-land permit use context).8
Regardless, even if the Project Charge is analyzed as a monetary exaction under
the unconstitutional conditions doctrine, it easily satisfies the Nollan-Dolan standard. LD
1777 and the Project Charge respond directly to an unforeseen increase in Maine

electricity rates that has created an “unexpected windfall to solar generators in the [NEB]
program and an uncontrolled exponential growth in the costs of the program that must
be borne by Maine ratepayers.” Sanborn Decl. ¶ 40. In 2026, the kWh credit program
specifically will cost Maine ratepayers $47 million, which the Project Charge will offset by
an estimated $28 million. Id. at ¶ 65. These costs are tied directly to Plaintiffs’
participation in the NEB and kWh credit programs, as the cost-shifting mechanisms of
the programs result in increased fixed charges on ratepayers’ utility bills. Accordingly, the
Project Charge bears an “essential nexus” and “rough proportionality” to the State’s
legitimate interest in reining in costs to Maine ratepayers. See Dolan, 512 U.S. at 386.
Plaintiffs instead argue the record demonstrates the NEB Program results in net
societal benefits; consequently, the Project Charge necessarily lacks the requisite nexus

and rough proportionality, as there are no societal costs to offset. See ECF No. 38 at 9–11.
In support, Plaintiffs point to a Maine PUC report highlighting the NEB Program’s
environmental and reliability benefits generally. Id. at 10; see ECF No. 38-4. However,

8 Although City of Monterey and Reilly were both decided prior to the Supreme Court’s decision
in Koontz, the Koontz decision does not alter this analysis. Koontz expanded the Nollan-Dolan
standard only in that it included the denial of land use permits (in addition to the approval of
land use permits) conditioned on the surrender of constitutional rights—it did not expand the
doctrine’s application beyond the realm of the land-use-permit context. See Koontz, 570 U.S. at
606 (“The principles that undergird our decisions in Nollan and Dolan do not change depending
on whether the government approves a permit on the condition that the applicant turn over
property or denies a permit because the applicant refuses to do so.”) (emphasis in original).
that same PUC report also discusses the net costs imposed by the NEB Program on Maine
ratepayers. See generally ECF No. 38-4 at 44–55. Defendants assert the Maine
legislature, in enacting LD 1777 and the Project Charge, specifically focused its cost-
benefit analysis on the financial burden to those ratepayers. See Sanborn Dec. ¶ 65 (“The
amount of the initial project charge . . . was carefully considered during the negotiations

regarding LD 1777, as legislators were particularly concerned about striking a careful
balance between reining in the unaffordable cost of the program to ratepayers and
ensuring financial viability of existing [DGR] projects.”). This Court’s role is not to
second-guess the legislature’s policy judgment as to which specific costs or benefits
should be prioritized. Because the legislature identified a documented cost to Maine
ratepayers and tailored the Project Charge to mitigate that specific impact, the Court finds
that even if the Project Charge could be characterized as a monetary exaction under the
Takings Clause, it satisfies the Nollan-Dolan nexus and proportionality standard and
therefore passes constitutional muster.9
ii. Specific and Identifiable Fund of Money
The second exception to the general rule against monetary assessments rising to

the level of an unconstitutional taking applies when the government directs payments
from a specific and identifiable fund of money. See, e.g., Phillips, 524 U.S. at 160 (seizure
of interest income held in lawyer trust accounts is private property of the owner of the

9 Similarly, even if analyzed as a user fee, the Project Charge is constitutional. Taxes and user fees
generally are not takings. See Koontz, 570 U.S. at 615. A user fee is constitutional if it is a “fair
approximation of the cost of benefits supplied,” United States v. Sperry Corp., 493 U.S. 52, 60
(citation omitted) (1989), and only becomes a taking if “so clearly excessive as to belie [its]
purported character as [a] user fee[],” id. at 62. Because the Project Charge is designed to offset
specific costs shifted to Maine ratepayers through Plaintiffs’ NEB participation, it does not reach
the level of “clear excessiveness” required to constitute a taking.
principal under Takings Clause and constitutes takings violation); Webb’s, 449 U.S. at 163
(appropriation of interest accruing on an interpleader fund is “analogous to the
appropriation of the use of private property” to constitute takings violation); Brown, 538
U.S. 216, 235 (2003) (state court’s seizure of interest on client funds held in escrow
account constituted an unconstitutional taking).

Here, Plaintiffs argue that “DGRs are similar to [] interest-bearing accounts”
because DGR assets, once built and operational, function “in all relevant aspects like a
bank account—used to collect revenue and pay debt.” ECF No. 3 at 14–15. Specifically,
Plaintiffs contend that because a DGR’s only cash flow consists of passive revenue from
customer subscriptions—which they liken to interest generated on the asset itself—the
Project Charge unlawfully confiscates their property.10 See id. at 15. In response,
Defendants argue characterizing DGR revenues as specific funds of money akin to
interest-bearing accounts is misplaced; instead, they contend the Project Charge operates
like any other monetary liability incurred by a business that may happen to be satisfied
by a DGR’s operating revenue. ECF No. 32 at 27.
The Court disagrees that Plaintiffs’ DGRs function like the interest-bearing

accounts in Webb’s or other similar cases. For instance, as discussed during the hearing,
the operation of DGRs requires ongoing maintenance, subscriber acquisition, and
servicing. Consequently, DGRs resemble active, profit-earning business entities rather
than passive interest-bearing escrow accounts. Thus, the Court finds LD 1777 and the

10 “Put simply, the DGRs are akin to a bank account that holds KWH Plaintiffs’ principal; the
revenue collected from subscriber credits is best analogized as the interest those assets earn; and
the Project Charge skims that interest making it an unlawful, targeted exaction, not a broad-based
fee.” ECF No. 38 at 13–14.
Project Charge do not constitute a per se taking under the “specific and identifiable fund
of money” exception.
2. Voluntary Participation
Even if Plaintiffs could establish that the Project Charge falls within either
established exception for monetary assessments—which they cannot—their claim would

still fail because their participation in the NEB is voluntary.11 The Supreme Court has
made clear that even in the context of per se takings, the distinction between a mandatory
requirement and voluntary condition remains relevant. See Horne v. Dep’t of Agric., 576
U.S. 350, 365–67 (2015). Accordingly, the Court finds that Plaintiffs’ participation in the
NEB is voluntary and thus cannot sustain their per se takings claim.12
For statutes such as LD 1777 to constitute a per se taking, a “property owner must
be legally compelled to engage in price-regulated activity.” Franklin Mem’l Hosp. v.
Harvey, 532 F. Supp. 2d 204, 208 (D. Me. 2008) (quoting Garelick v. Sullivan, 987 F.2d
913, 916 (2d Cir. 1993)). Conversely, where a service provider voluntarily participates in
a price-regulated program, “there is no legal compulsion . . . and thus there can be no
taking.” Id. (quoting Garelick, 987 F.2d at 916). The Takings Clause, therefore, does not

shield voluntary participants from the inherent risk of regulatory or statutory changes

11 The Court notes that Plaintiffs raised their argument regarding the inapplicability of
voluntariness to the Koontz-Nollan-Dolan line of cases for the first time at the January 23
hearing. However, their brief specifically addresses the issue of voluntariness extensively. See,
e.g., ECF No. 3 at 17 (“Horne is just one brick in a solid wall of case law demonstrating that
economic compulsion is sufficient to render participation in . . . the NEB Program[] involuntary.”)
(emphasis in original)). Many of the cases cited by parties in their briefing discussed voluntariness
specifically in the context of regulatory takings—a theory Plaintiffs have explicitly disclaimed for
this Preliminary Injunction Motion. In any event, for the reasons explained herein, the Court finds
Plaintiffs’ participation in the NEB Program is voluntary.
12 Regardless, given my holding that the Project Charge does not fit into either exception for
monetary assessments, see Section II.A.1, supra, the issue of voluntariness is non-dispositive.
that may alter their property rights. See Philip Morris, Inc. v. Harshbarger, 159 F.3d 670,
679 (1st Cir. 1998).
Plaintiffs argue their NEB participation is “involuntary” due to a combination of
legal and economic constraints. Legally, they point to third-party financing agreements
and contracts that mandate their continued participation in the NEB Program. See ECF

No. 3 at 15–17. Economically, they argue their only alternatives to participation—joining
the PPAs and selling power on the wholesale market—are either not feasible because of
the DGRs’ current subscription rates or, would result in “devastating economic impacts,”
including widespread debt defaults and foreclosures. Id. at 20–21.
The Court is unpersuaded. As an initial matter, private contractual obligations to
third-party lenders do not transform a voluntary state program into a compulsory one.
The State was not a party to those financing agreements, and a developer’s decision to
pledge its NEB participation as collateral is a private and independent business risk.
Furthermore, “the choice to participate in a voluntary government program does not
become involuntary simply because the alternatives . . . appear to entail worse, even
substantially worse, economic outcomes.” Boehringer Ingelheim Pharms., Inc. v. U.S.

Dep’t of Health & Hum. Servs., 150 F.4th 76, 90 (2d Cir. 2025) (rejecting, in takings
context, pharmaceutical company’s argument that opting out of Medicaid programs
would bring economic devastation, making any “choice” to avoid program “illusory”).
Plaintiffs are sophisticated commercial entities operating in a highly regulated
industry. Given the history of rapid statutory and regulatory changes within the NEB
Program since 2019, see generally ECF No. 32 at 4–11, the possibility of further legislative
modification was not only foreseeable, but expected, see Harshbarger, 159 F.3d at 679
(recognizing the “reality that a governmental entity which creates a market’s supply or
sets its prices may be expected to alter property rights in the course of modifying its
regulations”). While the “exit ramps” available to Plaintiffs—such as the wholesale market
or consolidating subscribers to qualify for PPAs—may be less profitable or even lead to
significant economic loss, they still remain alternatives to the Project Charge. Because the
Plaintiffs retain the right to exit the NEB Program, their continued participation in the

program is a choice, not a confiscatory taking. Accordingly, Plaintiffs cannot establish the
compulsion necessary to sustain a per se Takings Claim on these grounds.
B. Irreparable Harm
While certain constitutional violations—such as those involving free speech or
privacy rights—carry a qualitative importance that makes them “irremediable by any
subsequent relief,” not all constitutional violations constitute per se irreparable harm.
Me. Forest Prods. Council v. Cormier, 586 F. Supp. 3d 22, 62 (D. Me. 2022), aff’d, 51
F.4th 1 (1st Cir. 2022) (quoting Vaqueria Tres Monjitas, Inc. v. Irizarry, 587 F.3d 464,
484 (1st Cir. 2009)). Plaintiffs argue a Takings Clause violation alone constitutes
irreparable harm and cite numerous cases involving violations of various constitutional
rights, but none relating specifically to the Takings Clause. See ECF No. 3 at 26–27. The

Takings Clause does not proscribe the taking of property; it proscribes the taking of
property without just compensation. See Knick v. Twp. of Scott, Pa., 588 U.S. 180, 189
(2019). Because the injury from a takings violation is the denial of just compensation, the
potential for such a violation does not, by itself, constitute irreparable harm. Unlike the
violation of free speech or privacy rights, a takings violation lacks the “qualitative
importance as to be irremediable by subsequent relief.” Cormier, 586 F. Supp. 3d at 62.
Plaintiffs further contend that Maine’s sovereign immunity would prevent them
from recouping Project Charge payments should they ultimately prevail. ECF No. 3 at
27–28. In response, Defendants contend that because Plaintiffs pay the Project Charge to
utilities rather than the State, nothing precludes Plaintiffs from later seeking
reimbursement from those utilities directly. ECF No. 32 at 29. Irreparable harm
ordinarily consists of “a substantial injury that is not accurately measured or adequately
compensable by money damages.” Ross-Simons of Warwick, Inc., v. Baccarat, Inc., 217

F.3d 8, 13 (1st Cir. 2000); see Rosario-Urdaz v. Rivera-Hernandez, 350 F.3d 219, 222
(1st Cir. 2003) (“Where a plaintiff stands to suffer a substantial injury that cannot
adequately be compensated by an end-of-case award of money damages, irreparable
harm exists.”). Should Plaintiffs ultimately prevail on the merits, which, as explained
above, the Court finds unlikely, they could recover any monetary damages resulting from
the Project Charge directly from the utility companies.13 Accordingly, Plaintiffs have failed
to establish irreparable harm.
C. Balance of Equities and Public Interest
Finally, the remaining factors—the balance of equities and the public interest—
both weigh against a preliminary injunction. The third and fourth factors of the
preliminary injunction standard merge “when the government is the opposing party.”

Does 1–6 v. Mills, 16 F.4th 20, 37 (1st Cir. 2021) (quotation modified). The Defendants
have already stayed implementation of LD 1777 until March 1, 2026. Any further delay in
implementation of the law risks the sustainability of the NEB Program in the face of
Maine’s rapidly increasing electricity rates. See ECF No. 32 at 29–30. Plaintiffs’

13 Plaintiffs argue that because Defendants control how and when funds are disbursed to
ratepayers, any funds used to reduce rates would be beyond the reach of the utilities or the Court.
ECF No. 38 at 15. However, Plaintiffs do not explain why they could not recover a future judgment
directly from the utility companies, who would then offset those costs by readjusting rates for all
ratepayers—effectively restoring the NEB Program’s status quo without implicating the State’s
sovereign immunity.
arguments regarding the final factors rest primarily on the alleged unconstitutional
nature of LD 1777. See ECF No. 3 at 28 (“It is hard to conceive of a situation where the
public interest would be served by enforcement of an unconstitutional law or regulation.”)
(quoting Condon v. Andino, Inc., 961 F. Supp. 323, 331 (D. Me. 1997)). Because the Court
finds Plaintiffs’ constitutional claim unlikely to succeed, this argument is unavailing.

CONCLUSION
Accordingly, for the foregoing reasons, the Plaintiffs’ motion for a preliminary
injunction, ECF No. 3, is DENIED.
SO ORDERED.

Dated this 17th day of February, 2026.

/s/ Stacey D. Neumann
UNITED STATES DISTRICT JUDGE

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11261869. Public record. Not legal advice.