KES BROCKTON, INC., & another [Note 1] vs. DEPARTMENT OF PUBLIC UTILITIES.

ABRAMS, J. The petitioners, general partners of Brockton Wood, L.P. (Brockton Wood), appeal from the disapproval by the Department of Public Utilities (department) of an electricity purchase contract between Brockton Wood and the Western Massachusetts Electric Company (WME); the department's denial of the petitioners' motion to intervene in the department's contract review process; and the department's denial of the petitioners' motion for reconsideration. The petitioners appealed to the Supreme Judicial Court for Suffolk County; on joint motion of the parties, see G. L. c. 25, Section 5 (1992 ed.), a single justice reserved and reported the case to this court. We conclude that the petitioners have no standing to appeal.

On October 5, 1988, WME issued a solicitation (RFP) for bids for the competitive purchase of electricity from Qualifying Facilities (QFs), pursuant to 220 Code Mass. Regs. Section 8.00 (1986) (QF regulations). On February 2, 1989, Tamal Development Corporation (Tamal) submitted a project proposal in response to the RFP. During October and November, 1989, Tamal provided WME further details on the proposal. On December 12, 1989, WME notified Tamal that the Tamal proposal would be included in the award group. See 220 Code Mass. Regs. Section 8.05 (6) (a) (1986).

As originally bid, the project proposal was as follows: The project would be located in Assonet, inside WME's service area; WME would purchase electricity the project generated from Tamal; the primary generating technology would be a low-BTU boiler/steam turbine generator; the primary fuel would be wood waste, supplied to Tamal by the owner of the project site, from on-site sources (under a letter of intent); the project capacity would be twenty megawatts (MW); the contract would run for twenty years from the expected inservice date of January 1, 1994; and the price had a fixed and variable component. Tamal Energy, Inc., was listed as the 100% owner of the project.

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In January, 1990, Tamalproposed to WME that the project's generating technology be changed from wood gasification to a wood-fired stoker. WME initially rejected this change as constituting a change that would fundamentally alter the nature of the proposal. Following a department decision that WME interpreted as urging utilities to be more flexible in dealing with project developers, WME allowed Tamal to update its proposal to include the technology change, but suspended contract negotiations and recalculated the project's score to determine whether the revised project remained in the award group. WME reranked the proposal and notified Tamal on May 10, 1990, that the proposal remained in the award group, and that contract negotiations could be reopened.

On May 15, 1990, Tamal informed WME that the project would have to be relocated to an alternative site. WME suspended negotiations pending verification of the economic feasibility of the project after the proposed changes and reranking of the project. On July 18, 1990, WME notified Tamal that the rescored project [Note 2] remained within the award group; contract negotiations resumed.

In October, 1990, WME rejected Tamal's subsequent request to modify its pricing formula and to increase project size. In November, 1990, Tamal informed WME that Tamal intended to proceed on the bid terms and would provide a revised bid proposal; WME provided Tamal a draft contract incorporating all agreed changes.

During the first part of 1991, the parties continued to revise the proposed contract. WME repeatedly requested a revised project proposal. On July 15, 1991, WME notified Tamal that if WME did not receive an updated proposal by August 1, 1991, the project would be removed from the award group. On July 31, 1991, and during the following three weeks, Tamal informed WME of various changes in the proposed project's ownership, capital structure, capital costs, schedule and project description. Tamal also indicated

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that the project no longer had a committed long-term fuel supply. WME again suspended contract negotiations to obtain information it needed to rescore and rerank the project in light of the proposed changes. On October 9, 1991, WME notified Brockton Wood [Note 3] that the proposal remained in the award group and that contract negotiations could be resumed.

In October, 1991, Brockton Wood requested that WME accede to a reduction in project size from twenty MW to 16.9 MW. WME agreed to the change in project size. In February, 1992, KES informed WME that an alternate site had been chosen in Brockton to address environmental considerations. WME agreed to the change in site. Brockton Wood executed the electric power purchase agreement (contract) in June, 1992; WME executed the contract in July, 1992.

In September, 1992, WME submitted the contract to the department for review pursuant to 220 Code Mass. Regs. Section 8.03 (2). In October and November, 1992, the department issued, and WME responded to, four information requests regarding the contract. On November 11, 1992, Brockton Wood submitted to the department comments on WME's response to a department information request regarding an avoided-costs calculation of the Brockton Wood project proposal. Brockton Wood also filed a petition to intervene pursuant to 220 Code Mass. Regs. Section 1.03 to present additional evidence to the department disputing some of the assumptions that WME relied on in its cost-benefit analysis. Brockton Wood asked "to participate as an intervenor in this matter, and where appropriate, engage in any technical sessions or hearings, offer evidence and cross examine witnesses, present oral argument before the Department, and submit comments and briefs for the Department's consideration." WME corrected its original response and commented on Brockton Wood's earlier comments.

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On November 16, 1992, the department issued a letter decision disapproving the contract pursuant to 220 Code Mass. Regs. Section 8.03 (2), focusing on the number and significance of the changes made to the original project proposal. [Note 4] The department denied Brockton Wood's motion to intervene that same day, thereby limiting Brockton Wood's participation to the submissions previously filed with the department.

On December 14, 1992, the petitioners filed a petition for appeal with the Supreme Judicial Court for Suffolk County under G. L. c. 25, Section 5, and a motion for reconsideration with the department; both pleadings challenged the department's disapproval of the contract and the department's decision to deny intervention. On January 22, 1993, Brockton Wood moved for leave to file a memorandum in support of its motion for reconsideration in the department. On March 15, 1993, on joint motion of the parties, the single justice reserved and reported the case to this court. On May 19, 1993, the department denied Brockton Wood's motion

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for reconsideration, upholding its earlier decision denying Brockton Wood's intervention on the grounds that (i) 220 Code Mass. Regs. Section 8.03 (2) did not require a full G. L. c. 30A adjudicatory hearing; [Note 5] (ii) Brockton Wood had no constitutional right to a full adjudicatory hearing; and (iii) the department's review of the contract did not require process beyond what the department gave. The department also emphasized that Brockton Wood failed to meet the department's standards for obtaining reconsideration, and rejected Brockton Wood's assertion that the department made insufficient findings and that the department relied on inapplicable regulations in rendering its decision. The department refused to consider Brockton Wood's January 27, 1993, memorandum because Brockton Wood failed to show good cause for filing the memorandum after the twenty-day filing period required by 220 Code Mass. Regs. Section 1.11 (10). On March 23, 1993, the petitioners moved this court to amend their petition for appeal to include an appeal of the department's denial of the motion for reconsideration.

The department contends that the petitioners are not "aggrieved part[ies] in interest" under G. L. c. 25, Section 5, and therefore have no standing to appeal the disapproval of the contract. [Note 6] We agree.

We determine standing to appeal in this case by G. L. c. 25, Section 5, which expressly limits standing to an "aggrieved party in interest." Newton v. Department of Pub. Utils., 339 Mass. 535, 543-544 & n.2 (1959) ("except as to the standards

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of review . . . review of the decisions of the department is governed by c. 25, Section 5, to the extent that Section 5 contains a provision (as it does as to standing) relating to the particular aspect of review under consideration"). In Save the Bay, Inc. v. Department of Pub. Utils., 366 Mass. 667 (1975), we explored the distinction between an "aggrieved party in interest" under G. L. c. 25, Section 5, and a "person . . . aggrieved by a final decision of any agency in an adjudicatory proceeding" under G. L. c. 30A, Section 14. To establish standing to seek review under G. L. c. 25, Section 5, a petitioner must show "either that the Department did in fact exercise its discretion pursuant to G. L. c. 30A, Section 10, to admit the petitioner as an intervener; that as a matter of law the petitioner was entitled to intervene before the Department and was improperly denied that right; or that the petitioner is a person who as matter of constitutional or statutory law was entitled to participate fully in the proceedings and who on proper notice did make an appearance in said proceedings." Save the Bay, Inc., supra at 673. See SDK Medical Computer Servs. Corp. v. Professional Operating Management Group, Inc., 371 Mass. 117, 122 (1976) ("`aggrieved party' [as contrasted with `aggrieved person'] is customarily taken to mean one who has previously participated in an administrative hearing or was improperly denied the right to participate"); Newton v. Department of Pub. Utils., 367 Mass. 667, 673-675 (1975). Because the department did not in fact exercise its discretion to admit Brockton Wood as an intervener, [Note 7] and Brockton Wood did not make an appearance in the proceedings, the issue is whether Brockton Wood was entitled as a matter of law to intervene and was improperly denied that right.

No statute grants Brockton Wood the right to intervene in the department's contract review. The QF regulations allow

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the department wide discretion to grant, limit, or deny a person leave to intervene. 220 Code Mass. Regs. Section 1.03 (1) (e) (1986). [Note 8] Pointing to the expenditures made in formulating the proposal and in anticipation of departmental approval, the petitioners argue that due process requires that the contract review process be conducted as an adjudicatory hearing, and that intervention was constitutionally mandated. We disagree.

In Forsyth School for Dental Hygienists v. Board of Registration in Dentistry, 404 Mass. 211 (1989), we examined the issue whether a petitioner's interest in a favorable agency decision on a licensing application amounted to a "property interest" triggering due process requirements for an adjudicatory hearing. Noting that "[t]he school's right to engage in a lawful calling . . . is not equivalent to a right to practice its calling free from State regulation," id. at 215, we determined that the petitioner did not have such a property interest, id. at 214-217, even though "[t]he school's motive in petitioning the board . . . was to retain its competitiveness and its standing in its field." Id. at 213.

"To have a property interest in a benefit, a person clearly must have more than an abstract need or desire for it. He must have more than a unilateral expectation of it. He must, instead, have a legitimate claim of entitlement to it" (emphasis added). Regents of State Colleges v. Roth, 408 U.S. 564, 576-577 (1982).

Anticipation of the financial benefits that would accrue from departmental approval of a proposed public utility contract

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does not amount to a property interest requiring an adjudicatory proceeding. The petitioners attempt to distinguish Forsyth on the ground that in Forsyth a statute prohibited the action the petitioner desired to take. In this case, however, the petitioners well knew that the contract needed departmental approval. The petitioners had no legitimate claim of entitlement to the contract. In these circumstances, Forsyth controls. See Roth, supra.

Citing Milligan v. Board of Registration in Pharmacy, 348 Mass. 491 (1965); Borden, Inc. v. Commissioner of Pub. Health, 388 Mass. 707, cert. denied sub nom. Formaldehyde Inst., Inc. v. Frechette, 464 U.S. 936 (1983); Newton v. Department of Pub. Utils., 339 Mass. 535 (1959); and New York Cent. R.R. v. Department of Pub. Works, 354 Mass. 332 (1968), the petitioners contend that the department was required to conduct an adjudicatory hearing in its review of the contract, even in the absence of a statutory or regulatory provision requiring an adjudicatory hearing. We do not agree. Nor do the cases on which the petitioners rely require an adjudicatory hearing in these circumstances.

In Milligan, supra, the board's decision involved "the determination by the board of the facts concerning each applicant and the place in which he [wished] to carry on business." Id. at 499. The petitioners do not dispute the facts, namely the number and significance of the changes to the originally proposed project, on which the department based its decision. See note 4, supra. Rather, the petitioners contend that the decision itself required an adversary proceeding and therefore the department's decision was erroneous. We do not agree.

In Milligan we concluded that denial of an individual's freedom to engage in a lawful private occupation mandated an adjudicatory hearing. Id. Lotto v. Commonwealth, 369 Mass. 775, 778-779 (1976) (when plaintiff not denied permission to earn living by pursuing otherwise lawful private occupation, no liberty or property interest mandates adjudicatory hearing). No such denial occurred in the current case. In Milligan, we noted that regulation of the petitioner's profession

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(pharmacology) beyond matters of public health (an aspect of the public interest directly affected by the petitioner's profession) raised "more difficult questions of constitutional validity . . . concerning whether particular statutes, regulations, or policies, or their application in particular circumstances, bear a reasonable relation to significant aspects of the public interest. Particularly is this so in respect of occupations other than those (for example . . . public utility operation . . . ) most obviously appropriately subject to public regulation." (Footnote omitted.) Id. at 498. [Note 9]

In Hamilton v. Department of Pub. Utils., 346 Mass. 130 (1963), there was no dispute that any appellant was an aggrieved party; further, that case did not focus on whether an adjudicatory hearing should be held, but rather on whether the requirements of an adjudicatory hearing were satisfied when an adjudicatory proceeding was in fact held. In Borden, Inc., supra, we required an adjudicatory hearing only with respect to the factual issue whether a given supplier provided a specific product, when the Legislature mandated that no supplier shall be required to repurchase a product except from the person to whom he or she sold it. Id. at 719. In Newton v. Department of Pub. Utils, 339 Mass. 535 (1959), we determined that hearings held by the department were "adjudicatory proceedings" under G. L. c. 30A, Section 1 (1), because G. L. c. 160, Sections 128 and 128A, provided that "legal rights . . . of specifically named persons" were required to be determined after an agency hearing. The petitioners here point to no such statutory provision. New York Cent. R.R. v. Department of Pub. Works, supra, is inapplicable,

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because the statute under consideration required an agency hearing.

The department's determination that allowance of changes in the project proposal adversely affected the public interest "fall[s] into the category of nonadjudicative, policy-making judgments, rather than party-specific fact finding." Zachs v. Department of Pub. Utils., 406 Mass. 217, 221 (1989). [Note 10] The case is remanded to the Supreme Judicial Court for Suffolk County for entry of a judgment dismissing the appeal because the petitioners are not aggrieved parties under G. L. c. 25, Section 5.

So ordered.