Hundreds of millions of investment dollars, and the future growth of Maine’s wind power industry, will be at stake when state utility regulators and lawyers begin talks Thursday about whether a partnership between Maine’s largest wind power developer and a Canadian energy company can, or should, be preserved.

The outcome also could test the integrity of Maine’s 14-year-old electric industry restructuring law, which separated power generators from distribution companies to promote competition and eliminate the potential for favoritism.

The legality of a $333 million joint venture involving First Wind of Boston and Halifax, Nova Scotia-based Emera Inc., the parent company of utilities in Bangor and Presque Isle, was left in question earlier this month when the Maine Supreme Judicial Court said the Maine Public Utilities Commission wrongly approved the deal in 2012.

The justices found that the approval violated the restructuring law’s intent to uncouple electricity generation and transmission. They sent the matter back for further review by the PUC, which has ordered parties in the case to convene for initial talks about how to comply.

Expectations vary as the PUC prepares to take up the issue again. On one end of the spectrum is Emera, parent company of the utilities formerly known as Bangor Hydro-Electric Co. and Maine Public Service Co. It has $8.8 billion in assets invested in North America and the Caribbean.

Emera filed a motion last week asking the PUC to speed up its review. It noted that the commission’s prior approval contained about 50 conditions aimed at avoiding harm to the competitive market.

The motion highlights how the wind power industry could be hurt by the court action.

Emera says eight wind projects in Maine and elsewhere in the Northeast now are managed by the joint-venture company, called JV Holdco. Several hundred million dollars of investment by Emera has helped develop additional wind projects in Maine, including Bull Hill, a 34-megawatt wind farm in Hancock County.

The joint venture also “provides a structure to stimulate hundreds of millions of dollars of further investment in Maine,” it says.

Emera expressed concern that without a quick decision, third-party contractors may question whether their work agreements are legal.

“Given the circumstances,” a lawyer for Emera wrote, “an expedited proceeding is critical to the parties and the Maine communities, contractors and suppliers relying on the continued operation and development of these wind projects in Maine.”

Emera proposes that the PUC decide the case by April 28. It says there’s no need to reopen the record or hold additional hearings.

“More specifically,” the motion says, “fairness dictates that the commission issue a new order based upon the original record but applying the Law Court’s new legal standard.”

Emera’s motion was immediately opposed in a filing by the Houlton Water Co., which led the court appeal. The company said it will address the reasons at Thursday’s meeting.

A SERIOUS BLOW, OR ‘SALVATION’?

A lawyer for the Industrial Energy Consumer Group, which joined Houlton Water in the appeal, said the court decision has left JV Holdco with no legal basis for making investments.

“Can the transaction be approved under other terms?” asked Steven Hudson. “And if not, what would the other parties of interest propose to do to unwind the apparent close of the transaction?”

Despite Emera’s assertions, Hudson said it’s possible that the PUC will have to start over. Any new approval, he said, could produce a different relationship between Emera and First Wind.

At the other extreme, opponents of wind farms along the state’s ridge lines see the court’s finding as a blow to the industry.

“This decision could be the salvation of Maine’s mountains,” said Chris O’Neil, a spokesman for Friends of Maine’s Mountains.

O’Neil noted that First Wind had tried earlier to become a publicly traded company, but could not attract institutional investors. Its partnership with Emera, he said, represented the last hope for an ambitious wind power developer that has targeted Maine with massive projects.

“The court decision was proof positive that Big Wind was out of control,” O’Neil said. “Now maybe we have a chance of stopping this wind power insanity.”

First Wind isn’t a formal party to the case. But John Lamontagne, a company spokesman, said the joint venture provided low-cost capital that translated into lower rates for consumers in several power-purchase agreements with New England utilities. First Wind hopes the PUC will move ahead quickly, he said, and that the joint venture will be preserved.

“It’s to be determined what our ability to invest in new projects would be, were the joint venture not to move forward,” Lamontagne said.

RAMIFICATIONS FOR CMP’S PARENT

The PUC cannot comment on how it might act. But Tom Welch, the commission’s chairman, said the upcoming meeting with his staff is meant to evaluate what, if anything, happens immediately, whether further evidence is needed and whether the deal can be reformed to meet the court’s test.

Welch outlined options last week before the Legislature’s Energy, Utilities and Technology Committee.

“I noted that the court did not direct us to find that the transaction was impermissible,” he said. “It said instead that our decision that the transaction was permissible was based on our misinterpretation of a portion of the statute, and we should look again with the correct interpretation.”

The outcome also is being watched by Iberdrola USA, the parent company of Central Maine Power Co. The Spanish multinational company is among the world’s largest wind power developers.

In Maine, its Iberdrola Renewables subsidiary proposed a 97-megawatt project in Lexington and Concord townships, in western Maine. The Fletcher Mountain wind farm won a power-purchase agreement last fall to supply utilities in Massachusetts, but Iberdrola later withdrew, saying it was unable to develop the project in time.

“We are a transmission and distribution company, and we have a parent company involved in generation,” said John Carroll, a spokesman for Iberdrola. “To the extent it affects how the two operate in Maine, there are ramifications. We have to see how the PUC handles it.”

Maine lawmakers who oversee energy issues also are taking an interest.

In the days after the court decision, rumors circulated that political leaders might attempt a legislative fix. One remedy envisioned a bill to amend the restructuring law and accommodate the joint venture.

That talk has largely faded. The complicated law that restructured Maine’s electricity industry was the product of months of negotiations. Tinkering with it at the end of a legislative session would be a bad idea, said Sen. John Cleveland, D-Auburn, who co-chairs the energy committee and was a sponsor of the restructuring act.

“Frankly, I think the Maine Supreme Judicial Court got it exactly right,” he said.

Tux Turkel can be contacted at 791-6462 or at:

tturkel@pressherald.com