dissenting.
I agree with much of the majority’s discussion. My disagreement with the ultimate disposition of the majority stems from my view that the methodology that the PUC adopted to determine whether plaintiffs had been damaged and the nature of any remedy that the PUC could provide went beyond the scope of the remands on the previous judicial reviews.
As the majority has noted, rather than simply examining the impact on the pre-October 2000 rates of including Trojan in the rate base, the PUC concluded that it had the authority on remand to re-evaluate the pre-October 2000 rates to make substantial adjustments to some of the factors, other than the inclusion of Trojan in the rate base, that had gone into making them. In the process, the PUC re-examined and modified several of the decisions that it had made in determining those rates in ways that significantly affected PGE’s revenue requirements and, thus, its rates. Specifically, the PUC changed the amortization period for PGE’s remaining investment in Trojan from 17 years to 10 years, thus increasing PGE’s expenses for each of the years at issue; it awarded PGE interest at a little over seven percent on the Trojan balance to reflect the time value of money; and it restored $37.5 million of the balance that it had previously disallowed.
*106The net result of the changes was that PGE’s revenue requirement for the applicable period was $4.03 million greater than the PUC had provided in the rates. Because the difference was relatively small, the PUC concluded that the pre-October 2000 rates were not unjust or unreasonable. Thus, the PUC concluded, the legal error in including the return on Trojan in calculating the rates did not harm the ratepayers, and there was no need to consider reparations or a refund.
URP and the CAPs argue that the PUC erred, because its only role on remand was to determine the amount by which PGE had overcharged its ratepayers as a result of including the Trojan balance in the rate base. URP and the CAPs argue that, when the PUC considers a factor that the legislative authority, as a matter of policy, has expressly prohibited the PUC from considering, the resulting rates are by that very fact unlawful. The rates are not unlawful because the PUC misapplied one of the many considerations that normally go into ratemaking. Rather, the rates are unlawful because they are outside the authority that the legislature has delegated to the PUC. For that reason, they argue, the question of the overall fairness or reasonableness of the rates does not arise. With an unlawful rate, the only action that the PUC has the authority to take is to determine the amount by which the unlawful factor resulted in an overcharge compared to what the rate would have been without that factor. Thus, the CAPs and URP assert, the PUC acted beyond its authority when it re-evaluated the rates and adjusted its treatment of the legal factors that went into the creation of those rates.
The PUC and PGE respond that the appellate courts, in their previous decisions, did not second-guess the PUC’s exercise of its delegated authority to make rates. All that they held, according to the PUC and PGE, was that the PUC had erroneously applied one of the many elements in the ratemaking process. According to the PUC, consideration of an unlawful factor in ratemaking has the same effect as improper consideration of lawful factors, and the PUC’s job in such circumstances is to reconsider its previous actions as a package, not in isolation. The PUC argues that the normal *107rule — that rates that result from the process are lawful if they are fair and reasonable — continues to apply; it is the result of the process, not the process itself, that matters.
In my view, the previous appellate decisions generally support much of URP’s and the CAPs’ argument, and the PUC’s action in re-evaluating the entire rate structure rather than simply determining the effect on the previously approved rates of including Trojan in the rate base was not within its authority on remand. I therefore dissent.
The heart of the PUC’s position is that including an unlawful element, such as a return on PGE’s Trojan investment, in a rate determination is no different from assigning incorrect weight to one or more of the many legal elements that the PUC does have discretion to consider. The PUC and the majority rely on the well-established principle that it is the legality of the end result of the ratemaking process, and not the legality of each calculation or input used during that process, that controls.1 That approach is certainly correct for ordinary ratemaking, and the PUC simply applied it to the circumstances of this case, and it did so retrospectively. In ordinary ratemaking, the PUC must exercise its discretion in balancing a multitude of factors and many economic considerations in order to determine the appropriate rates. The result of such a procedure is likely to be no more than an approximation of the ideal rates, if such rates exist. It is not the role of a court to try to second-guess the complex work that the PUC does in the usual rate case; rather, the court’s role is to ensure that the process was proper and that the result fits into the broad goals that ORS 757.040 establishes for utility rates.
*108This, however, is not the normal rate case. ORS 757.355 expresses a legislative policy determination that the utility’s stockholders, not its ratepayers, shall bear the costs and the risk of property that is not in current use for providing utility service. See McPherson et al v. Pacific P & L. Co., 207 Or 433, 439, 296 P2d 932 (1956) (losses from utility’s failure to collect emergency surcharge from customers in competitive area “shall be borne by the Company’s stockholders”); American Can v. Lobdell, 55 Or App 451, 454, 638 P2d 1152, rev den, 293 Or 190 (1982) (PUC disallows costs that “stockholders alone should bear” in determining utility’s costs). Rates that derive in part from a rate base that contains the unamortized Trojan balance will permit PGE to charge ratepayers amounts that the law requires PGE’s stockholders to pay. Those rates cannot, as a matter of law, be legal rates. In the lexicon of Springfield Education Assn. v. School Dist., 290 Or 217, 226-28, 621 P2d 547 (1980), the terms of ORS 757.355 are not delegative. Under ORS 757.355, the PUC had absolutely no discretion whether to include the Trojan investment in PGE’s rate base. Its role in that regard was not to use its delegated authority to flesh out and apply a broadly stated legislative policy; rather, its role was to follow an explicit and precise legislative policy. As we said in Citizens’ Utility Board v. PUC, 154 Or App 702, 716-17, 962 P2d 744 (1998) (Trojan I),
“[t]he general grants of authority in ORS 756.040 and other general statutes do not empower PGE to charge or PUC to approve rates of a kind that are specifically contrary to the limitations in ORS 757.355 and ORS 757.140(2).”
The PUC did not misuse its broad discretion; it had no discretion to misuse. The PUC failed to recognize that, and, as a result, the rates that it approved included a single specific and impermissible element — a rate base that unlawfully includes return on the unamortized balance of Trojan. The rates that derive from that inclusion are unlawful, not because they are unfair and unreasonable but because they include an unlawful return on Trojan. Remedying that unlawfulness may require single-issue ratemaking, however impermissible it is otherwise. As I *109discuss below, that is what the appellate courts anticipated the PUC would do on remand.
In Trojan I, we clearly held that the pre-October 2000 rates were unlawful as a result of the inclusion of the return on the Trojan investment. Trojan I, 154 Or App at 716 (general grants of authority do not empower the PUC to approve rates that include a rate of return on capital assets that are not currently used for the provision of utility services). However, we remanded the case to the PUC for reconsideration without discussing what it should do on remand.
In contrast, much of the Supreme Court’s discussion in Dreyer v. PGE, 341 Or 262, 142 P3d 1010 (2006), is directed to the question of the PUC’s authority on remand. The case arose out of the CAPs’ attempt to obtain a judicial remedy for the alleged excessive charges in the pre-October 2000 rates. As the majority discusses, PGE argued that asking a jury to set the CAPs’ damages by determining the rates that the PUC should have set if it had followed ORS 757.355 necessarily would involve ratemaking that would intrude into the PUC’s exclusive jurisdiction. The Supreme Court disagreed with that argument:
“Although a jury theoretically could go about deciding the damage question in the manner suggested, i.e., by determining what a ‘fair and reasonable’ rate would have been if the objectionable return on Trojan had been excluded and then comparing that rate to the one actually charged during the relevant period, it also could simply attempt to determine what part of the rates that the PUC had approved as ‘fair and reasonable’ in fact represented a return on PGE’s investment in Trojan and, therefore, were unlawful under ORS 757.355 (1993), as interpreted in Citizens’ Utility Board, 154 Or App 702. The first approach arguably would invade the PUC’s exclusive ratemaking authority, but we are not persuaded that the latter approach would involve a similar trespass.”
Dreyer, 341 Or at 282.2
*110Thus, the Supreme Court suggested two ways to determine the damages that resulted from the PUC’s error. The first way would be for the PUC to determine what fair and reasonable rates would be if the rate base did not include Trojan. Doing so, the court assumed, would involve excluding the return on Trojan from PGE’s revenue requirement for the relevant period, establishing hypothetical rates as a result of the reduced revenue requirement that would follow from that exclusion, and then evaluating the resulting rates for fairness and reasonableness. The difference between what PGE would have received under the hypothetical rates and what it actually received under the rates that the PUC had actually approved would be the CAPs’ damages. 341 Or at 282.
The second possible way that the Supreme Court suggested to determine the CAPs’ damages was for the PUC or a jury simply to remove Trojan from the rate base, reduce PGE’s revenue requirement by the amount of its return on Trojan, and award damages to the CAPs in the amount of the difference. Because the second approach would not require establishing new hypothetical rates or determining whether they were fair and reasonable, it would not invade the PUC’s delegated authority. That approach would simply correct the unlawful rates by removing the factor that made them unlawful. Id.
The Supreme Court ordered the circuit court to abate the class action under the doctrine of primary jurisdiction, because it concluded that the PUC should decide what remedy it could “offer to PGE ratepayers, through rate reductions or refunds, for the amounts that PGE collected in violation of ORS 757.355 (1993) between April 1995 and October 2000” before the class action proceeded further. Dreyer, 341 Or at 286. If the PUC was able to provide a full or partial remedy, then the CAPs either were not injured at all — because they would receive a remedy through the PUC’s actions — or their remedy was to seek review of the PUC’s order. In the first case, the court could dismiss the class action; in the second, *111its work would be usefully curtailed. 341 Or at 285. The Supreme Court concluded that,
“[i]f the PUC determines that it can provide a remedy to ratepayers, then the present actions may become moot in whole or in part. If, on the other hand, the PUC determines that it cannot provide a remedy, and that decision becomes final, then the court system may have a role to play. Certainly, after the PUC has made its ruling, plaintiffs will retain the right to return to the circuit court for disposition of whatever issues remain unresolved, including the question of a fee award.”
341 Or at 286. The entire premise of the Supreme Court’s opinion in Dreyer was that the ratepayers were entitled to some remedy, in some venue. The issue was not whether the ratepayers could obtain a remedy, but how the ratepayers would obtain that remedy, either by a refund or a rate reduction. The court abated the case in order to give the PUC the first opportunity to consider that issue, including whether it had the authority to order a refund or to adjust future rates.
In Dreyer, the Supreme Court noted that the circuit court’s remand of Trojan II required the PUC to
‘“revise and reduce the existing rate structure so as to fully and promptly offset and recover all past improperly calculated and unlawfully collected rates, or alternatively, to order PGE to immediately issue refunds for the full amount of all excessive and unlawful charges collected by the utility for a return on its Trojan investment.’”
341 Or at 284 n 17 (quoting Trojan II, 215 Or App at 368). The circuit court had issued that remand while the case was on appeal to this court. In Trojan II, we reviewed the remand in light of Dreyer and concluded that it was too broad. The circuit court had presumed both that the PUC had the authority to offer a remedy through rate reductions or refunds of previously collected amounts and that it was required to exercise that authority. However, the Supreme Court in Dreyer had held that there were alternative ways for the ratepayers to recover the unlawfully collected amounts. Whether they should seek a rate reduction or refund, rather than proceeding by a class action against PGE, was a matter *112for the PUC to decide in the first instance. Trojan II, 215 Or App at 374.
“[B]efore the circuit court or this court orders the PUC to provide a refund or engage in retroactive ratemaking * * *, the PUC must determine — in the agency proceedings that are currently underway — whether it has authority and will exercise its authority to take those actions.”
Id. at 375-76.3 The PUC’s authority to require a refund, and its discretionary decision about whether to do so, were thus the fundamental issues on remand.
One foundation of both Dreyer and Trojan II is that the ratepayers were entitled to reimbursement, in some fashion, for the unlawful rates that PGE charged. Both appellate courts assumed that the proceedings that the PUC was conducting at the time of the decisions, and that ultimately resulted in the order on review in this case, would result in a decision about the extent to which the PUC could or would provide such a refund.
However, the PUC apparently failed to understand the limited issues that were before it on remand. It believed that its responsibility encompassed the authority to determine that the rates that had been imposed, even unlawfully, were nonetheless fair and reasonable and that no damages had been suffered. Throughout the proceedings on remand, the PUC failed to recognize the distinction between rates that are subject to its usual broad discretion and rates that are subject to a specific legislative policy that the PUC has no discretion to ignore. The first rates are subject to challenge primarily if they are not fair and reasonable as a whole, and the PUC’s role on remand is to adjust them to be fair and reasonable. In my view, however, the second rates are unlawful no matter how fair and reasonable they may be, and the PUC’s role on remand is to determine a remedy *113for that unlawfulness. It was not the PUC’s role to revisit its previous ratemaking but rather to determine whether it had the authority to order an appropriate remedy for the unlawfulness of the rates, whether in its discretion it would do so, and, if it did, what the remedy should be.4 I would conclude that the PUC erred on remand by evaluating the rates according to the first criterion rather than the second. For that reason, I would reverse its order on the pre-October 2000 rates and remand the case for further proceedings. In all other respects, I agree with the majority.
None of the three cases that the PUC cited to support this position involved using a legislatively forbidden factor to arrive at the rates. See Duquesne Light Company v. Barasch, 488 US 299, 314, 109 S Ct 609, 102 L Ed 2d 646 (1989) (economic judgments involved in ratemaking are often hopelessly complex and do not admit of a single correct result); Federal Power Commission v. Hope Natural Gas Co., 320 US 591, 602, 64 S Ct 281, 88 L Ed 333 (1944) (it is not the theory that led to the challenged rates that counts, but the total effect of the rate order; that the method used to reach results may contain infirmities is not important if the order itself is not unjust and unreasonable); Valley & Siletz R. R. Co. v. Flagg, 195 Or 683, 699, 247 P2d 639 (1952) (follows Hope Natural Gas Co.; end result of a rate order determines its validity, not process by which agency reached that result).
The PUC points out that it was not a party to Dreyer and that the order that we are reviewing is not an order on remand from that case. Thus, the PUC argues, Dreyer does not instruct the PUC to take any particular action. Of course, the PUC filed an amicus brief in Dreyer. More significantly, as we recognized in Utility *110Reform Project v. PUC, 215 Or App 360, 170 P3d 1074 (2007) (Trojan II), Dreyer expresses the Supreme Court’s view of the applicable law and of the options before the PUC in its proceeding on remand from Trojan I. That view is binding both on the PUC and on this court.
Our reference to “retroactive ratemaking” was in the context of the Supreme Court’s statement that “the issue of the PUC’s authority to provide a retroactive remedy is one that, at least initially, belongs before that body.” Dreyer, 341 Or at 285 (quoted and emphasized in Trojan II, 215 Or App at 375). The issue that we addressed in Trojan II was whether the PUC had the authority to provide a remedy — such as by adjusting the post-October 2000 rates — for excessive rates that PGE had already collected, not how it might reconsider the foundations of those rates.
The PUC correctly states that it technically did not engage in retroactive ratemahing because it did not consider past profits and losses in evaluating the rates. See Pacific Northwest Bell Telephone Co. v. Katz, 116 Or App 302, 311, 841 P2d 652 (1992), rev den, 316 Or 528 (1993). It did, however, retrospectively change a number of decisions that it had originally made before evaluating the original rates. It did not limit its consideration to the effect of including a return on Trojan on those rates.