dissenting, with whom RUDMAN, Justice, joins.
I must respectfully dissent from the Court’s opinion. Article IX, § 8, cl. 1 of the Maine Constitution states: “All taxes upon real and personal estate, assessed by authority of this State, shall be apportioned and assessed equally according to the just value thereof.” “Just value” means market value. Sweet v. City of Auburn, 134 Me. 28, 31, 180 A. 803, 804 (1935). In an appraisal report prepared for the Town of Moscow, Robert G. Taylor acknowledges this principle: “The valuation determined for this appraisal is based on the Fair Market Value of the properties.” He further defines fair market value in familiar terms: “Fair market value as utilized in this appraisal is defined as the amount a willing buyer would pay and a willing seller would accept where both have reasonable knowledge of all relevant facts and neither is under compulsion to enter into the transaction.”
As we stated in Shawmut Inn v. Town of Kennebunkport, there are “at least three standard appraisal methods of determining the market value of real property: 1) the ‘comparative’ or ‘market data’ approach, 2) the ‘income’ or ‘capitalization’ approach, and 3) the ‘reproduction cost less depreciation’ or ‘cost’ approach.” 428 A.2d 384, 390 (Me.1981). Although one of these approaches uses the word “market” descriptively, all three approaches are intended to assist an assessor in determining market value — what a willing buyer would pay and a willing seller would accept. Just value does not exist in a vacuum. It requires the reality of a market where there is a reasonable probability of a sales transaction: “Whatever factors are based upon a reasonable probability existing at the time of the assessment, as opposed to pure speculation, are relevant on the question of value.” Kittery Elec. Light Co. v. Assessors of Town, 219 A.2d 728, 737 (Me.1966) (quoting McKnight Shopping Ctr., Inc. v. Board of Property Assessment, A & R, 417 Pa. 234, 209 A.2d 389, 393 (1965)).
The Court goes astray by affirming a State Board of Property Tax Review decision which, reduced to its essence, sanctions an appraisal of the Wyman Dam that is based on possibilities of sales so remote that the market described is a fiction. Thus premised, the Town’s appraisal was “manifestly wrong,” and the evidence before the Board compelled that conclusion.
Although Taylor testified about the possibility of a sale of the Wyman Dam to the Massachusetts Municipal Wholesale Electric Company (MMWEC) and to non-utility generators (NUGs), his testimony does not withstand scrutiny. Legally, financially, prac*327tically, a sale to MMWEC could never happen. Taylor himself could not cite a single example where a functioning property like Wyman had been sold out of the rate base of a utility to a non-utility. The reason for his inability is well-stated in the amicus brief filed by the Maine Public Utilities Commission and the Office of the Public Advocate:
In order for the Commission to approve the sale of useful utility property to a non-regulated utility, the price received by the utility would need to be at a level that would allow the utility to replace such useful property, with property capable of generating electricity at the same cost and with the same or lower risk of future increases in costs, including fuel costs, maintenance costs and environmental costs. In this ease, such a price would necessarily reflect that power in replacement for Wy-man Dam would cost approximately ten times the cost of power produced by the dam.... Such a price is clearly beyond the realm of possibility.... Moreover, it is inconceivable that any non-hydro electric facility could provide the same operational or future cost reliability as the Wyman Dam.
Testimony to this effect was presented to the Board by Dr. Thomas Austin, then Finance Director of the PUC. This testimony was never refuted. Indeed, Taylor appeared to agree with it. That is a telling concession. Testimony about sales that will never take place because of PUC regulation has little value.
By statute, the assessors in their determination of just value “must consider all relevant factors, including without limitation, the effect upon value of any enforceable restrictions to which the use of the land may be subjected, current use, physical depreciation, functional obsolescence, and economic obsolescence.” 36 M.R.S.A. § 701-A (1985). Case law invoked by the Board as the touchstone for its decision makes the similar point that “[t]he likely influence on the market of the department’s [the Massachusetts Department of Public Utilities] rate making rules cannot disappear. The department’s views are of continuing importance.” Boston Edison Co. v. Board of Assessors, 402 Mass. 1, 520 N.E.2d 483, 490 (1988). We made the same point in Kittery Elec. Light “The reasonably foreseeable prospects of commission approval of sale or rate increases are considerations affecting the market value of property of public utilities.” 219 A.2d at 737. Although the Board pays lip service to these statutory and case law directives, it wholly disregards them with its insupportable deferral to the assessor’s claim of a possible sale to an unregulated utility. Indeed, the Board does not even acknowledge the obligation of the Town to discount the value asserted by Taylor in light of the remoteness of the sale possibilities described by him. “If property is known to be subject to a deed restriction or to a governmentally-imposed restriction affecting its value or its earning power, that fact should be considered in any determination of its fair cash value.” Boston Edison Co. v. Board of Assessors, 387 Mass. 298, 439 N.E.2d 763, 767 (1982).
In its decision, the Board concluded that “the Town’s methods of valuation of the property are not ‘manifestly wrong.’ ” The Board further concluded that CMP had “failed to prove the methods utilized by the Town in valuing the property to have been performed improperly.” Noting this reference by the Board to multiple methods of valuation, the Court asserts that “the Town’s assessment was not based solely on a possible but highly unlikely market sale of the dam.” In further support of this conclusion, the Court notes Taylor’s analysis of replacement value for the Wyman Hydro-electric Project and his use of “primary indicators” to check this value.
There is confusion here between methods of valuation and market value. The particular method of valuation chosen by an assessor is irrelevant if there are no willing sellers and buyers who would use that particular method of valuation. Replacement value is one method of determining market value if there is a market. Under the applicable legal standard of reasonable probability, a possible but highly unlikely market sale is an inappropriate subject for any method of valuation.
I recognize the difficult issues posed by the valuation of utility property. I recognize *328the well-established principle that “[t]he value of property for tax purposes and its value for rate-making purposes need not be the same.” Kittery Elec. Light, 219 A.2d at 735 (citing Public Service Co. of N.H. v. New Hampton, 101 N.H. 142, 136 A.2d 591, 597 (1957)). I understand that “[t]he market value of single purpose property must be determined by consideration of all factors calculated to influence an assumed buyer and seller in reaching a fair price in a free market.” Id. at 737. I also understand that the resort to an assumed buyer and seller does not dispense with a fundamental tenet of the just value exercise — the reasonable probability of a transaction between the assumed seller and buyer in a real market. The market described by the Town and the Board does not exist.
The Court notes in its opinion that the assessment of utility property raises policy issues that may have to be addressed by the Legislature. I agree. Until that happens, however, I believe we must accept the logic of the well-established principles of just valuation as they apply to utility property even if that logic produces uncomfortable results. The Town and the Board avoided that logic by creating a fictional market for the Wyman Dam. That evasion was essentially a policy decision that despite the applicable constitutional and statutory provisions, utility property will be assessed by a different legal standard. The Court’s decision affirms the very type of policy choice it seeks to avoid.
Our principles of deference to the decisions of local officials and state boards are important. They reflect respect for the expertise of other government officials and a recognition that time and resources are limited. Those principles, however, must not prevent us from seeing when the formulaic conclusions of a state board reflect legal error and insubstantial evidence. I fear those principles of deference have clouded the Court’s view in this case.
I would vacate the decision of the Board and remand for a redetermination of the assessment of the Wyman Dam.