NARUC: States assert authority on PURPA enforcement


NARUC has adopted a resolution asserting the authority of state regulators to decide specific policy issues related to the enforcement of PURPA. The resolution comes in the wake of a technical conference addressing PURPA held by the Federal Energy Regulatory Commission on June 29.

Resolution EL-2, adopted November 16, states that:  (1) state regulators must remain the appropriate bodies to make mandatory purchase and avoided-cost determinations; (2) state regulators should continue to be afforded the authority to select an appropriate methodology for calculating avoided costs; (3) PURPA’s goal of promoting QF development must be balanced with the states’ interest in just and reasonable rates; (4) FERC should establish criteria to help states evaluate whether a project developer has disaggregated a large project into multiple smaller projects; and (5) each state should retain the full authority and discretion to determine the process by which QFs become entitled to PURPA contracts; the scope of such contracts; the extent to which QFs with a design capacity larger than 100 kW are entitled to standard avoided cost rates; and other necessary and proper terms and conditions to ensure that each PURPA contract is consistent with and protects the state’s public interest, does not adversely impact retail ratepayers, and fairly calculates the rates paid to QFs.

FERC’s June 29 technical conference on PURPA addressed numerous issues, including the so-called “one-mile rule” for QF certification; the appropriate minimum term of PURPA contracts that a developer needs to secure financing; how establishing a minimum term and other conditions would affect QF development; whether the size threshold for standard contracts (currently 100 kW) should be revised, and if so, how; and whether utility data-submission requirements to state commissions for the purpose of determining avoided-cost rates are being adhered to.