On December 24, the Federal Energy Regulatory Commission (FERC) and the Idaho Public Utilities Commission (Idaho PUC) signed a Memorandum of Agreement addressing their dispute regarding interpretation and enforcement of the Public Utility Regulatory Policies Act (PURPA).

PURPA requires that utilities purchase power from generators with certain renewable or other characteristics (called Qualifying Facilities, or QFs) at prices that reflect the utilities’ avoided cost of generating the power.  FERC enforces the program but has left much of the implementation details to the states.  In 2013, FERC had taken the unusual step of taking the Idaho PUC to Federal court regarding the state’s implementation of the law.

In 2011, the Idaho PUC lowered the maximum size of QFs eligible to receive avoided cost rates.  A number of wind facilities at the time were in the final stages of negotiating purchase contracts with utilities but could not secure signatures until just after the effective date of the new lower size limit.  The Idaho PUC rejected a number of the agreements because they exceeded the new maximum size limits, finding that purchase agreements must be executed prior to the effective date of the change in eligibility criteria.
Continue Reading FERC and Idaho PUC Settle PURPA Lawsuit

FERC recently approved the California ISO’s (CAISO) proposal to lower a bidding floor to more efficiently address a growing “over generation” problem due in part to increasing “variable energy” (i.e., typically renewable) resources.  A bit of background is needed to understand the problem and the solution.

CAISO operates two bid-based energy spot markets to secure