The PURPA Rules are being challenged
The Solar Energy Industries Association (SEIA) petitioned the Ninth Circuit Court of Appeals in September to examine FERC Order No. 872, which improperly inhibits the establishment of qualifying facilities (QF) under the Public Utility Regulatory Policies Act (PURPA).
The order eliminates QFs’ ability to establish long-term, fixed-rate contracts and arbitrarily expands the “one-mile rule,” generating many additional conditions that stymie solar development. These practices are illegal and obviously contravene the objective of the PURPA legislation.
Following is a statement by Abigail Ross Hopper, president, and CEO of the Solar Energy Industries Association (SEIA):
“This attack on PURPA is an attack on the competition. FERC Order No. 872 very clearly contradicts existing law and protects the interests of incumbent utilities at the expense of regular customers. The FERC-approved amendments will hinder QF growth. It is one of the few options available to us for increasing competition in areas controlled by monopoly utilities. This new regulation will also allow utilities to bypass it. We are asking the court to invalidate Order No. 872.
“PURPA is a significant driver of solar jobs and investment and is responsible for bringing utility-scale solar online around the country. FERC Order No. 872 threatens progress for solar energy at a time our nation can least afford it. Solar energy will contribute 20% of total electricity output by 2030, according to SEIA’s Solar+ Decade objectives. Hundreds of thousands of new jobs and hundreds of billions of dollars in investment are on the way. All while dealing with our escalating climate crisis.”
Clean Energy Advocates Fights Back Against Unlawful PURPA Rules
Moreover, a federal court challenge has also been brought by the Montana Environmental Information Center, along with nine other advocacy groups. They filed a petition opposing the Federal Energy Regulatory Commission’s (FERC) new PURPA regulations. According to them, it “effectively guts” the law’s applicability.
The lawsuit, filed in the United States Court of Appeals for the Ninth Circuit, challenges what the petitioners describe as “four illegal components” of FERC’s regulations that “beyond the agency’s authority and conflict” with Congress’s goals:
- The FERC neglected to conduct an environmental impact assessment. This would have shown that regulations “undermining renewable energy development” would have a significant environmental impact.
- FERC “invented a new effective ceiling on generation held by the same firm throughout a vast region.” “Contrary to the limited authority provided,” to evaluate whether facilities are located at the same site. As a result, it is subject to PURPA’s 80 MW size limitations.
- That FERC abolished the ability of PURPA “qualifying facility” developers to establish a long-term price for their energy at contract formation. A measure that removes project finance options and “interferes with the aims of Congress.”
- FERC “illegally” transferred the obligation of estimating a utility’s saved costs, on which payment under PURPA is based, from the state regulator to the developer of a qualified plant.
The petition by the solar and environmental groups requested the court to “vacate” FERC’s regulatory order or rescind the regulations.
What is PURPA?
The Public Utility Regulatory Policies Act (PURPA, Pub.L. 95–617, 92 Stat. 3117, enacted November 9, 1978) is a United States Act that was passed as part of the National Energy Act. Furthermore, the primary goal of the act was to promote energy conservation and the use of domestic and renewable energy. It evolved one year before the second energy crisis in response to the energy crisis of 1973. Furthermore, when President Jimmy Carter came into office, he made energy policy a top priority. Additionally, the measure laid the groundwork for the reform of the energy industry.
Consequently, the legislation requires FERC to design regulations that encourage the deployment of QFs. These are generally low-power generators. Due to the recent changes, states can now delegate initiatives that have been proven to effectively improve QF implementation. States can also now delegate activities that have been shown to effectively develop QF. As a result of this reality, SEIA and others argue that FERC’s new decision violates federal law.