The Idaho Public Utilities Commission (PUC) has adjusted the size cap for wind and solar projects in the state. Projects can be no larger than 100 kW if developers want to be paid a rate published by the PUC.
Previously, projects up to 10 MW in size could qualify for the published rate. The 10 MW upper limit remains for non-wind and non-solar renewable projects.
The smaller size limit for wind and solar projects that can qualify for the published rate is temporary until a number of issues that led to a petition filed by the state’s largest three electric utilities can be resolved. Wind and solar projects that have signed agreements with utilities dated before Dec. 14, 2010, are still under the former 10 MW eligibility cap.
The three regulated utilities – Idaho Power Co., Avista Utilities and PacifiCorp – contend that a rapidly expanding number of wind projects is having a profound impact on customers’ rates and reliability, according to the PUC. The utilities say that large-scale wind farms are breaking up their projects into smaller 10 MW increments in order to qualify for the published rate, which is typically more attractive than rates for projects larger than 10 MW.
Small-power producers can have their projects declared qualifying facilities (QFs) under the provisions of the federal Public Utility Regulatory Policies Act (PURPA) passed by Congress in 1978 to promote the development of renewable energy technologies.
“The commission is supportive of all small-power producers contemplated by PURPA, including wind and solar, and it is not the commission’s intent to push small wind and solar QF projects out of the market,” according to the PUC.
The PUC is directing the parties in the case, which include utilities, power producers and environmental organizations, to schedule an informal meeting within 10 days of the commission order to establish a schedule to gather evidence in advance of a technical hearing that will be scheduled during the week of May 9.
Specifically, the PUC is soliciting information and investigating an avoided-cost rate cap structure that will allow wind and solar QFs that are 10 MW or smaller to again qualify for published rates, while also preventing large QFs from disaggregating their projects to qualify for a rate exceeding true avoided cost.
Parties representing wind developers claim the utilities have not provided sufficient evidence that reducing the published cap will have an adverse impact on PURPA development. The PUC says that federal rules regulating PURPA development insist that rates for purchases from QFs be “just and reasonable to ratepayers and in the public interest – not in the interest of the QFs.”