On May 13 Montana Governor Brian Schweitzer vetoed SB 225, a bill concerning small generator interconnection.
In his veto letter, Governor Schweitzer made the following comments about the bill:
Senate Bill 225 amends Montana statutes implementing the federal Public Utility Regulatory Policies Act (PURPA) and related rules. The bill would both add to and subtract from the criteria that guide the Public Service Commission (PSC) in setting rates for small power production facilities. A prominent amendment to current law found in SB 225 is the direction given to the PSC to base power rates on a consideration of whether a small power production facility has attributes that “meet the needs of a utility as outlined in the utility’s plan.” Given that the utility’s plan is a creation of the utility itself, this rate-setting criterion is totally circular and is in the exclusive self-interest of the utility. This self-serving criterion, which is not found in PURPA, appears contrary to the purpose of the federal law, making it an invitation to litigation.
Additionally, the intent of PURPA is to encourage substantial investments in new power facilities. As with any generation facility, the cost of these new power facilities can only be recovered over the long term. Therefore, it would be a critical mistake to strike the existing statutory language encouraging long-term contracts, which unfortunately is one of the things that SB 225 does.
I also ask legislators to recall that the key portion of SB 225, dealing with avoided cost, is duplicated by the content of HB 92, which was introduced at the request of the Energy and Telecommunications Interim Committee following a request from the Public Service Commission itself, and which I have already signed into law.
Source: Letter from the Governor