On April 15, 2021, the Federal Energy Regulatory Commission (FERC) issued an order finding that a qualifying facility (QF) called Kanab Solar had established a legally enforceable obligation (LEO) to sell power to Garkane Energy Cooperative (Garkane) prior to the date that Garkane and its generation and transmission cooperative, Deseret Power, had petitioned FERC for waivers to some of their obligations under the Public Utility Regulatory Policies Act (PURPA). FERC granted the waivers. However, FERC also determined that Kanab Solar established a LEO before the petitions were filed. This means that the waivers do not affect Kanab Solar’s pre-existing right to choose to sell to Garkane rather than to Deseret Power.
Idaho Commission Determines that QFs Cannot Establish a LEO Unless the Utility Delays Contract Execution
In April 2021, the Idaho Public Utilities Commission (the Commission) affirmed its December 2020 order that qualifying facilities (QF) under the Public Utility Regulatory Policies Act of 1978 (PURPA) can only establish a Legally Enforceable Obligation (LEO) by filing a meritorious complaint against the purchasing utility before the utility’s rates change. This order means that QFs interested in selling to Idaho utilities can only lock in contract pricing by obtaining a fully executed contract before rates change or by demonstrating that a utility delayed contract execution.
Oregon Court of Appeals Dismisses Utility Appeal regarding PURPA Fixed Price Payments
In December 2020, the Oregon Court of Appeals dismissed Portland General Electric Company’s (PGE’s) appeal of the Oregon Public Utility Commission’s (Oregon Commission’s) decision in Docket No. UM 1805 regarding contract term requirements under the Public Utility Regulatory Policies Act (PURPA). The Court’s decision capped a series of decisions affirming a long-standing Oregon Commission policy where qualifying facilities (QFs) eligible for standard contracts receive 15 years of fixed price payments.
The Montana Supreme Court Rules Against the Montana Commission’s Approval of Shorter Contract Terms and Lower Avoided Cost Prices
On August 24, 2020, the Montana Supreme Court ruled against the Montana Public Service Commission’s (Montana Commission) actions to reduce avoided cost rates and shorten contract terms for power purchase agreements between the utilities and solar Qualifying Facilities (QFs). The ruling is a victory for renewable energy developers and advocates, as it upheld an integral piece of the Public Utility Regulatory Policy Act of 1978’s (PURPA) that encourages QF development.
Wyoming Commission Reduces PURPA Contract Terms and Changes PacifiCorp’s Avoided Cost Pricing Method
On June 23, 2020, the Wyoming Public Service Commission (Wyoming Commission) partially granted a request from PacifiCorp, dba Rocky Mount Power, for authority to modify its Public Utility Regulatory Policies Act (PURPA) contracts with qualifying facilities (QFs). Within the same proceeding, the Wyoming Commission approved PacifiCorp’s other proposed changes to its avoided cost pricing methodology.
Ninth Circuit Reaffirms PURPA’s Must-Purchase and Fixed Contract Price Requirements
On July 29, 2019, the Ninth Circuit released an opinion in Winding Creek Solar, LLC v. California Public Utility Commission (California Commission or CPUC), finding that the Public Utility Regulatory Policies Act (“PURPA”) preempted the CPUC’s “Renewable Market Adjusting Tariff” (Re-Mat) and “Standard Offer Contract” programs. Under PURPA, utilities are required to purchase any energy and capacity made available from a qualifying facility (QF) at the utility’s avoided cost, and the QF has the option to have the price it is paid for that energy and capacity determined either at the time of contracting or at the time of delivery.
Montana District Court Reverses Public Service Commission on PURPA
On June 18, 2019, a Montana State District Court reversed the Montana Public Service Commission (Commission or MPSC), finding that MTSUN, a qualifying facility under the Public Utility Regulatory Policies Act (PURPA), was entitled to a 25-year contract to sell its energy and capacity to NorthWestern Energy. The case was heard before the same Judge that decided the QF-1 docket on April 2, 2019 and to a large degree the decision is the same.
Ninth Circuit Rejects PURPA Implementation Claim as Moot in Unpublished Opinion
On June 3, 2019, the Ninth Circuit issued an unpublished Decision Memorandum in Bear Gulch, LLC et. al. v. Montana Public Service Commission, in which it found that the federal district court erred by not finding that certain arguments related to Montana’s generally applicable legally enforceable obligation (LEO) standard was moot. The Ninth Circuit found that the arguments raised by Bear Gulch Solar, LLC and other qualifying facilities developed by Cypress Creek Renewables (QFs) were mooted because the Montana Commission subsequently enacted a new LEO rule.
Ninth Circuit Rules in Favor of Renewable QFs
On April 24, 2019, the Ninth Circuit Court of Appeals (Ninth Circuit) issued an opinion regarding the California Public Utilities Commission’s (“California Commission”) failure to properly implement the Public Utility Regulatory Policies Act (PURPA). Specifically, the Ninth Circuit held that the avoided cost price paid to a qualifying facility (QF) cannot be based on energy sources that do not meet California’s Renewable Portfolio Standard (RPS), if the state has an RPS and the utility is using the QF’s energy to meet the RPS.
Montana District Court Finds that Public Service Commission Acted Arbitrarily and Unreasonably
On April 3, 2019, a Montana District Court Judge, Judge Manley, issued an order reversing the Montana Public Service Commission’s (“Montana Commission”) orders 7500c and 7500d that cut Public Utility Regulatory Policies Act (“PURPA”) standard avoided cost prices and contract lengths for qualifying facilities (“QFs”) offered by Montana utility NorthWestern Energy (“NorthWestern”).