FERC Implements PURPA Repeal

The Federal Energy Regulatory Commission proposed in mid- January to remove the obligation of US utilities to purchase electricity from "qualifying facilities" in four key regions of the country.

Utilities had been required by a 1978 law called the Public Utility Regulatory Policies Act, or "PURPA," to buy electricity from two types of power plants at the "avoided cost" the utility would have to pay to generate the electricity itself. The two types of power plants are "cogeneration" facilities that produce two useful forms of energy from a single fuel, like electricity and steam produced by burning coal or natural gas, and power plants of up to 80 megawatts in size that burn renewable or waste fuels. These two types of power plants are called "qualifying facilities."