Legislation was introduced on June 10 in the U.S. Senate that would modernize the Public Utility Regulatory Policies Act of 1978 (PURPA).
The bill was introduced by U.S. Senator John Barrasso, R-Wyoming, who was joined by Sens. James Risch, R-Idaho, Kevin Cramer, R-N.D. and Steve Daines, R-Mont., in introducing the legislation.
PURPA requires all electric utilities to purchase all power produced by qualifying facilities of 80 megawatts or less. The law requires utilities to pay these small renewable facilities an administratively-set “avoided cost” rate for their power that is much higher than the market rates paid to all other generation resources, Barrasso’s office noted.
The “Updating Purchase Obligations to Deploy Affordable Resources to Energy Markets Under PURPA Act” would reform PURPA in the following ways:
- Protect electricity customers from having to pay for unnecessary PURPA costs;
- Empower state public utility commissions and nonregulated utilities to waive PURPA’s mandatory purchase obligation if additional power is not required to meet customers’ electricity needs;
- Ensure a level playing field for energy resources by requiring more PURPA resources to participate in energy markets; and
- Prevent abuse of the Federal Energy Regulatory Commission's “one-mile” rule.
When PURPA was enacted in 1978, energy markets were drastically different, Barrasso said. “Today, a significant amount of all new power added to the grid comes from renewable energy resources. It’s critical that we modernize PURPA as soon as possible. Electricity consumers in Wyoming and across the country should not have to foot the bill for outdated rules and regulations,” said Barrasso. “Our bill updates PURPA in a way that protects consumers while encouraging the development of all sources of American energy—including renewables.”
U.S. Rep. Tim Walberg, R-Mich., introduced similar legislation, H.R.1502, the “PURPA Modernization Act of 2019,” on March 5. The American Public Power Association supports this bill.
Earlier this year, the American Public Power Association and the National Rural Electric Cooperative Association supported a motion filed by the Edison Electric Institute that asked FERC to revisit its rules and regulations implementing PURPA.
