The 1978-era Public Utility Regulatory Policies Act (PURPA) is under fire, but does a law passed in an era of shag carpeting just as out of fashion or still essential to preserving market competition?
Call Girls in Delhi, Escort Service Available 24x7 in Delhi 959961-/-3876
Will the Feds Preserve Electricity Market Competition?
1. W I L L T H E F E D S P R E S E R V E
E L E C T R I C I T Y M A R K E T C O M P E T I T I O N ?
T H E P O W E R O F A P E A N U T FA R M E R ’ S “ P U R PA ”
John Farrell
Director of Energy DemocracySeptember 12, 2017
2. H U G E C L E A N E N E R G Y
P O T E N T I A L
4. POTENTIAL PERCENT OF
ELECTRICITY FROM
ONSHORE WIND POWER
0 TO 10%
10 TO 25%
25 TO 50%
50 TO 100%
100% OR MORE
W I N D P O W E R P O T E N T I A L
2 0 1 5 N R E L D ATA
35% c.f. or better
110m
Source: http://1.usa.gov/1CUrAWk
35 states could get
100% or more
6. R E N E WA B L E
B E N E F I T S
0
3
6
9
12
15
Jan-2002 Jan-2004 Jan-2006 Jan-2008 Jan-2010 Jan-2012 Jan-2014
Natural Gas Price
Wind and Sun Price
7. D I S T R I B U T E D
B E N E F I T S
Solar on Littlestown Hospital
D I S P E R S I N G 1 - M W S O L A R P L A N T S
R E D U C E S I N T E G R AT I O N C O S T S
0
1
2
3
4
1 solar project 5 solar projects 25 solar projects
0.3¢
1.1¢
3.9¢
cents per kilowatt-hour
Credit: USDA
8. L O C A L E C O N O M I C B E N E F I T S
1 megawatt
$2.5 million
20 jobs
Source: ILSR, 2014
$5.4 million in energy savings
9. C O M M U N I T Y
O W N E R S H I P
B E N E F I T S
10. How Green Energy Farmers busted the barriers:
Formed several,
unrelated LLCs with
only Iowa owners.
State regulation Pass-through to individuals
For a limited time, the
Production Tax Credit was
available as a cash grant,
more easily used by
ordinary investors.
Sold to the utility
Electricity was sold via a
power purchase
agreement to the utility.
11. O P P O R T U N I T Y AT
C O M M U N I T Y S C A L E
12. C O M M U N I T Y W I N D - S O L A R H Y B R I D
• Wind power for reliable,
low-cost power
• Solar power for peak
energy
• Big enough to capture
economies of scale
(2) 2-megawatt wind turbines
(1) 1-megawatt solar array
5 megawatts
13. C O M M U N I T Y W I N D - S O L A R H Y B R I D
• 20 local construction jobs,
and 1.5 ongoing
maintenance positions
• $87,000 in local tax revenue
over 20 years
• $500,000 in local
participation revenue over
20 years
(2) 2-megawatt wind turbines
(1) 1-megawatt solar array
5 megawatts
15. C O S T O F E L E C T R I C I T Y
G E N E R AT I O N T R A N S M I S S I O N D I S T R I B U T I O N
3¢ 3¢ 4¢
If customer pays 10¢ per kilowatt-hour
+ +
16. VA L U E O F D E L I V E RY
G E N E R AT I O N T R A N S M I S S I O N D I S T R I B U T I O N
3¢ 3¢ 4¢
3¢ 6¢ 10¢
If customer pays 10¢ per kilowatt-hour
17. VA L U E O F D E L I V E RY
G E N E R AT I O N T R A N S M I S S I O N D I S T R I B U T I O N
3¢ 6¢ 10¢
Wind-solar hybrid
19. A U C T I O N S FAV O R L A R G E P R O J E C T S …
20. … 1 ) B E C A U S E A U C T I O N S TA K E
O V E R H E A D
21. … 2 ) B E C A U S E T H E Y D O N ’ T C O U N T
D E L I V E RY C O S T S
G E N E R AT I O N T R A N S M I S S I O N D I S T R I B U T I O N
3¢ 6¢ 10¢
22. T H E F E D S F I G U R E D I T
O U T I N T H E 1 9 7 0 S
23. G E N E R AT I O N T R A N S M I S S I O N D I S T R I B U T I O N
3¢ 3¢ 4¢+ +
1 9 7 8 P U B L I C U T I L I T Y R E G U L AT O RY P O L I C I E S A C T
A R I G H T T O S E L L …
Utilities must buy electricity from “qualifying
facilities,” including wind and solar, at their
“avoided cost”
F E D E R A L L AW
24. B U T
T H E R E
WA S A
M I S S I N G
P I E C E
25. G E N E R AT I O N T R A N S M I S S I O N D I S T R I B U T I O N
3¢ 3¢ 4¢+ +
The utility claims this “Avoided cost”
A R I G H T T O S E L L … B U T A N U N FA I R
P R I C E ?
1 9 7 8 P U B L I C U T I L I T Y R E G U L AT O RY P O L I C I E S A C T
S TAT E I S S U E
26. G E N E R AT I O N T R A N S M I S S I O N D I S T R I B U T I O N
3¢ 3¢ 4¢+ +
But a wind-solar hybrid has a
higher “Avoided cost”
A R I G H T T O S E L L … B U T A N U N FA I R
P R I C E ?
1 9 7 8 P U B L I C U T I L I T Y R E G U L AT O RY P O L I C I E S A C T
S TAT E I S S U E
27. S TAT E S A L R E A D Y D O I T
• For distributed solar,
Minnesota’s value of solar
counts the avoided
distribution and
transmission costs
28. G O O D A N D B A D —
S TAT E S C A N I M P L E M E N T
29. M I N N E S O TA
• Complaint filed against
Otter Tail Power for fair
avoided cost
• Investigation requested
into avoided cost
methodology for all
utilities
30. M I C H I G A N
• Proceedings underway
since May 2016 aim to
establish an updated,
more complete
methodology for
calculating avoided cost
• Goal: to adequately
incorporate avoided
transmission costs
31. M O N TA N A
• In 2016, utility won
suspension of 6.6¢, 25-year
PURPA contracts
• FERC found action
inconsistent with law, but
left it to developers to take
legal action
32. N O R T H
C A R O L I N A
• High avoided cost (5¢)
led to over 2,000 MW of
solar development under
PURPA
• Duke Energy proposing to
shorten contracts from
20 years to 5 years
• State reviews every two
years
33. I D A H O
• Reduced PURPA contracts
from 20 years to 2 years
34. I M P L I C AT I O N S O F
D O I N G I T R I G H T
36. T H A N K Y O U !
@johnffarrell
www.ilsr.org
C H A N G I N G
T H E R U L E S
P R O V I D I N G
T O O L S
1 0 0 % R E N E WA B L E
L O C A L E C O N O M Y
H U M A N
S C A L E
L O C A L
O W N E R S H I P
D E M O C R AT I C
A U T H O R I T Y
I L L U S T R AT I N G
T H E V I S I O N