NC Supreme Court Settles Avoided-cost Dispute

The North Carolina Supreme Court has upheld state regulators' decision to reprice payments made by Virginia Electric and Power Co. (Vepco) to Ultra Cogen Systems, a qualifying facility (QF), for power purchased under avoided-cost contracts approved by Virginia's commission. The North Carolina Utilities Commission (UC) had disallowed $1.39 million in capacity costs while setting rates for the utility's Carolina Power division. The UC ruled that it was not bound by the actions of the Virginia commission and could, thus, apply a different measure of avoided cost in determining how much of the purchased power costs to include in retail rates for Carolina consumers.