The Federal Energy Regulatory Commission (FERC) announced that qualifying facilities (QFs) that fail to meet the standards needed to retain QF status will be required to file wholesale rates for sales during the period their facilities do not comply (Docket Nos. EL94-45-001 and QF88-84-006).
The FERC asked QFs to be as vigilant as possible. The new policy states that if a QF fails to comply with the regulations, fails to receive a FERC waiver excusing the lapse, and then returns to noncompliance, the QF will be required to file rates for the noncompliance period. But the QF would be allowed the other waivers permitted to QFs during that time, unless the noncompliance persists for a long time or recurs frequently. After more than one period of noncompliance, the QF will have a heavy burden to show it merits the waivers.
The policy was set in a rehearing order that directed LG&E-Westmoreland Southampton (em a
62.6-megawatt cogeneration facility in Virginia (em to file rates for its noncompliance period. The rates must approximate the purchasing utility's economy energy costs (in this case, Virginia Power's). Where the contract rate is less than the economy energy-purchase costs, the contract rate applies.