The potential for a federal renewable energy standard (RES) and carbon regulation, considered with the effect of state-imposed renewable energy standards, is fueling a strong, but challenging, market for renewable energy. Utilities are competing to sign up the best new projects, the types of renewable technologies available are increasing, and there are various government stimulus programs for energy; yet, the financial markets still are hesitant. Against this backdrop, how should contracts for power from new renewable resources be shaped so that those deals will look as good five, 10 and 15 years after execution as on the day the ink dries?

The Energy Policy Act of 2005 adds a new section of the Public Utility Regulatory Policies Act (PURPA) of 1978. Section 210(m) of PURPA now provides for the termination of an electric utility’s obligation to purchase energy and capacity from qualifying cogeneration facilities if FERC finds certain conditions are met.

Forget the mega merger as a means to acquire new power plants. FERC’s new rules may offer a better path.

The wide-ranging Energy Policy Act of 2005, signed into law by President Bush Aug. 8, already is affecting the energy industry—and guaranteeing that FERC will be a very busy agency. Fortnightly asked FERC Chairman Joseph T. Kelliher what the future holds for the commission.

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As a former independent power producer, George Lagassa is sympathetic to the woes of the merchant power industry. Until just a few years ago, he held the license to a micro-hydro qualifying facility (QF) in New Hampshire, so he understands what it takes to compete in a regulated-franchise industry. Yet, as the principal of Mainstream Appraisals in North Hampton, N.H., Lagassa is also a dedicated pragmatist. He sees the industry's consolidation trend as a sort of correction in the U.S. power market.

Business & Money

The consequences of exuberance are all around us.

Much of the 160 GW of new generation capacity added to the U.S. inventory since 1998 is now under water, economically speaking. At a per-megawatt cost of $300, this represents $50 billion of investment-much of which is concentrated in Texas (23 GW), Illinois (14 GW), and Georgia (11 GW). The key question for both merchant and other plant owners is how long it will take for plant values to recover.

The commission nails companies, but orders payments.

The Federal Energy Regulatory Commission (FERC) finally dealt with the many issues that arose out of the 2000/2001 California energy crisis. On June 25, FERC issued a slew of orders that settled some old disputes, gave a glimpse of the future, and offered insight into the commissioners' thinking.

The collapse of wholesale markets has utilities once again making the purchasing decisions, and taking all the risks.

If a common theme is emerging from the various policy directions across the country, it seems to be that responsibility for supply resources is moving away from open markets and back into the hands of load-serving utilities.

Who should have "green tag" ownership under power purchase agreements, the buyers or the sellers?

A legal controversy is brewing in the electric industry over who should reap the financial benefits of the green characteristics of power plants, under existing power purchase agreements (PPA).