The Federal Energy Regulatory Commission (FERC) has ruled that an Illinois statute did not require rates above avoided cost for wholesale sales by qualifying facilities (QFs), and so did not violate the Public Utility Regulatory Policies Act (PURPA) (Docket No. EL95-27-000).
The statute at issue requires a utility to buy power from qualifying solid-waste energy facilities at the utility's retail rate. But the statute includes an offsetting monthly tax credit, which prevents a utility from paying more than its avoided costs. A QF, CGE Fulton, had asked the FERC to rule on whether the statute violated the avoided-cost requirement. Although the FERC in Connecticut Light & Power Co., 70 FERC 61, 012 (1995), reh'g. pending, preempted state jurisdiction where states impose rates in excess of avoided cost for QF wholesale sales, Fulton contended that the holding did not apply to the Illinois statute. The QF argued that the tax credit acted as an offset, resulting in a rate equivalent to avoided cost.