N.C. Suspends Long-term Avoided-cost Rates

Fortnightly Magazine - February 15 1997
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The North Carolina Utilities Commission has permitted the state's major investor-owned electric utilities to suspend their

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existing avoided-cost rate offers for long-term power purchases from qualifying cogeneration facilities, pending regulatory review.

The commission said it would also review a proposal by North Carolina Power Co. to reduce the eligibility threshold for the avoided-cost rates from the current capacity level of 5,000 kilowatts, to only 100 kW.

Consumers Would Overpay. The utilities had argued that technological advances and other factors "are continuing to reduce the cost of capacity," and that current "avoided-cost" rates exceed true avoided costs. Consumers will overpay if utilities must buy from QFs at the old rates, the utilities said.

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