Bidding, transparency, and foregone conclusions in Big Sky Country.
Travis Kavulla is a Montana Public Service Commissioner, and serves on the boards of directors of the National Regulatory Research Institute and the National Association of Regulatory Utility Commissioners. The views expressed in this article are Kavulla’s.
As Bruce Radford points out in his August 2013 article, “FERC vs. Idaho,” many state commissions’ compliance with PURPA is predicated on the notion that competitive solicitations are open to QF bidders, and that these reverse auction processes are a better way to ascertain avoided cost than an administratively established standard rate. This is true, but it comes with a significant caveat. In order for PURPA’s objective of market access to really mean anything, it shouldn’t be enough for a state merely to invoke the words “competitive solicitation”; rather, that solicitation process must be credible, transparent, and even-handed to all comers.
This has sometimes not been the case in the Western United States, including in my own state of Montana, which is home to the most recent PURPA battle.
Self-Dealing by Design
Like the old adage about the Holy Roman Empire (that it was neither holy, nor Roman, nor an empire), much the same could be said about so-called competitive solicitations.