On March 17, 2016, FERC granted in part and denied in part a petition for waiver of the obligation to purchase energy and capacity from qualifying facilities (“QFs”) filed by Heartland Consumers Power District (“Heartland”) under section 292.402 of FERC’s Public Utilities Regulatory Policy Act (“PURPA”) regulations. Heartland’s petition for waiver—filed on behalf of its municipal customers in Minnesota, Iowa, and South Dakota—sought waiver of its customers’ obligations to purchase energy and capacity made available to them by QFs. 

In its petition, Heartland explained that, if FERC granted the request for waiver, Heartland would commit to purchase and pay for capacity from the QFs interconnecting with its customers and would not subject a QF to any duplicate interconnection charge or charges for wheeling power to Heartland. Because Heartland is responsible for purchasing the power to meet its customers’ loads, it argued that it was in a better position to provide interconnection and retail service to QFs. Heartland also sought waiver of the requirement for it to sell energy and capacity directly to QFs because Heartland’s customers offer QFs supplemental, backup, maintenance, and interruptible power at rates determined between the customer and the individual QF.

FERC granted Heartland’s petition with respect to twenty-two of the twenty-eight Heartland customers who also agreed to adopt the same or similar policy as Heartland’s policy. For those six customers who did not agree to Heartland’s policy, FERC rejected Heartland’s petition. FERC explained that denial of the petition was necessary for the six Heartland customers who refused to follow Heartland’s policy because PURPA’s mandatory purchase and sale obligations remained necessary to encourage QFs and cogeneration facilities interconnected to those six customers.

A copy of FERC’s order can be found here.