FAIRBANKS — Wind farmer Mike Craft is appealing the Regulatory Commission of Alaska’s decision to approve a tariff he said is illegal.
Craft is the managing owner of Alaska Environmental Power, a nine turbine, two megawatt wind farm in the Delta Junction area.
In July 2016, the RCA approved Golden Valley Electrical Association’s tariff sheet, which details what the utility charges independent power producers of wind and solar energy for service, and the justification for those charges, among other things.
Craft alleges the RCA broke its own regulations when the tariff was approved.
“The RCA adopted new regulations (in Nov. 2015), but the (tariff sheet) is flat-out grossly noncompliant,” said Teresa Clemmer, an attorney representing Alaska Environmental Power. “A lot of it boils down to how (GVEA) would determine the cost of paying for power and integration. Their methodology for determining that is noncompliant.”
Clemmer said the methodology GVEA used for determining costs is “100 percent nontransparent,” too.
However, Corey Borgeson, president and CEO of GVEA, is confident in legality of the RCA’s decision.
“I think the Regulatory Commission of Alaska knows what Golden Valley filed and knows it to be truly compliant with the regulations and that’s why they allowed it to go forward,” Borgeson said in a phone interview Thursday. “Golden Valley looks forward to bringing more wind under our system, but it needs to be a business arrangement that makes sense for everyone. We respect their right to appeal. We stand ready to respond to any information the court or RCA might need.”
In Alaska Environmental Power’s opening brief, the wind utility argues that the commission’s approval of GVEA’s tariff violates “numerous federal and state laws and regulations.”
“The purchase rate methodologies in (GVEA’s tariff) fail to apply the required Federal Energy Regulatory Commission factors, unlawfully discriminate against the entire categories of (wind and solar facilities) that GVEA deems non-schedulable, and unlawfully exclude payment for capacity costs for the these qualifying facilities,” according to the brief.
Craft has said multiple times this appeal is a big deal for Fairbanks and the Interior. He said it will affect other independent power producers of renewable energy, as well as air quality and the cost of energy.
“Here’s what I do understand,” Craft said. “We have one of the highest electrical fees in the U.S. We have the dirtiest air. Since 2009, this community has lost out on savings. Since that point in time, I think we would’ve saved $26 million, and displaced 36 million gallons of fuel.”
The RCA and GVEA have not yet filed their opening briefs with the Superior Court, Clemmer confirmed.
“In short, GVEA’s motion to dismiss and motion for a stay have made the case procedurally very messy and have caused significant delay,” Clemmer said in an email.
GVEA's motion to dismiss
GVEA filed a motion to dismiss this case in late November. In the conclusion of this filing, GVEA argues that Alaska Environmental Power “inappropriately” tried to bypass the RCA on an issue that falls “squarely” within the jurisdiction, or within the primary jurisdiction, of the commission.
The filing also states the wind farm’s claims regarding implementation of the Public Utilities Regulatory Policies Act belong in a federal court, not a state court.
But on Dec. 19, the RCA filed an opposition to GVEA’s motion. In addition, the state Attorney General’s office issued an objection to GVEA’s motion to dismiss.
“The supplement to the motion to dismiss, and all attached documents, should be disregarded by the court. On that basis, the RCA is not responding to the substance of the filing. However, the filing contains a material misrepresentation of fact and law that could mislead the court and must be corrected,” the objection states.
Third parties take interest
The Alaska Independent Power Producers, the Northern Alaska Environmental Center, and The Alaska Center filed a joint amicus brief asking the court to side with Alaska Environmental Power.
The brief argues there is government support and policies that encourage renewable energy, but many of Alaska’s independent renewable power producers have experienced “continued opposition and barriers” from electric utilities.
“The RCA’s recent amendment of its regulations governing utility interactions with (independent power producers) serves as an important first step toward overcoming this entrenched resistance,” according to the amicus brief, “but the rules will not be meaningful if they are not properly implemented and enforced.”
Last month, RCA section manager Ann Wilde said it is typical for the RCA to not comment on legal matters.
Contact staff writer Kevin Baird at 459-7575. Follow him on Twitter: @FDNMcity.