Federal energy regulators have rejected the application of two companies that have been trying to force Golden Valley Electric Association to purchase power that would be generated by their proposed wind- and propane-fired system in Delta Junction.
A utility can be forced to purchase power from an energy producer under the 1978 Public Utility Regulatory Policies Act if the energy producer can show that ratepayers would not be harmed by the power purchase.
Eco Green Generation, of Colorado, working with Alaska Environmental Power, of Delta Junction, in February requested that GVEA purchase power from the project’s 37.8-megawatt wind farm that would work in combination with a 100-megawatt plant that would be powered almost entirely by propane.
In an announcement last week, GVEA reported it had challenged the Colorado company’s self-certification to the Federal Energy Regulatory Commission that the project met the criteria to be considered a “qualifying facility” as specified in federal regulations and that GVEA, therefore, would be required to purchase power from the project.
“GVEA also had serious concerns regarding the cost and reliability impact of EGG’s proposed project,” the GVEA announcement reads. “In response to GVEA’s filing, FERC issued an order agreeing with GVEA on all points and revoking EGG’s QF self-certification.”
GVEA President and CEO Cory Borgeson praised the federal regulatory decision but noted the process has been costly for the Fairbanks-based utility cooperative.
“We are pleased with the regulators’ decision,” Borgeson said. “Golden Valley had argued from the beginning that EGG’s project failed to qualify as a QF under FERC regulations. FERC agreed with all of GVEA’s positions, thoroughly rejecting every one of EGG’s points.
“Responding to this proposal cost the co-op hundreds of hours of staff time and costs resulting in excess of hundreds of thousands of dollars,” he said. “Those costs are borne by our members, so GVEA wants to make sure any future proposals are qualified before incurring additional costs.
“GVEA’s door is always open for additional efficient renewable generation resources, but the projects must have no long-term negative impact on reliability or rates,” he said.
Federal regulators also agreed with GVEA’s request that Eco Green Generation be required to prove that any future project meets federal criteria for being designated a qualifying facility under the Public Utility Regulatory Policies Act.
Alaska Environmental Power is owned by Mike Craft, who for years has been trying to get GVEA to purchase power from his wind farm. GVEA officials declined to purchase the power, saying doing so would be too costly for customers.
Contact News-Miner Editor Rod Boyce at 459-7585. Follow him on Twitter: @FDNMeditor.