WASHINGTON, D.C. – Sen. John Barrasso introduced legislation intended to modernize the Public Utility Regulatory Policies Act of 1978.
Barrasso joined three other Republican senators in introducing the bill.
“When the Public Utility Regulatory Policies Act was enacted in 1978, energy markets were drastically different. Today, a significant amount of all new power added to the grid comes from renewable energy resources,” Barrasso said in a news release. “Our bill updates PURPA in a way that protects consumers while encouraging the development of all sources of American energy – including renewables.”
PURPA requires all electric utilities to purchase all power produced by wind and solar generation facilities of 80 megawatts or less. PURPA requires utilities to pay these small renewable facilities an administratively-set “avoided cost” rate for their power that is much higher than the market rates paid to all other generation resources. PURPA also requires utilities to purchase this power even when it is not needed to serve their customers.
Barrasso and the other senators argue the energy landscape has changed so much in the past 40 years that the bill needed to be changed to reflect the growing renewable energy landscape.
The “Updating Purchase Obligations to Deploy Affordable Resources to Energy Markets Under PURPA Act” (or the UPDATE PURPA Act) makes the following commonsense reforms to PURPA:
Protects electricity customers from having to pay for unnecessary PURPA costs.
Empowers state public utility commissions and nonregulated utilities to waive PURPA’s mandatory purchase obligation if additional power is not required to meet customers’ electricity needs.
Ensures a level playing field for energy resources by requiring more PURPA resources to participate in energy markets.
Prevents abuse of the Federal Energy Regulatory Commission’s one-mile rule.