Badger Creek seeks FERC changes due to issues with steam customer

Badger Creek Ltd., which controls a 46-MW cogeneration plant in California, filed Nov. 21 with the Federal Energy Regulatory Commission for authority to make power sales in case it loses its qualifying facility (QF) status due to problems with its steam customer.

The company asked FERC for:

  • acceptance for filing of its market-based rate tariff effective Nov. 22;
  • waiver of certain commission regulations under the Federal Power Act (FPA); and
  • the granting of certain blanket approvals.

“Seller owns a 46 MW cogeneration facility located in Bakersfield, California (Facility) that is operating as a qualifying facility (QF) under the Public Utility Regulatory Policies Act of 1978, as amended (PURPA),” the application said. “Pursuant to section 292.601(c) of the Commission’s regulations, Seller is exempt from rate regulation under FPA sections 205 and 206, because the entire output of the Facility is sold pursuant to the California Public Utility Commission’s (CPUC’s) implementation of section 210 of PURPA. However, the Facility’s QF status may be at risk due to an extended suspension of steam takes from the Facility by the Facility’s thermal host. While the Facility has resumed steam sales to its thermal host, the Facility will not satisfy the Commission’s QF operating and efficiency standards for calendar year 2012.”

The company told FERC it intends to file a request for limited waiver of the commission’s QF operating and efficiency standards for calendar year 2012. “Out of an abundance of caution, Seller also is seeking market-based rate authorization in order to avoid any potential interruption in power sales from the Facility in the event that it must relinquish QF status,” it added. “Therefore, Seller respectfully requests that the Commission accept for filing Seller’s Market-Based Rate Tariff effective November 22, 2012, one day after the date of this filing. Seller requests waiver of the Commission’s 60-day prior notice filing requirement to permit such an effective date.”

The company’s gas-fired facility is interconnected to the transmission system owned by Pacific Gas & Electric (PG&E) and operated by the California ISO (CAISO). The company currently sells the entire output of the facility to PG&E pursuant to the CPUC’s implementation of section 210 of PURPA.

Badger Creek is selling the output of the facility to PG&E under a Transition Power Purchase Agreement (Transition PPA) as part of the CPUC’s QF program and a comprehensive settlement for QFs and combined heat and power. The Transition PPA is effective through June 30, 2015, on the condition that the facility maintains QF status.

Badger Creek is an indirect wholly-owned subsidiary of ArcLight Energy Partners Fund II LP (ArcLight Fund II). ArcLight Fund II is a private equity investment fund with a focus on the independent power sector and is managed by ArcLight Capital Partners LLC

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.