House Energy and Commerce Committee Chairman Fred Upton, R-Mich., U.S. Sen. Lisa Murkowski, R-Alaska, who chairs the Senate Energy and Natural Resources Committee, and House Energy and Power Subcommittee Chairman Ed Whitfield, R-Ky., sent a Nov. 6 letter to the Federal Energy Regulatory Commission (FERC) requesting a technical conference on the Public Utility Regulatory Policies Act of 1978 (PURPA).
“Electricity markets, generation technologies, and investments in the electric grid have changed substantially since PURPA was enacted nearly 40 years ago as part of President Carter’s energy plan. Since then, competitive electricity markets and open access policies have emerged and matured, expanding the markets for new generation sources, particularly renewable energy resources,” the members of Congress wrote in the letter.
They urged FERC to take a comprehensive look at PURPA. In developing broad energy legislation this year, both the House and Senate committees received testimony on the potential need for policy reform, with one witness testifying that his company is locked into a PURPA “must purchase” contract at rates that are 43% higher than the market price, forcing customers to pay an incremental $1.1 billion over the next 10 years for electricity that is not even needed. That example testimony was from an official with Berkshire Hathaway Energy.
FERC’s evaluation of PURPA and its implementation will help identify potential administrative or legislative updates to ensure the appropriate role for PURPA in today’s electricity marketplace, the members said.