Industrials oppose Alliant's request to escape PURPA obligation

Washington (Platts)--25Aug2005

A group of large industrial power users Thursday said it opposes Alliant
Energy Corp's request that the US Federal Energy Regulatory Commission relieve
its utility units from the obligation to purchase power from non-utility
generators. 
     In an Aug 12 request, Alliant, parent of Interstate Power & Light and
Wisconsin Power & Light, asked the agency for a declaratory order stating that
neither utility would be required to enter into a new contract to buy power
from a qualifying cogeneration facility or qualifying small power production
facility because such generators now have non-discriminatory access to
competitive power markets through the Midwest Independent Transmission System
Operator. 
     In its filing, Alliant relied on changes made to the Public Utility
Regulatory Policies Act in the recently enacted 2005 Energy Policy Act that
allow FERC to terminate a utility's purchase obligation under PURPA if the
agency finds that a competitive wholesale power market exists. 
     Alliant said both of its utility units have received "demands" from the
developer of several small power production plants to purchase the output once
the facilities are built. 
     In a statement Thursday, John Anderson, president of the Washington-based
Electricity Consumers Resource Council, which represents large industrial
power users, argued that Alliant's filing is premature, given that MISO's
so-called Day 2 markets "have only been operating for less than five months."
MISO on April 1 began centrally dispatching generation and transmission
services and launched a real-time energy market. The grid operator's markets,
Anderson added, "are so new it is impossible to tell whether they will provide
the open and competitive markets that this new law requires."
     "We have always stated that if there are competitive markets--if
cogenerators find that they, in fact, have access to the grid in a
non-discriminatory mannter--then we agree: PURPA guarantees are not necessary.
But this market is still an infant--we should wait until it's at least an
adolescent before we start making long-term decision," Anderson said. He said
be believes Alliant's filing "jumps the gun,"  but expects to see similar
filings from other utilities in the coming months.

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