Is a co-located storage facility and wind or solar facility considered to be one qualifying facility (“QF”) under the Public Utility Regulatory Policies Act (“PURPA”)? Or multiple QFs? How will the aggregate capacity of such storage plus wind/solar QF(s) be measured? If the storage will only be charged from the co-located wind/solar facility, will the aggregate capacity of the storage plus wind/solar QF be the net power production capacity of the wind/solar facility? Or will it include the maximum capacity of the co-located storage facility (in addition to the capacity of the wind/solar facility)?
These questions should be answered when FERC rules on NorthWestern Corporation’s (“NorthWestern”) recently-filed motion (FERC Docket No. EL18-195) (the “NorthWestern Motion”) and an application for QF recertification by Beaver Creek Wind II, LLC (FERC Docket No. QF17-673-002) (the “QF Recertification”). On August 31, 2018, NorthWestern filed a motion to revoke the QF status of Beaver Creek Wind I, LLC, Beaker Creek Wind II, LLC, Beaver Creek Wind III, LLC and Beaver Creek Wind IV, LLC (collectively, the “Beaver Creek Projects”), arguing that the integration of battery storage facilities causes the Beaver Creek Projects to exceed the maximum 80 MW QF capacity for small power production facilities. The Beaver Creek Projects are each a proposed 80 MW wind farm with a battery storage system capable of a maximum power output capacity of up to 40 MWh (10 MW over 4 hours). Each of the Beaver Creek Projects has filed a QF self-certification or an application as a small power production facility. In the NorthWestern Motion, NorthWestern claims that none of Beaver Creek Projects’ 80 MW wind farms or the battery storage systems qualify as a QF since the storage plus wind facility has an aggregated net power production capacity over the 80 MW maximum to qualify as a QF small power production facility. According to NorthWestern, the wind farm and the battery storage system should be treated as separate projects for QF purposes and since both the wind farm and the battery storage system use wind as a fuel source and are located within a mile of each other, the capacity of the wind farm and the capacity of the battery storage system need to be aggregated together to determine the QF capacity (which in the case of the Beaver Creek Projects, would put them over the 80 MW threshold). In contrast, the Beaver Creek Projects (in the QF Recertification) argue that the 80 MW QF maximum capacity limit will not be exceeded since the battery storage system will not increase the renewable energy production of the wind farms and will not be providing any additional generation of energy for the wind farms. Furthermore, the injection of power to the grid from the Beaver Creek Projects will be limited to 80 MW.
FERC’s decision on these issues may affect the sizing of storage plus wind/solar facilities that are seeking to obtain QF status to qualify for PURPA power purchase agreements. Comments on the NorthWestern Motion are due on October 1, 2018.