Commissioner Cheryl A. LaFleur
August 3, 2018
Docket Nos. EL18-123-000,
QF87-481-002
In today’s order, the Commission denies an application for recertification of the T.E.S. Filer City Station cogeneration facility (Facility) as an existing cogeneration qualifying facility (QF). As discussed below, I believe that the specific facts of this case warrant acceptance of the application and I therefore dissent.
In its filing, T.E.S. Filer City Station (TES Filer) explains that it is converting its 1987 coal, tire-derived fuel, and waste wood fueled facility to a modern natural gas-fueled facility. TES Filer states that determinations regarding the technology and scale of the conversion were guided by the desire to achieve the most economic and efficient utilization of the Facility’s existing steam turbine equipment for its existing thermal host. There is no change in the amount of steam produced or the size of the thermal host facility. Rather, the increased MW output can be attributed to the modernization of the boiler system and the change in fuel consumed. TES Filer specifically indicates that “[t]he reconfigured Plant’s higher electrical output will simply be a consequence of this steam production optimization.”1
TES Filer seeks to recertify the Facility, with these changes, as a QF.
As cited in this order, Order No. 671 establishes the relevant standard for determining whether an existing QF facility that is seeking recertification should nonetheless be treated as a new QF:
The question before us, then, is whether the changes to the Facility are “so great” that they render it a new QF under Order No. 671 and Commission precedent.
While I recognize that this language is vague, I do not read the standard as requiring any significant increase in megawatt (MW) output to be treated as a change so great as to consider a facility a “new cogeneration facility at the same site.” In addition, I do not believe any of our existing precedent would preclude an acceptance in this instance.2
Order No. 671 illustrates the type of increase in MW output that may result in the consideration of an existing QF as a new QF; however, the record here shows that the conversion was designed to meet the needs of the thermal host, and that the increased MW output is simply a byproduct of meeting that existing need with a modern, efficient gas turbine. I believe those facts are the pertinent ones for determining here whether the changes are “so great” as to warrant denying recertification.
Finally, I note that PURPA requires, among other things, that the Commission prescribe rules to encourage cogeneration facilities. 3
Unfortunately, interpreting Order No. 671 in a manner that requires rejection in this instance may in fact discourage other cogeneration resources from updating and optimizing their systems, for fear of no longer maintaining their QF status. I do not believe that outcome is justified on this record and would instead recertify the Facility.
Accordingly, I respectfully dissent.
- 11 TES Filer Application for Recertification at 1.
- 23 Both of the cases cited by the majority are distinguishable from the instant filing. In Chugach Electric Association, Inc., where the Commission found the changes to the existing facility so great as to consider the facility “new,” the applicants did not have a dedicated thermal host and thus no specific steam production need that would justify the increase in MW production. Chugach Elec. Ass’n, Inc., 121 FERC ¶ 61,287 (2007). In Medical Area Total Energy Plant, Inc., where the Commission recertified the existing facility, the applicant did in fact have a thermal host and indicated that the reason for increased capacity, which was significantly smaller than the instant case, was the increased needs of the thermal host. Medical Area Total Energy Plant, Inc., 130 FERC ¶ 61,254, reh’g denied, 131 FERC ¶ 61,215 (2010).
- 34 16 U.S.C. § 824a-3(a) (2012).