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TITLE 16ECONOMIC REGULATION
PART 2PUBLIC UTILITY COMMISSION OF TEXAS
CHAPTER 25SUBSTANTIVE RULES APPLICABLE TO ELECTRIC SERVICE PROVIDERS
SUBCHAPTER JCOSTS, RATES AND TARIFFS
DIVISION 1RETAIL RATES
RULE §25.242Arrangements Between Qualifying Facilities and Electric Utilities

    (B) with regard to an electric utility that is legally obligated to obtain all its requirements for electric energy and capacity from another electric utility, provide to an interested person the data of its supplying utility and the rates at which it currently purchases such energy and capacity.

  (4) Filing date. By February 15 each year, large electric utilities shall file with the commission and shall maintain for public inspection the data set forth in paragraph (2) of this subsection.

(f) PTB REP and electric utility obligations.

  (1) Obligation to purchase from qualifying facilities.

    (A) In accordance with this subsection and subsection (g) of this section, each PTB REP and electric utility shall purchase any energy that is made available from a qualifying facility:

      (i) directly to the PTB REP or electric utility; or

      (ii) indirectly to the PTB REP or electric utility in accordance with paragraph (4) of this subsection.

    (B) Each electric utility shall purchase energy from a qualifying facility with a design capacity of 100 kilowatts or more within 90 days of being notified by the qualifying facility that such energy is or will be available, provided that the electric utility has sufficient interconnection facilities available. If an agreement to purchase energy is not reached within 90 days after the qualifying facility provides such notification, the agreement, if and when achieved, shall bear a retroactive effective date for the purchase of energy delivered to the electric utility correspondent with the 90th day following such notice. If the electric utility determines that adequate interconnection facilities are not available, the electric utility shall inform the qualifying facility within 30 days after being notified for distribution interconnection, or within 60 days for transmission interconnection, giving the qualifying facility a description of the additional facilities required as well as cost and schedule estimates for construction of such facilities. If an agreement to purchase energy is not reached upon completion of construction of the interconnection facilities or 90 days after notification by the qualifying facility that such energy is or will be available, the agreement, if and when achieved, shall bear a retroactive effective date for the purchase of energy delivered to the electric utility correspondent with the time of interconnection or the 90th day, whichever is later. Nothing in this subsection shall be construed in a manner that would preclude a qualifying facility from notifying and contracting for energy with a utility for sale of energy prior to 90 days before delivery of such energy.

    (C) Each PTB REP shall purchase energy from a qualifying facility with a design capacity of 100 kilowatts or more within a timely fashion after being notified by the qualifying facility that such energy is or will be available.

  (2) Obligation to sell to qualifying facilities. In accordance with subsection (k) of this section, each electric utility shall sell any energy and capacity requested to any qualifying facility located within the electric utility's service area. Each PTB REP shall also sell any energy requested to any qualifying facility; however, those sales shall be at market based rates. Nothing shall restrict the ability of any qualifying facility to purchase energy from any REP.

  (3) Interconnection. Interconnection by a qualifying facility is addressed by Subchapter I, Division 1, of this chapter (relating to Transmission and Distribution) if the interconnection is to a transmission system and by §25.211 of this title (relating to Interconnection of On-site Distributed Generation) if the interconnection is to a distribution system, except if the interconnection is regulated by the Federal Energy Regulatory Commission.

  (4) Transmission to other electric utilities. Transmission service provided by an electric utility in the ERCOT power region to a qualifying facility shall be governed by Subchapter I of this chapter.

  (5) PTB REP and scheduling with qualifying facilities. A PTB REP shall use dynamic resource scheduling or responsibility transfer in ERCOT with any qualifying facility that requests such scheduling, as permitted by ERCOT. The PTB REP's cost of using dynamic resource scheduling or responsibility transfer attributable solely to purchases from qualifying facilities shall be charged to qualifying facilities that use such scheduling. If a qualifying facility uses static scheduling, the qualifying facility shall bear the costs for any imbalances resulting from the qualifying facility's failure to submit a schedule or to comply with the schedule.

(g) Rates for purchases from a qualifying facility.

  (1) Rates for purchases of energy and capacity from any qualifying facility shall be just and reasonable to the customers of the electric utility or PTB REP and in the public interest, and shall not discriminate against qualifying cogeneration and small power production facilities.

  (2) Rates for purchases of energy and capacity from any qualifying facility shall not exceed avoided cost. Rates for purchase shall be based upon a market-based determination of avoided costs over the specific term of the contract or other legally enforceable obligation, the rates for such purchase do not violate this subsection if the rates for such purchase differ from avoided cost at the time of delivery. Payments which do not exceed avoided cost shall be found to be just and reasonable operating expenses of the electric utility.

  (3) A QF may agree to commit, on a day-ahead basis, to deliver firm power for the next day to a PTB REP. Rates for purchase of this power shall be based on prices for the day that the power was actually delivered as reported or published in an independent third party index or survey of trades of commonly traded power products in ERCOT, provided that the index or survey is ERCOT-specific and is based upon enough transactions to represent a liquid market, and the commitment to deliver shall correspond with the relevant hours of delivery of those products.

(h) Standard rates for purchases from qualifying facilities with a design capacity of 100 kilowatts or less.

  (1) There shall be included in the tariffs of each electric utility standard rates for purchases from qualifying facilities with a design capacity of 100 kilowatts or less. The rates for purchases under this paragraph:

    (A) shall be consistent with subsection (g) of this section, as it concerns purchases from a qualifying facility;

    (B) shall consider the aggregate capacity value provided by multiple qualifying facilities with a design capacity of 100 kilowatts or less; and

    (C) may differentiate among qualifying facilities using various technologies on the basis of the supply characteristics of the different technologies.

  (2) Terms and conditions unique to qualifying facilities with a design capacity of 100 kilowatts or less such as metering arrangements, safety equipment requirements, liability for injury or equipment damage, access to equipment and additional administrative costs, if any, shall be included in a standard tariff.

  (3) The standard tariff shall offer at least the following options:

    (A) parallel operation with interconnection through a single meter that measures net consumption;

      (i) net consumption for a given billing period shall be billed in accordance with the standard tariff applicable to the customer class to which the user of the qualifying facility's output belongs;

      (ii) net production will not be metered or purchased by the utility and therefore there will be no additional customer charge imposed on the qualifying facility;

    (B) parallel operation with interconnection through two meters with one measuring net consumption and the other measuring net production;

      (i) net consumption for a given billing period shall be billed in accordance with the standard tariff applicable to the customer class to which the user of the qualifying facility's output belongs;

      (ii) net production for a given billing period shall be purchased at the standard rate provided for in paragraph (1)(A) and (B) of this subsection;

    (C) interconnection through two meters with one measuring all consumption by the customer and the other measuring all production by the qualifying facility;

      (i) all consumption by the customer for a given billing period shall be billed in accordance with the standard tariff applicable to the customer class to which the customer would belong in the absence of the qualifying facility;

      (ii) all production by the qualifying facility for a given billing period shall be purchased at the standard rate provided for in paragraph (1)(A) and (B) of this subsection.

  (4) In addition, each electric utility shall offer qualifying facilities using renewable resources with an aggregate design capacity of 50 kilowatts or less the option of interconnecting through a single meter that runs forward and backward.

Cont'd...

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