Today was a big day for the solar industry at the Federal Energy Regulatory Commission (FERC).
In its monthly open meeting, FERC announced two decisions that will have a significant impact on the industry – one involving PURPA and one relating to PJM's Minimum Offer Price Rule (MOPR).
First, FERC overturned its September 2020 decision by Broadview Solar, in which the previous decision broke decades of precedents related to the method used to determine the net performance of qualified facilities under PURPA. This September decision called for qualified facilities to use equipment that could limit their performance, such as B. inverters, cannot be taken into account when determining their net power. In the case of Broadview Solar, this meant that a solar power qualifying facility with a solar module capacity of more than 80 MW but only 80 MW inverter power would not qualify for qualifying facility status. Today, however, FERC reversed that decision, stating that the net performance of a qualified facility should reflect the facility's design and its actual (not theoretical) capabilities.
Next, FERC responded to a petition for a declaratory order in which an applicant asked for confirmation that the local property tax relief that solar panels are available as pollution control equipment (Va. Code Ann. Sec. 58.1-3660) is not a state subsidy that would subject the applicant to the extended MOPR in the upcoming PJM Base Residual Auction. Just a few months ago, PJM had determined that the same tax breaks would result in recipients being subject to the MOPR. FERC disagreed, however, and as a result, solar power project owners can take advantage of this Virginia tax break with no consequence for PJM's capacity auctions.
The orders in this process have not yet been approved and we will provide further updates as needed as they become available for review.