74 Us Cogeneration Legislation Purpa

In 1978 the U.S. Congress amended the Federal Power Act by promulgation of the Public Utilities Regulatory Act (PURPA). The Act recognized the energy saving potential of industrial cogeneration and small power plants, the need for real and significant incentives for development of these facilities and the private sector requirement to remain unregulated.

PURPA of 1978 eliminated several obstacles to cogeneration so cogenerators can count on "fair" treatment by the local electric utility with regard to interconnection, back-up power supplies, and the sale of excess power. PURPA contains the major federal initiatives regarding cogeneration and small power production. These initiatives are stated as rules and regulations pertaining to PURPA Sections 210 and 201; which were issued in final form in February and March of 1980, respectively. These rules and regulations are discussed in the following sections.

Initially, several utilities—especially those with excess capacity-were reticent to buy cogenerated power and have, in the past, contested PURPA. Power (1980) magazine reported several cases in which opposition persisted in some utilities to private cogeneration. But after the Supreme Court ruling in favor of PURPA, more and more utilities are finding that PURPA can work to their advantage. Polsky and Landry (1987) report that some utilities are changing attitudes and are even investing in cogeneration projects.

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