FERC rules Tri-State to halt discrimination in solar program

This story has been updated to include comments from Tri-State.

BRIGHTON — The Federal Energy Regulatory Commission has issued four preliminary rulings in cases involving United Power and the Tri-State Generation and Transmission Association. Three of the rulings were in favor of United Power.

In a statement released after the initial ruling, United Power president and CEO Mark Gabriel said the decisions would positively affect more than just United Power.

“These rulings are significant as they will provide long term benefits to all Tri-State members and their rate payers, in identifying and controlling system costs and assuring the costs are allocated to those who benefit,” Gabriel said in a statement.

One decision would, if finalized, lead Tri-State to reimburse United Power over the cooperative’s energy storage resources. Tri-State would also need to make compliance filings with the Federal Energy Regulatory Commission within 15 days of reimbursement.

Lee Boughey, vice president of communications for Tri-State, said the cooperative charges for transmission demand, “and that is when that member hits their peak within our window, we have a charge for transmission demand, and that helps ensure that we have the transmission resources to serve that member at all times.

“When United installed their battery, they would not meter that battery, and we could not determine what those demand charges were, and so we, to ensure that our costs were being equitably shared with our membership, we made an estimate of what those demand charges would be,” Boughey said.

He said that without the metered data, Tri-State “calculated United Power’s transmission demand assuming that it was discharging that battery during its peak periods each month. So we didn’t have the metering information from United, so we made an estimate of what that could be.”

While the initial decision requires reimbursement to United Power of overcollection of transmission charges, it is significant in that Tri-State would be authorized to collect demand charges related to United Power’s battery-storage devices going forward, Boughey said.

“What they [United Power] didn’t talk about in this is that, going forward, their arguments about this were rejected, and we will be entitled to collect those demand charges that they had not paid to us as we go forward,” he said.

The other initial rulings include a move to uncouple transmission and delivery costs, directly assign non-networked delivery facilities and amend a discriminatory community solar policy. 

Boughey said the first two issues will inform Tri-State’s 2023 rate filing, with the decision that it must unbundle rates for wholesale power service having no cost impact on Tri-State but “could lead to significant cost shifts among Tri-State’s members.”

Tri-State’s community solar policy charged cooperative members that did not adopt specific community solar projects around $5 more per kilowatt month than members that did have community solar projects, which the Federal Energy Regulatory Commission ruled to be undue discrimination. The two amendments proposed in the ruling were charging the fee to all participants, or adding a load-sharing option for utilities sourcing from community solar programs.

The initial ruling points out that the costs Tri-State faces are the same regardless of whether their customers engage in community solar programs, so the difference in rates is not valid.

“Demand is the same regardless of what resource serves it, because Tri-State’s cost to stand ready to serve demand is the same regardless of what resource serves it,” the Federal Energy Regulatory Commission said.

Boughey emphasized that these are initial decisions by the administrative law judge, and that FERC has not issued final rulings.

“The nuance is that an administrative law judge has made an initial decision on those four cases, but FERC has not issued an order yet, and there’s still more process to go,” he said.” After an initial decision is made by an administrative law judge, then the parties can file exceptions related to the initial decision. The case then goes to the FERC commissioners, and that’s where the decision is made and the orders are issued.”

Boughey said he doesn’t know whether Tri-State will file exceptions to any of the orders.

United Power has announced plans to leave Tri-State unconditionally on May 1, 2024, citing concerns over electricity costs and mandates requiring that most members source 95% of their power from Tri-State. A ruling determining United Power’s exit fees is expected this summer.

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