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Duke Seeks to Shorten Price Fixing Period for Renewable Power Contracts in Florida, Citing Deluge of Projects

Duke Energy Florida LLC seeks to cut to two years the duration for fixing prices for the purchase of electricity from small renewable power suppliers that is mandated under a federal statute, citing the need to protect consumers from rate hikes and overpayments resulting from rapidly changing market conditions. Under the statute, the Public Utility Regulatory Policies Act of 1978, or PURPA, independent generators that meet certain criteria based on size and technology are entitled to sell their output to regulated utilities at the avoided cost, or the cost the utility would spend to generate the electricity or purchase supplies from another source. Duke is raising concerns about the provision, saying that it has seen an unprecedented surge in requests from solar projects over the last three years, with interconnection requests from over 80 projects with over 6,000 megawatts of solar capacity. The utility said that the growing levels of intermittent power supplies, which are unscheduled and unconstrained, will risk undermining system reliability at times when there’s excess generation and given the state’s limited export capabilities. Duke said locking into prices for the supplies over shorter periods will allow it to better respond to energy market changes, operational challenges, or reliability issues. Duke Energy Florida is a unit of Duke Energy Corp.

September 7, 2018
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