65- 407 C.M.R. ch. 360, § 2

Current through 2024-25, June 19, 2024

Section 407-360-2 - QUALIFYING COGENERATION AND SMALL POWER PRODUCTION FACILITIES

A. General Requirements for Qualification

1. Small power production facilities. A small power production facility is a qualifying facility if it:

a. meets the size criteria specified in § 2(B)(1);

b. meets the fuel use criteria specified in § 2(B)(2); and

c. meets the ownership criteria specified in § 2(D).

2. Cogeneration facilities. A cogeneration facility is a qualifying facility if it:

a. meets the applicable operating and efficiency standards specified in § 2(C); and

b. meets the ownership criteria specified in § 2(D).

B. Criteria for Qualifying Small Power Production Facilities

1. Size of the facility

a. Maximum size. The power production capacity of the facility for which qualification is sought, together with the capacity of any other facilities which use the same energy resource, are owned by the same person, and are located at the same site, may not exceed 80 megawatts.

b. Method of calculation. For purposes of this paragraph, facilities are considered to be located at the same site as the facility for which qualification is sought if they are located within one mile of the facility for which qualification is sought and, for hydro-electric facilities, if they use water from the same impoundment for power generation. For purposes of making this determination the distance between facilities shall be measured from the electrical generating equipment of a facility.

2. Fuel use

a. The primary energy source of the facility must be biomass, waste, renewable resources, or any combination thereof, and more than 75 percent of the total energy input must be from these sources. Any primary energy source which, on the basis of its energy content, is 50 percent or more biomass shall be considered biomass.

b. Use of oil, natural gas, and coal by a facility may not, in the aggregate, exceed 25 percent of the total energy input of the facility during any calendar-year period.

C. Criteria for Qualifying Cogeneration Facilities

1. Operating and efficiency standards for topping-cycle facilities

a. Operating standard. For any topping-cycle cogeneration facility, the useful thermal energy output of the facility must, during any calendar-year period, be no less than 5 percent of the total energy output.

b. Efficiency standard. For any topping-cycle cogeneration facility for which any of the energy input is natural gas or oil, and the installation of which began on or after March 13, 1980, the useful power output of the facility plus one-half of the useful thermal energy output, during any calendar-year period, must:

i subject to § 2(C)(1)(b)(ii), be no less than 42.5 percent of the total energy input of natural gas and oil to the facility; or

ii if the useful thermal energy output is less than 15 percent of the total energy output of the facility, be no less than 45 percent of the total energy input of natural gas or oil to the facility; or

iii for any topping-cycle cogeneration facility not subject to subsection 2(C)(1)(b) there is no efficiency standard.

2. Efficiency standards for bottoming-cycle facilities

a. For any bottoming-cycle cogeneration facility for which any of the energy input as supplementary firing is natural gas or oil, and the installation of which began on or after March 13, 1980, the useful power output of the facility must, during any calendar-year period, be no less than 45 percent of the energy input of natural gas or oil for supplementary firing.

3. Waiver. The Commission may waive any of the requirements of paragraphs (1) and (2) of this subsection upon a showing that the facility will consume significantly less energy than would be consumed by the facility and the electric utility if the cogeneration facility were not constructed.

D. Ownership Criteria

1. General rule. Prior to the date of retail access, a cogeneration facility or small power production facility may not be owned by a person primarily engaged in the generation or sale of electric power, other than power production facilities. After the date of retail access, a cogeneration facility or small power production facility may not be owned by a transmission and distribution utility or its affiliate unless permitted pursuant to 35-A M.R.S.A. §3204(6).

2. Ownership test

a. For purposes of this section, a cogeneration or small power production facility shall be considered to be owned by a person primarily engaged in the generation or sale of electric power if more than 50 percent of the equity interest in the facility is held by an electric utility or utilities, or by a public utility holding company, or companies, or any combination thereof. If a wholly or partially owned subsidiary of an electric utility or public utility holding company has an ownership interest in a facility, the subsidiary's ownership interest shall be considered as ownership by an electric company or public utility holding company. For purposes of this section a company shall not be considered to be an "electric utility" company if it is a subsidiary of an electric utility holding company which is exempt by rule or order adopted or issued pursuant to section 3(a)(3) or 3(a)(5) of the Public Utility Holding Company Act of 1935, 14 U.S.C. 79c(a)(3), 79c(a)(5); or is declared not to be an electric utility company by rule or order of the Securities and Exchange Commission pursuant to section 2(a)(3)(A) of the Public Utility Holding Company Act of 1935. 15 U.S.C. §79 b(a)(3)(A).

b. Any electric utility that owns any part of a qualifying facility shall maintain separate records for all income investment and expenses associated with its ownership, operation or management of the qualifying facility.

E. Exceptions. Notwithstanding any provision of this section any small power producer or cogenerator which is considered to be a qualifying facility by the Federal Energy Regulatory Commission shall be deemed to be a qualifying facility for purposes of this chapter.

65- 407 C.M.R. ch. 360, § 2