Public Utility of Regulatory Policies Act (PURPA)

The Congress enacted Public Utility of Regulatory Policies Act (PURPA) of 1978 to answer the energy crisis that U. S. was facing (470 U. S. 1075). Section 210 of Title II provides that the act shall promote for the development of alternative energy resources by stopping the practice of electric utilities in purchasing power from non-traditional facilities (470 U. S. 1075).In addition, the act also authorized the Federal Energy Regulatory Commission or FERC to implement the act by promulgating rules necessary to encourage cogeneration and small power production (470 U.S. 1075). The function of FERC includes also the setting of rate of electricity (470 U. S. 1075).Moreover, the act required the rates to be just and reasonable and non-discriminatory and shall not exceed the incremental cost of the electric utility of alternative electric energy (470 U. S. 1075). Pursuant to said act, FERC adopted the maximum rate which is the incremental of full- avoided cost and required all utilities to purchase from qualifying facilities (470 U. S. 1075). The state of New York has set minimum rate of six per kilowatt hour.The appellant argued that it cannot pay such amount because its avoided cost fell below that amount (470 U. S. 1075). PROCEDURE: The Appellate Division of the New York Supreme Court granted the petition because the rate of six cents per kilowatt hour exceeded the federally mandated avoided cost rate (470 U. S. 1075). The respondent here appealed to Court of Appeals and it reversed the decision of the lower court on the ground that the federal law and the statute are complementary and the statute is consistent with the purpose of the act.ISSUE: Can the state require utilities to pay more than the full avoided cost rate for their mandatory purchases? HOLDING: Yes, the state can. REASONING: There is no question as to the rate implemented by the state because the Act authorizes it. The state can freely enact regulations or laws providing rates as long as it achiev es the purpose of the Act. Furthermore, there is no substantial issue than can be debated and so the case is dismissed. DISSENTING: The Act and the state's regulations should be clearly interpreted.The decision of CA is contradictory to the case in Kansas where the court held that the state regulatory commission could not set rates for purchases from cogenerations that were higher than the avoided cost (470 U. S. 1075). Moreover, the state may have jurisdiction to set the rates under PURPA but the extent of their authority shall be settled (470 U. S. 1075). In addition, Justice White found that there are various cases similar to this and the states also have different approaches as to the setting of the rate under the PURPA (470 U.S. 1075). These cases may occur again in the future and in order to avoid it, the issue shall be resolved. Furthermore, the Justice found the issue as important and open for debate (470 U. S. 1075) Works Cited â€Å"Consolidated Edison Company of New York , Inc. v. Public Service Commission of New York, et al (470 U. S. 1075). † 2003. The New York Times. 23 May 2008 . â€Å"How To Brief A Case. † 2006. 4Lawschool. com. 23 May 2008