170 IAC 4-4.1-6 Wheeling capacity and energy

Sec. 6. (a) The terms and conditions for the wheeling of nonfirm energy or capacity and energy for an Indiana qualifying facility and the rate for such service shall be specified in a contract between the Indiana qualifying facility and the electric utility and shall not conflict with the Federal Energy Regulatory Commission's implementation of the Federal Power Act or with the authority of any other relevant federal authority. The electric utility shall offer to wheel pursuant to, at a minimum: (1) a contract of five (5) years' duration or longer to wheel capacity and energy; (2) a contract of five (5) years' duration or longer to wheel capacity and energy, subject to cancellation by the electric utility with two (2) years' written notice to the Indiana qualifying facility; or (3) a contract to wheel capacity and energy when, as, and if such service is available from the electric utility. (b) When requested by the qualifying facility, the electric utility shall provide an estimate of the capacity and energy which the electric utility will be able to wheel on its existing and planned transmission-distribution system during the next five (5) years. (c) Rates for wheeling as follows: (1) The wheeling rate will be based on the estimated average cost of the existing transmission and distribution facilities used to provide the wheeling service for the Indiana qualifying facility. (2) The rate for wheeling capacity and energy pursuant to a long-term contract subject to cancellation by the electric utility shall be based on the electric utility's estimated average cost of the existing transmission and distribution facilities used to provide the wheeling service for the Indiana qualifying facility. (3) The rate for wheeling capacity and energy pursuant to a contract providing for such service when, as, and if available from the electric utility shall be based on the electric utility's actual expenses associated with the transaction plus no more than two (2.0) mills per kilowatt-hour of electricity wheeled. (d) If an electric utility estimates that its existing and planned transmission and distribution facilities are inadequate to guarantee the wheeling service requested by the qualifying facility, or an electric utility providing wheeling service for the qualifying facility pursuant to a long-term contract subject to cancellation determines such service can no longer be guaranteed without significant service disruptions to the electric utility's own customers or physical additions to electric utility's transmission and distribution facilities, the electric utility will provide the Indiana qualifying facility with an estimate of the additional investment and expenses that it would necessarily incur in order to provide or continue to provide wheeling service for the qualifying facility. This estimate should be based upon sound engineering design and economics. If the qualifying facility agrees to pay the estimated costs, the electric utility shall endeavor to make the additional investment and operational changes necessary to ensure that it will be able to provide or continue to provide the wheeling service requested by the qualifying facility from the electric utility for the required transmission and distribution facility additions or operational changes. Such agreement shall recognize the current and future benefits, if any, provided to the electric utility and its ratepayers by such facility additions or operational changes. (e) If the electric utility gives notice of its intention to cancel a long-term contract subject to cancellation and the qualifying facility pays for the facility additions and operational changes necessary for the electric utility to be able to continue to guarantee the wheeling service for the qualifying facility, the electric utility shall provide the wheeling service for the remainder of the original contract term plus such additional period as may be requested by the qualifying facility and for which the facility additions and operational changes paid for by the qualifying facility will permit the electric utility to guarantee such service. (f) In determining the wheeling rate pursuant to subsection (c), recognition shall be given to the costs paid by the qualifying facility for the facility additions or operational changes in electric utility's transmission-distribution system.