A company wants to do business in South Dakota. Good. This company wants to use one of South Dakota’s natural resources. Better. The company will use a federal law to force people to buy its product. Bes—- Excuse me?
In this case, Oak Tree Energy LLC wants to erect wind turbines in Clark County and force NorthWestern Energy to buy the electricity that would be produced.
NorthWestern Energy has little choice. That’s because of a 1978 federal law known as PURPA — the Public Utility Regulatory Policy Act — that makes utility companies buy from independent energy producers.
NorthWestern is being forced to buy electricity it doesn’t want, and to pay a higher price for the electricity than it wants to pay, and the supply is unreliable.
If NorthWestern builds the 19.5 megawatts of Oak Tree power into its supply chain, NorthWestern also needs to have at the ready a backup supply for when those 19.5 megawatts are needed but Oak Tree can’t deliver them.
That means customers of NorthWestern essentially have to pay twice for the costs of generating the 19.5 megawatts.
Please, go and read the entire article. It is well written and points out the absolute folly of this situation, brought to you by well-meaning but clueless elected and unelected members of the federal government.
It is past time to get government to withdraw from the business of business, isn’t it?