FERC finally answered a question that has long needed answering – when does a QF self-recertification need to be refiled? I.e., is there a grace period before such filing is due after a material fact has changed? The short answer is that there is no grace period at all. And, Staff views anything beyond 30 days after a material change occurs as meriting a self-report.
The PURPA regulation found at 18 C.F.R. Section 292.207(f)(1)(i) states that “[i]f a qualifying facility fails to conform with any material facts or representations presented by the cogenerator or small power producer in its submittals to the Commission, the notice of self-certification or Commission order certifying the qualifying status of the facility may no longer be relied upon. At that point, if the facility continues to conform to the Commission’s qualifying criteria under this part, the cogenerator or small power producer may file either a notice of self-recertification of qualifying status pursuant to the requirements of paragraph (a) of this section, or an application for Commission recertification pursuant to the requirements of paragraph (b) of this section, as appropriate.” Many in the industry assumed that, as with other changes and reporting requirements (e.g., notices of succession; changes in status; Order No. 860 submissions), that there must be some reasonable deadline (i.e., 30-days) after the change occurs before the self-recertification is “due.” But, Irradiant Partners, LP clarifies that FERC expects material changes to be submitted by the day of the change in the fact. (Because Form 556, Line 1l allows a filer to indicate the date a change will take effect, changes can be filed earlier.) FERC did not take issue with the fact that Staff advised Irradiant that if it was filing a self-recertification later than 30 days after a change in material facts or representations, it should self-report such filing(s) to the Office of Enforcement.
In the case, Irradiant acquired a controlling interest of 185 QFs in October 2021, which it determined was a material change triggering Form No. 556 self-recertification. Irradiant filed a petition for declaratory order requesting waiver of the filing requirement for recertification of each QF. In denying the waiver, FERC noted that “the filing requirement is a substantive and important criterion for QF status, which was expressly adopted in Order No. 671 and must be followed.” That said, the failure to file largely was irrelevant because the QFs were not operational and were not relying on their QF certification for anything.
Irradiant noted in its filing that it could find no deadline for self-recertification filing and also discussed the advice received from Staff. In response, FERC found that information in a Form 556 always had to be current. FERC stated that “for a small power production facility to qualify as a QF, the owner or operator of the facility must ensure that the Form No. 556 on file with the Commission contains current and accurate information.” FERC went on to explain that while “the regulations do not explicitly state when a QF must file for recertification to reflect a material change, recertification is required when the material change is made.” FERC reiterated that early filings were often possible but not required.
There may be circumstances where this “by the same-day policy” could, in theory, matter significantly. For example, some RTOs, such as PJM, control and queue interconnections of entities with QF status planning on selling to the market. If these Irradiant QFs had been in the PJM queue, and lost their QF status for a period, as they clearly did per this order, PJM may have removed them all from its queue and instructed them to ask the distribution owner for interconnection service because they were no longer qualified to be in the PJM queue. In contrast, if a QF is operational, losing QF status for a brief period of time will not necessarily have serious consequences (some QF contracts even have alternate rates for periods of non-compliance), but given that it creates some risk, this “by the same-day policy” should be followed.