FERC on Thursday reversed its September order denying a Montana solar hybrid project certification as a qualifying facility because its capacity was too large.

The Public Utility Regulatory Policies Act (PURPA) limits qualifying facilities to 80 MW. The commission originally found that Broadview Solar’s project exceeded the cap despite the 80-MW limitation on its interconnection with the NorthWestern Energy transmission system. (See Montana Hybrid Ruling Departs from PURPA Precedent.)

In Thursday’s ruling, the commission reinstated its longstanding “send-out” analysis, which determines a facility’s power production capacity based on the electricity that it can actually deliver to the interconnecting electric utility (QF17-454-006).

Broadview’s project includes solar panels with a gross capacity of 160 MW DC and a 50-MW battery. But limitations on the project’s inverters allow it to produce and deliver only 80 MW to the interconnection with NorthWestern, FERC said.

“We were applying simple common sense,” said FERC Chair Richard Glick, who had dissented on the original order. “It is not fathomable to conclude that Congress would be more concerned about the electricity a project could theoretically generate on its own but not deliver to any customer. Instead, since the statute is all about the sale of a project’s output, the appropriate way to look at a facility is to assess how much can actually be sold the purchasing utility.”

“This case provided the commission the first occasion to interpret how PURPA’s limitation on a facility’s ‘power production capacity’ applies to a facility such as Broadview’s, which has a large array of solar PV cells but is physically incapable of producing more than 80 MW of power for delivery to the purchasing utility,” FERC said in a press release.

FERC said the prior ruling — by Commissioners Neil Chatterjee, Bernard McNamee and James Danly — erred by departing from PURPA, its own regulations and precedent.

Broadview had contended that FERC’s finding in 1981’s Occidental Geothermal, Inc. that “a facility’s power production capacity is not necessarily determined by the nominal rating of even a key component of the facility” backs up its claim that the solar facility falls within the 80-MW limit.

The company also cited FERC’s determination in Malacha Power Project, Inc., a 1987 ruling that said that “the electric power production capacity of the facility is the capacity that the electric power production equipment delivers to the point of interconnection with the purchasing utility’s transmission system.”

“We commend FERC’s decision to reverse the September 2020 Broadview order, which upended the 40-year precedent FERC used to measure capacity for PURPA facilities,” Gizelle Wray, director of regulatory affairs for the Solar Energy Industries Association, said in a statement. “This is good news for solar plus storage facilities across the United States and will ultimately make sure that independent power producers are fairly evaluated when it comes to calculating their capacity and the value they bring to the grid.”