Independent Power Producer - Wikipedia, the free encyclopedia

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http://en.wikipedia.org/wiki/Independent_Power_Producer

Independent Power Producer

From Wikipedia, the free encyclopedia

An independent power producer (IPP) or non-utility generator (NUG) is an entity,[1] which is not a
public utility, but which owns facilities to generate electric power for sale to utilities and end users.[2] NUGs
may be privately held facilities, corporations, cooperatives such as rural solar or wind energy producers, and
non-energy industrial concerns capable of feeding excess energy into the system.[3]

Contents
1 Economic situation
1.1 Canada
1.2 United States
2 References

Economic situation
For the majority of IPPs, particularly in the renewable energy industry, a feed-in Tariff or Power Purchase
Agreement provides a long term price guarantee.

Canada
In 2002, the BC government stipulated that new clean renewable energy generation in the province[4] would
be developed by independent power producers (IPPs) not BC Hydro, save for large hydro-electric
facilities. The role of the private sector in developing BCs public resources is one of the more
controversial issues that British Columbians are currently grappling with.

United States
Prior to the US Public Utility Regulatory Policies Act (PURPA) of 1978, NUGs were rare, and the few that
existed were seldom able to distribute power, as the cost of building the conveyance infrastructure was
prohibitive. Public utilities generated power and owned the generating facilities, the transmission lines, and
the local delivery systems. Congress Passed the PURPA in 1978, establishing a class of non-utility
generators, called Qualifying Facilities (QF), which were permitted to produce power for resale.
PURPA was intended to reduce domestic dependence on foreign energy, to encourage energy conservation,
and to reduce the ability of electric utilities to abuse the purchase of power from QFs. A QF is defined as a
generating facility that produces electricity and another form of useful thermal energy through the sequential
use of energy, and meets certain ownership, operating, and efficiency criteria established by the Federal
Energy Regulatory Commission (FERC).
Section 210 of PURPA now requires utilities to purchase energy from NUGs which qualify (qualifying
facilities) at the utility's avoided cost. This allows NUGs to receive a reasonable to excellent price for the
energy they produce and ensures that energy generated by small producers won't be wasted.[3]

References
10/02/2015 11:15

Independent Power Producer - Wikipedia, the free encyclopedia

2 of 2

http://en.wikipedia.org/wiki/Independent_Power_Producer

1. ^ Gas engines for IPPs (http://www.clarke-energy.com/2013/gas-engines-for-ipps/), www.clarke-energy.com,

accessed 11th November 2013
2. ^ "Independent Power Producer (IPP) - Americas Generators" (http://www.gopower.com/glossary
/term_view.php?TermID=76). Gopower.com. Retrieved 2012-02-08.
3. ^ a b "independent power producer (IPP), non-utility generator (NUG)" (https://energyvortex.com
/energydictionary/independent_power_producer_(ipp)__non_utility_generator_(nug).html). Energyvortex.com.
Retrieved 2012-02-08.
4. ^ [1] (http://www.wcel.org/articles/IPP-QandA.pdf)

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Categories: Electric power companies

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