Opinion ID: 553830
Heading Depth: 2
Heading Rank: 3

Heading: Application of an Ongoing Benefits Test

Text: 21 In Kentucky Utilities, the FERC waived the normal two-part test for fuel clause treatment and allowed the utility to pass through buyout costs, but only to the extent that fuel cost savings were actually realized. 45 F.E.R.C. at 62,292-93. The petitioners here urge the application of a similar ongoing benefits test to minimum take payments. The FERC points out that the ongoing benefits test is not to be found in the fuel clause regulations, but is imposed upon buyout costs solely as a condition of waiving the fuel clause requirements for those expenditures. 48 F.E.R.C. at 62,044-45. Because minimum take payments qualify for fuel clause treatment without need of a waiver, further qualification under the ongoing benefits test is not necessary. Id. If a utility unwisely commits itself to take coal in an excessive amount, or at an exorbitant price, fuel clause treatment does not preclude a customer from challenging a minimum take provision as imprudent. Id. at 62,044 n. 8. See Southern Calif. Edison Co. v. FERC, 805 F.2d at 1070-71.