1. (a) Obligation to purchase from qualifying facilities. Each electric utility shall purchase, in accordance with 23 CAR § 454-304, any energy and capacity that is made available from a qualifying facility, either:

   1. (1) Directly to the electric utility; or
   2. (2) Indirectly to the electric utility in accordance with subsection (d) of this section.
2. (b) Obligation to sell to qualifying facilities. Each electric utility shall sell to any qualifying facility, in accordance with 23 CAR § 454-305, any energy and power requested by the qualifying facility.

3. (c) Obligation to interconnect.

   1. (1)

      1. (A) Subject to subdivision (c)(2) of this section, any electric utility shall make such interconnections with any qualifying facility as may be necessary to accomplish purchase or sales under this subpart.
      2. (B) The obligation to pay for any interconnection costs shall be determined in accordance with 23 CAR § 454-306.
   2. (2) No electric utility is required to interconnect with any qualifying facility if, solely by reason of purchase or sales using the interconnection, the electric utility would become subject to regulation as a public utility under Part II of the Federal Power Act.

4. (d) Transmission to other electric utilities.

   1. (1) If a qualifying facility agrees, an electric utility that would otherwise be obligated to purchase energy or capacity from such a qualifying facility may transmit the energy or capacity to any other electric utility, provided that such transmitting utility may, at its sole option, interrupt or modify said transmission service if, in its opinion, such service would jeopardize or degrade its system or service to other customers.

   2. (2)

      1. (A) Any electric utility within the jurisdiction of the Arkansas Public Service Commission to which such energy or capacity is transmitted shall purchase such energy or capacity under this subpart as if the qualifying facility were supplying energy or capacity directly to such electric utility.
      2. (B) The rate for purchase by the electric utility under the jurisdiction of the Arkansas Public Service Commission to which such energy is transmitted:

5. (i) Shall be adjusted up or down to reflect line losses pursuant to 23 CAR § 454-304; and

   1. (ii) Shall not include any charges for transmission.

      1. (C) The qualifying facility may be charged by the transmitting utility for transmission of energy or capacity from a qualifying facility to another utility.
6. (e) Parallel operation. Each electric utility shall offer to operate in parallel with a qualifying facility, provided that the qualifying facility complies with any applicable standards established in accordance with 23 CAR § 454-308.

Codification Notes: This section was promulgated as Section 3.3 of the Cogeneration Rules prior to codification in the Code of Arkansas Rules. The Federal Power Act was enacted as Pub. L. No. 66-280.