(1) A utility may count as conservation savings a portion of the electricity output of a high-efficiency cogeneration facility that commences operation in its service territory.

(2) The high-efficiency cogeneration facility must be owned by a retail electric customer and used by that customer to meet its heat and electricity needs. Heat and electricity output provided to anyone other than the facility owner may not be considered in determining conservation savings.

(3) The useful thermal energy output of the cogeneration facility must be no less than thirty-three percent of the total energy output of the cogeneration facility under normal operating conditions.

(4) The reduction in customer load due to high-efficiency cogeneration must be determined by multiplying the annual electricity output of the cogeneration facility by a fraction equal to one minus the ratio of:

(a) The heat rate (in British thermal units per megawatt hour) of the cogeneration facility; and

(b) The heat rate (in British thermal units per megawatt hour) of a combined cycle natural gas-fired combustion turbine. The heat rate of the cogeneration facility must be based on the additional fuel requirements attributable to electricity production and excluding the fuel that would be required to produce all other useful energy outputs of the project without cogeneration. The heat rate of the combustion turbine must be based on a facility using best commercial available technology on a new and clean basis.

(5) The utility's documentation of a cogeneration facility's compliance with subsections (3) and (4) of this section must be certified by a registered professional engineer licensed by the Washington department of licensing.