AVOIDED COST is the incremental cost to an electric utility of electric energy and capacity which, but for the purchase from the QF, such utility would generate itself or purchase from another source. QFs also generally have the option to sell energy either "as-available" (i.e., as the QF determines such energy to be available for such purchases) or as part of a legally enforceable obligation for delivery of energy and capacity over a specified term.

*Avoided Cost Prices: A guide By the Renewable Energy Coalition

Avoided Cost Prices