This month, I took time out to reflect on 2011’s Policyland roller coaster, to celebrate the novel advancements and lament the setbacks. Let’s start with the good news (and luckily, there were plenty of candidates). I found the following regulatory snapshots to be particularly ground-breaking:

1.) Hawaii Interconnection

On November 29, 2011, the Hawaii Public Utilities Commission issued an order that significantly improved Hawaii’s interconnection procedures, known as Rule 14H. In addition to other improvements, a unique supplemental review process was incorporated into Rule 14H to allow a generator to avoid more intensive study if the “aggregate capacity per Line Section is below 50% of the Line Section minimum kW load during the period when the proposed generation is available.”  Then, in December, the Hawaii PUC issued another favorable decision that broke further ground in several burgeoning interconnection issues.

Why this matters:  Hawaii has proven its place among the leaders of clean energy policy in the country. This shift away from a hard 15% (of line section peak load) interconnection screen, in favor of a more flexible 50% of minimum load screen has already begun to pique the interest of other states that are experiencing high solar adoption rates.  In other words, this development can allow more solar to safely connect to the grid, in more places.

2.) Delaware

In July of 2011, the Delaware Public Service Commission adopted interconnection standards that apply to all types of distributed generation systems less than 10 MW in capacity that are sited in Delmarva’s service territory.   During the rulemaking procedures, the IREC model was often discussed and many of its “best practice” attributes were implemented. These changes brought Delaware from an F in Freeing the Grid to an A.  Earlier in 2011, the PSC also adopted rules for meter aggregation and community renewables.

Why this matters: High system size limits for interconnection allow non-residential customers (and community groups) to install systems capable of meeting their annual energy needs if they choose to do so.  This results in systems with a lower installed cost per kW and allows these systems to contribute to meeting the state’s RPS goals.

3.) Community Renewables

Despite the myriad potential setbacks, Community Renewables is surging ahead across the country.  For a brief run-down: Colorado has been carefully working its way toward regulations to allow Solar Gardens (not to mention plenty local governments taking up Solar Garden initiatives on their own volition); the Maryland has been working through the regulation process for meter aggregation; California has been working to expand Virtual Net Metering; and Delaware adopted rules for meter aggregation and community renewables.

Why this matters: Because of shading and structural considerations, most residential systems are not ideally suited to host a solar facility. Community rules allow them to invest in an off-site system, expanding the pool of eligible solar owners.

4.) Massachusetts DPU continues to raise the bar for net metering and interconnection

Over the past year, the Massachusetts Department of Energy Resources has gone to great lengths to improve the process and fairness of distributed generation policies in the state. Early in 2011, the DOER conducted a survey of interconnection customers, which helped inform an extensive distributed generation study of recommendations for improvement. Massachusetts continues to work on these issues through several dockets that address net metering project queue management, net metering of municipal facilities, and interconnection process improvement.

Why this matters: By reaching out to gather opinions and experience of distributed generation customers, we can tell that Massachusetts is actively interested in making real process-related improvements that can help spur growth in the market, while remaining within the mandates of state law.

5.) Interconnection in West Virginia

On June 30, the West Virginia Public Service Commission issued a ruling that significantly improved the state’s net metering rules and interconnection procedures (which were based on IREC’s own model Interconnection Procedures). Notably through this work, the State also joined the elite (but growing) club of states that allow virtual meter aggregation.

Why this matters: This work moved West Virginia’s net metering rules from a D to an A, and from an N/A to a solid B in the 2011 Freeing the Grid publication.  This complete policy overhaul represents real progress, which can have a significant impact in jump-starting a state’s renewable energy economy.

6.) California, a thought leader among states

Obviously, California would be on this list, as it continued to serve as a policy leader in 2011 with several important regulatory actions. Since the beginning of last year, the California Public Utilities Commission has been working to expand Virtual Net Energy Metering (VNM) options in the state. First piloted under the California Solar Initiative for affordable housing complexes, the CPUC has been authorized to expand VNM to the general multi-tenant market.  Within the past year, California has also begun to reform the state’s Interconnection Rule 21, with the creation of a drafting group and multi-stakeholder negotiation process.  Rule 21 has long been a solid set of interconnection procedures but as a result of the growing complexity in the solar market, it’s due for an update.

Why this matters: Even though California has been a national leader for installed solar capacity, the state continues to push forward, proving that policies need to continually evolve with the changing markets, in order to stay relevant. 

7.) Mississippi continues along the path toward net metering and interconnection rules

On January 6, 2011, the Mississippi Public Service Commission issued an order establishing a docket (# 2011- AD-2) to investigate the development and implementation of net metering and interconnection standards. The commission also recently hired consultants to provide recommendations for adopting state-appropriate regulations.

Why this matters: Mississippi, Tennessee, Alabama and South Dakota are currently the only four U.S. states that have no net metering option. This shows real progress that may also make Mississippi’s neighbors, Alabama and Tennessee, sit up and take notice.

8.) New York investigates kWh crediting

Beginning in late January 2011, the NY PSC initiated a proceeding requiring all utilities in the state to explain how they credit net-metered customers for excess generation that is exported to the grid.  The PSC looked into this issue in order to verify that solar customers are not disadvantaged by the date of their annual reconciliation with the utility, and that utilities are properly calculating customers’ bill credits.

Why this matters: Like the Massachusetts, this work shows a public utility commission that is engaged and interested in understanding and improving the implementation of its distributed generation regulations.

And, I would be remiss if I didn’t mention a couple less-than-positive developments to emerge last year:

9.) Virginia SCC approves controversial net metering standby fee

Any residential customer of Dominion Virginia Power who owns and operates net-metered generation systems of 10 – 20 kW can now expect to pay a new monthly standby charge as authorized by state law during the 2011 session of the General Assembly. In December, the Virginia State Corporation Commission approved a standby charge methodology that allows Dominion to recover its transmission and distribution costs.

10.) California’s SDG&E appeals for network use charge

In October 2011, San Diego’s SDG&E utility proposed a new “network use charge” that the utility says is designed to divide operational costs among solar-owning and non-solar-owning customers more equitably. Existing net-metering law prohibits utilities from imposing fees that are exclusive to net-metered customers. Instead, SDG&E would apply the network use charge to all customers, which could have the effect of penalizing net metering customers who use the “network” more frequently.

Why these matter: Obviously these reflect setbacks to the renewable energy community that has long fought for fair and equitable renewable energy policies that appropriately value distributed generation’s benefits to the grid.

So, despite the setbacks, 2011 proved to be another year of growth and policy develop- ment. Here’s to another year of progress that helps advance our clean energy economy! Stay tuned.

Regards,

Laurel Varnado

Note from the Editor

This month, I took time out to reflect on 2011’s Policyland roller coaster, to celebrate the novel advancements and lament the setbacks. Let’s start with the good news (and luckily, there were plenty of candidates). I found the following regulatory snapshots to be particularly ground-breaking:

1) Hawaii Interconnection

On November 29, 2011, the Hawaii Public Utilities Commission issued an order that significantly improved Hawaii’s interconnection procedures, known as Rule 14H. In addition to other improvements, a unique supplemental review process was incorporated into Rule 14H to allow a generator to avoid more intensive study if the “aggregate capacity per Line Section is below 50% of the Line Section minimum kW load during the period when the proposed generation is available.”  Then, in December, the Hawaii PUC issued another favorable decision that broke further ground in several burgeoning interconnection issues.

Why this matters:  Hawaii has proven its place among the leaders of clean energy policy in the country. This shift away from a hard 15% (of line section peak load) interconnection screen, in favor of a more flexible 50% of minimum load screen has already begun to pique the interest of other states that are experiencing high solar adoption rates.  In other words, this development can allow more solar to safely connect to the grid, in more places.

[Continued in Newsletter]

State News in Detail

Northeast States

Massachusetts publishes solar ACP rate schedule

New York makes minor updates to the state’s interconnection requirements

Vermont plans an aggressive renewable energy goal

Mid-Atlantic States        

Maryland municipality exploring net metering options

New Jersey lauds solar programs and accomplishments

Midwestern States        

Michigan PSC approves renewable energy plan for Detroit Edison

Wisconsin improves net metering for Xcel customers

Southern States

Florida municipality okays net metering and interconnection rules

Western States             

California makes headway in interconnection reform

Other States                 

Hawaii renders final interconnection decisions

Upcoming Events

Miscellaneous News

NREL launches geospatial mapping tool for renewable energy

Download the full newsletter as a PDF: January 2012 Connecting to the Grid Newsletter

FORMAT

While customer-sited net metering and interconnection policies are primarily addressed at the state level, they are also becoming important on a regional basis. This newsletter has been designed to provide state-level policy updates and capture emerging regional trends. Connecting to the Grid is a free, electronic newsletter published each month by the Interstate Renewable Energy Council (IREC). Click here to subscribe.

Editor: Laurel Varnado

The order also allows customers to net their generation and consumption annually, “as this better meets customer expectations and encourages the installation of small distributed renewable generation.”  In other words, customers are allowed to roll over kWh credits from month to month, until the beginning of summer, when the utility will reconcile the account at the utility’s avoided cost rate.  Previously, monthly net excess generation (NEG) was monetized (at the retail rate for renewables and avoided cost rate for non-renewables) and applied to the customer’s next bill.  If the NEG exceeded $25, the utility was required to issue a check to the customer. Existing net metering customers that were enrolled under the former 20 kW limit may continue under the same tariff, at least until the PSC issues an order in Xcel’s next general rate case.

Through this proceeding, Xcel also requested that net metering generation facilities be required to match the customer’s annual load requirements.  The Commission denied this request.

The WI PSC also accepted Xcel’s proposal to modify its existing Advanced Renewable Tariff (ART). The modified ART would expand eligible technologies from three to four, with the addition of solar, and introduce a tiered structure that Xcel believes better matches production costs with generator size and reduces the levels of uncertainty around what technologies qualify for the tariff and the tariff’s subscription cap.  Though it expanded the ART, the order also granted Xcel permission to cancel the utility’s BuyBack program, because of a lack of customer participation over the eleven years of the tariff’s existence.

Source: WI PSC order for Docket 4220-UR-117

The three main decisions in this order mandate the following:

Utilities prohibited from requiring SCADA equipment on systems under 250 kW

Facilities with an aggregate capacity of greater than 250 kW in HELCO and MECO territories, and greater than 1 MW in HECO territories, will be required to install supervisory (SCADA) controls. In HECO territories, the utility will have the discretion to require SCADA on facilities larger than 250 kW, up to 1 MW. This result is consistent with IEEE standards. However, for facilities with an aggregate capacity of 250 kW or less for all three utilities SCADA controls are not required. This is significant because SCADA controls can be costly and have the ability to upend an otherwise positive financial outlook for small and medium-sized systems.

Utilities required to use voltage set points consistent with IEEE and national standards

In the event of a voltage disturbance that deviates from utility normal operating ranges, facilities equipped with UL-certified inverters will automatically disconnect the utility system.  The utilities requested the ability to require voltage set points and clearing times outside of IEEE-specified limits.  Parties objected that this would allow utilities to establish set points and clearing times outside the already broad ranges currently specified in the rule (and allowed by IEEE) and raised questions as to the potential impact on inverter warranties. The utilities were denied the ability to adjust the set points outside of IEEE-specified ranges.

Denials of interconnection request for reasons other than safety or reliability prohibited

The HECO Companies requested the ability to reject interconnection requests for a broad range of reasons, many of which went well beyond relevant considerations of facility impacts on safety and reliability. Safety and reliability concerns are already factored in to the interconnection review process and this additional language would allow the electric utilities to reject interconnection requests for economic reasons that are not well defined and are better left to the Commission’s determination as a matter of public policy.  This request was denied.

This order establishes even further precedents in Hawaii’s new cutting-edge interconnection policy, hopefully paving the way for other states to follow in its path. See Hawaii PUC order 30027 for more information.

Note from the Editor

Net Metering for $200?

If you were to pit a smart meter against an electro-mechanical meter in a game of Jeopardy, I imagine the smart meter would probably win the game.  But would it win in every category? Since there has been so much in the news about smart meters in the last few years, I decided to do a little reading on the topic and see what studies have been done on “smart” net metering.

First, I started with a quick refresher on how meters work.  Electricity meters measure the instantaneous voltage and current (in amps, or I) and use the product of these to provide readings of instantaneous electrical power (watts). Remember Ohm’s Law from high school physics class (V x I = W)?   Electro-mechanical meters operate by counting the revolutions of an aluminum disc, designed to rotate at a speed proportional to the power being pulled from (or pushed to) the grid.  (Aside: I also discovered that Samuel Gardiner was the first person to take out a patent on an electricity meter, a DC lamp-hour meter, in 1872.)

[Continued in Newsletter]

State News in Detail

Northeast States

Massachusetts DPU plans for interconnection updates

Mid-Atlantic States        

New Jersey BPU to vote on revenue-grade meter requirement

Virginia SCC approves controversial net metering standby fee

West Virginia PSC decides the fate of PURPA renewable energy credits

Midwestern States        

Advanced Renewables Tariff now available to some Michigan customers

Indiana utility-advocacy partnership proves successful for feed-in tariff improvements

Southern States           

Gainesville, FL gets recognized for per capita solar

Western States             

California Energy Commission seeks comments on Energy Policy Report

Other States                 

Hawaii PUC decision a victory for interconnection

Upcoming Events

Miscellaneous News

DOE announces Solar Roof Challenge recipients

Spain allows net metering for small solar facilities

DOE Launches Initiative To Advance Clean Energy Development On Tribal Lands

Industrial DG expected to grow 46-85% in the coming years

Download the full newsletter as a PDF:  December 2011 Connecting to the Grid Newsletter

FORMAT

While customer-sited net metering and interconnection policies are primarily addressed at the state level, they are also becoming important on a regional basis. This newsletter has been designed to provide state-level policy updates and capture emerging regional trends. Connecting to the Grid is a free, electronic newsletter published each month by the Interstate Renewable Energy Council (IREC). Click here to subscribe.

Editor: Laurel Varnado

This program allows electric customers to sell the output of customer-owned solar generating systems to Consumers Energy for a fixed price over a contract length of 15 years. Applications for this next phase of the EARP must be submitted by Jan. 12, 2012.

A new website was launched to provide information on this renewable energy program. That address is: www.consumersenergy.com/EARP.

About 85 Michigan residents have installed their own solar energy systems during previous phases of this program.

Consumers Energy, the principal subsidiary of CMS Energy, provides natural gas and electricity to 6.8 million of Michigan’s 10 million residents in all 68 Lower Peninsula counties.

Source: PR Newswire

All systems that do not have a revenue-grade meters that meet the American National Standards Institute (ANSI) Standard C12.1-2008 must have one installed within 6 months from the rule adoption.  Following that date, SRECs will only be issued to systems based upon readings reported from a revenue grade meter measuring the system output.

This rule proposal is expected to be adopted by the NJBPU in December 2011, in which case a revenue-grade meter would be required to be installed no later than June 30, 2012.  Readings based on the meters will need to begin on the 1st day of the month following installation (i.e., if your meter is installed on May 10, 2012 then you will be required to begin reporting your generation from the meter as of June 1, 2012).

This rule will not really affect newer systems but it is however an issue for systems that went in under the old REIP and CORE programs since these systems were permitted to use production estimates for SREC creation.

The proposal can be found here.

Source: Renewable Energy World, Justin Barnes, NC Solar Center

Through Case number PUE-2011-00088, Dominion Power sought approval of a standby charge consisting of a $2.79 per kilowatt distribution-related component, a $1.40 per kilowatt transmission-related component, and a $0.00 per kilowatt generation-related “placeholder” component. In approving the methodology, the Commission stated in its final order that, “the evidence in this record indicates that any avoided cost benefits provided by customer-generators, at least in terms of the transmission and distribution grid, are insufficient to pay for their proportionate share of the grid.”

The Commission did not approve the company’s request for a generation component of the standby charge. Although the company wanted that component to be set at $0 for now, the Commission directed the company file a future request that evaluates both the generation costs and benefits associated with serving eligible customer-generators.

The Commission also encourages the consideration and adoption of alternative methodologies in subsequent proceedings that could mitigate the standby charge by weighing the potential avoided costs and benefits to the company from having net-metered customer-generators selling energy and capacity back into the company’s system.

Source: Virginia SCC Press Release

IREC played a central role in drafting revisions to Rule 14H, including updating the technical review screens, introducing a supplemental review process, and improving the interconnection study process. With the Commission’s approval of these features, Hawaii dramatically improves its interconnection standards. In the 2011 edition of Freeing the Grid, which went to print before the Commission approved these changes, Hawaii received an “F” for its interconnection policies. After the Commission’s order, Hawaii’s will now earn a “B” for interconnection.

The key reasons for Hawaii’s dramatic grade improvement are discussed briefly below.

Hawaii’s score for “Technical Screens” in FTG jumps from “-2” to “1” point

One of the most significant shortcomings of Rule 14H was the fact that it did not feature objective technical screens for evaluating fast track interconnections. Revised Rule 14H includes nine technical screens that are based closely on California’s Rule 21 interconnection process, with an improvement to the “penetration” screen that constitutes a new best practice. Although Rule 14H employs the standard “penetration” screen that allows a generator to interconnect on a more expedited basis so long as aggregate generating capacity is equal to or less than 15% of the line section peak load, a supplemental review process that has been incorporated into Rule 14H will allow a generator to avoid more intensive study if the “aggregate capacity per Line Section is below 50% of the Line Section minimum kW load during the period when the proposed generation is available (including noon on Sunday for solar photovoltaic systems).” This approach is far less restrictive than FERC’s pro forma SGIP and results in awarding a bonus point.

Revised Rule 14H Timelines improve upon the SGIP to earn “1” point

Previously, Rule 14H had few definite timeframes for completion of the interconnection process. Revised Rule 14H has clear timelines for when an application must be deemed complete, examined through initial review, processed through supplemental review, or moved on to a more intensive interconnection requirements study (IRS). Under the revised rules, an IRS must be completed within 150 calendar days of the time a customer agrees to proceed with the IRS and pays for the study. The maximum time under Rule 14H to complete the IRS is significantly shorter than the maximum time that may be required under the SGIP, which is calculated in business days.

Revised Rule 14H features several breakpoints

Although revised Rule 14H does not feature distinct levels of review like SGIP—demarcated by generator size—the Rule 14H technical screens make two distinctions based on generator size that reduce the scrutiny of the initial review process for smaller generators. For inverter-based generators 10 kW or less, Rule 14H will allow these generators to skip screens 7-9 and proceed directly to simplified interconnection. For inverter-based generators less than 250 kW that meet both IEEE 1547 and UL 1741 standards, revised Rule 14H will allow these generators to skip screen 8, which addresses short circuit contribution ratios.

Note from the Editor

A Veritable Feast of Community Renewables

For this month of Thanksgiving, I thought I’d bring you an update on one of our most neighborly news topics: Community Renewables and Meter Aggregation.  There’s been so much happening lately that it’s difficult to keep up with all of it.  There are also a lot of ongoing dockets pertaining to community renewables, so even after the laws get signed, there’s still quite a bit of work to do before tariffs are in place and it’s legal to engage in these fun, new policies.  There are as many variations on community renewables as there are policies, but I usually consider Community Renewables to include most types of net metering expansions such as joint billing, meter aggregation and virtual net metering, among others. A few recent regulatory updates of note:

Colorado Solar Gardens – Back in June of last year, Colorado enacted the Community Solar Gardens Act, which defined a solar garden as a community-owned solar array with at least 10 grid-connected “subscribers” within Xcel or Black Hills Energy territory. Each subscriber would own or lease one or more solar panels, and receive credit for electricity the panels produce. The Public Utilities Commission still has yet to finalize rules for this legislation but that hasn’t stopped towns and cities from going ahead with their own version of solar gardens.  Colorado Springs recently announced the approval of a solar garden to serve its city’s residents and several other Colorado cities, towns and counties including Boulder, Antonito and Saguache County are also in the solar garden planning process.

[Continued in Newsletter]

State News in Detail

Northeast States           

NY utility seeks to modify net metering tariffs

Mid-Atlantic States         

Maryland Governor seeking to include renewables in RFP

Virginia SCC to hold hearing on stand-by charges for net metering customers; Dominion asks SCC to approve community solar pilot

Midwestern States          

Illinois takes one step forward and five steps backward with net metering

Michigan PSC notes another rise in net metering customers

Southern States               

Georgia Commissioner calls for more solar

Western States                                

California’s SDG&E appeals for network use charge which could penalize net metering customers

Nevada PUC begins rulemaking for net metering changes

Other States                      

Hawaii to host smart grid/renewables test facility

Upcoming Events

IREC News

Freeing the Grid 2011 – Download your copy today!

Miscellaneous News

Assessing the Role of Distributed Power Systems in the U.S.

Report: Reviving PURPA’s Purpose

Download the full newsletter as a PDF:  November 2011 Connecting to the Grid Newsletter

FORMAT

While customer-sited net metering and interconnection policies are primarily addressed at the state level, they are also becoming important on a regional basis. This newsletter has been designed to provide state-level policy updates and capture emerging regional trends. Connecting to the Grid is a free, electronic newsletter published each month by the Interstate Renewable Energy Council (IREC) and the North Carolina Solar Center at North Carolina State University. Click here to subscribe.

Editor: Laurel Varnado
NC Solar Center, NC State University