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S.319`

Introduced by  Committee on Economic Development, Housing and General Affairs

Date:

Subject:  Public service; net metering

Statement of purpose:  This bill proposes to increase to 250 kilowatts the maximum amount of power that may be generated by a participant in the net metering program.  It also proposes to add new hydroelectric facilities to the list of eligible technologies in the net metering program.  It increases the cap on net metering systems within a service area from one percent to three percent of the peak 1996 demand or three percent of the peak demand of the most recent calendar year, whichever is greater.  It proposes to remove the provision that required that the electric company be a joint petitioner on any petition to the board to exceed this capacity.  It proposes to allow group net metering for other than farm applicants.  It proposes to repeal provisions pursuant to which extra credits revert to the electric company.  Instead, the bill proposes to establish a rolling 12-month credit, and provides that unused credits shall be purchased by the electric company at 95 percent of the average Vermont locational marginal price for wholesale electricity for the preceding year.  These purchases by an electric company shall be eligible for credit as SPEED resources.  Finally, it proposes, in the case of three-phase line upgrades to serve farm net metering systems, to allow the public service board to weigh the costs and benefits and when the benefits outweigh the costs, to spread to the general public the costs of these upgrades.

AN ACT RELATING TO EXPANDING THE SCOPE OF THE NET METERING PROGRAM

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  30 V.S.A. § 219a is amended to read:

§ 219a.  SELF-GENERATION AND NET METERING

(a)  As used in this section:

(1)  “Customer” means a retail electric consumer who uses a net metering system.

(2)  “Net metering” means measuring the difference between the electricity supplied to a customer and the electricity fed back by a net metering system during the customer’s billing period:

(A)  using a single, nondemand meter or such other meter that would otherwise be applicable to the customer’s usage but for the use of net metering; or

(B)  on farm or group systems, using multiple meters as specified in this chapter.  The calculation will be made by converting all meters to a nondemand, nontime-of-day meter, and equalizing them to the tariffed kilowatt-hour rate.

(3)  “Net metering system” means a facility for generation of electricity that:

(A)  is of no more than 15 250 kilowatts (AC) capacity, or is a farm system;

(B)  operates in parallel with facilities of the electric distribution system;

(C)  is intended primarily to offset part or all of the customer’s own electricity requirements;

(D)  is located on the customer’s premises or on premises leased by a group system; and

(E)  employs a renewable energy source and utilizes a photovoltaic array, wind turbine, new hydroelectric, fuel cell, or biomass gasification and farm electrical generating technology.

(4)  “Farm system” means a facility of no more than 150 kilowatts (AC) capacity that generates electric energy on a farm operated by a person principally engaged in the business of farming, as that term is defined in Regulation 1.175-3 of the Internal Revenue Code of 1986, from the anaerobic digestion of agricultural products, byproducts, or wastes, or other renewable sources as defined in subdivision (3)(E) of this subsection, intended to offset the meters designated under subdivision (g)(1)(A) of this section on the farm.

(5)  “New hydroelectric” means a hydroelectric facility that produces power for the first time after January 1, 2006.

(b)  A customer shall pay the same rates, fees, or other payments and be subject to the same conditions and requirements as all other purchasers from the electric company in the same rate-class, except as provided for in this section, and except for appropriate and necessary conditions approved by the board for the safety and reliability of the electric distribution system.

(c)  The board shall establish by rule or order standards and procedures governing application for, and issuance or revocation of a certificate of public good for net metering systems under the provisions of section 248 of this title.  A net metering system shall be deemed to promote the public good of the state if it is in compliance with the criteria of this section, and with board rules or orders.  In developing such rules or orders, the board:

(1)  may waive the requirements of section 248 of this title that are not applicable to net metering systems, including, but not limited to, criteria that are generally applicable to public service companies as defined in this title;

(2)  may modify notice and hearing requirements of this title as it deems appropriate;

(3)  shall seek to simplify the application and review process as appropriate; and

(4)  shall find that such rules are consistent with state power plans.

(d)  An applicant for a certificate of public good for a net metering system shall be exempt from the requirements of subsection 202(f) of this title.  Any certificate issued under this section shall be automatically transferred to any subsequent owner of the property served by the net metering system, provided, in accordance with rules adopted by the board, the board and the electric company are notified of the transfer, and the subsequent owner agrees to comply with the terms and conditions of the certificate.

(e)  Consistent with the other provisions of this title, electric energy measurement for net metering systems using a single nondemand meter that are not farm or group systems shall be calculated in the following manner:

(1)  The electric company which serves the net metering customer shall measure the net electricity produced or consumed during the customer’s billing period, in accordance with normal metering practices.

(2)  If the electricity supplied by the electric company exceeds the electricity generated by the customer and fed back to the electric distribution system during the billing period, the customer shall be billed for the net electricity supplied by the electric company, in accordance with normal metering practices.

(3)  If electricity generated by the customer exceeds the electricity supplied by the electric company:

(A)  The customer shall be billed for the appropriate charges for that month, in accordance with subsection (b) of this section;

(B)  The customer shall be credited for the excess kilowatt-hours generated during the billing period, with this kilowatt-hour credit appearing on the bill for the following billing period; and

(C)  At the beginning of each calendar year, any remaining unused kilowatt-hour credit accumulated during the previous year Any accumulated kilowatt-hour credits shall be used within 12 months.  If those credits are not used within that time, they shall revert to the electric company, without any compensation to the customer be purchased by the electric company at 95 percent of the average Vermont locational marginal price for wholesale electricity for the preceding year.  Purchases under this subdivision shall be eligible for credits under section 8005 of this title as SPEED resources.

(4)  For net metering systems using time of day, demand, or other types of metering, the board shall specify the manner of measurement and the application of bill credits for the electric energy produced or consumed in a manner substantially similar to that specified in this subsection for use with a single nondemand meter.

(f)  Consistent with the other provisions of this title, electric energy measurement for net metering farm systems or group net metering systems shall be calculated in the following manner:

(1)  Net metering customers that are farm systems or group net metering systems may credit on-site generation against all meters designated to the farm system or group net metering system under subdivision (g)(1)(A) of this section;

(2)  Electric energy measurement for farm systems or group net metering systems shall be calculated by subtracting total usage of all meters included in the farm or group net metering system from total generation by the farm or group net metering system.  If the electricity generated by the farm or group net metering system is less than the total usage of all meters included in the farm or group net metering system during the billing period, the farm system or group shall be credited for any accumulated kilowatt-hour credit and then billed for the net electricity supplied by the electric company, in accordance with the procedures in subsection (g) of this section.

(3)  If electricity generated by the farm or group net metering system exceeds the electricity supplied by the electric company:

(A)  The farm or group net metering system shall be billed for the appropriate charges for each meter for that month, in accordance with subsection (b) of this section.

(B)  Excess kilowatt-hours generated during the billing period shall be added to the accumulated balance with this kilowatt-hour credit appearing on the bill for the following billing period.

(C)  Any accumulated kilowatt-hour credits shall be used within 12 months or.  If those credits are not used within that time, they shall revert to the electric company without any compensation to the farm system be purchased by the electric company at 95 percent of the average Vermont locational marginal price for wholesale electricity for the preceding year. Purchases under this subdivision shall be eligible for credits under section 8005 of this title as SPEED resources.

(g)(1)  In addition to any other requirements of section 248 of this title and this section and board rules thereunder, before a net metering farm or group net metering system including more than one meter may be formed and served by an electric company, the proposed net metering farm or group net metering system shall file with the board, with copies to the department and the serving electric company, the following information:

(A)  the meters to be included in the farm or group net metering system, which in the case of a farm system shall be associated with the farm buildings and residences owned or occupied by the person operating the farm system, together with the person’s family or farm employees, and which in the case of a group net metering system shall be associated with the buildings and residences that are part of the group net metering system, all of which shall be identified by account number and location;

(B)  a method for adding and removing meters included in the farm or group net metering system;

(C)  a designated person responsible for all communications from the farm or group net metering system to the serving electric company, for receiving and paying bills for any service provided by the serving electric company for the farm or group net metering system, and for receiving any other communications regarding the farm system net metering or group net metering system; and

(D)  a binding process for the resolution of any disputes within the farm or group net metering system relating to net metering that does not rely on the serving electric company, the board, or the department.

(2)  The farm or group net metering system shall, at all times, maintain a written designation to the serving electric company of a person who shall be the sole person authorized to receive and pay bills for any service provided by the serving electric company, and for receiving to receive any other communications regarding the farm system, the group net metering system, or net metering.

(3)  The serving utility shall implement appropriate changes to the farm system or group net metering system within 30 days after receiving written notification from the designated person.  However, written notification of a change in the person designated under subdivision (2) of this subsection shall be effective upon receipt by the serving utility.  The serving utility shall not be liable for action based on such notification, but shall make any necessary corrections and bill adjustments to implement revised notifications.

(4)  Pursuant to subsection 231(a) of this title, after such notice and opportunity for hearing as the board may require, the board may revoke a certificate of public good issued to a farm system.

(h)(1)  An electric company:

(A)  Shall make net metering available to any customer using a net metering system, group net metering system, or farm system on a first-come, first-served basis until the cumulative generating capacity of net metering systems equals 1.0 3.0 percent of the distribution company’s peak demand during 1996; or 3.0 percent of the peak demand during the most recent full calendar year, whichever is less greater; provided, however, an electric company and or a farm or group net metering system may jointly petition the board to exceed this capacity.  In determining whether to exceed the cap, the board shall consider the following:

(i)  the costs and benefits of net metering systems already connected to the system; and

(ii)  the potential costs and benefits of exceeding the cap, including potential short and long-term impacts on rates, distribution system costs and benefits, reliability, and diversification costs and benefits;

(B)  Shall allow net metering systems to be interconnected using a kilowatt-hour meter capable of registering the flow of electricity in two directions or such other comparably equipped meter that would otherwise be applicable to the customer’s usage but for the use of net metering;

(C)  May, at its own expense, and with the written consent of the customer, install one or more additional meters to monitor the flow of electricity in each direction;

(D)  Shall charge the customer a minimum monthly fee that is the same as for other customers of the electric distribution company in the same rate class, but shall not charge the customer any additional standby, capacity, interconnection, or other fee or charge;

(E)  May charge reasonable fees for interconnection, establishment, special meter reading, accounting, account correcting, and account maintenance of farm or group net metering system net metering arrangements;

(F)  May charge, if the capacity of the distribution system is insufficient for the designed generation, subject to determination by the board, a reasonable fee to cover the cost of electric company improvements necessary to distribute power; provided, however, that if the costs incurred are those of a three-phase line upgrade to serve a net metered system on a farm and the board determines that the environmental, social, system reliability, and other benefits to the ratepayers outweigh the financial costs, those costs shall be allocated, as determined by the board, in the company’s general rates and shall not be assessed against the owner of the farm energy system;

(G)  May require that all meters included within a farm or group net metering system be read on the same billing cycle;

(H)  May book and defer, with carrying costs, additional incremental costs, to the extent that such costs are not recovered through charges, authorized in subdivisions (D), (E), and (F) of this subdivision (1), directly related to implementing farm system or group net metering systems;

(I)  Shall receive from a farm system, which is designed to produce less energy than the total annual load of the meters identified in subdivision (g)(1)(A) of this section, any tradeable renewable credits for which the farm  system is eligible.  All other farm systems shall retain any tradeable renewable credits for which the farm is eligible;

(2)  All such requirements shall be pursuant to and governed by a tariff approved by the board and any applicable board rule, which tariffs and rules shall be designed in a manner reasonably likely to facilitate net metering.

(i)(1)  A net metering system using photovoltaic generation shall conform to applicable electrical safety, power quality, and interconnection requirements established by the National Electrical Code, the Institute of Electrical and Electronic Engineers, and Underwriters Laboratories.  The customer shall be responsible for installation, testing, accuracy, and maintenance of net metering equipment.

(2)  By March 1, 1999, the board shall adopt, by rule or order, electrical safety, power quality, and interconnection requirements for net metering equipment which uses generation technologies other than photovoltaic technology.  In developing safety rules, and any amendments to those rules, the board shall solicit input from representatives of utilities and agents representing line workers.

(3)  The board may adopt, by rule or order, additional safety, power quality, and interconnection requirements for customers that the board determines are necessary to protect public safety and system reliability.

(4)  Pending the effective date of requirements adopted by the board under subsection (c) of this section and subdivision (2) of this subsection, an electric company may allow a customer to interconnect a net metering system, to be operated as provided in this section, if the company is reasonably satisfied concerning the safety and power quality of the system.  The customer may then operate the net metering system pending application for and receipt of a certificate of public good under subsection (c) of this section, provided such application shall be made within three months after the effective date of requirements adopted by the board under subsection (c).

(5)  An electric company may, at its own expense, and upon reasonable written notice to the customer, perform such testing and inspection of a net metering system in order to confirm that the system conforms to applicable electrical safety, power quality, and interconnection requirements.

(j)  Notwithstanding the provisions of this section that define a net metering system as being of no more than 15 kilowatts (AC) capacity, the board may allow net metering for up to ten systems per year for customers that produce more than 15 kilowatts (AC) capacity, but do not produce more than 150 kilowatts of power and are not farm systems.

(k)  Notwithstanding the provisions of subsections (f) and (g) of this section, an electric company may contract to purchase all or a portion of the output products from a farm any net metering system, provided:

(1)  the farm net metering system obtains a certificate of public good under the terms of subsections (c) and (d) of this section;

(2)  any contracted power shall be subject to the limitations set forth in subdivision (h)(1) of this section;

(3)  any contract shall be subject to interconnection and metering requirements in subdivisions (h)(1)(C) and (i)(2) and (3) of this section;

(4)  any contract may permit all or a portion of the tradeable renewable energy credits for which the farm net metering system is eligible to be transferred to the electric company.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us