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BILL AS INTRODUCED 2007-2008

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H.225

Introduced by Representative Dostis of Waterbury and Errecart of Shelburne

Referred to Committee on

Date:

Subject:  Public service; net metering; anemometers; biofuels; renewable energy; inclining electricity rates

Statement of purpose:  This bill proposes to require the state to increase the extent to which it purchases biofuels for state use for transportation or space heating purposes.  It proposes to require the public service board to establish parameters for rate design that would establish increasing block rates for residential and commercial electricity usage, and then would require the board to assure that individual utilities develop inclining block residential rates consistent with the parameters.  As a result, residential and commercial customers that consume more electricity, with necessity exceptions, shall be charged rates that increase in blocks as their rates of consumption increase.  It proposes to expand the net metering law to allow group metering within the same utility service area, to increase to 250 kW the maximum size of a generator that may be eligible for the program, and to increase the cap on how much net metering a distribution company must accommodate.  It proposes to establish a mini-248 review process for the temporary siting of anemometers.  It proposes to establish a biofuels study commission with a mandate to recommend an appropriate minimum biodiesel content requirement for diesel fuel and home heating fuel sold at retail in the state, to be effective on January 1, 2009; together with a plan for implementation of the recommendations.  Finally, it proposes to appropriate funds to assist communities in assessing their renewable energy resources and their potential for development.

AN ACT RELATING TO INCREASING ACCESS TO RENEWABLE RESOURCES

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

Sec. 1.  29 V.S.A. § 903(h) is added to read:

(h)  The commissioner of buildings and general services shall increase significantly the extent to which biofuels are purchased for state use for transportation purposes and for space heating purposes.  This rate of increased purchase shall continue to increase as biofuels are produced in the state.

Sec. 2.  30 V.S.A. § 218(b) is amended to read:

(b)  The department of public service shall propose, and the board through the establishment of rates of return, rates, tolls, charges, or schedules shall encourage the implementation by electric and gas utilities of energy-efficiency and load management measures which will be cost-effective for the utilities and their customers on a life cycle cost basis.  The board shall approve rate designs to encourage the efficient use of natural gas and electricity, including consideration of the creation of an inclining block rate structure for residential rate customers with an initial block of low-cost power available to all residences.  This inclining block structure for residential and commercial rate customers shall be developed as follows:

(1)  The public service board shall host one or more workshops on the issue, and by no later than January 15, 2008, shall adopt rules or orders that establish the parameters for residential and commercial inclining block rate designs, which shall include exemptions for situations in which special health needs or another extraordinary situation justifies a significant demand for electricity that, in fairness, should not be subject to inclining rates.

(2)  The board shall require a retail company to upgrade its rates as necessary to reflect the residential and commercial inclining block parameters by a specified date, or as part of its next rate-related appearance before the board, or according to a timetable otherwise specified by the board.

Sec. 3.  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;

* * *

(4)  “Farm system” means a facility of no more than 150 250 kilowatts (AC) output capacity, except as provided in subdivision (k)(5) of this section, 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 or has entered into a contract as specified in subsection (k) of this section.

(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.

* * *

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

(1)  Net metering customers that are farm 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 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 or group net metering system 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 shall revert to the electric company without any compensation to the farm or group net metering system.  Power reverting to the electric company under this subdivision (3) shall be considered SPEED resources under section 8005 of this title.

(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 shall be associated with the farm buildings and residences owned or occupied by the person operating the farm or group net metering system, or the person’s family or farm employees, or other members of the group, 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 or group net metering system net metering; 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 or group net metering system.

(5)  A group net metering system may consist only of customers that are located within the service area of the same electric company.

(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 output capacity of net metering systems equals 1.0 2.0 percent of the distribution company’s peak demand during 1996; or the peak demand during the most recent full calendar year, whichever is greater.  The board may raise the 1.0 2.0 percent cap.  In determining whether to raise 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 metering, meter reading, accounting, account correcting, and account maintenance of net metering arrangements of greater than 15 kilowatt (AC) capacity;

(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;

(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 net metering of greater than 15 kilowatt (AC) capacity;

(I)  Shall receive from a farm or group net metering 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 or group net metering system is eligible.  All other farm or group net metering systems shall retain any tradeable renewable credits for which the farm or group 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.

* * *

(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 or group net metering system, provided:

(1)  the farm or group 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 or group net metering system is eligible to be transferred to the electric company;

(5)  the output capacity of a system may exceed 150 250 kilowatts, provided:

(A)  the contract assigns the amount of power to be net metered;

(B)  the net metered amount does not exceed 150 250 kilowatts; and

(C)  only the amount assigned to net metering is assessed to the cap provided in subdivision (h)(1)(A) of this section.

Sec. 4.  30 V.S.A. § 246 is added to read:

§ 246.  TEMPORARY SITING OF ANEMOMETERS

(a)  The public service board shall establish by rule or order standards and procedures governing application for, and issuance or revocation of, a certificate of public good for the temporary installation of one or more anemometers under the provisions of section 248 of this title.  An anemometer shall be deemed to promote the public good of the state if it is in compliance with the criteria of this section and the board rules or orders.  An applicant for a certificate of public good for an anemometer shall be exempt from the requirements of subsection 202(f) of this title.

(b)  In developing those rules or orders, the board:

(1)  shall develop a simple application form and shall require that completed applications be filed with the board, the department of public service, the agency of natural resources, and the municipality in which the anemometer is proposed to be located.

(2)  shall require that if no objections are filed within 30 days of the board’s receipt of an application, the certificate of public good shall be issued for a period of 18 months, which may be renewed.  Upon expiration of the certificate, the tower on which the anemometer is situated shall be removed.

(3)  shall take appropriate steps under section 248 of this title, if one or more objection is filed within 30 days of the board’s receipt of an application or upon the board’s own motion.

(4)  may waive the requirements of section 248 of this title that are not applicable to anemometers, including criteria that are generally applicable to public service companies as defined in this title.

(5)  may modify notice and hearing requirements of this title as it deems appropriate.

(6)  shall seek to simplify the application and review process in conformance with this section as appropriate.

(7)  shall find that these rules are consistent with state power plans.

Sec. 5.  BIOFUELS STUDY COMMISSION

(a)  There is established a biofuels study commission to consist of the following:  two members of the senate appointed by the committee on committees; two members of the house appointed by the speaker of the house; the secretary of natural resources, or a designee; the secretary of transportation, or a designee; the secretary of agriculture, food and markets, or a designee; the commissioner of public service, or a designee; the commissioner of buildings and general services, or a designee; a representative of a fuel dealers’ association, appointed by the governor; a representative of a biofuels’ association, appointed by the governor; and two members of the public appointed by the governor.

(b)  As used in this section, “biodiesel” means a renewable, biodegradable, mono alkyl ester combustible liquid fuel derived from vegetable oil or animal fat which meets the American Society for Testing and Materials (ASTM)

specification D6751-02 for Biodiesel Fuel (B100) Blend Stock for Distillate

Fuel.

(c)  The commission shall study issues relating to:  the extent to which biodiesel is useful in replacing petroleum; the amount of energy required in the manufacturing and delivery of commercial quantities of biodiesel; the extent to which biodiesel is manufactured in the state or in proximity to the state; the management of biodiesel at existing service stations and the blending of biodiesel together with traditional diesel fuel; the extent to which biodiesel is required to be provided in other states; the management of quantities of biodiesel at facilities operated by the agency of transportation or the department of buildings and general services, or both; and the experience of other states in implementing biodiesel requirements.  Upon consideration of these issues and others deemed relevant by the commission, the commission, by no later than January 15, 2008, shall submit to the general assembly the following:

(1)  recommendations as to the most appropriate minimum percentage biodiesel content the state should require of all retail sellers of diesel fuel and home heating fuel in the state, to be effective by January 1, 2009;

(2)  a plan for implementing this requirement by that date, together with appropriate time lines for the completion of particular steps of that implementation plan.

(d)  The commission may elect a chair and a vice chair and may hold public hearings.  Legislative council shall provide support for the committee, which also shall be entitled to the assistance of the agency of natural resources, the agency of transportation, the agency of agriculture, food, and markets, and the department of taxes.

(e)  Vacancies on the commission shall be appointed in the same manner as original appointments.

(f)  Legislative members are entitled to per diem payment and reimbursement for expenses pursuant to 2 V.S.A. § 406.

Sec. 6.  APPROPRIATION FOR COMMUNITY RENEWABLE ENERGY

            ASSISTANCE

The sum of $200,000.00 is appropriated during fiscal year 2008 from the Vermont clean energy development fund established under 10 V.S.A. § 6523 to the commissioner of public service for purposes of providing communities with assistance in assessing their renewable energy resources and the potential for development of those resources, and to the extent that funds are available, assistance in developing those projects.  The commissioner may solicit proposals from new or existing organizations who desire to assume the responsibility to provide these services and, upon determining that a particular organization is well qualified to do so, and the best among the applicants, may transfer the appropriations to that organization.



Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont


www.leg.state.vt.us