Advancing Renewables in the Midwest March 28, 2007 2005 Energy Policy Act Provisions By Warren Wood,...

Advancing Renewables in the Midwest

March 28, 2007

2005 Energy Policy Act Provisions

By Warren Wood, PEDirector, Utility Operations Division

Missouri Public Service Commission - Staff

Energy Policy Act 2005 (EPAct 05)

Provisions I Will Cover:

Net Metering

Interconnection

Fuel Diversity

Fuel Efficiency

Smart Metering

Topics

Net Metering Equipment

House Power Panel

To Utility

Meter for Power in Both Directions

Isolation Switch

Optional Meter

Inverter

EPAct Net Metering Provision

Section 1251 – PURPA Section 111(d) Amendment

(11) NET METERING – Each electric utility shall make available upon request net metering service to any electric consumer that the electric utility serves. For purposes of this paragraph, the term ‘net metering service’ means service to an electric consumer under which electric energy generated by that electric consumer from an eligible on-site generating facility and delivered to the local distribution facilities may be used to offset electric energy provided by the electric utility to the electric consumer during the applicable billing period.

Legislation:

Following the 2001-2002 legislative session, the governor

signed into law Section 386.887 (RSMo 2002 Supp) – the

“Consumer Clean Energy Act”. The provisions of this

legislation (HB 1402) were hotly debated by numerous

parties due to the limitations that this legislation contained

that largely mimic the Public Utility Regulatory Policy Act

(PURPA) regarding interconnection of alternative energy

sources and appropriate compensation for excess generation.

Net Metering Legislation - MO

Section 386.887 “Consumer Clean Energy Act”• Permits interconnection of customer-generators with

systems below 100 kW in size that are a hydrogen fuel cell or powered by sun, wind or biomass.

• Permits interconnection with all “retail electric suppliers” including IOUs, munis and coops.

• Requires measurement of power delivered to grid by customer generator and delivered to customer-generator by supplier separately.

• Applies retail rates (~0.08 $/kWh) to customer generator supplied power and avoided rates (~0.02 $/kWh) to customer generator delivered power.


“Consumer Clean Energy Act” – continued• Limits participation to the lesser of 0.1% of previous

year peak or 10,000 kW.• Requires adherence to safety standards established by

PSC, NESC, IEEE, UL and all reasonable standards and requirements established by retail electric supplier.

• Requires customer-generator to obtain liability insurance in amount set by PSC.

• Requires PSC development of a contract for transactions between the customer-generator and retail electric supplier.


Rule 4 CSR 240-20.065:RSMO Section 386.887 required that the PSC develop rules for interconnection related to safety, contracts, certification and liability insurance. Technical conferences including representatives from a broad array of interest were active in these working meetings. The final outcome of these meetings was rule 4 CSR 240-20.065.

Missouri PSC Rules

4 CSR 240-20.065 “Net Metering”• Duplicates much of RSMo 386.887 in PSC rules.• Implements $100,000 liability insurance requirement.• Creates contract for transactions between retail electric

supplier and consumer generator.• Contract Provisions Include:

• Installation/Hardware Compliance• Operation/Disconnection/Termination Rights• Transfer of Ownership• Dispute Resolution

Missouri PSC Rules

“Net Metering” – continued• Contract Provisions – continued

• Inspection and Certification

• Testing Recording & Reporting Requirements

Missouri PSC Rules

EPAct Interconnection Provisions


(15) INTERCONNECTION – Each electric utility shall make available, upon request, interconnection service to any electric consumer that the electric utility serves. For purposes of this paragraph, the term ‘interconnection service’ means service to an electric consumer under which an on-site generating facility on the consumer’s premises shall be connected to the local distribution facilities. Interconnection services shall be offered based upon the standards developed by the Institute of Electrical and Electronics Engineers: IEEE Standard 1547 for Interconnecting Distributed Resources with Electric Power Systems, as they may be amended from time to time.



(15) INTERCONNECTION – continued

In addition, agreements and procedures shall be established whereby the services offered shall promote current best practices of interconnection for distributed generation, including but not limited to practices stipulated in model codes adopted by associations of state regulatory agencies. All such agreements and procedures shall be just and reasonable, and not unduly discriminatory or preferential.


Note difference in IEEE Standards:

EPAct Refers to IEEE Standard 1547 for Interconnecting

Distributed Resources with Electric Power Systems

Current PSC Rule Refers to IEEE Standard 929-2000 and

UL 1741.

Interconnection Equipment:• Energy source and conversion to electricity.• Inverter for alternating current conversion,

synchronization, isolation, and safety.• Isolation switch for disconnect from power panel.• Optional meter for measuring power generated.• Optional batteries for energy storage and backup power.• Optional alternative energy source for backup power.

Interconnection Equipment

Example Projects: Governor Office Building



Inverter


Isolation Switch


(12) FUEL SOURCES – Each electric utility shall

develop a plan to minimize dependence on 1 fuel

source and to ensure that the electric energy it

sells to consumers is generated using a diverse

range of fuels and technologies, including

renewable technologies.

EPAct Fuel Diversity Provisions

Missouri’s Electric Generation Resources

Regulated Investor Owned Utilities (IOUs) – AmerenUE, Kansas City Power & Light, Aquila MPS and L&P, Empire District Electric

CooperativesMunicipals Independent Power ProducersOut of State Generation Under Contract –

(SWPA, GRDA, etc…)

Which Resource Is “Best”?

Generation Fuel Diversity

MO Public Service Commission Rule 4 CSR 240-22 “Integrated Resource Planning” (IRP) Rule

IRP rule includes provisions for assessment of diverse fuel sources, including renewable resources.


Parties to IRP proceedings before our Commission are very familiar with renewable energy technology options and the costs and benefits of each.

Delivered cost of energy, environmental impacts and reliability are all of great importance to the Commission.


Renewable energy sources are continuing to receive greater attention. Currently 3 to 4 percent of energy in Missouri is from renewable sources.– Wind (fastest growing sector)– Landfill & Biomass Gas Projects– Ethanol (& related power generation)– Existing Hydro (no new dams)

Shows sources for plants in Missouri in 2001

Coal – almost 2/3

Gas – 14%

Other sources: oil, nuclear, and

hydro.

Missouri Generating Capability (MW) By Primary Energy Source

Missouri Generation (MWh) By Energy Source

MO plants only

Proportion of energy generated by coal (83.5%) exceeds coal capacity (65.1%) because coal plants have lower variable cost (except for nuclear) so are dispatched first.

Source: Energy Information Administration, Form EIA-860, "Annual Electric Generator

Report."


(13) FOSSIL FUEL GENERATION

EFFICIENCY – Each electric utility shall

develop and implement a 10-year plan to

increase the efficiency of its fossil fuel

generation.

EPAct Fuel Efficiency Provisions

MO Public Service Commission Rule 4 CSR 240-22 “Integrated Resource Planning” (IRP) Rule

IRP rule includes provisions for assessment of generation unit efficiency.


Generation unit efficiency is of great importance to utilities and customers. As emissions regulations continue to tighten, this will only be more true.

Electric Fuel Adjustment Clauses heighten the need to have regulatory provisions in place to assure continued generation unit efficiency.


PURPA Section 111(d) Amendment(14) TIME-BASED METERING AND COMMUNICATIONS –

(A) Not later than 18 months after the date of enactment of this paragraph, each electric utility shall offer each of its customer classes, and provide individual customers upon customer request, a time-based rate schedule under which the rate charged by the electric utility varies during different time periods and reflects the variance, if any, in the utility’s costs of generating and purchasing electricity at the wholesale level. The time-based rate schedule shall enable the electric consumer to manage energy use and cost through advanced metering and communications technology.

EPAct Smart Metering Provisions

Smart Metering System Example

Smart Metering

All of Missouri’s Investor Owned Electric Utilities have optional time of use rates. – These tariff provisions may not be available to

residential customers.– These tariff provisions may not provide an

option for variable rates on an hour-by-hour basis.

Our Commission is very interested in this topic and smart metering is the subject of a current EPAct case with our agency.

Smart Metering

A pilot program is currently ongoing in Missouri. A number of issues come up in smart metering discussions.– Metering Costs– Rate Differentials – Customer Communications Portals– Levels of Demand Response– Customer Interest and Retention Rates– Automatic vs Manual Response Schemes

EPAct Prior State Action Provision

Prior State Action (for section to not apply):

(1) The State has implemented for such utility the standard concerned (or a comparable standard);

(2) The State regulatory authority for such State or relevant nonregulated electric utility has conducted a proceeding to consider implementation of the standards concerned (or a comparable standard); or

(3) the State Legislature has voted on the implementation of such standard (or a comparable standard).

Net Metering: Commence Consideration by August ’07Determination by August ‘08

Interconnection: Commence Consideration by August ‘06Determination by August ‘07

Fuel Diversity: Commence Consideration by August ‘07Determination by August ‘08

Fuel Efficiency: Commence Consideration by August ‘07Determination by August ‘08

Smart Metering: Commence Consideration by August ‘06Determination by August ‘07

EPAct ‘05 Timeline Requirements

Warren Wood

MO Public Service Commission

PO Box 360

Jefferson City, MO 65102

Phone: (573) 751-2978

Cell: (573) 864-1213

Fax: (573) 751-1847

E-mail: [email protected]

Contact Information:

Advancing Renewables in the Midwest March 28, 2007 2005 Energy Policy Act Provisions By Warren Wood,...

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