FISCHER, FRANKLIN & FORD Attorneys and Counsellors GUARDIAN BUILDING, SUITE GRISWOLD STREET DETROIT, MICHIGAN

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1 ARTHUR J. LeVASSEUR MATTHEW M. PECK TROY C. OTTO SIDNEY M. BERMAN* LAUREN J. McGILL* *Of Counsel FISCHER, FRANKLIN & FORD Attorneys and Counsellors GUARDIAN BUILDING, SUITE GRISWOLD STREET DETROIT, MICHIGAN Telephone (313) Facsimilie (313) HARVEY A. FISCHER ( ) LEO I. FRANKLIN ( ) RICHARD C. FORD ( ) May 4, 2009 Mary Jo Kunkle Executive Secretary Michigan Pubic Service Commission P.O. Box Lansing, MI RE: Case No. U Dear Ms. Kunkle: Enclosed, for electronic filing, please find Bayfield Electric Cooperative, Inc. s Application for Waiver in the above referenced matter. If you have any questions, please contact me. Very truly yours, AJL:dmm Enclosure cc: Mary Beth Peranteau (w/encls.) Arthur J. LeVasseur

2 S T A T E O F M IC H I G A N BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION In the matter, on the Commission s own motion, ) to approve procedures and forms for use with the ) interconnection and net metering programs ) Case No. U ) BAYFIELD ELECTRIC COOPERATIVE, INC. S APPLICATION FOR WAIVER Pursuant to Michigan Public Service Commission ( Commission ) proposed Rule , Bayfield Electric Cooperative, Inc. ( BEC ) respectfully requests waiver from Parts 1 and 2 (Rules a et seq.) relating to general provisions and interconnection standards. In support of this application, BEC states as follows: 1. On October 6, 2008, the Clean, Renewable and Efficient Energy Act, 2008 P.L. Act 295, MCL et seq. (the Act ) was signed into law. Section 173(1) of the Act requires the Commission to establish a statewide net metering program. 2. On October 21, 2008, the Commission opened Implementation Docket No. U to implement the provisions of Section 173(1) of the Act, and on February 4, 2009, the Commission initiated Rules Docket No. U for the purpose of promulgating interconnection and net metering standards. 3. On March 18, 2009, the Commission adopted net metering and interconnection rules (Rules a et seq.) in Docket No. U-15787, and issued an order in Docket No. U ordering electric utilities to file proposed interconnection applications, interconnection agreements and net metering applications for Category 1 projects (inverter-based projects of 20 kw or less) by May 4, 2009.

3 4. By definition, Part 3 of the rules (Rule et seq.) pertaining to net metering standards does not apply to BEC because BEC is not an electric provider as that term is defined in Rule a(r). 5. Based on the Commission s jurisdiction over BEC s distribution lines located in the State of Michigan, BEC is an electric utility as that term is defined in Rule a(s) and MCL (e). 6. BEC is a retail electric distribution cooperative with its principal place of business in Iron River, Wisconsin. BEC serves approximately 8,600 member-customers in Ashland, Bayfield, Douglas, Iron, Sawyer and Vilas Counties in the State of Wisconsin, and a total of 59 member-customers in Gogebic County, Michigan. 7. As of December 2008, BEC s Michigan customers consisted of 7 year-round and 52 seasonal residences and hunting cabins on and near Chaney Lake, a remote area of the Western Upper Peninsula. In 2008, BEC s customers in Michigan accounted for 172,009 kwh, or 0.21% of BEC s total sales. 8. To date, BEC has not been approached by any of its Michigan customers with a request for interconnection of a distributed generation project of any size. 9. BEC has a number of Wisconsin customers with distributed generation projects of 5 kw or less who are billed for electricity on a net-metered basis. Electricity purchased by the customer is netted by the amount of electricity generated by that customer on a monthly basis at the same rate as that charged by BEC. 10. Pursuant to Section of the Wisconsin Statutes and Chapter PSC 119 of the Wisconsin Administrative Code, the Public Service Commission of Wisconsin ( PSCW ) has established four categories of distributed generation projects and has promulgated standard 2

4 forms for interconnection applications and agreements for distributed generation of 20 kw or less, and for projects of more than 20 kw and up to 15 MW, respectively. All investor-owned and municipal utilities in Wisconsin are required to use these standardized application forms and interconnection agreements. 11. Although BEC is not directly regulated under Chapter PSC 119, the Cooperative uses the Standard Distributed Generation Forms and Standard Generation Interconnection Agreements developed by PSCW when it is contacted by customers seeking to interconnect distributed generation projects. Copies of the PSCW forms used by BEC are attached hereto as EXHIBIT A (20 kw or less) and EXHIBIT B (greater than 20 kw, up to 15 MW) respectively. Also attached as EXHIBIT C is the contact list available on the PSCW website 1 for persons seeking to interconnect a distributed generation project, which notifies cooperative customers to contact the cooperative s local manager. 11. In its Order dated April 20, 2004, in Case No. U-12270, In the matter, on the Commission s own motion, of the investigation into methods to improve the reliability of electric service in Michigan, the Commission granted a waiver to BEC of the Service Quality and Reliability Standards for Electric Distribution Systems, Rule et seq., including standards for service outages, distribution facility upgrades, repairs and maintenance, telephone service, billing service, operational reliability and public and worker safety. In its 2004 waiver order, the Commission found that historically it has not undertaken any regulatory oversight of BEC typically associated with electric cooperatives operating in Michigan, and that, in the interest of regulatory efficiency, the Commission has relied upon the oversight of the Public Service Commission of Wisconsin. 1 Available at: 3

5 11. BEC believes good cause exists to grant a waiver from Parts 1 and 2 of the rules based on the very small number of customers located in the State of Michigan, the remote location of these customers, the fact that most of these customers are seasonal, the consequent lack of demand for interconnection by Michigan customers to date, and the low probability that Michigan customers will seek to interconnect small generation projects with BEC s distribution system. 12. BEC believes that the requested waiver is consistent with the public interest in promoting regulatory efficiency and uniformity. BEC has adopted the Standard Distributed Generation Application Forms and Interconnection Agreements promulgated by the PSCW, which the Cooperative would use in the event that any of its Michigan customers requests interconnection of a distributed generation project. The Wisconsin forms allow BEC to use consistent contracting practices and agreements in connection with interconnection requests from any of its members. WHEREFORE, Bayfield Electric Cooperative, Inc. respectfully requests that the Commission find pursuant to proposed Rule that good cause exists and that it is in the public interest to grant BEC a waiver from Parts 1 and 2 (Rules a et seq.) relating to general provisions and interconnection standards for electric utilities. Dated: May 4, 2009 Respectfully submitted, Mary Beth Peranteau Wheeler, Van Sickle &Anderson, S.C. Co-Counsel for Bayfield Electric Cooperative, Inc. 25 West Main Street, Suite 801 Madison, WI (608) FISCHER, FRANKLIN & FORD By: Arthur J. LeVasseur (P29394) Matthew M. Peck (P66361) Attorneys for Bayfield Electric Cooperative, Inc. 500 Griswold Street, Suite 3500 Detroit, MI (313)

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