Intercnnectin and Net Metering in Massachusetts Nathan Phelps Ecnmist Massachusetts Department f Public Utilities
DISCLAIMER Backgrund D.P.U. 11-75 Cmments reflect my persnal bservatins, and d nt necessarily reflect the psitin f the Cmmnwealth f Massachusetts, the Department f Public Utilities, r the DPU Cmmissiners SLIDE 2
DEPARTMENT OF PUBLIC UTILITIES (DPU) Backgrund D.P.U. 11-75 DPU Missin Statement The Department is respnsible fr versight f investr-wned electric pwer, natural gas, and water industries in the Cmmnwealth; develping alternatives t traditinal regulatin; mnitring service quality; regulating safety in the transprtatin and gas pipeline areas; and fr the siting f energy facilities. The missin f the Department is t ensure that utility cnsumers are prvided with the mst reliable service at the lwest pssible cst; t prtect the public safety frm transprtatin and gas pipeline related accidents; t versee the energy facilities siting prcess; and t ensure that residential ratepayers' rights are prtected Cmmissin Ann G. Berwick, Chair Jlette A. Westbrk, Cmmissiner David W. Cash, Cmmissiner SLIDE 3
INTERCONNECTION MA DEPARTMENT OF PUBLIC UTILITIES SLIDE 4
INTERCONNECTION: BIG PICTURE Backgrund D.P.U. 11-75 Intercnnectin is the prcess by which an electricity generating facility is integrated int the electricity grid Intercnnecting facility cannt impact: Safety; Reliability; r Pwer Quality Engineering, Engineering, and Engineering SLIDE 5
INTERCONNECTION: BIG PICTURE CONT. Backgrund D.P.U. 11-75 SLIDE 6 Fr the distributin cmpanies, intercnnectin is nrmally fr distributed generatin ( DG ) Intercnnectin is technlgy neutral NOTE: Intercnnectin des nt determine hw the wner f the facility will be cmpensated fr the utput f the facility
THE PROCESS IN MA Backgrund D.P.U. 11-75 Intercnnectin prcess is unifrm fr all fur distributin cmpanies in MA Municipal light districts d nt have t fllw the standardized intercnnectin prcess There is als an intercnnectin prcess at ISO-NE SLIDE 7
SIMPLIFIED PROCESS Engineering Terms Translatin Backgrund D.P.U. 11-75 SLIDE 8 Fr Prjects: 10 kw r less n single-phase radial service w/inverter 25 kw r less n three-phase radial service w/inverter 15 kw r less n spt netwrk w/inverter may apply Inverters must be IEEE 1547 cmpliant and tested at a natinal lab Applies t small prjects (e.g. residential) with apprved equipment Very Quick Prcess Nrmally
EXPEDITED/ STANDARD Expedited Backgrund D.P.U. 11-75 SLIDE 9 Engineering Terms Expedited Facilities that pass screens n radial circuits Standard All ther prjects Translatin Expedited = cmplicated Standard = very cmplicated Can take a very lng time Facilities that pass screens n radial circuits Standard All ther prjects
APPLICATION COSTS Simplified Prcess = $0 Backgrund D.P.U. 11-75 Expedited & Standard Prcess = $3/kW Minimum f $300 Maximum f $2,500 SLIDE 10
INTERCONNECTION STUDIES Backgrund D.P.U. 11-75 Studies can be: Time cnsuming; and Cstly Cst is brne by applicant SLIDE 11
OTHER COSTS Backgrund D.P.U. 11-75 Utility Upgrade Csts Applicant pays fr all necessary upgrades Can be very cstly Witness Tests Depending n the intercnnectin prcess, applicant may have t pay fr the Distributin Cmpany t inspect the facility Relatively inexpensive SLIDE 12
INTERCONNECTION MILESTONES 1. Submit Applicatin Backgrund D.P.U. 11-75 2. Cmplete Studies (if needed) 3. Signed Intercnnectin Service Agreement ( ISA ) SLIDE 13 4. Utility Upgrades (if needed) 5. Witness Test
D.P.U. 11-75: INTERCONNECTION NOI Backgrund D.P.U. 11-75 CEC & DOER cmmissined an intercnnectin reprt ( KEMA Reprt ) The KEMA reprt was submitted t the DPU DPU pened an investigatin in rder t address intercnnectin issues Intercnnectin Wrking Grup is expected t submit a reprt t the DPU shrtly SLIDE 14
ISSUES IN D.P.U. 11-75 Backgrund D.P.U. 11-75 Transparency Applicatin Vlume Intercnnectin Csts State v. federal jurisdictin Prcess review and redesign Objective High amunts f DG n circuits [E]nsure an efficient Dispute and effective reslutin intercnnectin prcess that will fster cntinued grwth f distributed generatin in Massachusetts Intercnnectin Educatin Netwrk Intercnnectins D.P.U. 11-75 at 2-3 Organizatin and staffing f Distributin Cmpanies SLIDE 15
www.mass.gv/dpu Questins?
NET METERING MA DEPARTMENT OF PUBLIC UTILITIES SLIDE 17
HISTORY OF NET METERING IN MASSACHUSETTS Net metering in MA since 1982 30 kw systems Histry Expanded in 1997 60 kw systems Significantly revised by the Green Cmmunities Act in 2008 Further amended by Sessin Law in 2010 Recently amended by Sessin Law in 2012 SLIDE 18
NET METERING: BASIC CONCEPT Histry Net metering is an incentive prgram t encurage custmers t install distributed generatin Custmers ffset wn electricity usage Custmers are cmpensated fr any electricity they generate and dn t use SLIDE 19
NET METERING: BASIC CONCEPT (CONT.) Histry If cnsumptin exceeds generatin, custmer pays fr net kwh cnsumed If generatin exceeds cnsumptin, custmer receives credit n bill fr net excess generatin SLIDE 20
NET METERING EXAMPLE: SOLAR PV FACILITY ON SCHOOL Illustrative Example PV System generates 60,000 kwh/mnth Histry SLIDE 21 Schl mnths Electricity usage = 80,000 kwh Schl is charged fr 20,000 kwh Summer mnths Electricity usage = 10,000 kwh Schl is credited fr 50,000 kwh = Excess Generatin
HOW BIG OF A FACILITY? Net metering system can be bigger than yur lad Histry N minimum lad is required Lad can be parasitic Wind Turbine at Jiminy Peak Muntain Resrt Hancck, MA SLIDE 22 http://www.panrami.cm/pht/13362450
KEY QUESTION: WHO CAN BE A HOST CUSTOMER? Histry 220 C.M.R. 18.02: Hst Custmer means a Custmer with a Class I, II, r III Net Metering Facility that generates electricity n the Custmer s side f the meter Intentinally brad definitin SLIDE 23
HOST CUSTOMER EXAMPLE Distributin Cmpany Schl Histry SLIDE 24 Muni Acct Name n Accunt = Hst Custmer
KEY QUESTION: WHAT IS A NET METERING CREDIT? Histry Generatin is tracked n a meter in kwh, but credits are a mnetary amunt Excess generatin (kwh) results in net metering credits Net metering credit = $ credit Credits ffset charges n electricity bills Credits never expire (they rllver ) SLIDE 25
WHAT IS A NET METERING CREDIT? (CONT.) Histry SLIDE 26 Credits fr wind, slar, and agricultural facilities are clse t the retail rate Credit Calculatin Facility Size r Unit Size (Gvt) Units Class I Class I- Wind, Slar, and AG 60 kw 60 kw Class II >60 kw - 1 MW Class III >1 MW - 2 MW Custmer Charge $/mnth Distributin Charge /kwh * Transmissin Charge /kwh Delivery Transitin Charge /kwh System Benefit Charge DSM (EE) /kwh RE /kwh Supply Basic Service /kwh Generatin Average Mnthly Clearing Price at the ISO-NE /kwh * Only applies t municipal r gvernmental Class III
EXAMPLE: CALCULATION OF NET METERING CREDITS Electricity (kwh) x Rate ($/kwh) = NMC ($) Histry Calculatin f credits depends n the Hst Custmer s rate class Lk at yur electric bill Illustrative Example: Excess f 100 kwh Cmpnents f rate class = $0.10/kWh Credit = $10 Landfill in Easthamptn, MA SLIDE 27
KEY QUESTION: WHAT CAN A HOST CUSTOMER DO WITH NET METERING CREDITS? Histry SLIDE 28 Optin 1 Optin 2 Use the credit fr the Hst Custmer s electric bill Hst Custmer can allcate credits t different accunts (yurs r ther custmers) Thus, generatin in ne lcatin can ffset electricity csts in anther lcatin (a.k.a. virtual net metering)
WHAT CAN WE DO WITH NET METERING CREDITS? (CONT.) Histry Allcating mnetary credits t electric bills SLIDE 29
KEY QUESTION: HOW MUCH NET METERING IN MA? Histry SLIDE 30 Statute: 3% cap n private prjects 3% cap n public prjects Caps are based n the distributin cmpany s peak demand Small net metering systems are exempt frm the net metering caps Increased as f 8/3/12
IS THERE A NET METERING QUEUE? Histry Sn, but nt yet The DPU is required t implement a System f Assurance The System f Assurance will enable custmers t knw whether they will be able t net meter in the future Implementatin is nging SLIDE 31
Thank Yu www.mass.gv/dpu Nathan Phelps, Ecnmist MA Department f Public Utilities One Suth Statin Bstn, MA (617) 305-3707 nathan.phelps@state.ma.us
WHO CAN BE A HOST CUSTOMER? (FURTHER EXPLAINED) Histry Hst Custmer des nt have t wn: The net metering facility; r The prperty n which the facility is lcated Hst Custmer has 1. an accunt with the utility; and 2. a net metering facility behind the meter SLIDE 33 6/25/12
KEY QUESTION: CAN A 3 RD PARTY OWN THE FACILITY? Histry Third-Party Ownership is permissible in MA See 220 C.M.R. 18.09(5) Allws fr pwer purchase agreements (PPAs) fr distributed generatin Very cmmn fr gvernmental prjects in rder t mnetize federal tax credits and depreciatin SLIDE 34
ELIGIBILITY Histry Additinal Infrmatin SLIDE 35 220 C.M.R. 18.06 states: Distributin Cmpanies shall nt prvide Net Metering services t a Hst Custmer wh is an electric cmpany, generatin cmpany, aggregatr, supplier, energy marketer, r energy brker, as thse terms are used in M.G.L. c. 164, 1 and 1F and 220 CMR 11.00 Hst custmers must self-certify that they are nt ne f the abve entities 6/25/12
DISCLAIMER Histry Additinal Infrmatin The next tw slides are fr illustrative and infrmatinal purpses nly Each situatin is different All custmers including Hst Custmers are encuraged t seek independent prfessinal advice n their ptins SLIDE 36 6/25/12
ILLUSTRATIVE EXAMPLE: MODEL A Histry Additinal Infrmatin SLIDE 37 6/25/12
ILLUSTRATIVE EXAMPLE: MODEL B Histry Additinal Infrmatin SLIDE 38 6/25/12
RENEWABLE ENERGY CERTIFICATES (RECS) Histry Additinal Infrmatin SLIDE 39 220 C.M.R. 18.01(1) states: The prvisin f Net Metering services des nt entitle Distributin Cmpanies t wnership f, r title t, the renewable energy r envirnmental attributes, including renewable energy certificates, assciated with any electricity prduced by a Net Metering facility = Custmer gets the RECs 6/25/12
MODEL SCHEDULE Z Backgrund Key Issues Future Additinal Infrmatin SLIDE 40 6/25/12
MODEL SCHEDULE Z (CONT.) Histry Additinal Infrmatin SLIDE 41 6/25/12
MODEL SCHEDULE Z (CONT.) Histry Additinal Infrmatin SLIDE 42 6/25/12
MODEL SCHEDULE Z (CONT.) Histry Additinal Infrmatin SLIDE 43 6/25/12
MODEL SCHEDULE Z (CONT.) Histry Additinal Infrmatin SLIDE 44 6/25/12
MODEL SCHEDULE Z (CONT.) Histry Additinal Infrmatin SLIDE 45 6/25/12