20020510Renewable Energy Advocates Comments.pdf

William M.Eddie (ISB #5800)
LAND AND WATER FUND OF THE ROCKIES
P.O.Box 1612
Boise,ID 83701
[phone]
fax:[phone]
[e-mail]
Express mail address:
1320 W.Franklin St.
Boise,ID 83702
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR )IPC-E-02-04
AMENDMENTS TO SCHEDULE 84 -NET )
METERING )
COMMENTS OF RENEWABLE ENERGY ADVOCATES
The Renewable Northwest Project,Idaho Rivers United,NW Energy Coalition,
Northwest Sustainable Energy for Economic Development,Climate Solutions,and
American Wind Energy Association ("Renewable Energy Advocates")provide the
followingcomments in the above-captioned matters.
Renewable Northwest Project promotes development of renewable energy sources,including wind,
solar,and geothermal technologies in the Northwest.Idaho Rivers United advocates for the protection
and restoration of Idaho's rivers,including through increased utilization of renewable energy.NW Energy
Coalition promotes energy conservation and renewable energy resources,consumer and low-income
protection,and fish and wildlife restoration on the Columbia and Snake Rivers.Northwest Sustainable
Energy for Economic Development(NWSEED)supports and develops creative programs,policies,and
financing approaches to build rural economies and meet the region's power needs through affordable,
distributed "green"generation.Climate Solutions seeks practical and profitablesolutions to global
warming,including through increased private investment in renewable energy technologies for rural
economic development.American Wind Energy Association (AWEA)is a national trade association that
represents wind power plant developers,wind turbine manufacturers,utilities,consultants,insurers,
financiers,researchers,and others involved in the wind industry.
COMMENTS OF RENEWABLE ENERGY ADVOCATES --1
The Renewable Energy Advocates support the Company's proposed capacity
limit of 100 kW per meter,and 580 kW per customer,although we believe those limits
may prove too small for some customers.
The most significant issue for the Commission to resolve in this case,we believe,
is the appropriatebilling system for net metering in customer classes other than
Schedules 1 and 7.We believe that the Commission should take stronger steps to
encourage net metering than Idaho Power proposes,including by providing for "banking"
of kilowatt-hours over an annual period,or for indefmite carryovers of excess generation.
Few customers in Idaho Power's service territoryare currentlyengaged in net metering,
so it is not possible to fairly balance the very small subsidy that those customers might
enjoy,versus the system reliability,diversification of generation resources,and
environmental benefits those customers provide.We ask that the Commission set
policies to encourage net metering at least until the 2.9 MW cumulative capacity limit for
net metering is reached,at which point a more detailed look at these issues would be
warranted.
The Renewable Energy Advocates recommend that all net metering customers be
metered through a single meter,although we recognize that straightforward meter
upgrades may be necessary for larger customers.We further suggest that interconnection
2 Our reviewof the availabilityof wind turbines indicates that the difference between a 100 kW and
125 kW net metering limit currently will providefew additional options for customers.As the industry
matures,additional wind turbines in the range of 100 kW to 250 kW will become available.M e.g.
Exhibit 2,Cornments of Renewable Energy Advocates,IPC-E-01-38,-39,-40 (Fuhrlander 250 kW wind
turbine specs).We also note that a large number of refurbished wind turbines in the 100 kW to 125 kW
capacity range (for example,Micon 108)may be available on the market soon,as older turbines installed in
Californiaare replaced.Turbines in this 100 kW to 250 kW range could be of particular value to Idaho
irngators.
We also note that a 100 kW limit will restrict the size of dairies and animal feed lots that could
take advantage of methane digesters for net metering.
COMMENTS OF RENEWABLE ENERGY ADVOCATES --2
issues be addressed only through Schedule 72,and that net metering customers not be
responsible for local distribution system upgrades which benefit many other customers.
A.Billing
Idaho Power has proposed that large customers be able to fully offset their
monthlyenergy usage,but that any excess energy generated by the customer be
purchased or credited monthlyat 85%of the market price for non-firm energy ("non-firm
avoided cost rate").
We believe it is more appropriate at this time to strongly encourage the
installation of net metered generation systems by allowing customers to "bank"generated
kilowatt-hours on an annual or indefinite basis.Specifically,Renewable Energy
Advocates propose that any excess kilowatt-hours of generation be credited to the
followingmonth at the customer's retail rate,and that such credits be carried forward
until the end of an annual period,at which time the Company should purchase any
remaining excess generation at the non-firm avoided cost rate.Essentially,we
recommend that the "true up"of excess generation occur annuallyrather than monthly.
Ïowa currentlyprovides for this type of net metering billing:excess kilowatt-hours are
credited to the following month and carried over until the end of the annual period,at
which point any excess generation is purchased at avoidedcost.Iowa Admin.Code §
199-15.1l(5).Numerous states,including Washington,also provide for excess
generationto be carried over from month-to-month until the end of an annual period.
In the alternative,excess generation credits could be carried over indefinitely,
without opportunity for customers to receive payment for excess generation.A system of
indefinite carryovers of excess generation would reduce administrative costs of issuing
COMMENTS OF RENEWABLE ENERGY ADVOCATES --3
payments to customers,and would closely match Idaho Power's current treatment of
Schedule 1 and 7 customers under Schedule 84.
We believe any risk of customers over-sizing their facilities in an effort to
circumvent PURPA is minimal,given that net metering is only available to customers
attempting to offset all or part of their energy usage.If excess generation credits are
carried over indefinitelywithout opportunity for cash payment,a customer's only
incentive is to offset their own electric consumption and reduce their power bills.M
proposed Schedule 84,at Third Revised Sheet 84-1.
The Renewable Energy Advocates recognize that our proposed billingsystem,
which would effectivelypay full retail rate for most excess kilowatt-hours generated,
may result in a slightly higher potential subsidy for net metering customers.However,
Idaho Power does not even attempt to calculate the actual amount of that potential
subsidy,which we believe would be almost imperceptibly small even at "full build out"
of net metering to the current 2.9 MW cumulative limit.Moreover,Idaho Power makes
no effort to balance any potential subsidy against the strong benefits of distributed
generation,including:(1)increased system reliability,(2)better diversification of
generation resources,and (3)environmental benefits of clean energy.
Idaho Power claims that net metering can "adversely impact system reliability"by
hiding loads,risking potential 'trip off'of generation,and potential causing overloads
and load curtailments,but that these problems would be "manageable"with a 2.9 MW
cumulative cap.Direct Testimony of Theresa Drake,page 19,lines 1-11.In fact,this
concern is unwarranted,regardless of the 2.9 MW cumulative cap.See eenerallv DOE,
Energy Efficiency and Renewable Energy Network ("EREN")worldwide website,
COMMENTS OF RENEWABLE ENERGY ADVOCATES --4
http://www.eren.doe.gov/der/.According to the Department of Energy,distributed
generation such as net metering has the following"consurner-side"and "grid-side"
benefits:
Consumer-Side Benefits
Better power reliability and quality
Lower energy costs
More choice in energy supply options
Greater predictability of energy costs (lower financial risk)with
renewable energy systems
Energy and load management
Combined heat and power capabilities
Environmental benefits -including cleaner,quieter operation,and
reduced emissions
Faster response to new power demands -as capacity additions can be
made more quickly
Grid-Side Benefits
Reduced energy losses in transmission lines
Reduced upstream congestion on transmission lines
Reduced or deferred infrastructure (line and substation)upgrades
Optimal utilization of existing grid assets -including potential to free
up transmission assets for increased wheeling capacity
Less capital tied up in unproductive assets -as the modular nature of
distributed generators means capacity additions and reductions can be
made in small increments,closely matched with demand,instead of
constructing central power plants sized to meet estimated future(rather than current)demand
Improvedgrid reliability
Higher energy conversion efficiencies than central generation
Faster permitting than transmission line upgrades
Ancillary benefits -including voltage support and stability,
contingency reserves,and black start capability
S_ee EREN,"MajorPotential Benefits of [Distributed Energy Resources]";
http://www.eren.doe.gov/der/potential benefits.html.
Idaho Power's fear that a sudden 'trip off'of generationsystems could cause grid
failures actually is most likely under the "central-system"model of generation and
COMMENTS OF RENEWABLE ENERGY ADVOCATES --5
distribution now common.The diversity and geographic separation of distributed
generation adds balance and reliability to the grid -not new risks.
Renewable Energy Advocates believe that net metering and other forms of
distributed generation should be strongly encouraged now,and that the balancing of
potential subsidies versus system benefits should be attempted once the 2.9 MW
cumulative capacity limit in reached,at which point the Company,the Commission,and
interested parties can take a careful look at actual facts and experience in employing
distributed generation technologies.
B.Meteringand Interconnection
Case number IPC-E-01-38 (evaluating proposed changes to existing Schedule 72)
remains outstanding,and the Renewable Energy Advocates will not restate their
Comments in that case,except to state that a simple and streamlined interconnection
process,which presents few or no unknown costs to customers,is critical to the growth of
distributed generation in Idaho.
We believe all net metering customers,including larger customers,should be
metered through a single meter.For large customers,a simple meter upgrade may be
required to measure bi-directional power flows,peak demand,and even time-of-use.See
Testimony of Tom Starrs,Case No.IPC-E-01-38 to -40,at page 10.
Idaho Power's proposal to use two meters eliminates the demand component
benefit that net metering customers are entitled to if their generation is coincident with
their demand.If a net metering customer is able to generate power coincident with their
demand,then that customer has effectively reduced demand requirements on Idaho
Power's system,and should not be charged for a higher demand than they actually
COMMENTS OF RENEWABLE ENERGY ADVOCATES --6
require.If the customer can not generate their own power coincident with demand,then
that customer should be charged --and will be charged --the same demand charge as
they paid before installing a net metered generation system.Because net metering
customers should be able to enjoy all benefits provided by systems they install,we
request that the Commission direct Idaho Power to allow net metering for all customers
through a single meter,while providing for any necessary meter upgrades.If the
Commission approves Idaho Power's two-meter proposal,we request that Idaho Power
cover the cost of the second meter.
We note that a provision of Idaho Power's proposed changes to Schedule 84
appears to overlap with the Company's proposed changes to Schedule 72.The
Company's proposed Schedule 84 states:
The Seller is responsible for all costs associated with the Generation
Facility and Interconnection Facilities.The Seller is also responsible for
all costs associated with any Company additions,modifications,or
upgrades to any Company facilities that the Company determines are
necessary as a result of the installation of the Generation Facility in order
to maintain a safe,reliable electrical system.
First Revised Sheet No.84-4,at Condition of Purchase and Sale No.5.
To avoid potential confusion and overlap,Renewable Energy Advocates suggest
that Schedule 84 simply require compliance with Schedule 72 with respect to
mterconnection issues.
We are not aware of any situation in any state where local distribution system
upgrades were necessary to safely install a net metered generationsystem.Nevertheless,
the requirement that a customer cover "all costs"to Company facility additions,
modifications,or upgrades may result in net metering customers paying a
disproportionateshare for such upgrades.Althougheach interconnection will be case-
COMMENTS OF RENEWABLE ENERGY ADVOCATES --7
specific,an upgrade to the local distribution system prompted by interconnection of a net
metering system may result in benefits enjoyedby all customers in that locality.
Therefore,we suggest the Commission require Idaho Power to determine whether local
distribution system upgrades prompted by net metering installations actually have
broader benefits,and therefore should be paid for on the same basis as other routine
system upgrades.
CONCLUSION
The Renewable Energy Advocates appreciate the opportunity to submit these
comments,and request the Commission approve policies to strongly encourage net
metering,including by providing for single-meter and streamlined interconnection
requirements for net metered generation systems.
Dated:May 10,2002 Respectf y submitted,
William M.Eddie
Land and Water Fund of the Rockies
On behalf of:
Renewable Northwest Project
Idaho Rivers United
NW Energy Coalition
NWSEED
Climate Solutions
AWEA
COMMENTS OF RENEWABLE ENERGY ADVOCATES --8
CERTIFICATE OF SERVICE
I hereby certify that on this 10 day of May 2002,I caused true and correct
copies of the COMMENTS OF RENEWABLE ENERGY ADVOCATES,et al.,to be
served on the persons listed below via the method of service noted:
Commission Secretary (VIA HAND DELIVERY)
Idaho Public Utilities Commission
472 W.Washington St.
Boise,ID 83702-5983
Barton Kline (VIA U.S.MAIL)
Senior Attorney
Idaho Power Company
1221 West Idaho Street
Boise,ID 83702
Maggie Brilz (VIA U.S.MAIL)
Director of Pricing
Idaho Power Company /'
1221 West Idaho Street ||
Boise,ID 83702 /
William M.Eddie
COMMENTS OF RENEWABLE ENERGY ADVOCATES --9