20130930Comments on Reconsideration.pdf

KARL T. KLEIN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BARNO.5156
Street Address for Express Mail:
472W, WASHINGTON
BOISE, IDAHO 83702-59I8
Attomey for the Commission Staff
BEFORE THE IDAHO PUBLIC
IN THE MATTER OF IDAHO POWER
COMPANY'S APPLICATION FOR
AUTHORITY TO MODIFY ITS NET
METERING SERVICE AND TO INCREASE
THE GENERATION CAPACITY LIMIT
UTILITIES COMMISSION
CASE NO. IPC.E.I2-27
SUPPLEMENTAL
COMMENTS OF THE
COMMISSION STAFF
The Staff of the Idaho Public Utilities Commission submits these supplemental
comments in response to Commission Order No. 32880, which asks interested persons to provide
input on the following issue:
If a net metering customer takes service through multiple meters at one or more premises,
should the customer be allowed to apply net metering credits to offset usage on the other
meters? If so, what conditions should apply?
STAFF ANALYSN
Staff believes the Commission should allow a net metering customer to apply the excess
net energy credit from a designated meter to offset usage on additional meters. But to preserve
the intent of net metering - that is, to allow a customer to offset usage with self-generation - Staff
believes the following conditions must exist to apply credits to offset usage on the aggregated
meters:
SUPPLEMENTAL STAFF COMMENTS SEPTEMBER 30,2013
l) The aggregated meters must be under the same account as the designated meter;l
2) The electricity recorded by the designated meter and any aggregated meters must be for
the customer-generator' s requirements;
3) The aggregated meters must be located on or contiguous to the premises of the designated
meter;
4) The designated meter and the aggregated meters must be served by the same primary
feeder; and
5) The excess net energy credit must first be applied to a designated meter and then to
aggregated meters on the same rate schedule as the designated meter before the balance
can be applied to other aggregated meters. The kWh credit can only be applied between
Schedule Nos. 1 and7, or between Schedule Nos. 9, 19, and24.2
Staff recognizes that the Commission's decision on how to apply credits to offset usage is
a policy decision, and notes that Staff developed its proposal with the current rate structures in
mind. If the Commission policies on rate design change in the future and more fixed costs
become collected through a Service Charge or other fixed charges, Staff would reconsider its
proposal.
Staff considered several issues when developing its proposal. First, Staff considered the
intra-class inequities addressed in the Company's original proposal and throughout the technical
hearing. Second, Staff considered the barriers to participation brought up in the intervening
parties' testimony, and in public comments. Third, Staff considered the meter aggregation
policies adopted by other states. The Commission should adopt Staff s five proposed conditions
before allowing net metering customers to apply their credit to other meters. If the five
conditions are met, then customers who take service through multiple meters should be allowed
to apply their credit to offset usage on the other meters. The reasons underlying the five
conditions are summarized below.
Condition Nos. I and 2: Account and Customer-Generator's Requirements
To make the process of applying excess kWh credits easy for customers to understand
and less administratively burdensome for the Company, customer aggregated meters should be
I In the case of one meter, the designated meter is the retail meter attached to the generation facility, In the case of
two meters, the designated meter is the retail meter attached to the separately metered generation facility.
2 Customers must select and rank the aggregated meters in the order in which the customer wishes to apply credits
beyond those used to offset all usage at the designated meter. An aggregated meter on the same rate schedule as the
designated meter must be ranked highest.
SUPPLEMENTAL STAFF COMMENTS 2 SEPTEMBER 30,20I3
under the same account as the designated meter. Consider, for example, a net metering customer
with a generation facility who has separately metered service provided to their house, an
outbuilding, and a domestic well pump. These meters may be in different locations, under
separate rate schedules and recorded under multiple accounts, making it difficult to administer
credits. For convenience purposes, the Company already allows customers to ask that the
Company combine the amount due from all their service points into a single account so that they
receive one monthly Staff believes it is reasonable that net metering customers who want to
apply credit to their usage on aggregated meters be required to have the aggregated meters on the
same account as the designated meter.
Furthermore, Staff believes the customer should only use the electricity recorded by the
designated meter and the aggregated meters for the customer-generator's requirements. Net
metering is for customers who wish to offset all or a portion of their load; it is not an avenue for
customers to apply credit toward business accounts or the accounts of friends, family members,
and neighbors.
Condition Nos. 3 and 4: Meter Locations
The Company currently requires net metering customers to have a Point of Delivery
(designated meter) that is adjacent to a Generation Interconnection Point. The Point of Delivery
is the retail metering point where the Company's and the customer's electrical facilities
interconnect to allow the customer to take retail electric service from the Company. The
Generation Interconnection Point is where the customer's Generation Facility interconnects with
the Company's facilities. Currently, the Company defines "adjacent" to mean that the
Generation Interconnection Point must share a common interconnection point with the
customer's standard retail Point of Delivery. Because it may not be practical to have more than
one point of delivery interconnected to the Generation Interconnection Point, Staff believes the
Company's definition of "adjacent" should be modified. Specifically, Staff believes all points of
delivery on or contiguous to the same premises where the Generation Interconnection Point is
located should qualify for net metering if Staff s five conditions are met. If a customer has
multiple delivery points under one account, Staff believes customers should be allowed to offset
their usage at multiple service points as long as each service point is served by the same feeder,
located on or contiguous to the premise of the Generation Interconnection Point, and is metered
on a compatible rate schedule. See Condition 5 on p. 2.
SUPPLEMENTAL STAFF COMMENTS 3 SEPTEMBER 30,20I3
It would be unreasonable to let customers apply their credits to any delivery point
regardless of where it is located. Even with one delivery point, net metering customers may not
pay their full fixed costs given the current rate structure. In fact, as Staff testified, ooaccording to
the Company's most recent cost-of-service study, if a residential net metering customer
generates enough excess net energy to completely offset their usage during the year, their service
charge covers only 8Yo of their fixed costs. So if a residential net metering customer achieves net
zero consumption, their distribution-related costs and most customer service-related costs will
need to be recovered from other standard service customers." Elam Testimony, p.5. Staff thus
believes it would be unreasonable to allow customers to apply credits to offset usage on meters
that are not contiguous or served by the same feeder, particularly given some customers may not
pay the distribution-related fixed costs necessary to theoretically distribute energy from where
the credit accrued to the location where it is applied. Staff believes the possible intra-class
inequities between some net metering customers and standard service customers may be
exacerbated if excess net energy is allowed to be accrued and then applied to multiple non-
adjacent delivery points or to delivery points served by separate feeders.
Condition No. 5: Applying Credits
The Company has historically calculated a financial credit based on the net difference
between what is generated by the customer's facility and what is consumed at the customer's
designated retail meter. Customers thus received the benefit of the financial credit regardless of
the number of delivery points, the type of service schedule, or where the service point was
located.
In accordance with Order No. 32846, customers will now receive a kWh credit rather
than financial credits for their excess generation. Staff believes that customers should continue
to have flexibility in the way they use their kWh credits. If a customer generates excess net
energy and has a credit at the end of the month, Staff believes the customer should be allowed to
pick from one of two options. First, the customer should be allowed to apply the credit to offset
usage recorded on the designated meter the following month. Alternatively, the customer should
be allowed to apply the remaining credits to offset usage recorded on an aggregated meter.
However, Staff believes any credit remaining after being applied to the designated meter should
first be applied to aggregated meters on the premises subject to the same rate schedule as the
designated meter. After the credits have been applied to aggregated meters on the premises
SUPPLEMENTAL STAFF COMMENTS SEPTEMBER 30,2013
subject to the same rate schedule as the designated meter, customers should be allowed to
interchangeably apply their excess net energy credits to aggregated meters (e.g., between
Schedules I and 7 , or between Schedules 9, 19, and 24).
The intention of pricing each kWh at the retail rate is to provide a one-to-one offset,
meaning the value of a kWh generated when the customer's system is producing excess energy is
worth the same as a kWh credit used to offset usage. The fixed costs built into each unit of
excess net energy may vary when the credit is applied across schedules, but Staff believes
Schedules I andT are similar enough to allow the credit be applied interchangeably. The two
rate schedules have the same customer charge, similar rates and comparable rate designs.
Furthermore, the proportion of fixed costs collected through the customer charges are nearly the
sarne. As mentioned previously, according to the Company's most recent cost-of-service study,
the fixed cost collected through the Schedule 1 customer charge is 8% of the total fixed costs,
whereas the fixed cost collected through the Schedule 7 customer charge is 14% of total fixed
costs. By comparison, the fixed cost collected outside of the energy rate for Schedules 9,19, and
24 is anywhere from 35o/o to 60Yo of total fixed costs, meaning in terms of cost recovery, an
excess kWh generated among these rate schedules is valued much differently than one generated
under the residential or small general service schedules.
In addition, the Commission's Utility Customer Relations Rules already separate the
residential and small general service rules from the other schedules, so allowing customers to
interchangeably apply their excess net energy credits to meters on Schedules 1 and 7 would be
less difficult given the Commission's rules. For example, the rules for deposits, denial of
service, termination of service, and payment arrangements are grouped into two classifications.
The first classification is for the residential and small commercial classes, and the second is for
the industrial, large commercial and irrigation classes. Staff believes the Commission's Utility
Customer Relations Rules are important, and accurately categorize the residential and small
general service schedules as being similarly situated.
Staff does not support allowing customers to accrue credit from a generation facility
interconnected to a residential or small commercial schedule, and then apply those credits to
offset usage at meters on industrial, large commercial or irrigation schedules. But Staff believes
allowing customers to apply excess energy credits interchangeably between Schedules 1 and 7
maintains a reasonable cost structure, while allowing customers flexibility in how their credits
can be applied.
SUPPLEMENTAL STAFF COMMENTS 5 SEPTEMBER 30,2013
STAFF RECOMMENDATION
Staff believes the Commission should allow a net metering customer to apply their excess net
energy credit from a designated meter to offbet usage on aggregated meters. But to preserve the
intent of net metering, the following five conditions must exist before the Company may apply
credits to offset usage on the aggregated meters:
1) The aggregated meters must be under the same account as the designated meter;3
2) The electricity recorded by the designated meter and any aggregated meters must be for
the customer-generator' s requirements;
3) The aggregated meters must be located on or contiguous to the premises of the designated
meter;
4) The designated meter and the aggregated meters must be served by the same primary
feeder; and
5) The excess net energy credit must first be applied to a designated meter and then to
aggregated meters on the same rate schedule as the designated meter before the balance
can be applied to other aggregated meters. The kWh credit can only be applied between
Schedule Nos. 1 and7, or between Schedule Nos. 9, 19, and24.a
Respectfully submitted this 3 O+' day of September 2013.
,'( '
Karl T. Klein
Deputy Attomey General
Technical Staff: Matt Elam
i :umisc:comments/ipce I 2.27kkme supp comments
3 See frr. I
a See frr. 2
SUPPLEMENTAL STAFF COMMENTS
i 1(. -
SEPTEMBER 30,2013
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 3O,H DAY oF SEPTEMBER 2013,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN
CASE NO. IPC-E.12.27, BY E-MAILING AND MAILING A COPY THEREOF,
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LISA NORDSTROM
REGULATORY DOCKETS
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
EMAIL: [e-mail]
dockets@ idahopower. com
BENJAMIN J. OTTO
IDAHO CONSERVATION LEAGUE
710 N. 6TH ST.
BOISE ID 83702
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PETER J RICHARDSON
RICHARSON & O'LEARY
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KEN MILLER DR
CLEAN ENERGY PROGRAM
SNAKE RIVER ALLIANCE
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MATT LARKIN
GREG SAID
IDAHO POWER COMPANY
PO BOX 70
BOrSE rD 83707-0070
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[e-mail]
PAPERWORKS LLC
CHRIS AEPELBACHER
PROJECT ENGINEER
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BATT FISHER PUSCH
& ALDERMAN LLP
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McDEVITT & MILLER LLP
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