Report Title:

Net Energy Metering; Renewable Energy; Electricity; Public Utilities Commission

 

Description:

Removes the capacity limit for net energy metering and increases eligible customer-generator capacity to one megawatt. Permits existing net metered customers to remain with net metering program once alternative credits or compensation mechanisms are created. Allows an eligible customer-generator to generate up to one hundred kilowatts before the eligible customer-generator must gain public utilities commission approval of safety and performance standards.

 


HOUSE OF REPRESENTATIVES

H.B. NO.

546

TWENTY-FIFTH LEGISLATURE, 2009

 

STATE OF HAWAII

 

 

 

 

 

A BILL FOR AN ACT

 

 

relating to renewable energy.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


SECTION 1. The legislature finds that the State must improve and develop new types of renewable energy to reduce dependence on imported oil to generate electricity. Accordingly, the legislature enacted the net energy metering law as an effective incentive for the rapid development of renewable electricity self-generation at low cost to the public.

However, the legislature recognizes that customer capacity and capacity limits have restricted the effectiveness of net energy metering. These limits were established to ensure the safety and reliability of the grid. However, they are no longer needed since the public utilities commission has subsequently established procedures to address these issues, including approval of the technical standard for distributed generation interconnection. Additionally, since that time, it has been recognized that net energy metering imposes no additional costs on the ratepaying public, and accordingly, the total capacity limit no longer serves its purpose, except to reduce the size, slow the speed, and increase the cost of renewable electricity development in Hawaii.

The purpose of this Act is to facilitate and encourage the development of renewable energy development in Hawaii, reduce the State's dependence on imported oil, reduce the cost of the State's electricity supply by increasing the consumer capacity limit on net metering, eliminating the total capacity limit on net metering, and permitting existing net metered customers to remain with the program once a feed-in tariff or other tariff structures are implemented.

SECTION 2. Chapter 269, part VI, Hawaii Revised Statutes is amended as follows:

1. By amending section 269-101, to read:

"269-101 Definitions. As used in this part:

"Eligible customer-generator" means a metered residential or commercial customer, including a government entity, of an electric utility who owns and operates, leases, or purchases electricity from a solar, wind turbine, biomass, or hydroelectric energy generating facility, or a hybrid system consisting of two or more of these facilities, that is:

(1) Located on the customer's premises;

(2) Operated in parallel with the utility's transmission and distribution facilities;

(3) In conformance with the utility's interconnection requirements; and

(4) Intended primarily to offset part or all of the customer's own electrical requirements.

"Net energy metering" means measuring the difference between the electricity supplied through the electric grid and the electricity generated by an eligible customer-generator and fed back to the electric grid over a monthly billing period; provided that:

(1) Net energy metering shall be accomplished using a single meter capable of registering the flow of electricity in two directions;

(2) An additional meter or meters to monitor the flow of electricity in each direction may be installed with the consent of the customer-generator, at the expense of the electric utility, and the additional metering shall be used only to provide the information necessary to accurately bill or credit the customer-generator, or to collect solar, wind turbine, biomass, or hydroelectric energy generating system performance information for research purposes;

(3) If the existing electrical meter of an eligible customer-generator is not capable of measuring the flow of electricity in two directions, the electric utility shall be responsible for all expenses involved in purchasing and installing a meter that is able to measure electricity flow in two directions;

(4) If an additional meter or meters are installed, the net energy metering calculation shall yield a result identical to that of a single meter; [and]

(5) An eligible customer-generator who already owns an existing solar, wind turbine, biomass, or hydroelectric energy generating facility, or a hybrid system consisting of two or more of these facilities, is eligible to receive net energy metering service in accordance with this part[.]; and

(6) The utility shall not unreasonably deny, burden, or delay net energy metering service upon request by an eligible customer-generator of the utility."

2. By amending section 269-101.5 to read:

"[[]269-101.5[]] Maximum capacity of eligible customer-generator. The eligible customer-generator shall have a capacity of not more than [fifty kilowatts; provided that the public utilities commission may increase the maximum allowable capacity that eligible customer-generators may have to an amount greater than fifty kilowatts by rule or order.] one megawatt."

3. By amending section 269-102 to read:

"269-102 Standard contract or tariff; rate structure. (a) Every electric utility shall develop a standard contract or tariff providing for net energy metering and shall make this contract available to eligible customer-generators, upon request, on a first-come-first-served basis [until the time that the total rated generating capacity produced by eligible customer-generators equals .5 per cent of the electric utility's system peak demand; provided that the public utilities commission may modify, by rule or order, the total rated generating capacity produced by eligible customer-generators; provided further that the public utilities commission shall ensure that a percentage of the total rated generating capacity produced by eligible customer-generators shall be reserved for electricity produced by eligible residential or small commercial customer-generators. The public utilities commission may define, by rule or order, the maximum capacity for eligible residential or small commercial customer-generators. Notwithstanding the generating capacity requirements of this subsection, the public utilities commission may evaluate, on an island-by-island basis, the applicability of the generating capacity requirements of this subsection and, in its discretion, may exempt an island or a utility grid system from the generating capacity requirements].

(b) Each net energy metering contract or tariff shall be identical, with respect to rate structure, to the contract or tariff to which the same customer would be assigned if the customer was not an eligible customer-generator. The charges for all retail rate components for eligible customer-generators shall be based exclusively on the eligible customer-generator's net kilowatt-hour consumption over a monthly billing period. Any new or additional demand charge, standby charge, customer charge, minimum monthly charge, interconnection charge, or other charge that would increase an eligible customer-generator's costs beyond those of other customers in the rate class to which the eligible customer-generator would otherwise be assigned are contrary to the intent of this section, and shall not form a part of net energy metering contracts or tariffs.

[(c) The public utilities commission may amend the rate structure or standard contract or tariff by rule or order.]"

4. By amending section 269-105 to read:

"269-105 Calculation. The net energy metering calculation shall be made by measuring the difference between the electricity supplied to the eligible customer-generator and:

(1) The electricity generated by the eligible customer-generator and fed back to the electric grid over a monthly billing period; and

(2) Any unused kilowatt-hour credits for excess electricity from the eligible customer-generator carried over from previous months since the last twelve-month reconciliation period."

5. By amending section 269-106 to read:

"269-106 Billing periods; twelve-month reconciliation. (a) Billing of net energy metering customers shall be on a monthly basis; provided that the last monthly bill for each twelve-month period shall reconcile for that twelve-month period the net electricity provided by the electric utility with:

(1) The electricity generated by the eligible customer-generator and fed back to the electric grid over the monthly billing period; and

(2) Any unused kilowatt-hour credits for excess electricity from the eligible customer-generator carried over from prior months since the last twelve-month reconciliation period.

(b) [Credits] Kilowatt-hour credits for excess electricity from the eligible customer-generator that remain unused after each twelve-month reconciliation period [may not be carried over to the next twelve-month period.] shall be compensated to the eligible customer-generator by the utility at the rate provided in section 269-27.2(c) for the prior twelve-month period."

6. By amending section 269-107 to read:

"269-107 Net electricity consumers. At the end of each monthly billing period, where the electricity supplied during the period by the electric utility exceeds:

(1) The electricity generated by the eligible customer-generator during that same period; and

(2) Any unused kilowatt-hour credits for excess electricity from the eligible customer-generator carried over from prior months since the last twelve-month reconciliation period,

the eligible customer-generator is a net electricity consumer and the electric utility shall be owed compensation for the eligible customer-generator's net kilowatt-hour consumption over that same period. The compensation owed for the eligible customer-generator's net monthly kilowatt-hour consumption shall be calculated at the retail rate of the rate class the customer is normally assigned to."

7. By amending section 269-108 to read:

"269-108 Net electricity producers; excess electricity credits and credit carry over. At the end of each monthly billing period, where the electricity generated by the eligible customer-generator during the month exceeds the electricity supplied by the electric utility during that same period, the eligible customer-generator is a net electricity producer and the electric utility shall retain any excess kilowatt-hours generated during the prior monthly billing period; provided that the excess electricity generated by the customer-generator, if any, in each monthly billing period shall be carried over to the next month as a [monetary] kilowatt-hour value to the credit of the eligible customer-generator, which credit may accumulate and be used to offset the compensation owed the electric utility for the eligible customer-generator's net kilowatt-hour consumption for succeeding months within each twelve-month period; provided further that the electric utility shall reconcile the eligible customer-generator's electricity production and consumption for each twelve-month period as set forth in section 269-106. [The eligible customer-generator shall not be owed any compensation for excess kilowatt-hours unless the electric utility enters into a purchase agreement with the eligible customer-generator for those excess kilowatt-hours.]"

8. By amending section 269-110 to read:

"269-110 [Termination by eligible customer-generators.] Eligible customer-generators; termination; alternative credits or compensation mechanisms. If an eligible customer-generator terminates the customer relationship with the electric utility, the electric utility shall reconcile the eligible customer‑generator's consumption and production of electricity, including any unused credits for excess electricity from the eligible customer‑generator carried over from prior months, for the period following the last twelve-month reconciliation period to the date of termination of the relationship, according to the requirements set forth in this part.

If the public utilities commission, at any time, establishes alternative mechanisms for crediting or otherwise compensating eligible customer-generators for exported power, eligible customer-generators with existing net energy metering contracts shall have the option of maintaining these existing net energy metering contracts rather than converting to new alternative credits or compensation mechanisms."

9. By amending section 269-111 to read:

"269-111 Safety and performance standards. (a) A solar, wind turbine, biomass, or hydroelectric energy generating system, or a hybrid system consisting of two or more of these facilities, used by an eligible customer-generator shall meet all applicable safety and performance standards established by the National Electrical Code, the Institute of Electrical and Electronics Engineers, and accredited testing laboratories such as the Underwriters Laboratories and, where applicable, rules of the public utilities commission regarding safety and reliability.

(b) For systems of [ten] one hundred kilowatts or less, an eligible customer-generator whose solar, wind turbine, biomass, or hydroelectric energy generating system, or whose hybrid system consisting of two or more of these facilities, meets the standards and rules under subsection (a) shall not be required to install additional controls, perform or pay for additional tests, or purchase additional liability insurance.

(c) For eligible customer-generator systems of greater than [ten] one hundred kilowatts, the public utilities commission, either through decision and order, by tariff adoption, or by rule, shall:

(1) Set forth safety, performance, and reliability standards and requirements; and

(2) Establish the qualifications for exemption from a requirement to install additional controls, perform or pay for additional tests, or purchase additional liability insurance.

(d) The public utilities commission shall initiate a rulemaking proceeding by September 1, 2009 to adopt best practices interconnection standards for solar, wind turbine, biomass, or hydroelectric energy generating facilities.

Upon adoption, the standards shall become the interconnection requirements of each utility subject to the jurisdiction of the public utilities commission. As part of the rulemaking proceeding, the public utilities commission shall consider:

(1) Interconnection standards adopted by other states twenty-four months prior to the rulemaking proceeding;

(2) Standards promulgated by the Federal Energy Regulatory Commission; and

(3) Model standards developed by nonprofit organizations whose primary purpose is to promote renewable energy.

The public utilities commission shall adopt best practices interconnection standards no later than September 1, 2010."

10. By repealing section 269-104:

["269-104 Additional customer-generators. Notwithstanding section 269-102, an electric utility is not obligated to provide net energy metering to additional customer-generators in its service area when the combined total peak generating capacity of all eligible customer-generators served by all the electric utilities in that service area furnishing net energy metering to eligible customer-generators equals .5 per cent of the system peak demand of those electric utilities; provided that the public utilities commission may increase, by rule or order, the allowable percentage of the electric utility's system peak demand produced from eligible customer-generators in the electric utility's service area, whereupon the electric utility will be obligated to provide net energy metering to additional eligible customer-generators in that service area up to the increased percentage amount."]

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

 

INTRODUCED BY:

_____________________________