BILL ANALYSIS Ó
AB 2339
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Date of Hearing: March 30, 2016
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Mike Gatto, Chair
AB 2339
(Irwin) - As Introduced February 18, 2016
SUBJECT: Net energy metering
SUMMARY: Defines "aggregated peak demand" for calculating the
maximum allowed capacity of customer self-generation that
publicly owned electric utilities may use for the requirement
that publicly owned electric utilities must offer net energy
metering (NEM) to their customers. Specifically, this bill:
1)Defines "aggregated peak demand" as the highest sum of the
noncoincident peak demands that occurs in any calendar year of
all customer in the service area of a publicly owned utility.
2)Allows publicly owned electric utility to determine aggregate
customer peak demand using an estimation technique that the
California Energy Commission (CEC) has determined to be
reasonable.
EXISTING LAW:
1)Requires electric utilities to offer NEM to customers until
the total rated generating capacity used by eligible
customer-generators exceeds 5% of the electric utility's
aggregate customer peak demand. (Public Utilities Code Section
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2827)
2)Categorically exempts Los Angeles Department of Water and
Power (LADWP) from the requirement to offer NEM. (Public
Utilities Code Section 2827(b)(3))
3)Defines large electrical corporation to mean an electrical
corporation with more than 100,000 service connections in
California. (Public Utilities Code Section 2827)
4)Requires the California Public Utilities Commission (CPUC) to
require every large electrical corporation to offer NEM until
the large electrical corporation reaches its NEM program limit
or July 1, 2017, whichever is earlier.
5)Specifies that aggregate peak demand means the highest sum of
the noncoincident peak demands of all of the large electrical
corporation's customers that occurs in any calendar year using
a uniform method specified by the CPUC. (Public Utilities Code
Section 2827)
6)Specifies the limit calculated for the large electrical
corporations as:
a) For San Diego Gas and Electric Company (SDG&E), when it
has made 607 megawatts (MWs) of nameplate generating
capacity available to eligible customer-generators.
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b) For Southern California Edison Company (SCE), when it
has made 2,240 MWs of nameplate generating capacity
available to eligible customer-generators.
c) For Pacific Gas and Electric Company (PG&E), when it has
made 2,409 MWs of nameplate generating capacity available
to eligible customer-generators. (Public Utilities Code
Section 2827)
1)Requires the CPUC to develop a standard contract or tariff,
which may include NEM by December 31, 2015 that provides the
following:
a) Sustainable growth of customer sited renewable
generation.
b) Base the contract or tariff on the costs and benefits of
the renewable generation facility.
c) Ensure that the total benefits of the standard contract
or tariff to all customers and the electrical system are
approximately equal to the costs. (Public Utilities Code
Section 2827.1)
7)Requires the CPUC to establish a transition period for any
customer who took service prior to July 1, 2017, in
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consideration of a reasonable expected payback period based on
the year the customer initially took service. (Public
Utilities Code Section 2827.1)
FISCAL EFFECT: Unknown. This bill is keyed non-fiscal by the
Legislative Counsel.
COMMENTS:
1)Author's Statement: "Net energy metering (NEM) is an
innovative program that enables California electric consumers
to invest in solar energy to reduce their energy costs and
support clean, renewable energy. This program provides fair
compensation to electric customers for the excess electricity
supplied to the electric grid while allowing utilities and
other ratepayers to avoid utility and societal costs
associated with the development and maintenance of traditional
generation and distribution infrastructure. This allows
customers all across the state to move toward
self-sustainability in an effort to reduce greenhouse gases
while saving money.
"By law, all utilities are required to offer a NEM program to
its customers on a first-come, first-serve basis until the
generating capacity used by customers exceeds 5% of the
utility's aggregate customer peak demand. Electricity
providers are separated into two categories, investor-owned
utilities (IOUs) and publicly-owned utilities (POUs). IOUs,
including PG&E and [SCE], and POUs now calculate their 5%
limits or caps differently. AB 327 in 2013 codified a CPUC
decision that IOUs use noncoincident peak demand to determine
aggregate customer peak demand, and thus the 5% NEM cap.
However, by calculating the NEM cap using highest peak demand,
POUs are calculating their caps in a way that limits the
number of customers who can access NEM compared with IOUs.
Faced with a lower threshold for the 5% cap, proportionally
more customers in POU territories are unable to participate in
NEM programs than in IOU territories creating a disparity
since some of the largest POUs are located in the Central
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Valley or inland parts of the state.
"At least five POUs have exceeded their 5% NEM caps using
highest peak demand. Without NEM, solar installations have
been steadily declining. Energy consumers who would like to
support renewable energy and earn credits against their energy
bills can no longer do so without these programs. With at
least eight more POUs rapidly approaching their caps, it is
critical that the Legislature establish a consistent statewide
methodology across all electric utilities to ensure more
electric customers can take advantage of NEM programs.
"California remains on the forefront of efforts to decrease
its reliance on fossil fuels and focus on the proactive
benefits of renewable energy. Even LADWP has voluntarily
increased its available amount of net metered solar energy to
reflect methods used by IOUs in response to the huge growth in
solar power. AB 2339 will require POUs to use the same NEM
cap methodology as IOUs. This will create a uniform,
statewide framework for all electric utilities in California
that will offer electric consumers an equal opportunity to
save money and choose cleaner energy."
2)Large Electrical Corporations and Publicly Owned Utilities -
What's the difference? This bill requires all POUs and
electrical cooperatives, except for LADWP to use the method of
calculating the capacity limit on offering NEM that applies to
large electrical corporations.
Electrical corporations are owned by shareholders and
investors and regulated by the CPUC. Publicly owned
utilities, irrigation districts, and electrical cooperatives
are non-profit entities owned by a local government or
customers of the utility and managed by locally elected
officials or public employees.
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Companies that fit the statutory definition of a large
electrical corporation are SCE (3.7 million accounts), PG&E
(5.3 million accounts), and SDG&E (1.4 million accounts).
Companies exempted from the requirement to calculate the NEM
cap using non-coincident peak are: Liberty Utilities,
Pacificorp, and Bear Valley Electric Service.
According to CEC data, there are 45 POUs and Irrigation
Districts and four Electric Cooperatives. If the same
definition (100,000 or more accounts) were applied to POUs and
cooperatives, the following POUs would fit this definition:
LADWP, Sacramento Municipal Utility District (SMUD), Imperial
Irrigation District (IID), Modesto Irrigation District, City
of Riverside, and Turlock Irrigation District. The remaining
POUs and Electric Cooperatives have between five and 70,000
accounts:
-------------------------------------------------------------
| |Number of | Utility Type |
| Utility | Customer | |
| | Accounts | |
| | (2014) | |
|----------------------------------+----------+---------------|
|Eastside Power Authority | 5|Publicly Owned |
|----------------------------------+----------+---------------|
|Power & Water Resources Pooling | 17|Publicly Owned |
|Authority | | |
|----------------------------------+----------+---------------|
|Valley Electric Association | | Cooperative |
| | ?? 44 | |
| | | |
|----------------------------------+----------+---------------|
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|Port of Stockton | |Publicly Owned |
| | ??51 | |
| | | |
|----------------------------------+----------+---------------|
|Victorville, City of | |Publicly Owned |
| | ?? 51 | |
| | | |
|----------------------------------+----------+---------------|
|City of Industry | |Publicly Owned |
| | ?? 80 | |
| | | |
|----------------------------------+----------+---------------|
|Port of Oakland | |Publicly Owned |
| | ?? 134 | |
|----------------------------------+----------+---------------|
|Lathrop ID | 180|Publicly Owned |
|----------------------------------+----------+---------------|
|Cerritos, City of | |Publicly Owned |
| | ?? 303 | |
|----------------------------------+----------+---------------|
|Pittsburg, City of (Island | |Publicly Owned |
|Energy) | ?? 481 | |
|----------------------------------+----------+---------------|
|Rancho Cucamonga Municipal | |Publicly Owned |
|Utility | ?? 581 | |
|----------------------------------+----------+---------------|
|Shelter Cove Resort Improvement | | Special |
|District | ?? 609 | District |
|----------------------------------+----------+---------------|
|Biggs Municipal Utilities | |Publicly Owned |
| | ?? 654 | |
|----------------------------------+----------+---------------|
|Kirkwood Meadows PUD | |Publicly Owned |
| | ?? 764 | |
|----------------------------------+----------+---------------|
|Corona, City of | |Publicly Owned |
| | 1,016 | |
|----------------------------------+----------+---------------|
|Vernon, City of | |Publicly Owned |
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| | 1,133 | |
|----------------------------------+----------+---------------|
|City and County of San Francisco | |Publicly Owned |
| | 2,312 | |
|----------------------------------+----------+---------------|
|Surprise Valley Electric Co-op | | Cooperative |
| | 2,744 | |
|----------------------------------+----------+---------------|
|Gridley Electric Utility | |Publicly Owned |
| | 2,881 | |
|----------------------------------+----------+---------------|
|Needles, City of | |Publicly Owned |
| | 3,520 | |
|----------------------------------+----------+---------------|
|Shasta Lake, City of | |Publicly Owned |
| | 4,423 | |
|----------------------------------+----------+---------------|
|Anza Electric Co-op | | Cooperative |
| | 4,520 | |
|----------------------------------+----------+---------------|
|Healdsburg, City of | |Publicly Owned |
| | 5,718 | |
|----------------------------------+----------+---------------|
|Moreno Valley Electric Utility | |Publicly Owned |
| | 6,185 | |
|----------------------------------+----------+---------------|
|Trinity Public Utilities District | |Publicly Owned |
| | 7,261 | |
|----------------------------------+----------+---------------|
|Ukiah, City of | |Publicly Owned |
| | 7,627 | |
|----------------------------------+----------+---------------|
|Merced Irrigation District | |Publicly Owned |
| | 8,930 | |
|----------------------------------+----------+---------------|
|Lassen Municipal Utility District | |Publicly Owned |
| | 11,227 | |
|----------------------------------+----------+---------------|
|Banning, City of | |Publicly Owned |
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| | 11,888 | |
|----------------------------------+----------+---------------|
|Truckee Donner Public Utilities | |Publicly Owned |
|District | 13,328 | |
|----------------------------------+----------+---------------|
|Plumas-Sierra Rural Electric | | Cooperative |
|Co-op | 14,497 | |
|----------------------------------+----------+---------------|
|Lompoc, City of | |Publicly Owned |
| | 15,584 | |
|----------------------------------+----------+---------------|
|Azusa Light and Water | |Publicly Owned |
| | 16,680 | |
|----------------------------------+----------+---------------|
|Colton Electric Utility | |Publicly Owned |
|Department | 18,443 | |
|----------------------------------+----------+---------------|
|Bear Valley Electric Service | |Investor-Owned |
| | 24,125 | |
|----------------------------------+----------+---------------|
|Lodi Electric Utility | |Publicly Owned |
| | 25,533 | |
|----------------------------------+----------+---------------|
|Palo Alto, City of | |Publicly Owned |
| | 29,192 | |
|----------------------------------+----------+---------------|
|Alameda Municipal Power | |Publicly Owned |
| | 34,298 | |
|----------------------------------+----------+---------------|
|Pasadena Water and Power | |Publicly Owned |
| | 40,734 | |
|----------------------------------+----------+---------------|
|Redding Electric Utility | |Publicly Owned |
| | 43,670 | |
|----------------------------------+----------+---------------|
|Glendale Water and Power* | |Publicly Owned |
| | 43,814 | |
|----------------------------------+----------+---------------|
|PacifiCorp | |Investor-Owned |
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| | 43,937 | |
|----------------------------------+----------+---------------|
|Liberty Utilities | |Investor-Owned |
| | 48,929 | |
|----------------------------------+----------+---------------|
|Burbank Water and Power | |Publicly Owned |
| | 52,368 | |
|----------------------------------+----------+---------------|
|Silicon Valley Power | |Publicly Owned |
| | 53,361 | |
|----------------------------------+----------+---------------|
|Roseville Electric | |Publicly Owned |
| | 57,229 | |
|----------------------------------+----------+---------------|
|Anaheim, City of | |Publicly Owned |
| | 70,667 | |
|----------------------------------+----------+---------------|
|Turlock Irrigation District | |Publicly Owned |
| | 102,381 | |
|----------------------------------+----------+---------------|
|Riverside, City of | |Publicly Owned |
| | 108,238 | |
|----------------------------------+----------+---------------|
|Modesto Irrigation District | |Publicly Owned |
| | 117,132 | |
|----------------------------------+----------+---------------|
|Imperial Irrigation District | |Publicly Owned |
| | 151,410 | |
|----------------------------------+----------+---------------|
|Sacramento Municipal Utility | |Publicly Owned |
|District | 613,326 | |
|----------------------------------+----------+---------------|
|Los Angeles Department of Water & | |Publicly Owned |
|Power | 866,095 | |
|----------------------------------+----------+---------------|
|San Diego Gas & Electric | |Investor-Owned |
| | 1,422,847 | |
|----------------------------------+----------+---------------|
|Southern California Edison | |Investor-Owned |
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| | 3,758,295 | |
|----------------------------------+----------+---------------|
|Pacific Gas & Electric | |Investor-Owned |
| | 5,339,262 | |
-------------------------------------------------------------
* Note: according to a directory published by the
California Municipal Utilities Association Glendale has
85,629 accounts. At the time of this analysis the correct
number of accounts was not known.
The author may wish to consider an amendment to apply the
provisions of this bill to those POUs and electric
cooperatives which have more than 100,000 accounts and to
extend the provisions of this bill to those POUs and electric
cooperative which have more than 25,000 accounts if a POU has
failed to provide a tariff which provides certainty to its
solar customers. Certainty
means:_______________________________________________. A
customer, or customer representative, may request review of
the action of a POU or electric cooperative by the Governor's
Office of Planning and Research.
1)Benefits, Utility Revenues, and Cost of Service: Discussions
about NEM usually include discussions about benefits, utility
revenues, and cost of service. Similar to the proceeding
underway at the CPUC, some POUs are working on addressing
these issues through a public process, particularly those who
have or have nearly reached their NEM caps. The sponsors note
that, at least four POUs have reached their NEM caps and as
many as eight more may reach their caps soon.
One Irrigation District that already reached its cap is
Turlock Irrigation District (TID). TID adopted its new
electric rate structure in December 2014 and included in that
new rate structure a new design for NEM. According to TID,
nearly 10% of all solar installed in the TID have been
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installed since it adopts its NEM successor tariff. They
report that the residential and commercial projects were sold
by 35 solar vendors. TID points out that it has surpassed its
23 MW goal set by SB 1 (Murray), Chapter 132, Statutes of
2006, and will have more than 32 MW of solar once pending
projects are completed.
The City of Palo Alto is working toward implementing its
successor tariff by May 2016 in anticipation of reaching its
current NEM cap by the summer of 2016. A recent City Council
staff report<1> by the City of Palo Alto discusses the issues
that they are addressing in developing their successor
approach to the current NEM structure:
First, given the City's existing electric rate
structures, NEM results in cost-shifting between
customer classes. Customers who adopt distributed
generation and utilize NEM can reduce or completely
avoid costs on their electric utility bills even
though they remain interconnected to the grid and
continue to use grid services.
Second, distributed generation presents challenges
for utilities to sustainably recover the fixed costs
associated with the electric distribution system. As
distributed generation continues to be deployed, the
cost-shift from NEM to non-participating customers
increases. This results in increasingly higher rates
for non-participating customers, which in turn makes
adopting distributed generation even more attractive
for non-participating customers.
Third, an increasing block electricity rate
structure, (or tiered rate structure such as the one
in use in Palo Alto), can create situations in which
---------------------
<1>
http://www.cityofpaloalto.org/civicax/filebank/documents/50383
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highly efficient, low-energy use NEM customers
receive a lower NEM compensation rate than
high-energy consuming NEM customers. Low-energy
consuming households who conserve and have
implemented many home energy efficiency measures may
only reach the first or second electricity usage
tiers over the course of a month. For example, if a
household that consumes 600 kilowatt hours (kWh) per
month installs a solar [photovoltaic] system that is
sized to meet all of the household's electricity
usage over the course of the year, the household
would, in effect, be compensated at a rate of 11.2
?/kWh for the energy generated from their on-site
system under the current rate structure. By
contrast, if a higher energy-using household using
1,200 kWh/month installs a solar system of the exact
same size as the lower-energy consuming household,
the high-energy consuming household is effectively
compensated at 17.4 ?/kWh for the energy generated
from their on-site system.
Therefore, high-energy use consumers are compensated
at a significantly higher rate than low-energy use
consumers for distributed renewable electricity,
although the value of the output may be equivalent.
As a result, NEM combined with tiered rate
structures discourages solar adoption by low-energy
consumers.
2)NEM cap methodology: According to the sponsors, "AB 2339
establishes the same methodology for POUs as IOUs when
calculating their 5% caps for their respective NEM programs."
This bill allows POUs to determine aggregate customer peak
demand using an estimation technique that the Energy
Commission has determined to be reasonable. It defines
aggregate customer peak demand as "the highest sum of the
noncoincident peak demands of all the customers of electric
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utilities in that service area that occurs in any calendar
year."
The method of calculating the aggregate peak demand specified
in this bill differs from the method the CPUC requires. In May
2012 the CPUC issued a decision (D.12-05-036)<2> which
specified, among other things, that within 90 days of the
effective date of this decision, the assigned Commissioner, in
consultation with the Administrative Law Judge and Energy
Division, shall issue a ruling with instructions to SCE,
SDG&E, and PG&E on the methodology they must
On September 4, 2012, the CPUC issued a ruling<3> ordering the
large electric corporations to calculate non-coincident
aggregate customer peak demand as follows:
a) Non-coincident peak demand should be calculated using
load research studies to estimate load profiles by customer
class using standard statistical sampling techniques to
select representative load research samples.
b) Use four-year moving average of the most recently
available annual non-coincident peak load data.
c) Update the non-coincident peak demand annually but not
decrease below the most recent level determined.
d) Use 15- or 30-minute interval data to calculate
--------------------------
<2> http://docs.cpuc.ca.gov/word_pdf/FINAL_DECISION/167591.pdf
<3>
http://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M027/K113/271133
41.PDF
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non-coincident aggregate customer peak demand in 2012, but
must use 15-minute interval data for the purposes of
calculating non-coincident aggregate customer peak demand
in subsequent years.
Not all POUs have installed smart meters. This means that
they would be unable to collect interval data as the CPUC has
ordered the investor-owned utilities to use.
To ensure consistency in this calculation, the author may wish
to amend the bill to specify that the aggregated peak demand
be calculated in a manner consistent with the CPUC ruling. If
the POU does not have access to 15- or 30-minute interval data
to calculate non-coincident demand it should base the
calculation on the load studies and four year moving average,
and not decrease the level below the most recent level
determined, consistent with the investor-owned utilities.
1)Transition to a successor tariff: In addition to establishing
a method for calculating the aggregate cap on offering NEM to
utility customers, AB 327 (Perea), Chapter 611, Statutes of
2013, also including statute directing the CPUC to develop a
NEM successor tariff that would replace the current NEM tariff
once the NEM cap is reached. The CPUC recently concluded phase
one of that process and has directed its staff to take steps,
including but not limited to collecting data, holding
workshops, and developing reports and information tools, that
would contribute to the CPUC's administration of the NEM
successor tariff and any programs that implement alternatives
for growth of renewable distributed generation among
residential customers in disadvantaged communities, as well as
advance consumer protection for customers.
Because POUs, Irrigation Districts, and Electric Cooperatives
have governance by Boards and elected officials, they also
develop and adopt their electric rate structures through a
public process. For some, their process has been completed and
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a successor tariff has been approved by their governing body,
such as in the case of TID. It is unclear if the author
intends to invalidate an action that has already been adopted
by a governing board of a POU or electric cooperative.
The author may wish to consider an amendment to require the
specified calculation of the aggregate peak demand applies to
those POUs that have not yet adopted a successor tariff as of
January 1, 2016.
This bill is also unclear on whether a customer enrolled in a
NEM successor tariff would be "grandfathered" back to the old
NEM or if they would continue on the current NEM. This is
addressed if the author amends the bill to apply the
calculation of aggregated peak demand to those POUs that have
adopted a successor tariff as of January 1, 2016
2)Related legislation:
a) SB 550 (Hertzberg, POU NEM cap calculation) - Died on
the Senate Appropriations Committee suspense file.
b) AB 1530 (Levine) - Pending in the Senate Energy,
Utilities and Communications Committee.
c) AB 327 (Perea, residential rate reform, distributed
energy resources, and large electrical corporation NEM cap
calculation) - Chaptered by Secretary of State - Chapter
611, Statutes of 2013.
3)Support and Opposition: Supporters point out the benefits of
rooftop solar and that without net metering no rooftop solar
market would exist in POU service areas. Other supporters
point out the need for consistency in the method used to
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calculate the NEM cap. They point out that at least five POUs
have exceeded their NEM caps, effectively shutting down solar
growth in these areas and their contribution towards the
state's clean energy and climate goals. They point out that
some companies have stopped doing business in these service
areas, thereby severely limit the ability of customers to go
solar and receive savings.
Opponents point out that NEM provides full retail rate value
for the electricity they generate on site, which is more than
the actual value of the generation, and allows an NEM customer
to avoid the utility's transmission and distribution costs,
even though the customer relies on these assets. They express
concerns that the cost of service for the NEM customers must
be borne by non-NEM customers, many of whom are low income,
elderly, or live in multi-family buildings. They also express
concerns about Proposition 26. Proposition 26, enacted in 2010
by the voters, restricting charges imposed by local
governments when the charges are for a specific government
service or product that is not directly provided to the payor
or is provided to those not charged. They point out that
non-NEM customer will pay more for services and products than
the NEM customer and oppose this bill because it would place
local governments in a position where they risk violating the
California Constitution.
4)Suggested Amendments:
SECTION 1.
Section 2827 of the Public Utilities Code is amended to read:
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2827. (a) The Legislature finds and declares that a program to
provide net energy metering combined with net surplus
compensation, co-energy metering, and wind energy co-metering
for eligible customer-generators is one way to encourage
substantial private investment in renewable energy resources,
stimulate in-state economic growth, reduce demand for
electricity during peak consumption periods, help stabilize
California's energy supply infrastructure, enhance the continued
diversification of California's energy resource mix, reduce
interconnection and administrative costs for electricity
suppliers, and encourage conservation and efficiency.
(b) As used in this section, the following terms have the
following meanings:
(1) "Co-energy metering" means a program that is the same in all
other respects as a net energy metering program, except that the
local publicly owned electric utility has elected to apply a
generation-to-generation energy and time-of-use credit formula
as provided in subdivision (i).
(2) "Electrical cooperative" means an electrical cooperative as
defined in Section 2776.
(3) "Electric utility" means an electrical corporation, a local
publicly owned electric utility, or an electrical cooperative,
or any other entity, except an electric service provider, that
offers electrical service. This section shall not apply to a
local publicly owned electric utility that serves more than
750,000 customers and that also conveys water to its customers.
(4) (A) "Eligible customer-generator" means a residential
customer, small commercial customer as defined in subdivision
(h) of Section 331, or commercial, industrial, or agricultural
customer of an electric utility, who uses a renewable electrical
generation facility, or a combination of those facilities, with
a total capacity of not more than one megawatt, that is located
on the customer's owned, leased, or rented premises, and is
interconnected and operates in parallel with the electrical
grid, and is intended primarily to offset part or all of the
customer's own electrical requirements.
(B) (i) Notwithstanding subparagraph (A), "eligible
customer-generator" includes the Department of Corrections and
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Rehabilitation using a renewable electrical generation
technology, or a combination of renewable electrical generation
technologies, with a total capacity of not more than eight
megawatts, that is located on the department's owned, leased, or
rented premises, and is interconnected and operates in parallel
with the electrical grid, and is intended primarily to offset
part or all of the facility's own electrical requirements. The
amount of any wind generation exported to the electrical grid
shall not exceed 1.35 megawatt at any time.
(ii) Notwithstanding paragraph (2) of subdivision (e), an
electrical corporation shall be afforded a prudent but necessary
time, as determined by the executive director of the commission,
to study the impacts of a request for interconnection of a
renewable generator with a capacity of greater than one megawatt
under this subparagraph. If the study reveals the need for
upgrades to the transmission or distribution system arising
solely from the interconnection, the electrical corporation
shall be afforded the time necessary to complete those upgrades
before the interconnection and those costs shall be borne by the
customer-generator. Upgrade projects shall comply with
applicable state and federal requirements, including
requirements of the Federal Energy Regulatory Commission.
(C) (i) For purposes of this subparagraph, a "United States
Armed Forces base or facility" is an establishment under the
jurisdiction of the United States Army, Navy, Air Force, Marine
Corps, or Coast Guard.
(ii) Notwithstanding subparagraph (A), a United States Armed
Forces base or facility is an "eligible customer-generator" if
the base or facility uses a renewable electrical generation
facility, or a combination of those facilities, the renewable
electrical generation facility is located on premises owned,
leased, or rented by the United States Armed Forces base or
facility, the renewable electrical generation facility is
interconnected and operates in parallel with the electrical
grid, the renewable electrical generation facility is intended
primarily to offset part or all of the base or facility's own
electrical requirements, and the renewable electrical generation
facility has a generating capacity that does not exceed the
lesser of 12 megawatts or one megawatt greater than the minimum
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load of the base or facility over the prior 36 months. Unless
prohibited by federal law, a renewable electrical generation
facility shall not be eligible for net energy metering for
privatized military housing pursuant to this subparagraph if the
renewable electrical generation facility was procured using a
sole source process. A renewable electrical generation facility
procured using best value criteria, if otherwise eligible, may
be used for net energy metering for privatized military housing
pursuant to this subparagraph. For these purposes, "best value
criteria" means a value determined by objective criteria and may
include, but is not limited to, price, features, functions, and
life-cycle costs.
(iii) A United States Armed Forces base or facility that is an
eligible customer generator pursuant to this subparagraph shall
not receive compensation for exported generation.
(iv) Notwithstanding paragraph (2) of subdivision (e), an
electrical corporation shall be afforded a prudent but necessary
time, as determined by the executive director of the commission
but not less than 60 working days, to study the impacts of a
request for interconnection of a renewable electrical generation
facility with a capacity of greater than one megawatt pursuant
to this subparagraph. If the study reveals the need for upgrades
to the transmission or distribution system arising solely from
the interconnection, the electrical corporation shall be
afforded the time necessary to complete those upgrades before
the interconnection and the costs of those upgrades shall be
borne by the eligible customer-generator. Upgrade projects shall
comply with applicable state and federal requirements, including
requirements of the Federal Energy Regulatory Commission. For
any renewable generation facility that interconnects directly to
the transmission grid or that requires transmission upgrades,
the United States Armed Forces base or facility shall comply
with all Federal Energy Regulatory Commission interconnection
procedures and requirements.
(v) An electrical corporation shall make a tariff, as approved
by the commission, available pursuant to this subparagraph by
November 1, 2015.
(5) "Large electrical corporation utility " means
(a) a electrical corporation with more than 100,000 service
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connections in California
(b) a publicly owned utility, irrigation district, or electrical
cooperative with more than 100,000 service connections
(c) a publicly owned utility, irrigation district, or electrical
cooperative with more than 25,000 service connections if it has
failed to provide a tariff which provides certainty to its solar
customers. Certainty
means:_______________________________________________.
(6) "Net energy metering" means measuring the difference between
the electricity supplied through the electrical grid and the
electricity generated by an eligible customer-generator and fed
back to the electrical grid over a 12-month period as described
in subdivisions (c) and (h).
(7) "Net surplus customer-generator" means an eligible
customer-generator that generates more electricity during a
12-month period than is supplied by the electric utility to the
eligible customer-generator during the same 12-month period.
(8) "Net surplus electricity" means all electricity generated by
an eligible customer-generator measured in kilowatthours over a
12-month period that exceeds the amount of electricity consumed
by that eligible customer-generator.
(9) "Net surplus electricity compensation" means a per
kilowatthour rate offered by the electric utility to the net
surplus customer-generator for net surplus electricity that is
set by the ratemaking authority pursuant to subdivision (h).
(10) "Ratemaking authority" means, for an electrical
corporation, the commission, for an electrical cooperative, its
ratesetting body selected by its shareholders or members, and
for a local publicly owned electric utility, the local elected
body responsible for setting the rates of the local publicly
owned utility.
(11) "Renewable electrical generation facility" means a facility
that generates electricity from a renewable source listed in
paragraph (1) of subdivision (a) of Section 25741 of the Public
Resources Code. A small hydroelectric generation facility is not
an eligible renewable electrical generation facility if it will
cause an adverse impact on instream beneficial uses or cause a
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change in the volume or timing of streamflow.
(12) "Wind energy co-metering" means any wind energy project
greater than 50 kilowatts, but not exceeding one megawatt, where
the difference between the electricity supplied through the
electrical grid and the electricity generated by an eligible
customer-generator and fed back to the electrical grid over a
12-month period is as described in subdivision (h). Wind energy
co-metering shall be accomplished pursuant to Section 2827.8.
(c) (1) Except as provided in paragraph (4) and in Section
2827.1, every electric utility shall develop a standard contract
or tariff providing for net energy metering, and shall make this
standard contract or tariff available to eligible
customer-generators, upon request, on a first-come-first-served
basis until the time that the total rated generating capacity
used by eligible customer-generators exceeds 5 percent of the
electric utility's aggregate customer peak demand. Net energy
metering shall be accomplished using a single meter capable of
registering the flow of electricity in two directions. An
additional meter or meters to monitor the flow of electricity in
each direction may be installed with the consent of the eligible
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 eligible
customer-generator pursuant to subdivision (h), or to collect
generating system performance information for research purposes
relative to a renewable electrical generation facility. If the
existing electrical meter of an eligible customer-generator is
not capable of measuring the flow of electricity in two
directions, the eligible customer-generator shall be responsible
for all expenses involved in purchasing and installing a meter
that is able to measure electricity flow in two directions. If
an additional meter or meters are installed, the net energy
metering calculation shall yield a result identical to that of a
single meter. An eligible customer-generator that is receiving
service other than through the standard contract or tariff may
elect to receive service through the standard contract or tariff
until the electric utility reaches the generation limit set
forth in this paragraph. Once the generation limit is reached,
only eligible customer-generators that had previously elected to
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receive service pursuant to the standard contract or tariff have
a right to continue to receive service pursuant to the standard
contract or tariff. Eligibility for net energy metering does not
limit an eligible customer-generator's eligibility for any other
rebate, incentive, or credit provided by the electric utility,
or pursuant to any governmental program, including rebates and
incentives provided pursuant to the California Solar Initiative.
(2) An electrical corporation shall include a provision in the
net energy metering contract or tariff requiring that any
customer with an existing electrical generating facility and
meter who enters into a new net energy metering contract shall
provide an inspection report to the electrical corporation,
unless the electrical generating facility and meter have been
installed or inspected within the previous three years. The
inspection report shall be prepared by a California licensed
contractor who is not the owner or operator of the facility and
meter. A California licensed electrician shall perform the
inspection of the electrical portion of the facility and meter.
(3) (A) On an annual basis, every electric utility shall make
available to the ratemaking authority information on the total
rated generating capacity used by eligible customer-generators
that are customers of that provider in the provider's service
area and the net surplus electricity purchased by the electric
utility pursuant to this section.
(B) An electric service provider operating pursuant to Section
394 shall make available to the ratemaking authority the
information required by this paragraph for each eligible
customer-generator that is their customer for each service area
of an electrical corporation, local publicly owned electric
utility, or electrical cooperative, in which the eligible
customer-generator has net energy metering.
(C) The ratemaking authority shall develop a process for making
the information required by this paragraph available to electric
utilities, and for using that information to determine when,
pursuant to paragraphs (1) and (4), an electric utility is not
obligated to provide net energy metering to additional eligible
customer-generators in its service area.
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(4) (A) (i) An electric utility that is not a large electrical
corporation utility is not obligated to provide net energy
metering to additional eligible customer-generators in its
service area when the combined total peak demand of all
electricity used by eligible customer-generators served by all
the electric utilities in that service area furnishing net
energy metering to eligible customer-generators exceeds 5
percent of the aggregate customer peak demand of those electric
utilities. An electric utility that is not a large electrical
corporation may determine aggregate customer peak demand using
an estimation technique that the Energy Commission has
determined to be reasonable. For the purpose of calculating the
program limit of a large electrical utility that is not a large
electrical corporation, the "aggregate customer peak demand"
means the highest sum of the noncoincident peak demands of all
of the large electrical corporation's customers that occurs in
any calendar year. To determine the aggregate customer peak
demand, every large electrical utility shall use a uniform
method. If the large electrical utility does not have access to
15- or 30-minute interval data to calculate non-coincident
demand it should base the calculation on load research studies
to estimate load profiles by customer class using standard
statistical sampling techniques, using a four year moving
average, and not decrease the level below the most recent level
determined.
(ii) For the purpose of calculating the program limit of an
electric utility that is not a large electrical corporation, the
"aggregate customer peak demand" means the highest sum of the
noncoincident peak demands of all the customers of electric
utilities in that service area that occurs in any calendar year.
(ii) If a large electric utility that is not a large electrical
corporation has reached its program limit all new
customer-generators shall be subject to the standard contract or
tariff developed and adopted by January 1, 2016 the governing
board of the utility and any rules, terms, and rates developed
pursuant to subdivision.
(iii) A customer, or customer representative, may request review
of the action of a POU or electric cooperative by the Governor's
Office of Planning and Research.
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(B) The commission shall require every large electrical
corporation to make the standard contract or tariff available to
eligible customer-generators, continuously and without
interruption, until such times as the large electrical
corporation reaches its net energy metering program limit or
July 1, 2017, whichever is earlier. A large electrical
corporation reaches its program limit when the combined total
peak demand of all electricity used by eligible
customer-generators served by all the electric utilities in the
large electrical corporation's service area furnishing net
energy metering to eligible customer-generators exceeds 5
percent of the aggregate customer peak demand of those electric
utilities. For purposes of calculating a large electrical
corporation's program limit, "aggregate customer peak demand"
means the highest sum of the noncoincident peak demands of all
of the large electrical corporation's customers that occurs in
any calendar year. To determine the aggregate customer peak
demand, every large electrical corporation shall use a uniform
method approved by the commission. The program limit calculated
pursuant to this paragraph shall not be less than the following:
(i) For San Diego Gas and Electric Company, when it has made 607
megawatts of nameplate generating capacity available to eligible
customer-generators.
(ii) For Southern California Edison Company, when it has made
2,240 megawatts of nameplate generating capacity available to
eligible customer-generators.
(iii) For Pacific Gas and Electric Company, when it has made
2,409 megawatts of nameplate generating capacity available to
eligible customer-generators.
(C) Every large electrical corporation shall file a monthly
report with the commission detailing the progress toward the net
energy metering program limit established in subparagraph (B).
The report shall include separate calculations on progress
toward the limits based on operating solar energy systems,
cumulative numbers of interconnection requests for net energy
metering eligible systems, and any other criteria required by
the commission.
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(D) Beginning July 1, 2017, or upon reaching the net metering
program limit of subparagraph (B), whichever is earlier, the
obligation of a large electrical corporation to provide service
pursuant to a standard contract or tariff shall be pursuant to
Section 2827.1 and applicable state and federal requirements.
(d) Every electric utility shall make all necessary forms and
contracts for net energy metering and net surplus electricity
compensation service available for download from the Internet.
(e) (1) Every electric utility shall ensure that requests for
establishment of net energy metering and net surplus electricity
compensation are processed in a time period not exceeding that
for similarly situated customers requesting new electric
service, but not to exceed 30 working days from the date it
receives a completed application form for net energy metering
service or net surplus electricity compensation, including a
signed interconnection agreement from an eligible
customer-generator and the electric inspection clearance from
the governmental authority having jurisdiction.
(2) Every electric utility shall ensure that requests for an
interconnection agreement from an eligible customer-generator
are processed in a time period not to exceed 30 working days
from the date it receives a completed application form from the
eligible customer-generator for an interconnection agreement.
(3) If an electric utility is unable to process a request within
the allowable timeframe pursuant to paragraph (1) or (2), it
shall notify the eligible customer-generator and the ratemaking
authority of the reason for its inability to process the request
and the expected completion date.
(f) (1) If a customer participates in direct transactions
pursuant to paragraph (1) of subdivision (b) of Section 365, or
Section 365.1, with an electric service provider that does not
provide distribution service for the direct transactions, the
electric utility that provides distribution service for the
eligible customer-generator is not obligated to provide net
energy metering or net surplus electricity compensation to the
customer.
(2) If a customer participates in direct transactions pursuant
to paragraph (1) of subdivision (b) of Section 365 or 365.1 with
an electric service provider, and the customer is an eligible
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customer-generator, the electric utility that provides
distribution service for the direct transactions may recover
from the customer's electric service provider the incremental
costs of metering and billing service related to net energy
metering and net surplus electricity compensation in an amount
set by the ratemaking authority.
(g) Except for the time-variant kilowatthour pricing portion of
any tariff adopted by the commission pursuant to paragraph (4)
of subdivision (a) of Section 2851, each net energy metering
contract or tariff shall be identical, with respect to rate
structure, all retail rate components, and any monthly charges,
to the contract or tariff to which the same customer would be
assigned if the customer did not use a renewable electrical
generation facility, except that eligible customer-generators
shall not be assessed standby charges on the electrical
generating capacity or the kilowatthour production of a
renewable electrical generation facility. The charges for all
retail rate components for eligible customer-generators shall be
based exclusively on the customer-generator's net kilowatthour
consumption over a 12-month period, without regard to the
eligible customer-generator's choice as to from whom it
purchases electricity that is not self-generated. Any new or
additional demand charge, standby charge, customer charge,
minimum monthly charge, interconnection charge, or any other
charge that would increase an eligible customer-generator's
costs beyond those of other customers who are not eligible
customer-generators in the rate class to which the eligible
customer-generator would otherwise be assigned if the customer
did not own, lease, rent, or otherwise operate a renewable
electrical generation facility is contrary to the intent of this
section, and shall not form a part of net energy metering
contracts or tariffs.
(h) For eligible customer-generators, the net energy metering
calculation shall be made by measuring the difference between
the electricity supplied to the eligible customer-generator and
the electricity generated by the eligible customer-generator and
fed back to the electrical grid over a 12-month period. The
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following rules shall apply to the annualized net metering
calculation:
(1) The eligible residential or small commercial
customer-generator, at the end of each 12-month period following
the date of final interconnection of the eligible
customer-generator's system with an electric utility, and at
each anniversary date thereafter, shall be billed for
electricity used during that 12-month period. The electric
utility shall determine if the eligible residential or small
commercial customer-generator was a net consumer or a net
surplus customer-generator during that period.
(2) At the end of each 12-month period, where the electricity
supplied during the period by the electric utility exceeds the
electricity generated by the eligible residential or small
commercial customer-generator during that same period, the
eligible residential or small commercial customer-generator is a
net electricity consumer and the electric utility shall be owed
compensation for the eligible customer-generator's net
kilowatthour consumption over that 12-month period. The
compensation owed for the eligible residential or small
commercial customer-generator's consumption shall be calculated
as follows:
(A) For all eligible customer-generators taking service under
contracts or tariffs employing "baseline" and "over baseline"
rates, any net monthly consumption of electricity shall be
calculated according to the terms of the contract or tariff to
which the same customer would be assigned to, or be eligible
for, if the customer was not an eligible customer-generator. If
those same customer-generators are net generators over a billing
period, the net kilowatthours generated shall be valued at the
same price per kilowatthour as the electric utility would charge
for the baseline quantity of electricity during that billing
period, and if the number of kilowatthours generated exceeds the
baseline quantity, the excess shall be valued at the same price
per kilowatthour as the electric utility would charge for
electricity over the baseline quantity during that billing
period.
(B) For all eligible customer-generators taking service under
contracts or tariffs employing time-of-use rates, any net
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monthly consumption of electricity shall be calculated according
to the terms of the contract or tariff to which the same
customer would be assigned, or be eligible for, if the customer
was not an eligible customer-generator. When those same
customer-generators are net generators during any discrete
time-of-use period, the net kilowatthours produced shall be
valued at the same price per kilowatthour as the electric
utility would charge for retail kilowatthour sales during that
same time-of-use period. If the eligible customer-generator's
time-of-use electrical meter is unable to measure the flow of
electricity in two directions, paragraph (1) of subdivision (c)
shall apply.
(C) For all eligible residential and small commercial
customer-generators and for each billing period, the net balance
of moneys owed to the electric utility for net consumption of
electricity or credits owed to the eligible customer-generator
for net generation of electricity shall be carried forward as a
monetary value until the end of each 12-month period. For all
eligible commercial, industrial, and agricultural
customer-generators, the net balance of moneys owed shall be
paid in accordance with the electric utility's normal billing
cycle, except that if the eligible commercial, industrial, or
agricultural customer-generator is a net electricity producer
over a normal billing cycle, any excess kilowatthours generated
during the billing cycle shall be carried over to the following
billing period as a monetary value, calculated according to the
procedures set forth in this section, and appear as a credit on
the eligible commercial, industrial, or agricultural
customer-generator's account, until the end of the annual period
when paragraph (3) shall apply.
(3) At the end of each 12-month period, where the electricity
generated by the eligible customer-generator during the 12-month
period exceeds the electricity supplied by the electric utility
during that same period, the eligible customer-generator is a
net surplus customer-generator and the electric utility, upon an
affirmative election by the net surplus customer-generator,
shall either (A) provide net surplus electricity compensation
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for any net surplus electricity generated during the prior
12-month period, or (B) allow the net surplus customer-generator
to apply the net surplus electricity as a credit for
kilowatthours subsequently supplied by the electric utility to
the net surplus customer-generator. For an eligible
customer-generator that does not affirmatively elect to receive
service pursuant to net surplus electricity compensation, the
electric utility shall retain any excess kilowatthours generated
during the prior 12-month period. The eligible
customer-generator not affirmatively electing to receive service
pursuant to net surplus electricity compensation shall not be
owed any compensation for the net surplus electricity unless the
electric utility enters into a purchase agreement with the
eligible customer-generator for those excess kilowatthours.
Every electric utility shall provide notice to eligible
customer-generators that they are eligible to receive net
surplus electricity compensation for net surplus electricity,
that they must elect to receive net surplus electricity
compensation, and that the 12-month period commences when the
electric utility receives the eligible customer-generator's
election. For an electric utility that is an electrical
corporation or electrical cooperative, the commission may adopt
requirements for providing notice and the manner by which
eligible customer-generators may elect to receive net surplus
electricity compensation.
(4) (A) An eligible customer-generator with multiple meters may
elect to aggregate the electrical load of the meters located on
the property where the renewable electrical generation facility
is located and on all property adjacent or contiguous to the
property on which the renewable electrical generation facility
is located, if those properties are solely owned, leased, or
rented by the eligible customer-generator. If the eligible
customer-generator elects to aggregate the electric load
pursuant to this paragraph, the electric utility shall use the
aggregated load for the purpose of determining whether an
eligible customer-generator is a net consumer or a net surplus
customer-generator during a 12-month period.
(B) If an eligible customer-generator chooses to aggregate
pursuant to subparagraph (A), the eligible customer-generator
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shall be permanently ineligible to receive net surplus
electricity compensation, and the electric utility shall retain
any kilowatthours in excess of the eligible customer-generator's
aggregated electrical load generated during the 12-month period.
(C) If an eligible customer-generator with multiple meters
elects to aggregate the electrical load of those meters pursuant
to subparagraph (A), and different rate schedules are applicable
to service at any of those meters, the electricity generated by
the renewable electrical generation facility shall be allocated
to each of the meters in proportion to the electrical load
served by those meters. For example, if the eligible
customer-generator receives electric service through three
meters, two meters being at an agricultural rate that each
provide service to 25 percent of the customer's total load, and
a third meter, at a commercial rate, that provides service to 50
percent of the customer's total load, then 50 percent of the
electrical generation of the eligible renewable generation
facility shall be allocated to the third meter that provides
service at the commercial rate and 25 percent of the generation
shall be allocated to each of the two meters providing service
at the agricultural rate. This proportionate allocation shall be
computed each billing period.
(D) This paragraph shall not become operative for an electrical
corporation unless the commission determines that allowing
eligible customer-generators to aggregate their load from
multiple meters will not result in an increase in the expected
revenue obligations of customers who are not eligible
customer-generators. The commission shall make this
determination by September 30, 2013. In making this
determination, the commission shall determine if there are any
public purpose or other noncommodity charges that the eligible
customer-generators would pay pursuant to the net energy
metering program as it exists prior to aggregation, that the
eligible customer-generator would not pay if permitted to
aggregate the electrical load of multiple meters pursuant to
this paragraph.
(E) A local publicly owned electric utility or electrical
cooperative shall only allow eligible customer-generators to
aggregate their load if the utility's ratemaking authority
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determines that allowing eligible customer-generators to
aggregate their load from multiple meters will not result in an
increase in the expected revenue obligations of customers that
are not eligible customer-generators. The ratemaking authority
of a local publicly owned electric utility or electrical
cooperative shall make this determination within 180 days of the
first request made by an eligible customer-generator to
aggregate their load. In making the determination, the
ratemaking authority shall determine if there are any public
purpose or other noncommodity charges that the eligible
customer-generator would pay pursuant to the net energy metering
or co-energy metering program of the utility as it exists prior
to aggregation, that the eligible customer-generator would not
pay if permitted to aggregate the electrical load of multiple
meters pursuant to this paragraph. If the ratemaking authority
determines that load aggregation will not cause an incremental
rate impact on the utility's customers that are not eligible
customer-generators, the local publicly owned electric utility
or electrical cooperative shall permit an eligible
customer-generator to elect to aggregate the electrical load of
multiple meters pursuant to this paragraph. The ratemaking
authority may reconsider any determination made pursuant to this
subparagraph in a subsequent public proceeding.
(F) For purposes of this paragraph, parcels that are divided by
a street, highway, or public thoroughfare are considered
contiguous, provided they are otherwise contiguous and under the
same ownership.
(G) An eligible customer-generator may only elect to aggregate
the electrical load of multiple meters if the renewable
electrical generation facility, or a combination of those
facilities, has a total generating capacity of not more than one
megawatt.
(H) Notwithstanding subdivision (g), an eligible
customer-generator electing to aggregate the electrical load of
multiple meters pursuant to this subdivision shall remit service
charges for the cost of providing billing services to the
electric utility that provides service to the meters.
(5) (A) The ratemaking authority shall establish a net surplus
electricity compensation valuation to compensate the net surplus
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customer-generator for the value of net surplus electricity
generated by the net surplus customer-generator. The commission
shall establish the valuation in a ratemaking proceeding. The
ratemaking authority for a local publicly owned electric utility
shall establish the valuation in a public proceeding. The net
surplus electricity compensation valuation shall be established
so as to provide the net surplus customer-generator just and
reasonable compensation for the value of net surplus
electricity, while leaving other ratepayers unaffected. The
ratemaking authority shall determine whether the compensation
will include, where appropriate justification exists, either or
both of the following components:
(i) The value of the electricity itself.
(ii) The value of the renewable attributes of the electricity.
(B) In establishing the rate pursuant to subparagraph (A), the
ratemaking authority shall ensure that the rate does not result
in a shifting of costs between eligible customer-generators and
other bundled service customers.
(6) (A) Upon adoption of the net surplus electricity
compensation rate by the ratemaking authority, any renewable
energy credit, as defined in Section 399.12, for net surplus
electricity purchased by the electric utility shall belong to
the electric utility. Any renewable energy credit associated
with electricity generated by the eligible customer-generator
that is utilized by the eligible customer-generator shall remain
the property of the eligible customer-generator.
(B) Upon adoption of the net surplus electricity compensation
rate by the ratemaking authority, the net surplus electricity
purchased by the electric utility shall count toward the
electric utility's renewables portfolio standard annual
procurement targets for the purposes of paragraph (1) of
subdivision (b) of Section 399.15, or for a local publicly owned
electric utility, the renewables portfolio standard annual
procurement targets established pursuant to Section 399.30.
(7) The electric utility shall provide every eligible
residential or small commercial customer-generator with net
electricity consumption and net surplus electricity generation
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information with each regular bill. That information shall
include the current monetary balance owed the electric utility
for net electricity consumed, or the net surplus electricity
generated, since the last 12-month period ended. Notwithstanding
this subdivision, an electric utility shall permit that customer
to pay monthly for net energy consumed.
(8) If an eligible residential or small commercial
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 during any part of a 12-month period following the
last reconciliation, according to the requirements set forth in
this subdivision, except that those requirements shall apply
only to the months since the most recent 12-month bill.
(9) If an electric service provider or electric utility
providing net energy metering to a residential or small
commercial customer-generator ceases providing that electric
service to that customer during any 12-month period, and the
customer-generator enters into a new net energy metering
contract or tariff with a new electric service provider or
electric utility, the 12-month period, with respect to that new
electric service provider or electric utility, shall commence on
the date on which the new electric service provider or electric
utility first supplies electric service to the
customer-generator.
(i) Notwithstanding any other provisions of this section,
paragraphs (1), (2), and (3) shall apply to an eligible
customer-generator with a capacity of more than 10 kilowatts,
but not exceeding one megawatt, that receives electric service
from a local publicly owned electric utility that has elected to
utilize a co-energy metering program unless the local publicly
owned electric utility chooses to provide service for eligible
customer-generators with a capacity of more than 10 kilowatts in
accordance with subdivisions (g) and (h):
(1) The eligible customer-generator shall be required to utilize
a meter, or multiple meters, capable of separately measuring
electricity flow in both directions. All meters shall provide
time-of-use measurements of electricity flow, and the customer
shall take service on a time-of-use rate schedule. If the
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existing meter of the eligible customer-generator is not a
time-of-use meter or is not capable of measuring total flow of
electricity in both directions, the eligible customer-generator
shall be responsible for all expenses involved in purchasing and
installing a meter that is both time-of-use and able to measure
total electricity flow in both directions. This subdivision
shall not restrict the ability of an eligible customer-generator
to utilize any economic incentives provided by a governmental
agency or an electric utility to reduce its costs for purchasing
and installing a time-of-use meter.
(2) The consumption of electricity from the local publicly owned
electric utility shall result in a cost to the eligible
customer-generator to be priced in accordance with the standard
rate charged to the eligible customer-generator in accordance
with the rate structure to which the customer would be assigned
if the customer did not use a renewable electrical generation
facility. The generation of electricity provided to the local
publicly owned electric utility shall result in a credit to the
eligible customer-generator and shall be priced in accordance
with the generation component, established under the applicable
structure to which the customer would be assigned if the
customer did not use a renewable electrical generation facility.
(3) All costs and credits shall be shown on the eligible
customer-generator's bill for each billing period. In any months
in which the eligible customer-generator has been a net consumer
of electricity calculated on the basis of value determined
pursuant to paragraph (2), the customer-generator shall owe to
the local publicly owned electric utility the balance of
electricity costs and credits during that billing period. In any
billing period in which the eligible customer-generator has been
a net producer of electricity calculated on the basis of value
determined pursuant to paragraph (2), the local publicly owned
electric utility shall owe to the eligible customer-generator
the balance of electricity costs and credits during that billing
period. Any net credit to the eligible customer-generator of
electricity costs may be carried forward to subsequent billing
periods, provided that a local publicly owned electric utility
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may choose to carry the credit over as a kilowatthour credit
consistent with the provisions of any applicable contract or
tariff, including any differences attributable to the time of
generation of the electricity. At the end of each 12-month
period, the local publicly owned electric utility may reduce any
net credit due to the eligible customer-generator to zero.
(j) A renewable electrical generation facility 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, including Underwriters
Laboratories Incorporated and, where applicable, rules of the
commission regarding safety and reliability. A
customer-generator whose renewable electrical generation
facility meets those standards and rules shall not be required
to install additional controls, perform or pay for additional
tests, or purchase additional liability insurance.
(k) If the commission determines that there are cost or revenue
obligations for an electrical corporation that may not be
recovered from customer-generators acting pursuant to this
section, those obligations shall remain within the customer
class from which any shortfall occurred and shall not be shifted
to any other customer class. Net energy metering and co-energy
metering customers shall not be exempt from the public goods
charges imposed pursuant to Article 7 (commencing with Section
381), Article 8 (commencing with Section 385), or Article 15
(commencing with Section 399) of Chapter 2.3 of Part 1.
(l) A net energy metering, co-energy metering, or wind energy
co-metering customer shall reimburse the Department of Water
Resources for all charges that would otherwise be imposed on the
customer by the commission to recover bond-related costs
pursuant to an agreement between the commission and the
Department of Water Resources pursuant to Section 80110 of the
Water Code, as well as the costs of the department equal to the
share of the department's estimated net unavoidable power
purchase contract costs attributable to the customer. The
commission shall incorporate the determination into an existing
proceeding before the commission, and shall ensure that the
charges are nonbypassable. Until the commission has made a
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determination regarding the nonbypassable charges, net energy
metering, co-energy metering, and wind energy co-metering shall
continue under the same rules, procedures, terms, and conditions
as were applicable on December 31, 2002.
(m) In implementing the requirements of subdivisions (k) and
(l), an eligible customer-generator shall not be required to
replace its existing meter except as set forth in paragraph (1)
of subdivision (c), nor shall the electric utility require
additional measurement of usage beyond that which is necessary
for customers in the same rate class as the eligible
customer-generator.
(n) It is the intent of the Legislature that the Treasurer
incorporate net energy metering, including net surplus
electricity compensation, co-energy metering, and wind energy
co-metering projects undertaken pursuant to this section as
sustainable building methods or distributive energy technologies
for purposes of evaluating low-income housing projects.
REGISTERED SUPPORT / OPPOSITION:
Support
Alameda Municipal Power (if amended)
Absolutely Solar
Advanced Energy Economy
American Solar Power
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Brightline Defense Project
California Apartment Association
California Building Industry Association
California Business Properties Association
California Grocers Association
California Independent Petroleum Association
California Retailers Association
California Solar Energy Industries Association
Chico Electric
Clean Tech Energy Solutions
Center for Sustainable Energy
Interfaith Power & Light
McCalmont Engineering
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MyDomino
Palo Alto, City of (if amended)
Petersen Dean
Port of Oakland
Promise Energy
Quality Home Services
Renova Solar - 28 employees
Roof Tech
Santa Clara, City of (if amended)
Sierra Club
Solar Point Energy Group
Solar Roof Dynamics
SolarCity
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Solartronics
SolEd Benefit Corporation
Sunrun
Silicon Valley Leadership Group
TechNet
Unlimited Solutions
Uptown Solar
Opposition
Anza Electric
Biggs, City of
California Coalition of Utility Employees
California Municipal Utilities Association
Golden State Power
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Gridley, City of
Healdsburg, City of
Lodi, City of
Lompoc, City of
Northern California Power Authority (unless amended)
Pasadena Water and Power
Plumas-Sierra Rural Electric
Sacramento Municipal Utility District
Redding, City of
Southern California Public Power Authority
Turlock Irrigation District
Truckee Donner Public Utilities
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Analysis Prepared by:Sue Kateley / U. & C. / (916) 319-2083