BILL ANALYSIS �
SB 594
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Date of Hearing: August 8, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
SB 594 (Wolk) - As Amended: August 6, 2012
Policy Committee:
UtilitiesVote:13-0
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill allows an electric utility customer to aggregate their
electricity usage on multiple meters to establish the maximum
project size for renewable generation and fuel cells as allowed
under net energy metering (NEM). Specifically, this bill:
1)Allows the electric utility to use the sum of the electric
load on multiple electric meters located on property adjacent
or contiguous to the property on which the renewable
generation facility is located, if those properties are solely
owned, leased, or rented by the eligible customer-generator.
2)Allows the customer-generator to use the sum of the loads to
establish the maximum size renewable generation to be used for
both NEM credits and maximum rebates allowed through the
California Solar Initiative (CSI).
3)Allows aggregation of electricity usage of multiple meters, as
in (1), to establish the maximum project size for fuel cell
customer-generation.
4)Prohibits an electric utility customer using aggregated NEM
from receiving compensation for surplus kilowatt-hours (kWh)
supplied to the grid.
5)Specifies that if an eligible customer-generator with multiple
meters elects to aggregate their electrical load pursuant to
(1), and different rate schedules are applicable to service at
any of those meters, the electricity generated by the
customer-generator shall be allocated to each of the meters in
proportion to the electrical load served by those meters.
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6)Conditions the authorization in (1) on the Public Utilities
Commission (PUC) making a determination by March 1, 2013, that
permitting aggregation from multiple meters will not result in
an increase in the expected revenue obligations from non-NEM
customers.
FISCAL EFFECT
The PUC will incur ongoing special fund costs of about $120,000
for one regulatory analyst position to implement the new NEM
authorization. �Public Utilities Reimbursement Account]
COMMENTS
1)Purpose . According to the author, "Customers with multiple
meters, for example, farmers with separate meters for each of
their irrigation pumps and other functions, are currently
required to have separate facilities for each meter to utilize
NEM. In some cases, customers are told they are only allowed
to have one facility on their premises connected to one meter.
Installing multiple facilities, if it is allowed, is
incredibly costly and inefficient and does not allow the
customer to optimize the location of the renewable facility on
the property, since the incentive is to join the facility with
the largest energy use."
SB 594 is supported by numerous solar, agricultural and
environmental groups. In support, the California Solar Energy
Industries Association states, "This bill will create a
pathway for previously disenfranchised customers to utilize
renewable energy systems that are sized to their total load,
rather than being limited to the load at the interconnected
meter only."
2)NEM allows commercial and residential electricity customers to
receive credits on their utility bills for on-site renewable
energy generation in excess of their electric load that is
exported to the electric grid. A standard NEM arrangement
involves one onsite renewable customer-generator offsetting
the electrical load of one meter-up to the 1 megawatt cap.
The value of the NEM credit varies based on the customer's
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electricity rate schedule (known as a tariff). Each of these
tariffs has a variety of rates for a kWh of electricity-as low
as $0.08/kWh for a large agricultural customer, to as high as
$0.52/kWh for a residential customer.
3)Opposition . The three large investor owned electrical
utilities, the California Municipal Utilities Association
(CMUA), and utility labor groups argue that the original
intent of the NEM program was to allow customers to offset
their own on-site energy needs. Southern California Edison
states, "Expanding the NEM program to include oversized
projects and aggregation as proposed in this legislation is
not necessary because customer-generators can utilize other
programs to sell renewable power to utilities under such
circumstances."
Analysis Prepared by : Israel Salas / Chuck Nicol / APPR. /
(916) 319-2081