HB2155: Electric utility service; net energy metering.


HOUSE BILL NO. 2155
AMENDMENT IN THE NATURE OF A SUBSTITUTE
(Proposed by the House Committee on Commerce and Labor
on February 5, 2009)
(Patrons Prior to Substitute--Delegates Toscano and Poisson [HB 1705])
A BILL to amend and reenact 56-594 of the Code of Virginia, relating to electric utility service; net energy metering.

Be it enacted by the General Assembly of Virginia:

1.  That 56-594 of the Code of Virginia is amended and reenacted as follows:

56-594. Net energy metering provisions.

A. The Commission shall establish by regulation a program, to begin no later than July 1, 2000, which that affords eligible customer-generators the opportunity to participate in net energy metering. The regulations may include, but need not be limited to, requirements for (i) retail sellers; (ii) owners and/or operators of distribution or transmission facilities; (iii) providers of default service; (iv) eligible customer-generators; or (v) any combination of the foregoing, as the Commission determines will facilitate the provision of net energy metering, provided that the Commission determines that such requirements do not adversely affect the public interest.

B. For the purpose of this section:

"Eligible customer-generator" means a customer that owns and operates, or contracts with other persons to own, operate, or both, an electrical generating facility that (i) has a capacity of not more than 10 kilowatts for residential customers and 500 kilowatts for nonresidential customers unless a utility elects a higher capacity limit for such a facility; (ii) uses as its total source of fuel renewable energy, as defined in 56-576; (iii) is located on the customer's premises and is connected to the customer's wiring on the customer's side of its interconnection with the distributor; (iv) is interconnected and operated in parallel with an electric company's transmission and distribution facilities; and (v) is intended primarily to offset all or part of the customer's own electricity requirements.

"Net energy metering" means measuring the difference, over the net metering period, between (i) electricity supplied to an eligible customer-generator from the electric grid and (ii) the electricity generated and fed back to the electric grid by the eligible customer-generator.

"Net metering period" means the 12-month period following the date of final interconnection of the eligible customer-generator's system with an electric service provider, and each 12-month period thereafter.

C. The Commission's regulations shall ensure that the metering equipment installed for net metering shall be capable of measuring the flow of electricity in two directions, and shall allocate fairly the cost of such equipment and any necessary interconnection. An eligible customer-generator's electrical generating system 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 Underwriters Laboratories. Beyond the requirements set forth in this section, an eligible customer-generator whose electrical generating system meets those standards and rules shall bear the reasonable cost, if any, as determined by the Commission, to (i) install additional controls, (ii) perform or pay for additional tests, or (iii) purchase additional liability insurance.

D. The Commission shall establish minimum requirements for contracts to be entered into by the parties to net metering arrangements. Such requirements shall protect the customer-generator against discrimination by virtue of its status as a customer-generator, and permit customers that are served on time-of-use tariffs that have electricity supply demand charges contained within the electricity supply portion of the time-of-use tariffs to participate as an eligible customer-generator.  Notwithstanding the cost allocation provisions of subsection C, eligible customer-generators served on demand charge-based time-of-use tariffs shall bear the incremental metering costs required to net meter such customers.

E. If electricity generated by an eligible customer-generator over the net metering period exceeds the electricity consumed by the customer-generator, the customer-generator shall be compensated for the excess electricity if the entity contracting to receive such electric energy and the customer-generator enter into a power purchase agreement for such excess electricity. If the eligible customer-generator receives generation service from a default service provider, the default service provider, upon Upon the written request of the customer-generator, the supplier that serves the eligible customer-generator shall enter into a power purchase agreement with the requesting eligible customer-generator that is consistent with the minimum requirements for contracts established by the Commission pursuant to subsection D. The power purchase agreement shall obligate the default service provider supplier to purchase such excess electricity at the rate that is provided for such purchases in a net metering standard contract or tariff approved by the Commission, unless the parties agree to a higher rate. The eligible customer-generator owns the renewable energy certificates associated with its electrical generating facility, however, at the time that the eligible customer-generator enters into a power purchase agreement with its supplier, the customer-generator shall have a one-time option to sell the renewable energy certificates associated with such electrical generating facility to its supplier and be compensated at an amount that is established by the Commission to reflect the value of such renewable energy certificates.  Nothing in this section shall prevent the eligible customer-generator and the supplier from voluntarily entering into an agreement for the sale and purchase of excess electricity or renewable energy certificates at mutually-agreed upon prices if the eligible customer-generator does not exercise its option to sell its renewable energy certificates to its supplier at Commission-approved prices at the time that the eligible customer-generator enters into a power purchase agreement with its supplier.  All costs incurred by the supplier to purchased excess electricity and renewable energy certificates from eligible customer-generators shall be recoverable through its Renewable Energy Portfolio Standard (RPS) rate adjustment clause, if the supplier has a Commission-approved RPS plan.  If not, then all costs shall be recoverable through the suppliers fuel adjustment clause.  For purposes of this section, "all costs" shall be defined as the rates paid to the eligible customer-generator for the purchase of excess electricity and renewable energy certificates and any administrative costs incurred to manage the eligible customer-generators power purchase arrangements. The net metering standard contract or tariff shall be available to eligible customer-generators on a first-come, first-served basis in each electric distribution company's Virginia service area until the rated generating capacity owned and operated by eligible customer-generators in the state reaches one percent of each electric distribution company's adjusted Virginia peak-load forecast for the previous year, and shall require the default service provider supplier to pay the eligible customer-generator for such excess electricity in a timely manner at a rate to be established by the Commission.

HOUSE BILL NO. 2155
Offered January 14, 2009
Prefiled January 14, 2009
A BILL to amend and reenact 56-594 of the Code of Virginia, relating to electric utility service; net energy metering.
Patron-- Toscano

Committee Referral Pending

Be it enacted by the General Assembly of Virginia:

1. That 56-594 of the Code of Virginia is amended and reenacted as follows:

56-594. Net energy metering provisions.

A. The Commission shall establish by regulation a program, to begin no later than July 1, 2000, which that affords eligible customer-generators the opportunity to participate in net energy metering, and a program, to begin no later than July 1, 2010, that affords eligible aggregating customers the opportunity to participate in net energy metering as provided in subsection F. The regulations may include, but need not be limited to, requirements for (i) retail sellers; (ii) owners and/or operators of distribution or transmission facilities; (iii) providers of default service; (iv) eligible customer-generators; (v) eligible aggregating customers; or (vvi) any combination of the foregoing, as the Commission determines will facilitate the provision of net energy metering, provided that the Commission determines that such requirements do not adversely affect the public interest.

B. For the purpose of this section:

"Eligible aggregating customer" means a retail customer that (i) receives electric service at more than one separately metered location within the certificated service territory of an electric service provider, and (ii) is an eligible customer-generator at one or more of such locations.

"Eligible customer-generator" means a customer that owns and operates, or contracts with other persons to own, operate, or both, an electrical generating facility that (i) has a capacity of not more than 10 kilowatts for residential customers and 500 kilowatts two megawatts for nonresidential customers; (ii) uses as its total source of fuel renewable energy, as defined in 56-576; (iii) is located on the customer's premises and is connected to the customer's wiring on the customer's side of its interconnection with the distributor; (iv) is interconnected and operated in parallel with an electric company's transmission and distribution facilities; and (v) is intended primarily to offset all or part of the customer's own electricity requirements.

"Net energy metering" means measuring the difference, over the net metering period, between (i) electricity supplied to an eligible customer-generator or eligible aggregating customer from the electric grid and (ii) the electricity generated and fed back to the electric grid by the eligible customer-generator or eligible aggregating customer, as appropriate.

"Net metering period" means the 12-month period following the date of final interconnection of the eligible customer-generator's system with an electric service provider, and each 12-month period thereafter.

"Participating facility" means a facility operated by an eligible aggregating customer that the eligible aggregating customer designates for participation in a net energy metering program pursuant to subsection F.

C. The Commission's regulations shall ensure that the metering equipment installed for net metering shall be capable of measuring the flow of electricity in two directions, and shall allocate fairly the cost of such equipment and any necessary interconnection. An eligible customer-generator's electrical generating system 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 Underwriters Laboratories. Beyond the requirements set forth in this section, an eligible customer-generator whose electrical generating system meets those standards and rules shall bear the reasonable cost, if any, as determined by the Commission, to (i) install additional controls, (ii) perform or pay for additional tests, or (iii) purchase additional liability insurance.

D. The Commission shall establish minimum requirements for contracts to be entered into by the parties to net metering arrangements. Such requirements shall protect the customer-generator or the eligible aggregating customer against discrimination by virtue of its status as a customer-generator or eligible aggregating customer.

E. If electricity generated by an eligible customer-generator over the net metering period exceeds the electricity consumed by the customer-generator, the customer-generator shall be compensated for the excess electricity if the entity contracting to receive such electric energy and the customer-generator enter into a power purchase agreement for such excess electricity. If the eligible customer-generator receives generation service from a default service provider, the default service provider, upon the written request of the customer-generator, shall enter into a power purchase agreement with the requesting eligible customer-generator that is consistent with the minimum requirements for contracts established by the Commission pursuant to subsection D. The power purchase agreement shall obligate the default service provider to purchase such excess electricity at the rate that is provided for such purchases in a net metering standard contract or tariff approved by the Commission, unless the parties agree to a higher rate; however, the customer-generator shall be compensated at an amount that is at least equal to the retail tariff rate that the customer-generator is charged for its electricity consumption by the default service provider. The net metering standard contract or tariff shall be available to eligible customer-generators on a first-come, first-served basis in each electric distribution company's Virginia service area until the rated generating capacity owned and operated by eligible customer-generators in the state reaches one percent of each electric distribution company's adjusted Virginia peak-load forecast for the previous year, and shall require the default service provider to pay the eligible customer-generator for such excess electricity in a timely manner at a rate to be established by the Commission.

F. The program to afford eligible aggregating customers the opportunity to participate in net energy metering shall provide that:

1. The electric service provider shall treat each participating facility of an eligible aggregating customer as a single facility for purposes of billing and the application of all net metering provisions of this section;

2. If electricity generated at a participating facility of the eligible aggregating customer over a net metering period exceeds the consumption of electricity by the eligible aggregating customer at the participating facility, such excess shall be credited in the same net metering period against such consumption by the eligible aggregating customer at its other participating facilities;

3. The crediting of excess generation to consumption at other participating facilities of the eligible aggregating customer shall comply with the provisions of subsection E;

4. The power purchase agreement shall obligate the electric service provider to purchase excess electricity generated by the eligible aggregating customer at the rate as provided in subsection E, which excess shall be calculated by netting the electricity generated by all of the participating facilities of the eligible aggregating customer against the electricity consumed by all of the participating facilities of the eligible aggregating customer;

5. An eligible aggregating customer shall not be required to designate all of its facilities within an electric service provider's certificated service territory as participating facilities; and

6. Each participating facility shall receive electric service under the same rate schedule.