Net Surplus Compensation

A.10-03-001; A.10-03-010; A.10-03-012; A.10-03-013; A.10-03-017; ________________ On Dec 1 and 2, PG&E and SCE respectively filed advice letters modifying Schedule RES-BCT- Schedule For Local Government Renewable Energy Self-Generation Bill Credit Transfer pursuant to the just-signed AB 512 which will take effect Jan 1. AB 512 makes three changes to the statute: 1) This bill expands the definition of an eligible renewable generating facility for the purposes of the program to include a facility that has a generating capacity of no more than 5 megawatts. 2) The bill prohibits an electrical corporation from being required to compensate a local government for electricity generated from a facility in excess of the bill credits applied to the designated benefiting account. 3) The bill prohibits a local government renewable generation facility participating in the program from being eligible for any other tariff or program that requires an electrical corporation to purchase generation from that facility while participating in the program. Protests are due Dec 21 for PG&E and Dec 22 for SCE. ___________________ Oct 20, 2011 post: On Sept. 22, the California Public Utilities Commission approved utility tariffs to provide net surplus compensation (NSC) for net energy metering customers that generate a surplus of unused credits at the end of their annual true-up periods. These tariffs are now available for customers in all three investor-owned utility service territories. Here are some general points about NSC to minimize any confusion caused by the new billing arrangements. The NSC rate may fluctuate every month because it is based on a rolling 12-month average of spot market prices. Based on current market prices, the rate is approximately 4 cents per kWh. NSC rates are available for customers who qualify on or after Jan. 1, 2011. NSC is not designed to offset more than the customer's onsite load — the new policy does not allow customers to oversize their PV systems in order to generate surplus compensation. Renewable energy credit (REC) payments are still pending the California Energy Commission's verification and tracking methodologies. More information is available on the CPUC Web site , including utility-specific FAQ sites and a NSC fact sheet . ___________________ June 20, 2011 post: On June 9, 2011, the CPUC approved by a 4-1 vote (Peevey dissenting) the original Proposed Decision establishing a rate for payment of excess kWh generated by distributed wind and solar systems, as required by AB 920. The Decision sets the rate equal to the 12-month average spot market price for the hours of 7 am to 5 pm for the year in which the customer generated surplus power. It was estimated by the CPUC to average $0.05/kWh. The proceeding is closed. On April 5, 2010, President Peevey's office released an Alternate Decision proposing a different payment rate and different treatment of Renewable Energy Credits (RECs) than the Proposed Decision. Parties may file comments on the Alternate Decision no later than April 25, 2011. The Commissioners will vote to adopt either the Proposed Decision or Alternate Decision at a Commission meeting no earlier than May 5. It was estimated by the PUC to average $0.10 - 0.13 /kWh. On November 3, 2010, the CPUC released a Proposed Decision to establish a rate for net surplus compensation and resolve other issues pursuant to AB 920. Parties filed comments November 20, 2010. ___________________ Feb 11, 2011 post: AB 2466, which was approved by Governor Schwarzenegger on September 28, 2008 and became effective January 1, 2009, established PU Code Section 2830. This section requires the Investor Owned Utilities (IOUs) to provide a tariff allowing Local Governments to; [1] generate energy from an Eligible Renewable Generating Facility for their own use at a “Generating Account” [Paragraph 2830(a)(5)], [2] export energy not consumed at the time of generation by the Generating Account to SCE’s grid, and [3] receive credits for energy exported to the grid which can be applied against the generation energy charges of “Benefiting Accounts” [Paragraph 2830(a)(1)] designated by the Local Government. On June 10, 2009, SCE filed Advice 2351-E to establish, Schedule LG-VNM, Local Government-Virtual Net Metering. On May 3, 2010, SCE filed Advice 2351-E-A in compliance with Resolution E-4283 to revise Schedule LG-VNM and rename it to Schedule RES-BCT, Local Government Renewable Energy Self-Generation Bill Credit Transfer. Subsequently, AB 1031, approved by the Governor on October 11, 2009 and effective January 1, 2010, modified PU Code Section 2830 to expand the definition of “Local Government” to include “Campus” [Paragraph 2830(a)(3)] and authorize a customer meeting the definition of “Campus” to receive bill credits at designated Benefiting Accounts for electricity exported to the grid by an eligible renewable generating facility interconnected at a Generating Account. SCE requests to update its Schedule RESBCT accordingly and to revise the definition of “Local Government” to include “Campus” defined as an individual community college campus, individual California State University campus, or individual University of California campus. Tariff Revisions 1) In Schedule RES-BCT change “Local Government” wherever it is mentioned to read “Local Government or Campus.” 2) Under Special Condition 5 Definitions, the Local Government definition is revised as follows: Local Government or Campus- A city, county (whether general law or chartered city and county), special district, school district, political subdivision, or other local public agency (e.g. water companies, sanitation districts) which does not sell electricity exported to the electrical grid to a third party, is authorized by law to generate electricity, but shall not mean the state, any agency or department of the state, or joint powers authority, with the exception of a “Campus.” “Campus” is defined as an individual community college campus, individual California State University campus, or individual University of California campus. _____________ end of Feb 20,2011 post On October 11, 2009, Governor Schwarzenegger signed into law Assembly Bill (AB) 920 (Huffman), requiring the CPUC to establish a program to compensate Net Energy Metering (NEM) customers for electricity produced in excess of on-site load at the end of their 12-month true-up period. AB 920 directs the CPUC to adopt a Net Surplus Compensation rate to compensate net surplus customer-generators for surplus kilowatt-hours over 12 months. Customers may opt to receive either a payment for net surplus generation or to roll a credit for that generation over into the next 12-month true-up period.

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