SB 117-FN-LOCAL - AS INTRODUCED
2015 SESSION
15-0881
06/09
SENATE BILL 117-FN-LOCAL
AN ACT relative to energy security and diversity.
SPONSORS: Sen. Soucy, Dist 18; Sen. Feltes, Dist 15; Rep. Murotake, Hills 32; Rep. Backus, Hills 19
COMMITTEE: Energy and Natural Resources
This bill:
I. Provides credits for group hosts for surplus electric generation.
II. Modifies the formula for determining when tariffs providing for net energy metering are available to customer-generators.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
15-0881
06/09
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Fifteen
AN ACT relative to energy security and diversity.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Net Energy Metering. Amend RSA 362-A:9, I to read as follows:
I. Standard tariffs providing for net energy metering shall be made available to eligible customer-generators by each electric distribution utility in conformance with net metering rules adopted and orders issued by the commission. Each net energy metering tariff shall be identical, with respect to rates, rate structure, and charges, to the tariff under which a customer-generator would otherwise take default generation supply service from the distribution utility. Such tariffs shall be available on a first-come, first-served basis within each electric utility service area under the jurisdiction of the commission until such time as the total rated generating capacity owned or operated by eligible customer-generators totals a number equal to [50 megawatts] 6 percent of the peak electric demands for the state of New Hampshire, as recorded by the independent system operator (ISO-New England) in 2013, multiplied by each such utility’s percentage share of the total 2010 annual coincident peak energy demand distributed by all such utilities as determined by the commission. No more than 4 megawatts of such total rated generating capacity shall be from a combined heat and power system as defined in RSA 362-A:1-a, I-d.
2 Net Energy Metering. Amend RSA 362-A:9, XIV(c) to read as follows:
(c) Notwithstanding paragraph V, a group host [shall be paid for its surplus generation at the end of each billing cycle at rates consistent with the credit the group host receives relative to its own net metering under either subparagraph IV(a) or (b)] and each group member may receive credits on the customer electric bill of each member and host based upon energy production allocations certified to the utility and the commission under subparagraph (a) for the surplus generation at the end of each billing cycle. If necessary, on an annual basis, the electric distribution utility shall calculate a payment adjustment if the host’s surplus generation for which it was paid is greater than the group’s total electricity usage during the same time period. The adjustment shall be such that the resulting compensation to the host for the amount that exceeded the group’s total usage shall be at the utility’s avoided cost or its default service rate in accordance with subparagraph V(b) or paragraph VI. The utility shall pay or bill the host accordingly.
3 Requirements for Electric Generation Equipment Funded by Public Utility; Investments in Distributed Energy Resources. Amend RSA 374-G:3 and RSA 374-G:4 to read as follows:
374-G:3 Electric Generation Equipment Funded by Public Utility; Requirements. Any electric generation equipment funded in part by a public utility under this chapter is subject to the following requirements:
I. The energy produced by electric generation equipment utilizing a non-renewable fuel source that is owned in part or in its entirety by the public utility shall be used as an offset to distribution system losses or the public utility company’s own use;
II. The energy produced by electric generation equipment utilizing a renewable fuel source that is owned entirely by the public utility shall be used as an offset to distribution system losses or the public utility company’s own use;
III. The energy produced by electric generation equipment utilizing a renewable fuel source that is owned in part or invested in by the public utility, that is also owned in part by another entity or the host, shall be used to displace the customers own use; however, if energy is generated in excess of the customer’s energy requirements, it may be credited to the customer’s or group of customer’s account under RSA 362-A:9.
IV. The energy produced as part of equipment under paragraph II may be sold to a customer or group of customers as part of a third-party financing mechanism under a long-term contract for the sale of energy.
V. The energy produced by electric generation equipment utilizing a non-renewable fuel source that is owned by a customer, or sited on a customer’s property shall be used to displace the customer’s own use;
VI. The energy produced by electric generation equipment utilizing a renewable fuel source that is owned by a customer, or sited on the consumer’s premises shall be used to displace the customers own use; however, if energy is [occasionally] generated in excess of the customer’s energy requirements, it may be credited to the customer’s account [in a subsequent period] or a group of customers account under RSA 362-A:9.
VII. Any biomass-fueled generation shall meet the emission requirements to qualify as eligible biomass technology under RSA 362-F:2, VIII.
VIII. Any fossil-fuel fueled generation shall produce combined heat and power with a minimum energy efficiency of 60 percent, measured as usable thermal and electrical output in BTUs divided by fuel input in BTUs, shall be installed as an integrated combined heat and power application, and shall meet the following emission standards (in lbs/MW-H): NOx--0.07; CO--0.10; VOCs--0.02. A credit to meet the emission standard may be applied at the rate of one MW-H for each 3.4 million BTUs of heat recovered.
IX. These requirements apply in addition to and do not preempt or replace any emission standards or permitting requirements applicable to a given generation facility under any other applicable state or federal law.
374-G:4 Investments in Distributed Energy Resources.
I. Notwithstanding any other provision of law to the contrary, as provided in RSA 374-G:5, a New Hampshire electric public utility may invest in or own, in part or in its entirety, distributed energy resources, located on or inter-connected to the local electric distribution system.
II. Distributed electric generation owned by or receiving investments from an electric utility under this section shall be limited to a cumulative maximum in megawatts of 6 percent of the utility’s total distribution peak load in megawatts.
III. In addition, once the cumulative generation authorized under this chapter for a given public utility reaches 3 percent of the utility’s total distribution peak load in megawatts, then that utility shall not be allowed to add any additional non-renewable generation under this chapter, until the cumulative renewable generation installed pursuant to this chapter, as a percentage of total generation installed pursuant to this chapter, shall equal or exceed twice the sum of the then-applicable percentage requirements for class I and class II under RSA 362-F:3.
3 Utility Investment in Distributed Energy Resources; Rate Filing; Authorization. Amend RSA 374-G:5 to read as follows:
374-G:5 Rate Filing; Authorization.
I. A New Hampshire electric public utility may seek rate recovery for its portion of investments in distributed energy resources from the commission by making an appropriate rate filing. At a minimum, such filing shall include the following:
(a) A detailed description and economic and environmental evaluation of the proposed investment.
(b) A discussion of the costs, benefits, and risks of the proposal with specific reference to the factors listed in paragraph II, including an analysis of the costs, benefits, and rate implications to the participating customers, to the company’s default service customers, and to the utility’s distribution customers.
(c) A description of any equipment or installation specifications, solicitations, and procurements it has or intends to implement.
(d) A showing that the utility has used a competitive bidding process to reasonably minimize the costs of the project to its customers.
(e) A showing that it has made reasonable efforts to involve local businesses in its program.
(f) Evidence of compliance with any applicable emission limitations.
(g) A copy of any customer contracts or agreements to be executed as part of the program.
II. Prior to authorizing a utility’s recovery of investments made in distributed energy resources, the commission shall determine that the utility’s investment and its recovery in rates, as proposed, are in the public interest. Determination of the public interest under this section shall include giving a balanced consideration and proportional weight to each of the following factors[:].
(a) The effect on the reliability, safety, and efficiency of electric service.
(b) The efficient and cost-effective realization of the purposes of the renewable portfolio standards of RSA 362-F and the restructuring policy principles of RSA 374-F:3.
(c) The energy security benefits of the investment to the state of New Hampshire resulting from the use of domestic clean and renewable fuels.
(d) The environmental benefits of the investment to the state of New Hampshire including the reduction of emissions resulting from clean and renewable fuels.
(e) The economic development benefits and liabilities of the investment to the state of New Hampshire.
(f) The effect on competition within the region’s electricity markets and the state’s energy services market.
(g) The costs and benefits to the utility’s customers, including but not limited to a demonstration that the company has exercised competitive processes to reasonably minimize costs of the project to ratepayers and to maximize private investment in the project.
(h) Whether the expected value of the economic benefits of the investment to the utility’s ratepayers over the life of the investment outweigh the economic costs to the utility’s ratepayers including revenues from projects generating economic benefits under a structure authorized under RSA 374-G:3, IV.
(i) The costs and benefits to any participating customer or customers including savings on energy costs and revenues from projects generating economic benefits under a structure authorized under RSA 374-G:3, IV.
(j) Consistency of the project with the objectives and recommendations of the state energy strategy.
III. Authorized and prudently incurred investments shall be recovered under this section in a utility’s base distribution rates as a component of rate base, and cost recovery shall include the recovery of depreciation, a return on investment, taxes, and other operating and maintenance expenses directly associated with the investment, net of any offsetting revenues received by the utility directly attributable to the investment including revenues from projects under RSA 374-G:3, IV. The utility may recover all reasonable costs associated with the filing, whether or not the application is approved by the commission.
IV. The commission may add an incentive to the return on equity component as it deems appropriate to encourage investments in distributed energy resources.
V. The commission shall approve, disapprove, or approve with conditions a utility rate filing under this section within 90 days of its filing. The commission may extend this deadline to 6 months at its discretion for any filing involving an investment in excess of $1,000,000. The commission may also extend the deadline at its discretion for failure of the applicant to respond to data requests on an expedited timeline.
4 Exemption for Solar Energy Systems. Amend RSA 72:62 to read as follows:
72:62 Exemption for Solar Energy Systems. Each city and town may adopt under RSA 72:27-a an exemption from the assessed value, for property tax purposes, for persons owning real property which is equipped with a solar energy [system] source as defined in [RSA 72:61] RSA 362-F:2, XV.
5 Effective Date. This act shall take effect 60 days after its passage.
LBAO
15-0881
01/28/15
SB 117-FN-LOCAL - FISCAL NOTE
AN ACT relative to energy security and diversity.
FISCAL IMPACT:
The Public Utilities Commission states this bill, as introduced, will have an indeterminable fiscal impact on state, county and local revenue and expenditures in FY 2015 and each year thereafter.
METHODOLOGY:
The Public Utilities Commission states this bill modifies the formula for determining when tariffs providing for net energy metering are available to customer generators and provides credits for group hosts for surplus electric generation. The Commission states amending RSA 362-A:9 will allow tariffs for net metering to be available on a first come, first served basis until the total rated generating capacity of eligible customer generators equals six percent of the peak electric demand for New Hampshire as recorded for the ISO-NE in 2013. This will likely more than double the current generation capacity available for net metering. By increasing the capacity available for net metering, more customer generators can install, operate or purchase power from renewable energy electric generating facilities. Additionally, the customer generator’s electricity costs will decrease. A group host and group members can receive credits on their electric bill based on production allocations given to the utility. If necessary, on an annual basis, if the host’s surplus generation is greater than the group’s total usage, then the utility shall calculate a payment adjustment. The excess generation above the total group’s usage will only be compensated at the utility’s avoided cost or its default service rate.
The Commission states amending RSA 374-G:3 by allowing the public utilities to invest in, own in part or in entirety non-renewable and renewable electric generation equipment, the public utility would displace the customer’s own use and excess generation is credited to the customer or customer group. Renewable generation may be sold to a customer or customer group as part of a third party financing mechanism. Without the financial arrangements and generation quantity, the Commission is not able to determine the fiscal impact on state, county and local entities as ratepayers.
The Commission states amending RSA 374-G:5 to require an utility to show it has used competitive bidding to reasonably minimize the costs of a project to its customers will have an indeterminable fiscal impact on state, county and local entities as ratepayers.
Lastly, amending RSA 72:62 to include a definition of source that is the same as renewable energy source would impose stricter guidelines for property tax exemptions. This would negatively impact the renewable market by reducing the exemptions allowed at the municipal level. The local level tax revenue may increase but the amount is indeterminable.