Report Title:

Public Utilities; Net Energy Metering

 

Description:

Increases the total rated generating capacity produced by eligible customer-generators.  Increases the maximum capacity of an eligible customer-generator.  Requires the public utilities commission to adopt rules that incorporate best practices interconnection standards.

 

 


HOUSE OF REPRESENTATIVES

H.B. NO.

2550

TWENTY-FOURTH LEGISLATURE, 2008

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT


 

 

RELATING TO PUBLIC UTILiTIES.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  The legislature finds that Hawaii is especially vulnerable to the volatility in global oil markets.  In November 2007, oil prices reached $100 per barrel.  Electric utilities will shift these high fuel costs to electric utility consumers in the form of higher electric utility rates.  For example, residential electric rates on Kauai could reach as high as 50 fifty cents per kilowatt hour.

     The legislature further finds that the draft report of the Hawaii 2050 sustainability task force creates a long-term vision, action agenda, and implementation mechanisms for achieving sustainability for the State.  The report emphasizes that taking action is necessary to accomplish the sustainability objectives.  The legislature further finds that one of the first actions must be to remove barriers to renewable energy development.

     The legislature further finds that the public utilities commission has an open docket related to net energy metering in which a settlement proposal has recently been submitted.  The settlement allows modest incremental increases in the current net energy metering limits, but it also requires any future changes to the limits to be determined by the electric utilities through the lengthy and complex integrated resource planning process.  Moreover, it generally requires that one-half of the net metered systems be limited to less than ten kilowatts.  The legislature further finds that a settlement such as this may have been helpful a decade ago, but given today's high oil prices, the impact of oil generation on climate change, and Hawaii's sustainability goals, it is far too small a step towards removing the barriers to customer-owned distributed solar generation.

     The purpose of this Act is to enhance Hawaii's energy and economic security and reduce its vulnerability to fluctuating fuel prices related to electricity generation by removing barriers to the development of solar electric resources and increasing the accessibility of net energy metering.

     SECTION 2.  Section 269-101, Hawaii Revised Statutes, is amended to read as follows:

     "§269-101 Definitions.  As used in this part:

     "Eligible customer-generator" means a metered residential or commercial customer, including a government entity, of an electric utility who owns and operates, leases or purchases electricity from a solar, wind turbine, biomass, or hydroelectric energy generating facility, or a hybrid system consisting of two or more of these facilities, that is:

     (1)  Located on the customer's premises;

     (2)  Operated in parallel with the utility's transmission and distribution facilities;

     (3)  In conformance with the utility's interconnection requirements; and

     (4)  Intended primarily to offset part or all of the customer's own electrical requirements.

     "Net energy metering" means measuring the difference between the electricity supplied through the electric grid and the electricity generated by an eligible customer-generator and fed back to the electric grid over a monthly billing period; provided that:

     (1)  Net energy metering shall be accomplished using a single meter capable of registering the flow of electricity in two directions;

     (2)  An additional meter or meters to monitor the flow of electricity in each direction may be installed with the consent of the 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 customer-generator, or to collect solar, wind turbine, biomass, or hydroelectric energy generating system performance information for research purposes;

     (3)  If the existing electrical meter of an eligible customer-generator is not capable of measuring the flow of electricity in two directions, the electric utility shall be responsible for all expenses involved in purchasing and installing a meter that is able to measure electricity flow in two directions;

     (4)  If an additional meter or meters are installed, the net energy metering calculation shall yield a result identical to that of a single meter; [and]

     (5)  An eligible customer-generator who already owns an existing solar, wind turbine, biomass, or hydroelectric energy generating facility, or a hybrid system consisting of two or more of these facilities, is eligible to receive net energy metering service in accordance with this part[.]; and

     (6)  The electric utility shall not unreasonably deny, burden, or delay net energy metering services upon request by an eligible customer-generator of the electric utility."

     SECTION 3.  Section 269-101.5, Hawaii Revised Statutes, is amended to read as follows:

     "[[]§269-101.5[]]  Maximum capacity of eligible customer-generator.  The eligible customer-generator shall have a capacity of not more than [fifty] five hundred kilowatts[;] in 2008, one megawatt in 2009, and two megawatts thereafter; provided that the public utilities commission may increase the maximum allowable capacity that eligible customer-generators may have to an amount greater than [fifty kilowatts] these amounts by rule or order."

     SECTION 4.  Section 269-102, Hawaii Revised Statutes, is amended to read as follows:

     "§269-102  Standard contract or tariff; rate structure.  (a)  Every electric utility shall develop a standard contract or tariff providing for net energy metering and shall make this contract available to eligible customer-generators, upon request, on a first-come-first-served basis until the time that the total rated generating capacity produced by eligible customer-generators equals [.5] one per cent of the electric utility's system peak demand[;] in 2008, two per cent of the electric utility's system peak demand in 2009, five per cent of the electric utility's system peak demand in 2010, and without limitation thereafter; provided that the public utilities commission may increase, by rule or order, the total rated generating capacity produced by eligible customer-generators to an amount above [.5 per cent of the electric utility's system peak demand.] the limitations specified in this section.

     (b)  Each net energy metering contract or tariff shall be identical, with respect to rate structure, to the contract or tariff to which the same customer would be assigned if the customer was not an eligible customer-generator.  The charges for all retail rate components for eligible customer-generators shall be based exclusively on the eligible customer-generator's net kilowatt-hour consumption over a monthly billing period.  Any new or additional demand charge, standby charge, customer charge, minimum monthly charge, interconnection charge, or other charge that would increase an eligible customer-generator's costs beyond those of other customers in the rate class to which the eligible customer-generator would otherwise be assigned are contrary to the intent of this section, and shall not form a part of net energy metering contracts or tariffs.

     [(c)  The public utilities commission may amend the rate structure or standard contract or tariff by rule or order.]"

     SECTION 5.  Section 269-104, Hawaii Revised Statutes, is amended to read as follows:

     "§269-104  Additional customer-generators.  Notwithstanding section 269-102, an electric utility [is not obligated] may choose to provide net energy metering to additional customer-generators in its service area when the combined total peak generating capacity of all eligible customer-generators served by all the electric utilities in that service area furnishing net energy metering to eligible customer-generators equals [.5 per cent of the system peak demand of those electric utilities;] the limitations specified in section 269-102(a); provided that the public utilities commission may increase, by rule or order, the allowable percentage of the electric utility's system peak demand produced from eligible customer-generators in the electric utility's service area, whereupon the electric utility will be obligated to provide net energy metering to additional eligible customer-generators in that service area up to the increased percentage amount."

     SECTION 6.  Section 269-105, Hawaii Revised Statutes, is amended to read as follows:

     "§269-105  Calculation.  The net energy metering calculation shall be made by measuring the difference between the electricity supplied to the eligible customer-generator and:

     (1)  The electricity generated by the eligible customer-generator and fed back to the electric grid over a monthly billing period; and

     (2)  Any unused kilowatt-hour credits for excess electricity from the eligible customer-generator carried over from previous months since the last twelve-month reconciliation period."

     SECTION 7.  Section 269-106, Hawaii Revised Statutes, is amended to read as follows:

     "§269-106  Billing periods; twelve-month reconciliation.  (a)  Billing of net energy metering customers shall be on a monthly basis; provided that the last monthly bill for each twelve-month period shall reconcile for that twelve-month period the net electricity provided by the electric utility with:

     (1)  The electricity generated by the eligible customer-generator and fed back to the electric grid over the monthly billing period; and

     (2)  Any unused kilowatt-hour credits for excess electricity from the eligible customer-generator carried over from prior months since the last twelve-month reconciliation period.

     (b)  [Credits] Kilowatt-hour credits for excess electricity from the eligible customer-generator that remain unused after each twelve-month reconciliation period [may not be carried over to the next twelve-month period.] shall be compensated to the eligible customer-generator by the electric utility at the rate provided in section 269-27.2(c) for the prior twelve-month period."

     SECTION 8.  Section 269-107, Hawaii Revised Statutes, is amended to read as follows:

     "§269-107  Net electricity consumers.  At the end of each monthly billing period, where the electricity supplied during the period by the electric utility exceeds:

     (1)  The electricity generated by the eligible customer-generator during that same period; and

     (2)  Any unused kilowatt-hour credits for excess electricity from the eligible customer-generator carried over from prior months since the last twelve-month reconciliation period,

the eligible customer-generator is a net electricity consumer and the electric utility shall be owed compensation for the eligible customer-generator's net kilowatt-hour consumption over that same period.  The compensation owed for the eligible customer-generator's net monthly kilowatt-hour consumption shall be calculated at the retail rate of the rate class the customer is normally assigned to."

     SECTION 9.  Section 269-108, Hawaii Revised Statutes, is amended to read as follows:

     "§269-108  Net electricity producers; excess electricity credits and credit carry over.  At the end of each monthly billing period, where the electricity generated by the eligible customer-generator during the month exceeds the electricity supplied by the electric utility during that same period, the eligible customer-generator is a net electricity producer and the electric utility shall retain any excess kilowatt-hours generated during the prior monthly billing period; provided that the excess electricity generated by the customer-generator, if any, in each monthly billing period shall be carried over to the next month as a [monetary] kilowatt-hour value to the credit of the eligible customer-generator, which credit may accumulate and be used to offset the compensation owed the electric utility for the eligible customer-generator's net kilowatt-hour consumption for succeeding months within each twelve-month period; provided further that the electric utility shall reconcile the eligible customer-generator's electricity production and consumption for each twelve-month period as set forth in section 269-106.  [The eligible customer-generator shall not be owed any compensation for excess kilowatt-hours unless the electric utility enters into a purchase agreement with the eligible customer-generator for those excess kilowatt-hours.]"

     SECTION 10.  Section 269-111, Hawaii Revised Statutes, is amended to read as follows:

     "§269-111  Safety and performance standards.  (a)  A solar, wind turbine, biomass, or hydroelectric energy generating system, or a hybrid system consisting of two or more of these facilities, 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 such as the Underwriters Laboratories and, where applicable, rules of the public utilities commission regarding safety and reliability.

     (b)  For systems of ten kilowatts or less, an eligible customer-generator whose solar, wind turbine, biomass, or hydroelectric energy generating system, or whose hybrid system consisting of two or more of these facilities, meets the standards and rules under subsection (a) shall not be required to install additional controls, perform or pay for additional tests, or purchase additional liability insurance.

     (c)  For eligible customer-generator systems of greater than ten kilowatts, the commission, either through decision and order, by tariff adoption, or by rule, shall:

     (1)  Set forth safety, performance, and reliability standards and requirements; and

     (2)  Establish the qualifications for exemption from a requirement to install additional controls, perform or pay for additional tests, or purchase additional liability insurance.

     (d)  The public utilities commission shall initiate rulemaking proceedings by September 1, 2008, to adopt best practices interconnection standards for solar, wind turbine, biomass, or hydroelectric energy generating facilities.  No later than September 1, 2009, the commission shall adopt rules pursuant to chapter 91 that incorporate best practices interconnection standards.  Upon adoption, the standards shall become the interconnection requirements of each utility subject to the authority of the commission.  As part of the rulemaking process, the commission shall consider interconnection standards adopted within the previous twenty-four months by other states, standards promulgated by the United States Federal Energy Regulatory Commission, and model standards developed by nonprofit organizations with the primary purpose of promoting renewable energy."

     SECTION 11.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun, before its effective date.

     SECTION 12.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 13.  This Act shall take effect upon its approval.

 

INTRODUCED BY:

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