Chapter 111
2009 -- H 5461 SUBSTITUTE A
Enacted 07/15/09
A N A C T
RELATING TO PUBLIC UTILITIES AND CARRIERS -- RENEWABLE ENERGY STANDARD
Introduced By: Representatives Segal, Ruggiero, A Rice, Edwards, and Kennedy
Date
Introduced: February 12, 2009
It is enacted by the
General Assembly as follows:
SECTION 1. Sections 39-26-2 and 39-26-6 of the General Laws
in Chapter 39-26
entitled "Renewable Energy Standard" are hereby
amended to read as follows:
39-26-2.
Definitions. -- When used in this chapter:
(1) "Alternative
compliance payment" means a payment to the Renewable Energy
Development Fund of fifty dollars ($50.00) per
megawatt-hour of renewable energy obligation, in
2003 dollars, adjusted annually up or down by the
consumer price index, which may be made in
lieu of standard means of compliance with this statute;
(2)
"Commission" means the
(3) "Compliance
year" means a calendar year beginning January 1 and ending December
31, for which an obligated entity must demonstrate
that it has met the requirements of this statute;
(4)
"Customer-sited generation facility" means a generation unit that is
interconnected on
the end-use customer's side of the retail electricity
meter in such a manner that it displaces all or
part of the metered consumption of the end-use customer;
(5) "Educational
institution" means any public school, approved private non-profit
school, or institution of higher education as defined in 20
U.S.C. Chapter 28, Subchapter 1, Part
A section 1001 (a).
(6) "Electrical
energy product" means an electrical energy offering, including, but not
limited to, last resort and standard offer service, that can
be distinguished by its generation
attributes or other characteristics, and that is offered for
sale by an obligated entity to end-use
customers;
(7) "Eligible
biomass fuel" means fuel sources including brush, stumps, lumber ends and
trimmings, wood pallets, bark, wood chips, shavings, slash and
other clean wood that is not
mixed with other solid wastes; agricultural waste, food and
vegetative material; energy crops;
landfill methane; biogas; or neat bio-diesel and other neat
liquid fuels that are derived from such
fuel sources;
(8) "Eligible
renewable energy resource" means resources as defined in section 39-26-5;
(9) "End-use
customer" means a person or entity in
electrical energy at retail from an obligated entity;
(10) "Existing
renewable energy resources" means generation units using eligible
renewable energy resources and first going into commercial
operation before December 31, 1997;
(11) "Farm"
shall be defined in accordance with section 44-27-2, except that all
buildings associated with the farm shall be eligible for net
metering credits as long as: (i) the
buildings are owned by the same entity operating the farm or
persons associated with operating
the farm; and (ii) the buildings are on the same farmland
as the renewable generation on either a
tract of land contiguous with such farmland or across a
public way from such farmland.
(12) "Generation
attributes" means the nonprice characteristics
of the electrical energy
output of a generation unit including, but not limited to,
the unit's fuel type, emissions, vintage
and policy eligibility;
(13) "Generation
unit" means a facility that converts a fuel or an energy resource into
electrical energy;
(14) "NE-GIS"
means the generation information system operated by NEPOOL, its
designee or successor entity, which includes a generation
information database and certificate
system, and that accounts for the generation attributes of
electrical energy consumed within
NEPOOL;
(15) "NE-GIS
certificate" means an electronic record produced by the NE-GIS that
identifies the relevant generation attributes of each
megawatt-hour accounted for in the NE-GIS;
(16) "NEPOOL"
means the New England Power Pool or its successor;
(17) "Net
metering" means the process of measuring the difference between
electricity
delivered by an electrical distribution company and electricity
generated by a solar-net-metering
facility or wind-net-metering facility, and fed back to the
distribution company;
(18) "New
renewable energy resources" means generation units
using eligible renewable
energy resources and first going into commercial operation
after December 31, 1997; or the
incremental output of generation units using eligible renewable
energy resources that have
demonstrably increased generation in excess of ten percent (10%)
using eligible renewable
energy resources through capital investments made after
December 31, 1997; but in no case
involve any new impoundment or diversion of water with an
average salinity of twenty (20) parts
per thousand or less;
(19) "Non-profit
affordable housing" shall mean a housing development or housing
project as defined by section 42-55-3 undertaken by a
non-profit entity where the residential units
taking electric service are either in the same building in
close proximity to the renewable energy
source or, if not within the same building, are within
one-half (1/2) of a mile radius from the
renewable energy source; provided, however, that the
application has been filed with and
reviewed by the division of public utilities and carriers and
the division has certified the
development or project as eligible. The division shall promulgate
regulations setting forth an
application process and eligibility criteria to assure that the
net metering allowed will benefit the
low income residential electric customers affordable
housing residents only. The renewable
generation credit applicable for nonprofit affordable housing
shall be calculated based on the rate
class applicable to residential units.
(20) "Obligated
entity" means a person or entity that sells electrical energy to end-use
customers in
electric utility distribution companies, as defined in section
39-1-2, supplying standard offer
service, last resort service, or any successor service to
end-use customers; including Narragansett
Electric, but not to include Block Island Power
Company as described in section 39-26-7 or
Pascoag Utility District;
(21) "Off-grid
generation facility" means a generation unit that is not connected to a
utility transmission or distribution system;
(22) "Renewable
generation credit" means credit equal to the excess kWhs
by the time of
use billing period (if applicable) multiplied by the sum
of the distribution company's:
(i)
standard offer service kWh charge for the rate class
applicable to the net metering
customer;
(ii) distribution
kWh charge;
(iii) transmission kWh charge; and
(iv) transition
kWh charge. This does not include any charges relating to conservation
and load management, demand side management, and
renewable energy.
(23) "Reserved
certificate" means a NE-GIS certificate sold independent of a transaction
involving electrical energy, pursuant to Rule 3.4 or a
successor rule of the operating rules of the
NE-GIS;
(24) "Reserved
certificate account" means a specially designated account established by
an obligated entity, pursuant to Rule 3.4 or a successor
rule of the operating rules of the NE-GIS,
for transfer and retirement of reserved certificated from
the NE-GIS;
(25)
"Self-generator" means an end-use customer in
part of its retail electricity consumption, as metered by
the distribution utility to which it
interconnects, through the use of a customer-sited generation
facility, the ownership of any such
facility shall not be considered an obligated entity as a
result of any such ownership arrangement;
(26) "Small hydro
facility" means a facility employing one or more hydroelectric turbine
generators and with an aggregate capacity not exceeding thirty
(30) megawatts. For purposes of
this definition, "facility" shall be defined in
a manner consistent with Title 18 of the Code of
Federal Regulations, section
92.201 et seq.; provided, however, that the size of the facility is
limited to thirty (30) megawatts, rather than eighty (80)
megawatts.
(27) "Towns and
cities" means any
title 45 of the general laws, which may exercise all such
powers, including those set forth in
chapter 45-40.1, in developing, owning, operating or
maintaining energy generation units
utilizing eligible renewable energy resources.
39-26-6.
Duties of the commission. -- The commission shall:
(a) Develop and adopt
regulations on or before December 31, 2005, for implementing a
renewable energy standard, which regulations shall include, but
be limited to, provisions for:
(1) Verifying the
eligibility of renewable energy generators and the production of energy
from such generators, including requirements to notify the
commission in the event of a change in
a generator's eligibility status.
(2) Standards for
contracts and procurement plans for renewable energy resources, to
achieve the purposes of this chapter.
(3) Flexibility
mechanisms for the purposes of easing compliance burdens, facilitating
bringing new renewable resources on-line, and avoiding and/or
mitigating conflicts with state
level source disclosure requirements and green marketing
claims throughout the region; which
flexibility mechanisms shall allow obligated entities to: (i) demonstrate compliance over a
compliance year; (ii) bank excess compliance for two (2)
subsequent compliance years, capped at
thirty percent (30%) of the current year's obligation; and
(iii) allow renewable energy generated
during 2006 to be banked by an obligated entity as early compliance,
usable towards meeting an
obligated entity's 2007 requirement. Generation used for early
compliance must result in the
retirement of NE-GIS certificate in a reserved certificate
account designated for such purposes.
(4) Annual compliance
filings to be made by all obligated entities within one month after
NE-GIS reports are available for the fourth (4th)
quarter of each calendar year. All electric utility
distribution companies shall cooperate with the commission in
providing data necessary to assess
the magnitude of obligation and verify the compliance of
all obligated entities.
(b) Authorize rate
recovery by electric utility distribution companies of all prudent
incremental costs arising from the implementation of this
chapter, including, without limitation,
the purchase of NE-GIS certificates, the payment of
alternative compliance payments, required
payments to support the NE-GIS, assessments made pursuant to
section 39-26-7(c) and the
incremental costs of complying with energy source disclosure
requirements.
(c) Certify eligible
renewable energy resources by issuing statements of qualification
within ninety (90) days of application. The commission shall
provide prospective reviews for
applicants seeking to determine whether a facility would be
eligible.
(d) Determine, on or
before January 1, 2010, the adequacy, or potential adequacy, of
renewable energy supplies to meet the increase in the
percentage requirement of energy from
renewable energy resources to go into effect in 2011 and
determine on or before January 1, 2014,
the adequacy or potential adequacy, of renewable energy
supplies to meet the increase in the
percentage requirement of energy from renewable energy resources
to go into effect in 2015. In
making such determinations the commission shall consider
among other factors the historical use
of alternative compliance payments in
the event that the commission determines an inadequacy or
potential inadequacy of supplies for
scheduled percentage increases, the commission shall delay the
implementation of the scheduled
percentage increase for a period of one year or recommend to the
general assembly a revised
schedule of percentage increases, if any, to achieve the
purposes of this chapter.
(e) Establish sanctions
for those obligated entities that after investigation have been
found to fail to reasonably comply with the commission's
regulations. No sanction or penalty
shall relieve or diminish an obligated entity from
liability for fulfilling any shortfall in its
compliance obligation; provided, however, that no sanction shall
be imposed if compliance is
achieved through alternative compliance payments. The
commission may suspend or revoke the
certification of generation units, certified in accordance with
subsection (c) above, that are found
to provide false information, or that fail to notify the
commission in the event of a change in
eligibility status or otherwise comply with its rules. Financial
penalties resulting from sanctions
from obligated entities shall not be recoverable in rates.
(f) Report, by February
15, 2006, and by February 15 each year thereafter, to the
governor, the speaker of the house and the president of the
senate on the status of the
implementation of the renewable energy standards in
report shall include in 2009, and each year thereafter, the
level of use of renewable energy
certificates by eligible renewable energy resources and the
portion of renewable energy standards
met through alternative compliance payments, and the
amount of rate increases authorized
pursuant to subsection (b) above.
(g) Implement the
following changes regarding distributed generation from renewable
energy systems by January June 1, 2009.
(1) Increase the
maximum allowable distributed generation capacity for eligible net-
metered energy systems to 1.65 megawatts (MW); except that
for eligible net-metered renewable
energy systems developed but not owned by cities and towns,
located on city or town owned land,
and providing power solely to the city or town that the
project is located in, increase said
maximum to 2.25 megawatts; and except that for eligible
net-metered renewable energy systems
owned by cities and towns of and the
Narragansett Bay Commission and state
agencies, increase said maximum to 3.5 megawatts (MW).
(2) Increase the
aggregate amount of net metering to a maximum of two percent (2%) of
peak load, provided that at least one megawatt is reserved
for projects less than twenty-five (25)
kW.
(3)(i) If With the exception of those customers
described in subsection (ii), if the
electricity generated by the renewable generation facility during
a billing period exceeds the
customer's kilowatt-hour usage during the billing period, the
customer shall upon a request of the
customer be billed for zero kilowatt-hour usage and the excess
renewable generation credits shall
be credited to the customer's account for the following
billing period. Any
town, educational institution, farm, or the Narragansett
Bay Commission may elect to apply any
such credits earned to another account owned by it.
Non-profit affordable housing may elect to
apply any such credits earned to other accounts within the
eligible affordable housing
development. Unless
otherwise requested by the customer, the customer shall be compensated
monthly by a check from the electric distribution company for
the excess renewable generation
credits pursuant to the rate specified in subdivision
39-26-2(22).
(ii) If the
electricity generated by the renewable generation facility owned by a Rhode
Island city or town, educational institution,
nonprofit affordable housing, farm, the state or the
Narragansett Bay Commission, during a billing period
exceeds the customer's kilowatt-hour
usage during the billing period, the customer shall be
billed for zero-kilowatt-hour usage, and:
(A) Upon request of
the customer, the excess renewable generation credits shall be
credited to the customer's account for the following billing
period; or
(B) Upon request of
the customer, the excess renewable generation credits shall be
applied to no more than ten (10) other accounts owned by the
customer during the billing period;
or
(C) Unless otherwise
requested by the customer, the customer shall be compensated
monthly by a check from the distribution company for the
excess renewable generation credits
pursuant to the rates specified in subdivisions 39-26-2(19)
and 39-26-2(22).
(iii) Nonprofit
affordable housing shall use said compensation, pursuant to paragraph (ii),
to benefit the residents of the housing development.
(4) If the customer's
kilowatt-hour usage exceeds the electricity generated by the
renewable generation facility during the billing period, the
customer shall be billed for the net
kilowatt-hour usage at the applicable rate. Any excess credits may
be carried forward month to
month for twelve (12) month periods as established by the
commission. At the end of the
applicable twelve (12) month period, if there are unused excess
credits on the net metering
customer accounts, such credits shall be transferred to the
renewable energy low income fund set
forth in subsection 39-26-6(j). used to offset
recoverable utility costs. Where compensation has
been provided for excess renewable generation credits, no
further charge may be made to the
customer against said credits.
(h) Any prudent and
reasonable costs incurred by the electric distribution company
pursuant to achieving compliance with subsection (g) and the
annual amount of the distribution
component of any renewable generation credits provided to net
metering customers shall be
aggregated by the distribution company and billed to all
customers on an annual basis through a
uniform per kilowatt-hour surcharge embedded in the
distribution component of the rates
reflected on customer bills.
(i) Report, by July 1, 2010 to the governor, the
speaker of the house and the president of
the senate on the status of the implementation of
subsection (g) and (h), including if said
provisions are optimally cost-effective, reliable, prudent and
environmentally responsible.
(j) The commission
shall establish a renewable energy low income fund to which unused
excess renewable credits shall be transferred, as provided
in subdivision 39-26-6(g)(4). The
commission shall direct the electrical distribution utility to
apply the credits to reduce the electric
bills of customers in the low income rate class, by such
method as determined by the commission.
The electric distribution company shall file an annual
report disclosing the amount of unused
credits and propose a method of allocating the credits to the
low income rate class. The
commission shall, after conducting a public hearing, retain discretion
to accept the proposal,
modify it, or direct a different method of allocating the
credits to the low income rate class.
(j)(k) Consistent with the public policy objective of
developing renewable generation as
an option in
implement pilot programs to own and operate no more than
fifteen megawatts (1 W) of
renewable generation demonstration projects in
in rates to distribution customers. At least two (2)
demonstration projects shall include renewable
generation installed at or in the vicinity of nonprofit
affordable housing projects where energy
savings benefits are provided to reduce electric bills of the
customers at the nonprofit affordable
housing projects. Any renewable generation proposals shall be
subject to the review and approval
of the commission. The commission shall annually make an
adjustment to the minimum amounts
required under the renewable energy standard under chapter
39-26 in an amount equal to the
kilowatt hours generated by such units owned by the electric
distribution company. The electric
and gas distribution company shall also be authorized to
propose and implement smart metering
and smart grid demonstration projects in
commission, in order to determine the effectiveness of such new
technologies for reducing and
managing energy consumption, and include the costs of such
demonstration projects in
distribution rates to electric customers to the extent the project
pertains to electricity usage and in
distribution rates to gas customers to the extent the project
pertains to gas usage.
SECTION 2. This act shall take effect upon passage.
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LC01367/SUB A
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