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Utah solar parties, PacifiCorp use state agency proposal in net metering talks

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Essential Energy Insights - January 2021


Utah solar parties, PacifiCorp use state agency proposal in net metering talks

As hearings begin in Utah over retail net energy metering for PacifiCorp's solar customers, the utility and stakeholders are using a joint proposal by two state agencies for a new rate structure as a framework for settlement negotiations.

The state Commerce Department's Division of Public Utilities and Utah Office of Consumer Services jointly support transitioning away from net metering into a new rate structure for customer-owned distributed generation, according to a summary of the agencies' proposal issued with supporting testimony of the division's energy section manager, Artie Powell.

The joint proposal is a significant development in enabling parties to find common ground for negotiations after three years of being at loggerheads over PacifiCorp's efforts to end its net energy metering program, in which solar customers are compensated with full retail rate credits for excess energy they put on the grid.

In effect, the joint proposal would create three sets of distributed generation customers: grandfathered net metered customers, transition distributed generation customers and post-transition period distributed generation customers. The latter two sets of customers would get lower credits for their exported power, but the proposal would not include PacifiCorp's proposed demand charge that has been particularly unpopular with many parties.

Utah Clean Energy Executive Director Sarah Wright said in an interview that negotiations among parties concern "modifications and tweaks" to what the division and office have proposed. While the Public Service Commission is presiding over an Aug. 9 public hearing and five days of expert witness testimony and exhibits set for the week of Aug. 14, there may still be time for a settlement before the commissioners issue a decision, Wright said. Utah Clean Energy is a nonprofit group that works to advance renewable energy and energy efficiency. It also sponsors the Clean Energy Business Coalition, which is a networking group of solar companies, clean energy and efficiency advocacy groups, community groups, local governments and educational institutions.

PacifiCorp's Rocky Mountain Power division spokesman, Dave Eskelsen, pointed to the joint state agency proposal as a reference point for multiparty negotiations that are still active during the hearing portion of the PSC's proceedings.

Rocky Mountain Power Senior Vice President Gary Hoogeveen in Aug. 8 testimony said, "If certain modifications are made to the joint proposal, it would address many of the concerns the company has with the current [net energy metering] program. Therefore, if the commission determines that the structure of the joint proposal is an acceptable or preferable alternative, or even because of the desirability for consensus, the company supports that framework, provided the values in the joint proposal are modified for the transition period."

The agencies' joint proposal would close the Berkshire Hathaway Energy subsidiary's net metering program to new customers at the end of 2017 and grandfather customers who interconnected prior to Jan. 1, 2018, for 12 to 17 years, as determined by the commission.

A transition period would be established for solar customers who interconnect after 2017. During that period, a compensation level of 9.67 cents per kWh would be paid to residential customer generators and it would be based on 15-minute metering intervals with no monthly netting of exports against customer consumption of utility-supplied electricity. Other customer classes would get lower compensation rates for the power they put on the grid. Customers who interconnect during the transition period would be credited at those compensation rates for 10 to 15 years, as determined by the PSC.

The transition period compensation rate would only be available to customers who interconnect before the commission establishes final compensation rates or until a 200-MW cap is reached. To determine final compensation rates for customers who interconnect systems after the transition docket is concluded or the cap is reached, the commission would open a new compensation docket at the start of the transition period. Exports for post-transition distributed generation customers would be measured and credited at whatever level the PSC determines in the compensation docket. (Utah PSC Docket No. 14-035-114)