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Vol. 25, No. 2, April 2006
Seminar prepares public utilities for Colorado RPS
wind turbine and house with solar panel
Incentives will encourage consumers to build small generation systems. Utilities must be ready for those systems with interconnection standards and net-metering policies.

As rulemaking for Colorado's voter-enacted renewable portfolio standard nears completion, utilities are asking how Amendment 37 will affect their customers and their business. A group of energy industry experts assembled at Tri-State Generation and Transmission Association Feb. 22 to answer some of those pressing questions.

Western teamed up with a "Who's Who" list of renewable energy advocates to present "Under 2 MW Interconnection and Net Metering for Renewables: What Utility Decision-Makers Need to Know." Sponsors included Colorado Energy Science Center, the state Office of Energy Management and Conservation, Colorado Renewable Energy Society, Interstate Renewable Energy Council, SolarBound, Solar Electric Power Association and DOE's Solar Powers America.

Seminar meets need

"The passage of Amendment 37 is a wake up call to utilities," explained Peggy Plate, Energy Services representative for Western's Rocky Mountain Region. "The tax incentives are coming and ratepayers will want to take advantage of them. Power providers must be ready with interconnection standards and net metering policies."

Although organizers were anticipating rather than responding to a need when they planned the seminar, more than 100 people attended. Along with utilities representatives, the presence of renewable developers, facility managers and even a few homeowners pointed to a broad, growing interest in alternative energy systems. "We wanted to know what other utilities were doing for a net metering standard," said Stephen Casey, member services supervisor for Holy Cross Energy.

Michael Haddorff, president of Collins Control and Electric, Inc. in Fort Collins, attended in hopes of getting the big picture from the utilities' perspective. "Contractors are really interested in making it work," Haddorff said. "The industry seems to have matured a lot since the last big solar push, but vendors are still concerned about whether or not this will last."

Holy Cross has renewable and efficiency provisions that predate A37. "Our policies seem to be following the trends of compliance," observed Casey. He added that Holy Cross is expecting EPAct rebates to motivate more customers to install systems.

RPS locally, nationally

The daylong program examined the issues and challenges of integrating small renewable generators into the power mix. Speakers explained the history of Colorado's RPS, Federal and state regulations, safety codes and standards and rates and incentives. The OEMC has made the presentations available online.

Participants learned about the evolution of interconnection standards and net-metering rules from Rusty Haynes of IREC. Haynes recommended visiting the Database of State Incentives for Renewable Energy to learn more about how other states are addressing those issues. Other presentations provided background on Amendment 37, explained FERC regulations, looked at net-metering provisions in EPAct 2005 and offered a case study on overcoming utility objections.

Colorado 's two investor-owned utilities, Xcel Energy and Aquila, discussed their plans to comply with the RPS. Xcel plans to net meter projects up to 2 MW, installing a single meter on projects generating 10 kW or less. Those systems will receive an upfront incentive of $4.50 per watt. Systems of 10 kW to 2 MW will be dual-metered and receive a two-part incentive—$2-per-watt in upfront capital, and a dollar-per-watt REC or energy payment over a 20-year contract term.

Aquila, which serves 93,000 meters in southern Colorado, must aquire 34 MW of renewables, 4 percent of which must be solar and half of that must be onsite. That translates into 40 homes by 2015, according to Operations Manager Dave Atwood. The rebate program is still under development, but will pay more for the first 50 kW to generate interest, Atwood said. The utility hired the consultant that created its demand side management program to design its solar rebate program.

Public power policies

Representing the municipal and cooperative viewpoints were Colorado Springs Utilities, Fort Collins Utilities and Platte River Power Authority. Springs Utilities launched a pilot program available to the first 50 customers to sign up before the end of 2007. Current participants include a middle school and two residential customers, with a new rebate program expected to attract more. Rate schedules are posted on the utility's Web site.

PRPA, which supplies electricity to Fort Collins, Estes Park, Longmont and Loveland, Colo., is not directly connected to any distributed generation systems. Member cities report grid-paralleled generators in their territory and use their own discretion in purchasing power from systems under 50 kW. PRPA will purchase from 50 to 1,000 kW at avoided cost, and negotiates purchases greater than 1,000 kW. Longmont and Fort Collins are the only PRPA customers with net-metering policies.

Fort Collins developed a net-metering policy before A37 in response to customer interest. The city has five residential PV systems, one 10-kW commercial system and three commercial systems between 50 kW and 1 MW, for a total of 1.3 MW. The commercial systems are paid under a different rate structure than the residential systems, which are part of a pilot program to gather data on the benefits of distributed solar power.

Practical concerns

Ken Regelson of Five Star Energy Consultants talked about net metering as it relates specifically to solar. A 2002 Colorado law allows RECs to call dual metering net metering, but dual-metered customers pay more for their electricity than net-metered customers. That combines with the fact that many co-ops don't offer renewable system rebates to create the perception that consumer-owned utilities are unfriendly to PV. Regelson recommended clearly defining metering terms for customers.

Another concern for co-ops is that member-owners without systems are paying for member-owners with net-metered renewable systems. Regelson suggested polling members to see if they would accept a small rate increase to support solar development.

Although solar got most of the attention because of A37's PV requirement and because the technology lends itself to cities and suburbs, wind development is an option for many rural customers. Jim Green of NREL's National Wind Technology Center noted that rural co-ops faced tight budgets and that no eastern Colorado co-ops offered net metering. Price signals to customers were often confusing, he added. However, given the economic development opportunity wind offered rural communities, utilities would be getting requests and needed to clarify their policies.

A discussion of safety codes completed the program. Tom Basso of the Institute of Electrical and Electronic Engineers reviewed current rules for interconnection and talked about the changes needed to accommodate distributed generation. Like most other aspects of RPSs, procedures are still evolving and states are implementing them individually.

At the end of the day, the seminar may have raised as many questions for utilities as it answered. It will take time and cooperation for Colorado's power providers to work out the details of implementing the renewable portfolio standard, but knowing what the questions are is the first step to getting the answers.

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