10 September 2009

Net Metering Update

Here is the elusive 1:1 net metering language I discussed earlier:

20VAC5-315-50. Metering, billing, payment and tariff considerations.

Net metered energy shall be measured in accordance with standard metering practices by metering equipment capable of measuring (but not necessarily displaying) power flow in both directions. Each contract or tariff governing the relationship between a net metering customer, electric distribution company or energy service provider shall be identical, with respect to the rate structure, all retail rate components, and monthly charges, to the contract or tariff under which the same customer would be served if such customer was not a net metering customer with the exception that time of use metering is not permitted. Said contract or tariff shall be applicable to both the electric energy supplied to, and consumed from, the grid by that customer.

Click here for more info: Net Metering

After writing this I got this response from Carol Huffman, the AEP local netmetering coordinator which makes this much clearer:

Hi Adam-

Yes, that little summary is a little bit misleading. The entire law allows for the following:

First, the Net Metering program is intended for customers wanting to offset their own energy requirements so the generators need to be sized according to their loads.

Net metering periods run 12 months and begin on the first meter reading date following interconnection. A customer can carry forward, to the next 12 month period, excess generated energy to the extent that they purchased that number of kwhs from the utility during that same period. This is what I think the summary is referring to when it says "allows customers to receive the full retail value for their excess electricity at times when their system is producing more electricity than the building is consuming" because they are in essence offsetting future usage at retail rates. At the end of each 12 month period, you should come out even at the most (that's why you can only carry over to the extent you purchased that many kwhs during the year).

The Virginia Administrative Code 20VAC5-315-50 puts it like this:

"If electricity generated by the net metering customer and fed back to the electric grid exceeds the electricity supplied to the net metering customer from the grid during any billing period, the net metering customer shall be required to pay only the nonusage sensitive charges for the billing period. Such billing period credits shall be accumulated, carried forward and applied at the first opportunity to any billing periods having positive net consumptions. However, any accumulated billing period credits remaining unused at the end of a net metering period shall be carried forward into the next net metering period only to the extent that such accumulated billing period credits carried forward do not exceed the net metering customer's billed consumption for the current net metering period, adjusted to exclude accumulated billing period credits carried forward and applied from previous net metering periods."

This clause in the law, in my mind, ensures that customers are not sizing generation larger than their own energy requirements.

New as of last fall, customers now also have the option to enter into a contract with their utility to have those kwhs purchased at the PJM day ahead annual simple average LMP rate for the AEP zone and for the most recent calendar year ending on or before the end of each Net Metering Period. For calendar year 2009, that rate is .053 per kwh. The law does stipulate that they have to request to contract for payment PRIOR to the beginning of the net metering period. And remember too..the intend is still that the customer is producing to offset their own energy requirements.

The Virginia Administrative Code explains it as follows:

"...upon the written request of the customer, the electric distribution company shall enter into a power purchase agreement for excess generation for one or more net metering periods. ...For net metering periods beginning on or after January 1, 2009, the written request shall be submitted prior to the beginning of the net metering period....and obligate the investor-owned electric distribution company to purchase the excess generation at a price equal to the PJM zonal day ahead annual simple average LMP for the PJM load zone in which the electric distribution company's Virginia retail service territory resides, as published by the PJM Market Monitoring Unit, for the most recent calendar year ending on or before the end of each net metering period.

Hope this helps!

PS...I really enjoy your blog!

Carol R. Huffman, C.E.M.
Customer Services
Appalachian Power Company

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