General Assembly		Raised Bill No. 6989
January Session, 2015		LCO No. 4870
		*04870_______ET_*
Referred to Committee on ENERGY AND TECHNOLOGY
Introduced by:
(ET)

AN ACT CONCERNING DISTRIBUTED ENERGY RESOURCES.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 16-19ff of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2015):

(a) Notwithstanding any provisions of the general statutes to the contrary, each electric distribution company shall allow the installation of submeters for the purpose of fairly allocating the costs associated with an individual customer's usage of electricity provided by an electric distribution company to the submetering entity at (1) a recreational campground, (2) individual slips at marinas for metering the electric use by individual boat owners, or (3) [commercial, industrial, multifamily residential or multiuse buildings where the electric power or thermal energy is provided by a Class I renewable energy source, as defined in section 16-1, or a combined heat and power system, as defined in section 16-1, or (4) in] any other location as approved by the authority where submetering promotes the state's energy goals, as described in the Comprehensive Energy Strategy, while protecting consumers against termination of residential utility service or other related issues. Each entity approved to submeter by the Public Utilities Regulatory Authority, pursuant to subsection (c) of this section, shall provide electricity to any allowed facility, as described in this subsection, at a rate no greater than the rate charged to that customer class for the service territory in which such allowed facility is located, provided nothing in this section shall permit such entity to charge a submetered account for (A) usage for any common areas of a commercial, industrial or multifamily residential building, or (B) other usage not solely for use by such account.

(b) The Public Utilities Regulatory Authority shall adopt regulations, in accordance with the provisions of chapter 54, to carry out the purposes of subsections (a) to (c), inclusive, of this section. Such regulations shall: (1) Require a submetered customer to pay only his portion of the energy consumed, which cost shall not exceed the amount paid by the owner of the main meter for such energy; (2) establish standards for the safe and proper installation of submeters; (3) require that the ultimate services delivered to a submetered customer are consistent with any service requirements imposed upon the company; (4) establish standards that protect a submetered customer against termination of service or other related issues; and (5) establish standards for the locations of submeters. The authority may adopt any other provisions it deems necessary to carry out the purposes of subsections (a) to (c), inclusive, of this section and section 16-19ee.

(c) The authority shall develop an application and approval process that allows for the reasonable implementation of submetering provisions at allowed facilities, as described in subsection (a) of this section, while protecting consumers against termination of residential utility service or other related issues.

(d) The authority shall allow submetering of electricity provided by an approved entity to commercial, industrial, multifamily residential or multiuse buildings where the electric power is provided by a Class I renewable energy source, as defined in section 16-1, or a combined heat and power system, as defined in section 16-1, generating less than three megawatts. Each entity approved to submeter such behind the meter generation by the authority, pursuant to this subsection, shall provide such electricity in accordance with the rate schedule that would be applicable to the rate class of the approved entities' customers if those customers are served by an electric distribution company in accordance with the net metering provisions of section 16-243h, provided nothing in this subsection shall permit such entity to charge a customer's account for (1) usage for any common areas of a commercial, industrial, multifamily residential or multiuse building, or (2) other usage not solely for use by such account.

Sec. 2. Subsection (f) of section 16a-40l of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2015):

[(f) On or before October 1, 2011, the department shall begin accepting applications for financial incentives for combined heat and power systems of not more than one megawatt of power. To qualify for such financial incentives, such combined heat and power system shall reduce energy costs at an amount equal to or greater than the amount of the installation cost of the system within ten years of the installation. The department shall review the current market conditions for such systems, including any existing federal or state financial incentives, and determine the appropriate financial incentives under this program necessary to encourage installation of such systems. Such financial incentives may include providing private financial institutions with loan loss protection or grants to lower borrowing costs. Financial incentives pursuant to this subdivision shall not exceed two hundred dollars per kilowatt. A project accepted for such incentives shall qualify for a waiver of (1) the backup power rate under section 16-243o, and (2) the requirement to provide baseload electricity under section 16-243i. Any purchase of natural gas for any combined heat and power system installed pursuant to this subdivision shall not include a distribution charge pursuant to section 16-243l.] (f) The Department of Energy and Environmental Protection shall, on or before January 1, 2016, establish a program to grant awards to end use customers of electric distribution companies to fund the capital costs of combined heat and power systems of not more than twenty megawatts of nameplate capacity. Such program shall be subject to review and approval by the joint standing committee of the General Assembly having cognizance of matters relating to energy and technology. The department shall submit a report, in accordance with the provisions of section 11-4a, regarding such program to the committee. Not later than sixty calendar days after receipt of the department's report, such committee, shall advise the department of their approval or modifications, if any, of the program proposed.

(1) Eligible projects shall receive a one-time, nonrecurring award in accordance with the following: (A) An eligible project or combination of eligible projects that in the aggregate account for a total nameplate capacity of thirty megawatts that become operational on or before January 1, 2016, shall receive a payment of four hundred fifty dollars per kilowatt of such system or systems, (B) such eligible projects that become operational after January 1, 2016, and on or before January 1, 2017, two hundred fifty dollars per kilowatt of such system, (C) such eligible projects that become operational after January 1, 2017, and on or before January 1, 2018, one hundred fifty dollars per kilowatt of such system, and (D) such eligible projects that become operational after January 1, 2018, one hundred dollars per kilowatt, provided the Commissioner of Energy and Environmental Protection deems such awards to be consistent with the Comprehensive Energy Strategy, issued pursuant to section 16a-3d. The department may provide for a premium to be awarded to combined heat and power systems that serve critical facilities, as defined in section 16-243y, as amended by this act, in a microgrid or that result in avoided costs for the electric distribution company's infrastructure development plan. Payment of the award shall be made at the time each such system becomes operational. The cost of the award shall be recoverable from a nonbypassable component of rates as determined by the Public Utilities Regulatory Authority. Revenues from such awards shall not be included in calculating the electric distribution company's earnings for the purpose of determining whether its rates are just and reasonable under sections 16-19, 16-19a and 16-19e. Each electric distribution company shall be made whole for all of its reasonable costs incurred in implementing the program through a fully reconciling, nonbypassable rate. Awards issued pursuant to this subsection shall not exceed fifteen million dollars annually or sixty million dollars total.

(2) An eligible project accepted for an award pursuant to this program shall qualify for a waiver of: (A) The backup power rate pursuant to section 16-243o, and (B) the requirement to reduce federally mandated congestion charges pursuant to section 16-243i. Any purchase of natural gas for any combined heat and power system installed pursuant to this subdivision shall not include a retail delivery charge pursuant to section 16-243l.

(3) All renewable energy credits associated with eligible projects that receive a grant pursuant to this section shall be the property of the respective electric distribution company. Each electric distribution company shall sell the renewable energy credits associated with eligible projects to serve the long-term interest of ratepayers.

(4) Not later than January 1, 2019, and biannually thereafter, the department shall assess the number and type of retail combined heat and power systems deployed in the state and financed pursuant to the provisions of this subsection. As part of its evaluation, the department shall consider the effect on all customer rates, determine the cost-effectiveness of the program and any other factors deemed relevant by the department in its program review. Not later than January 1, 2020, the department shall submit a report, in accordance with the provisions of section 11-4a, containing recommendations on continuing, modifying or terminating the award program to the joint standing committee of the General Assembly having cognizance of matters relating to energy and technology. The department shall make such report available on the department's Internet web site.

Sec. 3. Section 16-245a of the general statutes is amended by adding subsection (i) as follows (Effective July 1, 2015):

(NEW) (i) Notwithstanding the provisions of this section and the regulations adopted pursuant to subsection (f) of this section, the Public Utilities Regulatory Authority shall issue registration numbers to electric generating facilities that are eligible Class I renewable energy sources and derive electricity from either solar power, wind power or a fuel cell. The owner of any electric generating facility shall register with the authority, subject to section 16-33 of the general statutes, using a self-certification process as prescribed by the authority and shall sign a statement under oath indicating that such owner has complied with the requirements and criteria for the issuance of a Class I renewable energy source registration number. Failure to comply with such requirements and criteria may result in the authority revoking such registration.

Sec. 4. Subsection (c) of section 16-243y of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2015):

(c) The department shall award grants or loans under the microgrid grant and loan pilot program to any number of recipients. To the extent possible, the amount of loans and grants awarded under the program shall be evenly distributed between small, medium and large municipalities. Such grants and loans [shall only be used to] may provide assistance to recipients for the cost of a microgrid's design, engineering services and interconnection infrastructure, and may provide matching funds or low interest loans for new generation, energy storage or both for any such microgrid, provided such generation is derived from a Class I or Class II renewable energy source or a gas microturbine with an efficiency factor of 40. The department may establish any financing mechanism to provide or leverage additional funding to support the development of interconnection infrastructure, distributed energy generation and microgrids. [that is not limited to the cost of interconnection infrastructure.]

Sec. 5. Subsection (g) of section 16-244u of the general statutes is repealed and the following is substituted in lieu thereof (Effective July 1, 2015):

(g) A municipal, state or agricultural customer host shall be allowed to aggregate all electric meters located on the property of one of the virtual net metering facilities that are billable to such customer host.

This act shall take effect as follows and shall amend the following sections:
Section 1	July 1, 2015	16-19ff
Sec. 2	July 1, 2015	16a-40l(f)
Sec. 3	July 1, 2015	16-245a
Sec. 4	July 1, 2015	16-243y(c)
Sec. 5	July 1, 2015	16-244u(g)

Statement of Purpose:

To allow net metering of class I renewable energy sources, create a new combined heat and power incentive program, streamline the application process for solar, wind and fuel cell generating facilities, expand the microgrid program and allow for the aggregation of all electric meters located on the property of virtual net metering facilities.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]