June 12, 2014, Introduced by Reps. Irwin, Switalski, Roberts, Dianda, Barnett, McBroom, Kivela, Zemke, Townsend, Lamonte, Robinson, Kelly and Hovey-Wright and referred to the Committee on Energy and Technology.
A bill to amend 2008 PA 295, entitled
"Clean, renewable, and efficient energy act,"
by amending section 177 (MCL 460.1177) and by adding section 178.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 177. (1) Electric meters shall be used to determine the
amount of the customer's energy use in each billing period, net of
any excess energy the customer's generator delivers to the utility
distribution system during that same billing period. For a customer
with a generation system capable of generating more than 20
kilowatts, the utility shall install and utilize a generation meter
and a meter or meters capable of measuring the flow of energy in
both directions. A customer with a system capable of generating
more than 150 kilowatts shall pay the costs of installing any new
meters.
(2) An electric utility serving over 1,000,000 customers in
this state may provide its customers participating in the net
metering program, at no additional charge, a meter or meters
capable of measuring the flow of energy in both directions.
(3) An electric utility serving fewer than 1,000,000 customers
in this state shall provide a meter or meters described in
subsection (2) to customers participating in the net metering
program at cost. Only the incremental cost above that for meters
provided by the electric utility to similarly situated
nongenerating customers shall be paid by the eligible customer.
(4) If the quantity of electricity generated and delivered to
the utility distribution system by an eligible electric generator
during a billing period exceeds the quantity of electricity
supplied from the electric utility or alternative electric supplier
during the billing period, the eligible customer shall be credited
by their supplier of electric generation service for the excess
kilowatt hours generated during the billing period. The credit
shall appear on the bill for the following billing period and shall
be
limited to the total power supply charges on that bill. Any
Except as provided in section 178, any excess kilowatt hours not
used to offset electric generation charges in the next billing
period will be carried forward to subsequent billing periods.
Notwithstanding
any law or regulation, net metering customers shall
not
receive credits for electric utility transmission or
distribution
charges. The credit per kilowatt
hour for kilowatt
hours delivered into the utility's distribution system shall be
either of the following:
(a)
The monthly average real-time locational marginal price
for
energy at the commercial pricing node within the electric
utility's
distribution service territory, customer's
retail rate,
or for net metering customers on a time-based rate schedule, the
monthly
average real-time locational marginal price for energy at
the
commercial pricing node within the electric utility's
distribution
service territory customer's
retail rate during the
time-of-use pricing period.
(b) The electric utility's or alternative electric supplier's
power
supply component of the full retail
rate during the billing
period or time-of-use pricing period.
Sec. 178. (1) An electric provider may apply for commission
approval for an alternative rate that compensates a customer
through a bill credit for the value to the electric provider, its
customers, and society for operating a distributed generation
resource interconnected to the system and operated by the customer
primarily for meeting the customer's own energy needs. If the
commission approves the alternative rate, it applies to a customer
interconnection occurring after the date of approval. The
alternative rate is in lieu of the applicable rate under section
177(4) or any other rate under this part.
(2) The commission shall, after notice and opportunity for
public comment, approve the alternative rate if the electric
provider has proposed a plan to establish and implement an
alternative rate that meets all of the following:
(a) Appropriately applies the methodology established by the
commission under subsection (4).
(b) Includes a mechanism to allow recovery of the cost of
serving customers who are compensated at the alternative rate.
(c) Charges the customer for all electricity consumed by the
customer at the applicable rate schedule for the electric
provider's sales to that class of customer.
(d) Credits the customer for all electricity generated by the
distributed generation device at the alternative rate established
under this subsection.
(e) Applies the charges and credits in subdivisions (c) and
(d) to a monthly bill and applies the unused portion of the credit
in any month or billing period to be carried forward and credited
against all the electric provider's charges. If the customer has a
positive balance after the 12-month cycle ending on the last day in
January, that credit balance is paid to the customer at the
alternative rate and the 12-month credit cycle restarts with the
next billing period.
(f) Complies with any applicable size limit specified in this
part.
(g) Complies with the interconnection requirements under
section 173.
(h) Complies with the standby charge requirements established
by the commission for net metering customers.
(3) A provider shall provide to the customer the meter and any
other equipment needed to provide service under the alternative
rate.
(4) The commission shall establish a distributed generation
value methodology for use in subsection (2)(a) not later than 180
days after the effective date of the amendatory act that added this
section. When developing the distributed generation value
methodology, the commission shall consult stakeholders with
experience and expertise in power systems, renewable energy, and
electric provider ratemaking regarding the proposed methodology,
underlying assumptions, and preliminary data.
(5) The distributed generation value methodology established
by the commission shall, at a minimum, account for the value of
energy and its delivery, generation capacity, transmission
capacity, transmission and distribution line losses, and
environmental value. The commission may, based on known and
measurable evidence of the cost or benefit of distributed
generation operation to the electric provider, incorporate other
values into the methodology, including credit for locally
manufactured or assembled energy systems, systems installed at
high-value locations on the distribution grid, or other factors.
(6) The credit for distributed generation value applied to
alternative rates approved under this section shall represent the
present value of the future revenue streams of the value components
identified in subsection (4).
(7) The electric provider shall recalculate the alternative
rate every 2 years, and shall file the recalculated alternative
rate with the commission for approval.
(8) Renewable energy credits for energy from distributed
generation that is subject to this section belong to the electric
provider providing the credit.
(9) The commission shall not authorize an electric provider to
use an alternative rate that is lower than the electric provider's
applicable retail rate until 3 years after the commission approves
an alternative rate for the electric provider.
(10) A electric provider shall enter into a contract with an
owner of a distributed generation device receiving an alternative
rate under this section for a minimum of 20 years, unless a shorter
term is agreed to by the parties.
(11) An owner of a distributed generation device receiving an
alternative rate under this section shall be paid the same rate per
kilowatt-hour generated each year for the term of the contract.
Enacting section 1. This amendatory act does not take effect
unless Senate Bill No. ____ or House Bill No. ____ (request no.
02653'13) of the 97th Legislature is enacted into law.