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HB 37: "An Act relating to the net metering of electric energy for electric utilities subject to economic regulation by the Regulatory Commission of Alaska and for a utility's retail consumers; and providing for an effective date."

00                              HOUSE BILL NO. 37                                                                          
01 "An Act relating to the net metering of electric energy for electric utilities subject to                               
02 economic regulation by the Regulatory Commission of Alaska and for a utility's retail                                   
03 consumers; and providing for an effective date."                                                                        
04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA:                                                                
05    * Section 1. AS 42.05 is amended by adding a new section to read:                                                  
06            Sec. 42.05.686. Net metering of electrical energy. (a) This section applies to                             
07       every electric utility that is subject to exercise of the jurisdiction of the commission                          
08       that extends to matters concerning rates and charges for public utility services.                                 
09            (b)  The commission may modify or waive a requirement in this section, in                                    
10       whole or in part, by order. The commission may act on an application for modification                             
11       or waiver and a showing of good cause or on the commission's own motion. An                                       
12       application for modification or waiver under this section must be in writing and must                             
13       set out the pertinent facts in sufficient detail to support a finding by the commission                           
14       that no legitimate public interest will be served by enforcing the requirement                                    
01       designated in the application. Under the authority set out in this subsection, the                                
02       commission may not modify or waive a requirement in another provision of AS 42.05.                                
03            (c)  The commission may adopt by regulation additional requirements                                          
04       pertaining to safety, power quality, and interconnection standards for consumer                                   
05       generation systems participating in the net metering program if the commission                                    
06       considers the requirements to be necessary to protect public safety and system                                    
07       reliability.                                                                                                      
08            (d)  This section does not apply to the following systems of an electric utility                             
09       that is otherwise subject to exercise of the jurisdiction of the commission described in                          
10       (a) of this section:                                                                                              
11                 (1)  an independent electric system owned and operated by an electric                                   
12       utility if                                                                                                        
13                      (A)  except for fossil fuel generation for standby and emergency                                   
14            power, 100 percent of the independent electric system's power is supplied by a                               
15            facility described in (l)(1) of this section; or                                                             
16                      (B)  the independent system had total retail sales of less than                                    
17            5,000,000 kilowatt-hours during the previous calendar year; or                                               
18                 (2)  any portion of the distribution system of the electric utility if and to                           
19       the extent the electric utility demonstrates to the commission that limiting net metering                         
20       installations in that portion of its distribution system is reasonably necessary to                               
21       address system stability constraints or other operational issues.                                                 
22            (e)  Except as provided in (f) or (j) of this section, an electric utility subject to                        
23       this section shall                                                                                                
24                 (1)  make a net metering program available to each of its retail                                        
25       consumers that requests interconnection; and                                                                      
26                 (2)  allow eligible consumer generation systems complying with (l) of                                   
27       this section to be interconnected to the electric utility's facilities in accordance with                         
28       interconnection standards approved or accepted by the commission.                                                 
29            (f)  An electric utility may refuse to interconnect with a consumer that requests                            
30       net metering if interconnection would cause the total nameplate capacity of all eligible                          
31       consumer generation systems participating in the net metering program to exceed 1.5                               
01       percent of the electric utility's average retail demand. The utility shall notify the                             
02       commission if it refuses to interconnect with a potential net metering consumer under                             
03       this subsection.                                                                                                  
04            (g)  An electric utility that has a decrease in average retail demand that results                           
05       in the total nameplate capacity of eligible consumer generation systems exceeding 1.5                             
06       percent of average retail demand shall allow existing net metering consumers to                                   
07       continue participating in the net metering program.                                                               
08            (h)  By March 1 of each year, an electric utility shall submit a tariff filing                               
09       stating the number of kilowatts equivalent to 1.5 percent of the electric utility's                               
10       average retail demand for the previous calendar year and the total nameplate capacity                             
11       of eligible consumer generation systems participating in the net metering program at                              
12       the time of filing. The commission may require the filing to be made using a tariff                               
13       advice letter with accompanying tariff sheet.                                                                     
14            (i)  An electric utility may submit a tariff filing requesting an increase in the                            
15       limit on total nameplate capacity of eligible consumer generation systems participating                           
16       in the net metering program above 1.5 percent of the electric utility's average retail                            
17       demand. The commission may require the filing to be made using a tariff advice letter.                            
18            (j)  An electric utility may deny participation in a net metering program to an                              
19       electric consumer that                                                                                            
20                 (1)  participates in another program if the program allows the consumer                                 
21       to collect, through voluntary contributions from other participating consumers of the                             
22       utility, more than the non-firm power rate a kilowatt-hour for the sale of electric                               
23       energy; or                                                                                                        
24                 (2)  sells electric energy under an existing contract if the contract                                   
25       allows the consumer to collect more than the non-firm power rate a kilowatt-hour for                              
26       the sale of electric energy.                                                                                      
27            (k)  An electric utility may install additional metering equipment for net                                   
28       metering consumers. The electric utility                                                                          
29                 (1)  is responsible for all costs related to the purchase, installation, and                            
30       maintenance of the additional metering equipment; and                                                             
31                 (2)  may not assess a recurring charge for the additional metering                                      
01       equipment.                                                                                                        
02            (l)  To be eligible for interconnection under a net metering program, a                                      
03       generation system must                                                                                            
04                 (1)  be a facility that produces electric energy derived from one or more                               
05       of the following sources:                                                                                         
06                      (A)  solar photovoltaic and solar thermal energy;                                                  
07                      (B)  wind energy;                                                                                  
08                      (C)  biomass energy;                                                                               
09                      (D)  hydroelectric energy;                                                                         
10                      (E)  geothermal energy;                                                                            
11                      (F)  hydrokinetic energy;                                                                          
12                      (G)  ocean thermal energy;                                                                         
13                      (H)  landfill gas or biogas produced from organic matter,                                          
14            wastewater, anaerobic digesters, or municipal solid waste; and                                               
15                      (I)  other sources, as approved by the commission, that                                            
16            generally have similar environmental effects;                                                                
17                 (2)  be operated and owned or leased by the consumer and                                                
18                      (A)  have a total nameplate capacity of not more than 25                                           
19            kilowatts for each consumer premises;                                                                        
20                      (B)  be located on or adjacent to the consumer's premises;                                         
21                      (C)  be used primarily to offset part or all of the consumer's                                     
22            requirements for electric energy; and                                                                        
23                      (D)  include a device that converts direct current power into                                      
24            alternating current power to ensure the generated power is compatible with                                   
25            power generated by an electric utility;                                                                      
26                 (3)  include an electric generator and its accompanying components                                      
27       that connect the electric generator to a utility's electric distribution system, including                        
28       interface equipment and interface equipment controls, switchgear, inverter, and other                             
29       interface devices; and                                                                                            
30                 (4)  be physically interconnected to the consumer's side of the meter                                   
31       from which electric service is provided by the utility to the consumer.                                           
01            (m)  Each electric utility with a consumer participating in a net metering                                   
02       program shall measure the net electric energy during each monthly billing period, and                             
03                 (1)  if the utility supplied more electric energy to the consumer than the                              
04       consumer supplied to the utility during the monthly billing period, the electric utility                          
05       shall bill the consumer for the number of kilowatt-hours of net electric energy supplied                          
06       by the utility to the consumer at the applicable rates contained in the utility's currently                       
07       effective tariff; or                                                                                              
08                 (2)  if the consumer supplied more electric energy to the utility than the                              
09       utility supplied to the consumer during the monthly billing period, the electric utility                          
10       shall credit the consumer's account with an amount derived by multiplying the                                     
11       kilowatt-hours of net electric energy supplied by the consumer to the utility by the                              
12       non-firm power rate contained in the utility's currently effective tariff, unless a                               
13       different rate has been established in a commission-approved contract; the electric                               
14       utility shall credit dollar amounts to the account of a net metering consumer for                                 
15       furnishing electric energy to the utility under this paragraph and use the credits to                             
16       reduce dollar amounts owed by the consumer in subsequent monthly billing periods;                                 
17       the credits do not expire or otherwise revert to the utility.                                                     
18            (n)  Except as otherwise provided in (m) of this section regarding kilowatt-                                 
19       hour charges, the electric utility may bill a net metering consumer for all applicable                            
20       charges authorized by the electric utility's approved tariff.                                                     
21            (o)  An electric utility administering a net metering program may not charge a                               
22       consumer participating in the net metering program any additional fee for standby,                                
23       capacity, interconnection, or other net metering expense unless approved by the                                   
24       commission.                                                                                                       
25            (p)  An electric utility may petition the commission to change electric rate                                 
26       designs, consistent with regulations adopted by the commission, including appropriate                             
27       rate classes for net metered consumers. The commission shall allow the charge if the                              
28       utility can demonstrate an adverse material rate effect on utility consumers that do not                          
29       participate in the net metering program.                                                                          
30            (q)  In this section,                                                                                        
31                 (1)  "average retail demand" is the number of kilowatts determined by                                   
01       dividing the total retail sales of the utility, measured in kilowatt-hours, for a calendar                        
02       year                                                                                                              
03                      (A)  with 365 days, by 8,760 hours; or                                                             
04                      (B)  with 366 days, by 8,784 hours;                                                                
05                 (2)  "consumer" means a customer of an electric utility described in (a)                                
06       of this section that consumes the electricity purchased from the utility;                                         
07                 (3)  "consumer premises" means all buildings and associated grounds                                     
08       owned or leased by a consumer at a single location where an electric utility provides                             
09       service through one or more utility meters;                                                                       
10                 (4)  "electric system" means an integrated electrical system that                                       
11       includes, at a minimum, generation and distribution of electric energy;                                           
12                 (5)  "independent electric system" means an electric system that is not                                 
13       interconnected with another electric system;                                                                      
14                 (6)  "nameplate capacity" means the maximum rated output of a                                           
15       generator, prime mover, or other electric power production equipment under specific                               
16       conditions designated by the manufacturer;                                                                        
17                 (7)  "net electric energy" means, as metered by the electric utility for a                              
18       specified period and expressed in kilowatt-hours, the amount by which the quantity of                             
19       electric energy supplied by the                                                                                   
20                      (A)  utility to the consumer exceeds the quantity of electric                                      
21            energy supplied by the consumer to the utility; or                                                           
22                      (B)  consumer to the utility exceeds the quantity of electric                                      
23            energy supplied by the utility to the consumer;                                                              
24                 (8)  "non-firm power rate" means the rate updated quarterly in an                                       
25       electric utility's tariff in accordance with regulations adopted by the commission or                             
26       another non-firm power rate as may be authorized by the commission;                                               
27                 (9)  "retail sales" means sales of electricity to the end-use consumer,                                 
28       exclusive of any wholesale sales.                                                                                 
29    * Sec. 2. This Act takes effect January 1, 2012.