Establishes goals for electric utility companies to implement renewable portfolio standards, which include a minimum percentage of renewable energy resources or energy efficiency programs within their overall resource portfolio. Provides net energy metering for eligible customer-generators. Provides for monthly billing and an annual reconciliation period. (SD2)

A BILL FOR AN ACT

Accordingly, the legislature finds that it should establish goals for electric utilities to guide them in incorporating renewable resources into their generation portfolios as well as encourage the expansion of demand-side management and energy efficiency programs to reduce the use of imported oil.

The purpose of this Act is to lessen Hawaii’s dependence on imported oil by encouraging the greater use of renewable energy by:

SECTION 2. For the purposes of this Act:

"Energy efficiency" means electrical energy savings brought about by the use of new or replacement energy efficient electrical equipment that meets or exceeds existing federal, state, and city and county standards and codes. This includes, among other equipment, energy efficient lighting, energy efficient cooling equipment, energy efficient electric motors, and solar and heat pump water heating.

"Electric utility company," means an electric utility company as defined under section 269-1, Hawaii Revised Statutes.

"Renewable energy" means electrical energy produced by wind, solar energy, hydropower, landfill gas, waste to energy, geothermal resources, ocean thermal energy conversion, wave energy, biomass including municipal solid waste, biofuels or fuels derived entirely from organic sources, hydrogen fuels derived entirely from renewable energy, or fuel cells where the fuel is derived entirely from renewable sources.

"Renewable portfolio standard" means the percentage of electrical energy sales that is represented by renewable energy generation and electrical energy savings from energy efficiency measures.

SECTION 3. Renewable portfolio standards. Each electric utility company that sells electricity for consumption in the State shall establish a renewables portfolio standard goal of ____ percent of their net electricity sales by December 31, 2010.

SECTION 4. An electric utility company and its electric utility affiliates may aggregate their renewable portfolios including demand-side management and energy efficiency programs in order to achieve the renewable portfolio standard.

SECTION 5. Any electric utility company not meeting the renewable portfolio standard shall report to the public utilities commission within ninety days of December 31, 2010, and provide an explanation for not meeting the renewable portfolio standard. The public utilities commission shall have the option to either grant a waiver from the renewable portfolio standard or an extension for meeting the prescribed standard.

§269-A Definitions. As used in this part:

"Eligible customer-generator" means a metered residential or commercial customer of an electric utility who owns and operates a solar, wind turbine, biomass, or hydroelectric energy generating facility, or a hybrid system consisting of two or more of these facilities, with a capacity of not more than ten kilowatts, that is:

"Net energy metering" means measuring the difference between the electricity supplied through the electric grid and the electricity generated by an eligible customer-generator and fed back to the electric grid over a twelve-month period; provided that:

§269-B Standard contract or tariff; rate structure. (a) Every electric utility shall develop a standard contract or tariff providing for net energy metering, and shall make this contract available to eligible customer-generators, upon request, on a first-come-first-served basis until the time that the total rated generating capacity produced by eligible customer-generators equals one per cent of the electric utility's aggregate customer peak demand.

(b) Each net energy metering contract or tariff shall be identical, with respect to rate structure, all retail rate components, and any monthly charges, to the contract or tariff to which the same customer would be assigned if the customer was not an eligible customer-generator. The charges for all retail rate components for eligible customer-generators shall be based exclusively on the eligible customer-generator's net kilowatt-hour consumption over a twelve-month period, without regard to the eligible customer-generator's choice of electric utility that offers net energy metering and is subject to sections 269-E to 269-K. Any new or additional demand charge, standby charge, customer charge, minimum monthly charge, interconnection charge, or other charge that would increase an eligible customer-generator's costs beyond those of other customers in the rate class to which the eligible customer-generator would otherwise be assigned are contrary to the intent of this section, and shall not form a part of net energy metering contracts or tariffs.

§269-C Generating capacity. On an annual basis, beginning in 2003, every electric utility shall make available to the public utilities commission information on the total rated generating capacity produced by eligible customer-generators that are customers of that utility in the utility's service area. The public utilities commission shall develop a process for making the information required by this section available to electric utilities, and for using that information to determine when, pursuant to section 269-D, an electric utility is not obligated to provide net energy metering to additional customer-generators in its service area.

§269-D Additional customer-generators. Notwithstanding section 269-B, an electric utility is not obligated to provide net energy metering to additional customer-generators in its service area when the combined total peak demand of all customer-generators served by all the electric utilities in that service area furnishing net energy metering to eligible customer-generators equals one per cent of the aggregate customer peak demand of those electric utilities.

§269-E Calculation. The net energy metering calculation shall be made by measuring the difference between the electricity supplied to the eligible customer-generator and the electricity generated by the eligible customer-generator and fed back to the electric grid over a twelve-month period. Sections 269-F to 269-K shall apply to the annualized net metering calculation.

§269-F Billing and reconciliation periods. (a) Billing of net metering customers shall be only on a monthly basis.

(b) There shall be an annual reconciliation period at the end of each twelve-month period following the date of final interconnection of the eligible customer-generator's system with an electric utility, and at each anniversary date thereafter, in which the electric utility shall:

§269-G Net electricity consumers. At the end of each twelve-month period, where the electricity supplied during the period by the electric utility exceeds the electricity generated by the eligible customer-generator during that same period, the eligible customer-generator is a net electricity consumer and the electric utility shall be owed compensation for the eligible customer-generator's net kilowatt-hour consumption over that same period. The compensation owed for the eligible customer-generator's net twelve-month kilowatt-hour consumption shall be calculated as follows:

Any credits owed to the eligible customer-generator for net production of electricity in a specific month shall be carried forward to the next month's bill until the end of each twelve-month period.

§269-H Net electricity producers. At the end of each twelve-month period, where the electricity generated by the eligible customer-generator during the twelve-month period exceeds the electricity supplied by the electric utility during that same period, the eligible customer-generator is a net electricity producer and the electric utility shall retain any excess kilowatt-hours generated during the prior twelve-month period. The eligible customer-generator shall not be owed any compensation for those excess kilowatt-hours unless the electric utility enters into a purchase agreement with the eligible customer-generator for those excess kilowatt-hours. The electric utility shall have the right to resell any excess net metered electricity to other customers as green power and charge an appropriate premium for the service. The public utilities commission shall approve any green power tariffs.

§269-I Net electricity consumption or production information. The electric utility shall provide every eligible customer-generator with net electricity consumption or production information with each regular monthly bill, which shall include the current monetary balance owed the electric utility for net electricity consumed or credited by the utility for net electricity produced since the end of the last monthly billing period.

§269-J Termination by eligible customer-generators. If an eligible customer-generator terminates the customer relationship with the electric utility, the electric utility shall reconcile the eligible customer-generator's consumption and production of electricity during any part of a twelve-month period following the last reconciliation, according to the requirements set forth in this part.

§269-K Termination by electric utilities. If an electric utility providing net metering to an eligible customer-generator ceases providing that electrical service to that customer during any twelve-month period, and the eligible customer-generator enters into a new net metering contract or tariff with a new electric utility, the twelve-month reconciliation period, with respect to that new electric utility, shall commence on the date on which the new electric utility first supplies electric service to the eligible customer-generator.

§269-L Safety and performance standards. A solar, wind turbine, biomass, or hydroelectric energy generating system, or a hybrid system consisting of two or more of these facilities, used by an eligible customer-generator shall meet all applicable safety and performance standards established by the National Electrical Code, the Institute of Electrical and Electronics Engineers, and accredited testing laboratories such as the Underwriters Laboratories and, where applicable, rules of the public utilities commission regarding safety and reliability. An eligible customer-generator whose solar, wind turbine, biomass, or hydroelectric energy generating system, or whose hybrid system consisting of two or more of these facilities, meets those standards and rules shall not be required to install additional controls, perform or pay for additional tests, or purchase additional liability insurance."

SECTION 7. Section 269-1, Hawaii Revised Statutes, is amended as follows:

1. By deleting the definition of "eligible customer-generator" as follows:

[""Eligible customer-generator" means a metered residential customer of an electric utility who owns and operates a solar, wind, or micro-hydro electric energy generating facility with a capacity of not more than ten kilowatts, that is located on the customer's premises, operates in parallel with the utility's transmission and distribution facilities, is in conformance with the utility's interconnection requirements, and is intended primarily to offset part or all of the customer's own electrical requirements."]

2. By deleting the definitions of "incremental cost of alternative electric energy", and "net energy metering" as follows:

[""Incremental cost of alternative electric energy" means, with respect to electric energy purchased from an eligible customer-generator, the cost to the utility of the electric energy that, but for the purchase from the eligible customer-generator, the utility would generate or purchase from another non-firm source.

"Net energy metering" means using a non-time-differentiated meter to measure the electricity supplied by a utility and another non-time-differentiated meter to measure the electricity generated by an eligible customer-generator and fed back to the utility over an entire billing period."]

SECTION 8. Section 269-16.21, Hawaii Revised Statutes, is repealed.

["[§269-16.21] Net energy metering. (a) Every electric utility in the State that offers residential electrical service shall develop a standard contract or tariff providing for net energy metering, and shall make this contract available to eligible customer-generators on a first-come, first-served basis until such time as the total rated generated capacity owned and operated by eligible customer-generators in each utility's service areas equals 0.1 per cent of the utility's peak demand.

(b) Each eligible customer-generator meeting the criteria of subsection (a) shall be entitled to net energy metering, calculated as follows:

(c) A utility, with the consent of the eligible customer-generator, may annualize the period during which the net energy measurement is calculated.

(d) In the event of disputes between a utility and an eligible customer-generator, either party may request a determination of the disputed issue by the commission.

(e) The electric utility shall have the right to deny interconnection with an eligible customer-generator if the interconnection will directly result in degradation of service.

(f) The electric utility shall have the right to prevent electric energy flow into the system by the customer-generator if the customer-generator's facilities are not in compliance with the electric utility's interconnection requirements. The interconnection will be reinstated upon remediation by the customer-generator within a reasonable period. Repeated violations within a one-year period may be grounds for termination of the interconnection agreement."]

SECTION 9. In codifying the new sections added by section 1 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 10. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 11. This Act shall take effect on July 1, 2050.