Interconnection of small wind solar systems to distribution utilities a cooperative perspective
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Patrick Parke Midwest Energy Hays, KS September 26, 2007 PowerPoint PPT Presentation


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Interconnection of Small Wind & Solar Systems to Distribution Utilities: A Cooperative Perspective. Patrick Parke Midwest Energy Hays, KS September 26, 2007. Outline. Governing statutes & regulations Interconnection tariff content (generic) Net metering. Governing Statutes.

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Patrick Parke Midwest Energy Hays, KS September 26, 2007

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Interconnection of Small Wind & Solar Systems to Distribution Utilities:A Cooperative Perspective

Patrick Parke

Midwest Energy

Hays, KS

September 26, 2007


Outline

  • Governing statutes & regulations

  • Interconnection tariff content (generic)

  • Net metering


Governing Statutes

  • KSA 66-1,238 – Directed KCC to establish interconnection provisions for renewable sources

  • KSA 66-1,184 – Interconnection and buy-back

  • KSA 17-4652 – Renewable generation coops

  • FERC guidelines apply if the device is connected to FERC-jurisdictional transmission lines or no KCC-approved guidelines are in place.


KSA 66-1,184 interconnection and buy-back provisions

  • Residential – 25 kW or less

  • Commercial – 200 kW or less (previously 100)

  • Appropriately sized for customer’s load

  • Excess generation priced at 150% of system average energy cost (Note: Customer gets value of full retail rate for every kWh displaced)

  • Dodge City CC/Cloud County CC – 1.5 MW

  • Buy-back = 100%of system average energy cost


KSA 66-1,184 interconnection andbuy-back provisions (Cont.)

  • Annual bill credit/payment or when total = $25

  • Utility owns, supplies & maintains meter(s)

  • Very general safety/protection guidelines

  • Total connected capacity may be limited by capacity of line or 4% of utility peak load

  • Subject to KCC-approved tariffs or current FERC procedures and regulations


Generic InterconnectionTariff Content

  • Applicability

  • Process overview

  • Technical requirements

  • Cost responsibility

  • Metering

  • Boilerplate

  • Sample agreements


Applicability

  • Who qualifies? Per KSA 66-1,184

    • Residential customers up to 25 kW

    • Commercial customers up to 200 kW

    • Schools (CCCC & DCCC) up to 1.5 MW

  • Utilities not prohibited from connecting larger systems


Process Overview – Series of steps largely dependent on generator size


Typical Screens

  • Use of qualified inverter (UL 1741)

  • Aggregate generation as % of annual peak on that line segment

  • % contribution to maximum fault current

  • % of short circuit interrupting capacity

  • Contribution to imbalances

  • % voltage drop for motoring


Technical Requirements

  • Interconnection

  • Operation

  • Disconnection – For protection of people and property on both sides of the meter.

    Customers may not understand these provisions, but their vendors should!


Cost Responsibility: Interconnecting Customer

  • Review and study costs

  • Interconnection equipment costs

  • System modification costs

  • May be a requirement of creditworthiness

  • Minimal/no fees for smallest systems

    • Midwest Energy, up to 10 kW = $0

    • SGIA model = $100

  • Utilities must provide cost estimates in advance (KSA 66-1,184)


Metering

  • KSA 66-1,184: Cost is utility’s responsibility

  • For larger systems: Utility specific

  • Meter type dependent on generator size and contract provisions


Boilerplate

  • Definitions

  • Insurance requirements

  • Indemnifications

  • Confidentiality provisions

  • Notices

  • Amendments

  • Assignment

  • Etc.


Typical Agreements

  • Combined Application & Agreement (10 kW category)

  • Review or Study Agreements

  • Interconnection Agreement


Net Metering


Net Metering Definition

  • Customers use their own generation to offset consumption; electric meters turn backwards when electricity is generated in excess of actual load


Net Metering Definition (Cont.)

  • Net metering allows for the flow of electricity both to and from the customer through a single, bi-directional meter

  • Customers may receive retail prices for the excess electricity they generate, depending on the state

  • Avoided cost; average power cost or monthly market rate also used (per IREC)


Net Billing

  • A second meter measures electricity that flows back to the utility

  • Utility purchases the power measured by the second meter at rate reflecting variable energy cost (w/o capacity cost)

  • The amount that the utility pays the customer is netted against the amount that the customer owes the utility


Reasons Cited for Allowing Net Metering

  • Easy to administer – standard electric meter registers net flow (w/o TOU info)

  • Subsidy encourages investment in renewable energy technologies

  • Allows customers to "bank" their energy and use it a different time than it is produced, i.e., another subsidy, especially with wind


Components of Retail Service

  • When a utility sells electric energy to the customer, the utility is selling 3 services

    • Generation

    • Transmission

    • Distribution

  • With rare exceptions, all three services are “firm”, but wind is an intermittent resource


110 MW Gray County Wind Farm2005 Operating History

  • 18% of year: output was 0 MW

  • 32% of year: output was <10% capacity

  • 66% of year: output was <50% capacity

  • 22 occasions, the output dropped by 55 MW or more in a ten-minute period; 4 occasions by more than 99 MW.

  • 38 occasions, the output increased by 55 MW or more in a ten-minute period; 1 occasion by more than 99 MW.

  • Wind is an intermittent energy source, not firm capacity


Net Metering Subsidy

  • Customer generation is non-firm

  • Customer does not own transmission or distribution (T&D); significant portion of the costs in retail rates

  • Payment calculated using the firm retail rate is too high for intermittent power produced and absence of T&D functions


Net Metering Subsidy (Cont.)

  • Subsidy is paid by remaining customers

  • I.e., a subsidy from those who cannot afford generators to those who can; not everyone can afford a $30,000 - $40,000 wind machine and tower. (Bergey Excel)

  • Environmental benefits flow to all citizens; cost of net metering subsidy falls on customers of mostly rural systems


Kansas Coops Demonstrating Support for Renewable Energy

  • Concern with net metering ≠ opposition to renewable energy

  • Sunflower: 100 MW of wind

  • Midwest Energy: 25 MW contracted; 25 MW under negotiation

  • KEPCo gaining access via supply contracts

  • 150 MW = 20,000 Bergey Excel 7.5 kW units


Smart Shopping

  • Typical wholesale wind cost <5 cents/kWh

  • Average residential rate >10 cents/kWh

  • Net metering means the utility pays firm retail rates for a wholesale commodity

  • Why should the coop pay 10 cents for what it can buy at under 5 cents?


An Economist’s Perspective: Two Policy Questions

  • Does net metering lead to greater efficiency?

  • Not if the result is paying double for wind energy!

  • Does net metering lead to greater equity?

  • Not if those who can afford renewable generators are subsidized by those who cannot.


The End


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