Presentation Transcript

1. Rule 21 Interconnection and Procurement Opportunities Webinar October 9, 2012
2. Overview
3. Welcome and Introduction Nick Chaset Governor’s Office of Planning and Research
4. Our Long-term Energy Vision Transition California’s energy system to a highly efficient, renewables-based system and electrify transportation.
5. Elements of this energy transformation Improve energy efficiency and reduce energy demand Develop a cleaner, more reliable energy supply Implement an efficient and responsive energy infrastructure Reduce emissions from the transportation sector (Source: California Clean Energy Future)
6. Developing a cleaner energy supply: Renewables of all sizes are needed Electricity demand will increase with population growth and electric transportation. Along with energy demand programs, we will need more power. Recent report: State’s solar capacity must increase 12% and its wind capacity 7.5% every year between now and 2050 to meet demand increases and our long-term climate goal. Governor Brown has called for expansion of both large-scale and small-scale energy.
7. Key Renewable Energy Policies in California 33% Renewable Portfolio Standard (RPS) 12 GW of Distributed Generation (DG) Desert Renewable Energy Conservation Project (DRECP) CPUC Procurement programs (IOU procurment, RAM, FIT, Net Metering, etc)
8. The CPUC’s Actions to Reform the Rule 21 Interconnection Process Rachel Peterson, Energy Division California Public Utilities Commission rp1@cpuc.ca.gov (415) 703-2872
9. The Commission’s Actions to Reform the Interconnection Process September 22, 2011 Order Instituting Rulemaking (R.) 11-09-011: “Ensure that the interconnection process is timely, non-discriminatory, cost-effective, and transparent.” Commission staff (Energy and Legal Divisions) initiated a multi-party settlement process to develop consensus on numerous reforms needed within Rule 21. March 16, 2012 Fourteen settling parties filed a settlement agreeing to a significantly reformed Rule 21, a new form interconnection request, and a new form interconnection agreement for exporting generators. September 13, 2012 In Decision 12-09-018, the Commission approved the entire package of reforms proposed by the settling parties without modification. September 20, 2012 PG&E, SCE, and SDG&E each posted the reformed Rule 21 and new features. September 25, 2012 Assigned Commissioner Florio issued Phase II Scoping Memo for R.11-09-011.
10. The Rule 21 Reforms Respond to the Commission’s Goals “Timely” - New timelines and accountability rules standardize the interconnection process “Non-discriminatory” - New clearly defined interconnection study tracks serve all segments of the diverse distributed generation market “Cost-effective” - Highest permitted generating capacity penetration levels in the U.S. where safety and reliability tests are met “Transparent” - New market-wide tools inform interconnection siting
11. For Industry: Anticipated Outcomes of the Rule 21 Reforms
12. For Utilities: Anticipated Outcomes of the Rule 21 Reforms
13. Phase II Issues Will Further Advance the Commission’s Goals “Timely” - Distribution Group Study Process “Non-discriminatory” – Compliance with timelines, completion rates by study track, effectiveness of dispute resolution tools “Cost-effective” – Interconnection cost responsibility “Transparent” – Additional standardized interconnection agreements
14. Information and Resources CPUC Decision 12-09-018 adopting the Rule 21 Settlement: http://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M028/K168/28168335.PDF Assigned Commissioner Michel P. Florio’s Phase II Scoping Memo: http://docs.cpuc.ca.gov/PublishedDocs/Efile/G000/M028/K946/28946652.PDF Proceeding Detail and Docket for R.11-09-011: http://delaps1.cpuc.ca.gov/CPUCProceedingLookup/f?p=401:56:42780590447401::NO
15. SCE Interconnection Process Michael MooreProject Manager, Grid Interconnection and Contract Development
16. State of the QueueActive Interconnection Requests
17. State of the QueueActive Interconnection Projects
18. What Constitutes a Complete Interconnection Request? Complete Interconnection Requests include: A completed interconnection request form, with all requested technical data A site plan diagram A single line electrical diagram Site exclusivity documentation An Interconnection Request Fee and, if detailed studies are required, a study deposit The Interconnection Request Fee is $800 For Fast Track: there is no fee for the Initial Review, if a project requires Supplemental Review, the fee is $2,500 For Independent Study process: the deposit for projects 5 MWs and less is $10,000 for a System Impact Study and $15,000 for a Facilities Study, for projects greater than 5 MW is $50,000 plus $1,000/MW up to $250,000 maximum. Rule 21 Interconnection Requests are for energy only and full capacity deliverability is not available Request for Distribution Service is a separate application that you may need depending on your power procurement agreement (see Section 15.2 of WDAT). Lack of site exclusivity documentation and lack of technical data are typical reasons for triggering a deficiency notice.
19. Rule 21 Generator Interconnection Process Study Tracks Fast Track Process Screening process to determine if project can beinterconnected without further study Limited to 3MW or less on distribution system Customer options meeting and SupplementalReview Screens if fail Initial Review screens If pass Initial Review screens, go directly to cost estimate and interconnection agreement. Otherwise, move to Supplemental Review ($2,500 fee). If fail screens, options meeting to evaluate Changes to generation facility Changes to distribution system Or move into Detailed Study Features Independent Study Process (ISP) Detailed study of projects in serial fashion No size limit CAISO test for electrical independence SCE test for electrical independence Apply any time of year System Impact Study and Facilities Study Study deposit: <= 5 MW $10,000 for SIS, $15,000 for FS, > 5 MW $50,000 plus $1,000 per MW; Max $250,000 3-step security postings (see below) Features Distribution Group Study Process Group study for interdependent projectson the distribution system Details to be worked out in Phase 2 of R.11-09-011 Features Cluster Study Process Not conducted under Rule 21, Applicants apply under Wholesale Distribution Access Tariff No size limit Studies groups of electrically-related generation Cost of upgrades allocated among group based on contribution Deliverability options Open window each year 3/1-3/31 One study cycle per year – 2 Phases Study deposit: $50,000 plus$1,000 per MW; Max $250,000 3-step security postings Between Phase I and II After Phase II At Start of Construction Features
20. Technical Scoping Meeting The purpose of the scoping meeting is to: Ensure a common understanding of interconnection customer’s project. Ensure understanding of generator interconnection procedures. Come to an agreement on point of Interconnection (POI) and generator size. SCE will provide technical system details, limitations, and information regarding earlier queued projects. Outline general study process steps. Outline next steps. On the basis of the meeting, Applicant shall confirm POI.
21. Scope of InterconnectionTechnical Studies Technical studies are intended to provide: Impact of generation on SCE’s electric system and/or the CAISO grid. Scope of facilities required to ensure the safety, reliability, and integrity of the grid: Interconnection facilities Generator-specific facilities required for interconnection. Distribution upgrades Upgrades to the distribution system required by the generator . Network upgrades Upgrades to the network (CAISO controlled grid) triggered by the generator . Cost estimate for required facilities and duration of expected construction.
22. Financial Security Postings Three financial security postings are due at different times during the ISP. Initial posting due: 60 calendar days after SIS. Second posting due: 120 calendar days after Facilities Study (or SIS if Facilities Study waived). Third posting due: On or before start of construction. Failure to post within the specified time will result in the Interconnection Request being deemed withdrawn.
23. Interconnection Agreement Interconnection agreement negotiations commence following completion of studies or successful eligibility for Fast Track status. An Interconnection agreement is a contract that sets forth the requirements for interconnection, including: Estimated cost and schedule Defines the network upgrades, distribution upgrades, and interconnection facilities to be constructed Identifies major milestones Defines the point of interconnection Specifies the required financial obligations Interconnection agreements do not contain: Provisions for power procurement Generation tie-lines Access to SCE rights-of-way Interconnection agreements are executed by the Applicantand SCE.
24. Project Implementation After execution of interconnection agreement, SCE and interconnection customer commence Engineering/design, Procurement, and Construction (EPC) of the generating and interconnection facilities. SCE will be responsible for EPC of the agreed upon facilities listed in the interconnection agreement. Customer will be responsible for EPC of the electrical system on the customer’s side of the point of change of ownership (unless otherwise specified in the interconnection agreement). Any facilities that will be constructed by customer and deeded to SCE will have to be EPC’d to appropriate specifications. After the completion of EPC, SCE and the customer will coordinate a pre-parallel inspection and commissioning prior to achieving synchronization.
25. Types of Interconnection Costs Interconnection Facilities Sole use facilities, specific to the project Distribution System Upgrades and Network upgrades Dependent on the location of the project, the size of the project and the relative position in the queue Network Upgrades in transmission vague areas create added complexity (see next slide) Those areas where the combination of existing grid characteristics and projects in the queue before your project result in the need for upgrades Metering and Telemetry Costs Environmental Mitigation Costs May be reduced by including SCE’s facilities in Customers EIR Income Tax Component of Contribution (ITCC)
26. Transmission Area Report for a Transmission Vague Area Transmission Interconnection Planning’s “Area Study” reports will be published as they are revised in parallel with the cluster process. Green Projects can proceed to an Interconnection Agreement. Red Projects can proceed only if they are willing to fund needed upgrades
27. Projects in “Transmission Vague” Areas Customers will be provided the area report¹ so they can see where they fall in relation to the red and green areas and the projects in the queue before them Because of the complexities of the number and types of projects in the queue ahead of your project and the levels of existing load, generation and transmission infrastructure, SCE can only provide a range of cost estimates based on the information available at the time Customers Need to Make a Decision Despite this uncertainty, active Rule 21 generators will be obligated by the tariff to move forward or withdraw. To move forward, customers might need to commit to funding such upgrades and post security. In the long term, the additional clarity regarding the queue achieved with this approach will benefit all stakeholders. ¹ Distribution upgrades and interconnection facilities cost are not included in the area report and will be provided separately.
28. Rule 21 Provides New Tools for Developers Combined Rule 21 and WDAT interconnection queue was posted on SCE’s open access website on October 1st and will be updated monthly Pre-Application Report SCE Ombudsman will assist developers by addressing disputes over missed timelines (Rule21.Ombudsman@sce.com) These tools and more are available at http://www.sce.com/AboutSCE/Regulatory/openaccess/default.htm
29. Transition Plan Cindy JacobsProject Manager, Regulatory Policy T&D
30. Transition Plan Overview The Transition Plan explains how the Revised tariff will be applied to already queued generators Timelines: Clock starts ticking on the effective date of the tariff and when notice is provided to Applicant Tariff allows extensions of timelines when needed Rule 21 now requires that projects that are in transmission interdependent areas be studied in a transmission cluster under the WDAT generation interconnection procedures Under SCE’s Transition Plan, there is an exception for projects with queue dates on or before March 16, 2012
31. Transition: Application Process and Fast Track Interconnection Requests that were submitted prior to September 20, 2012, but have not been given a queue date, will be processed according to the Revised Rule 21 A new Interconnection Request does not need to be submitted Interconnection Request will be deemed complete based on the requirements of the old Rule 21 Applicants in the Fast Track process (Initial or Supplemental Review) will be evaluated under the new Fast Track screens
32. Transition: Projects that Require Detailed Study Applicants that require Detailed Study will be advised what study track they qualify for Interconnection Requests that are not transmission interdependent will follow the Independent Study Process in the Revised Rule 21 Interconnect Requests that are transmission interdependent will be studied in the cluster study process Required to withdraw from Rule 21 and may apply under the WDAT Tariff However, there is an exception for projects that have a queuedate of March 16, 2012 or earlier These projects will continue to be studied serially Special timelines will apply
33. Transition: Serial Study Group
34. Transition: Special Provisions for the Serial Study Group The Transition Plan sets out timelines for the serial study group These timelines only apply to generators who have signed a study agreement by July 31, 2012 Generators who did not sign a study agreement by that date will be advised of the completion dates by their project managers For projects with queue dates prior to 3/31/11, System Impact Studies are due November 30, 2012 For projects with queue dates after 3/31/11, SIS are due February 28, 2013 For projects that proceed to a Facilities Study, the timelines are staggered The first 75 requests will be completed within 90 calendar days The second 75 requests will be completed within 180 calendar days The remaining requests will be completed within 270 calendar days For projects that proceed to an Interconnection Agreement, the same staggered timelines apply (30 calendar days, 60 calendar days and 90 calendar days)
35. Transition: Interconnection Agreement
36. Questions? For more information on interconnection see http://www.sce.com/AboutSCE/Regulatory/openaccess/default.htm Contact Us interconnectionQA@sce.com (Put Rule 21 in the subject line) (626) 302-3688 Scroll down
37. SCE Renewable Procurement Opportunities for Rule 21 Generators October 9, 2012 Gerry Torribio, Janice Wang Renewable & Alternative Power Origination
38. SCE Delivers More Renewable Energy Than Any Company In The U.S. Renewable Resources Goals (billion kWh) 2011 Renewable Resources 15.5 Billion kWh 21.1% of SCE’s portfolio 83% Increase Small Hydro 6% Solar 6% Biomass 6% Geothermal 47% Wind 35% 2011 Actual Procurement 2020 33% RPS Goal Preliminary EIA energy data (kWh) indicates that in 2010 SCE procured: 49% of the nation's and 59% of California's geothermal generation 55% of the nation's and 87% of California's solar generation 5% of the nation's and 64% of California's wind generation
39. Opportunities for Rule 21 Generators Renewable Market Adjusting Tariff (Re-MAT) Public Utility Regulatory Policies Act (PURPA) AB 1613 Feed-in-Tariff
40. Re-MAT Overview Legislative/regulatory mandated FIT for renewable generators ≤ 3 MW SCE’s program cap is 226 MW (~68 MW remaining) split into three buckets: Peaking, as-available Non-peaking, as-available Baseload All MWs executed under CREST count towards this goal. Price starts at $89.23/MWh and adjusts bimonthly according to subscription for each resource type. If capacity is undersubscribed, price increases If capacity is oversubscribed, price decreases Standard contract Re-MAT replaces California Renewable Energy Small Tariff (CREST) Program not yet effective. CPUC Decision 12-05-035 established eligibility and pricing, but is subject to final CPUC decision on tariff and standard contract Second CPUC Decision expected Q4, 2012.
41. Changes from CREST to Re-MAT Pursuant to SB 32 and SBX 1 2, the CPUC is in the process of replacing CREST with Re-MAT The transition to Re-MAT will occur through two CPUC decisions: (1) pricing and eligibility (D.12-05-035), and (2) power purchase agreement and tariff language (decision expected in Q4 2012) (158 MW executed to date; 64% cap met) (Assuming no more CREST PPAs are executed, cap is 68 MW) Until CPUC issues a final ruling on the Rule 21 Reform, WDAT generators are eligible for Re-MAT. After CPUC’s final ruling, eligibility appear to be limited to Rule 21 generators.
42. Denial of Service The generating facility does not meet the requirements of CPUC Code Section 399.20, all applicable CPUC decisions, laws, building standards, and utility interconnection requirements. The grid serving the point of interconnection is inadequate or the aggregate of all electric facilities on a distribution circuit would adversely impact utility operation and load restoration efforts of the distribution system. The applicant will have an excess of 10 MW of executed and effective Re-MAT PPAs with SCE. There exist any outstanding obligations owed to SCE under a previously executed Re-MAT PPA or other agreement related to the sale of energy, capacity, green attributes, or other related products, in each case, that relates to either any portion of the site or the interconnection queue position to be utilized by the project seeking service. The project appears to be part of a larger overall installation by the same company or consortium in the same general location. Exact requirements are pending final CPUC approval. The applicant does not otherwise meet the requirements of Schedule Re-MAT.
43. Timeline of Transition Today 8/15/2012 Opening Comments on proposed tariffs and PPA due Stakeholders have dedicated many hours to crafting a program that balances the needs of different stakeholders CREST is active until Re-MAT becomes effective. Ineligible CREST applicants must comply with Schedule Re-MAT to be considered for a Re-MAT PPA. WDAT projects are eligible to participate in Re-MAT until the CPUC makes a final determination on the Rule 21 Reform. After CPUC ruling, only Rule 21 projects appear to be eligible to participate in Re-MAT. Details on the Re-MAT proceeding can be found at http://www.cpuc.ca.gov/PUC/energy/Renewables/hot/feedintariffs.htm 5/7/2012 2nd Joint IOU PPA Workshop 11/30/2012 CPUC issues final decision on tariff and PPA 10/11/2012 CPUC issues PD on tariff and PPA 2/1/2013 IOUs hold first bi-monthly auction 3/20/2012 CPUC issues PD on pricing 6/21/2012 SCE files motion for clarification regarding CREST 4/30/2012 Filed 3rd draft of PPA 7/18/2012 IOUs file proposed tariff and PPA 2/15/2012 IOUs file Joint IOU PPA 3/16/2012 Filed 2nd draft of PPA 11/1/2012 Reply Comments on PD due 1/1/2013 IOUs launch Re-MAT 4/16/2012 Filed Reply Comments on PD 2/22/2012 Joint IOU PPA Workshop 5/24/2012 CPUC issues Final Decision on pricing 7/10/2012 CPUC issues ruling on SCE’s motion 9/10/2012 Reply Comments on proposed tariffs and PPA due 1/10/2012 CPUC Ruling Setting Workshop on PPA 10/18/2012 Opening Comments on PD due 12/7/2012 IOUs file Advice Letter 4/9/2012 Filed Opening Comments on PD 2012 2013 Q1 Q2 Q3 Q4 Q1
44. General Process Flow Re-MAT Participation Request Checklist Re-MAT Application Interconnection Study Project Description w/Single Line Diagram Executed NDA Application Fee ($2/kW of nameplate capacity) Site Control Attestation Daisy-Chaining Attestation Supplier Concentration Attestation Complete applications will be assigned a Re-MAT Number Applicants will have 10 business days to cure any application deficiencies. The more complete the application is, the less time it will take to be deemed complete. Exact requirements are pending final CPUC approval.
45. General Process Flow (cont.) SCE will execute PPAs in order of the Re-MAT Number. Eligible participants without a Re-MAT PPA will be eligible to “strike” at the available price in subsequent periods. An eligible participant that loses its position in the program must submit a new Re-MAT application to participate in Re-MAT. SCE may file a motion with the CPUC to suspend Re-MAT when evidence of market manipulation or malfunction exists.
46. Re-MAT Pricing & Capacity Allocation Program capacity is allocated over 12 bi-monthly periods Period 1 capacity <3 MW. Minimum Participation Threshold: At least 5 eligible projects from different sponsors before a price change $89.23/MWh Uncontracted capacity will be reallocated to the same product type following Period 12 and will be equal to the lesser of the capacity allocated to Period 1 and the total amount of uncontracted capacity. SCE will not execute the last marginal PPA that causes SCE to exceed the capacity allocated for that bimonthly period.
47. Example of Price Change Capacity allocation assumes no more than 158 MW of CREST PPAs are executed. No price change because subscription was 50% - 99% of Period 1’s capacity. Price increased because subscription was < 50% of Period 1’s capacity. Price decreased because Period 1’s capacity was oversubscribed. Price change accelerates with every consecutive oversubscription or undersubscription The initial price change increment is $4/MWh.
48. Re-MAT PPA Standard Contract across IOUs Term: 10, 15, 20 years Price: Fixed Commercial Operation Date: 24 months + 6 month extension for delay Transactions: Full Buy/Sell or Excess Deliverability: 2 sets of Time of Delivery Factors Compliance Expenditure Cap: $25,000/year Economic Curtailment: Take or pay WMDVBE Reporting Performance Requirement: % of Contract Quantity measured over two consecutive years Wind: 140% − Other intermittent technologies: 170% Baseload: 180% − Hydro: Seller to propose a reasonable threshold Credit & Collateral: Generators < 1 MW: $20/kW − Generators > 1 MW: $50/kW Buyer Right of First Refusal: 2 years Seller Transmission Buy-Down Right Telemetry: Generators < 500 kW may participate in an aggregated telemetering solution with a $20,000 cost cap. Final PPA pending CPUC approval; PD expected in Q4, 2012
49. QF Contract Overview QFs are defined in the Public Utilities Regulatory Policy Act of 1978 (as amended and codified in 18 C.F.R. §§ 292.203 and following), and include two types of facility. Cogeneration facility (a.k.a. Combined Heat & Power or “CHP”): generating facility that sequentially produces electricity and another form of useful thermal energy (such as heat or steam) in a way that is more efficient than the separate production of both forms of energy. Small power production facility: generating facility of 80 MW or less whose primary energy source is renewable (hydro, wind or solar), biomass, waste, or geothermal resources. There are some limited exceptions to the 80 MW size limit that apply to certain facilities certified prior to 1995. “QFs” (or Qualifying Facilities) can elect to interconnect under “state jurisdictional” tariffs if they: Sell power only to an electric utility at the utility’s avoided cost, pursuant to its must-take obligation under PURPA. Have a net capacity (generator rating less auxiliary loads) does not exceed 20 MW.
50. SCE’s PURPA Program Interconnection: Seller elects which path to follow (WDAT or Rule 21). Term: Up to 7 years for existing capacity, Up to 12 years for new capacity. Eligibility: QFs of any technology up to 20 MW net output. Pricing: SRAC energy pricing as determined by CPUC Capacity pricing pursuant to D. 07-09-040 Firm Capacity at $91.97 / kW-yr As-Available Capacity of $41.22 / kW-yr escalating each year Project Development Security, Performance Assurance for new facilities. Contract: “The Standard Contract for Qualifying Facilities with a Power Rating that is Less than or Equal to 20 MW,” and an application form to request such a contract, are available at http://www.sce.com/EnergyProcurement/renewables/chp/chp-settlement.htm Generators able to provide Resource Adequacy benefits to the utility are eligible to select the Firm Capacity option of the Standard Contract.
51. SCE’s AB1613 Program Interconnection: Seller elects which path to follow (WDAT or Rule 21). Term: Up to 10 years for existing capacity, Up to 12 years for new capacity. Eligibility: New, efficient CHP up to 20 MW net output: Meet efficiency and energy use requirements of Section 2843 of Public Utilities Code and CEC regulations (60% minimum efficiency), also PURPA requirements for cogeneration facility. Commence operation on or after January 1, 2008. Pricing: Variable price component (based on gas price and 6,924 Btu/kWh heat rate) Fixed price component (based on MPR fixed component) Projects located in Local RA area get 10% bonus Project Development Security, Performance Assurance for new facilities. Contracts: This program has three types of power purchase contracts for various sizes of project up to 20 MW. Contracts and application form available athttp://www.sce.com/EnergyProcurement/renewables/chp/chp-ab1613.htm Generators able to provide Resource Adequacy benefits to the utility are eligible for payments at AB1613 pricing; otherwise paid per PURPA As-Available pricing.
52. Questions PURPA/CHP Gerry Torribio gerome.torribio@sce.com (626) 302-9669 Re-MAT Janice Wang janice.wang@sce.com (626) 302-3515
53. Questions?