Xcel Energy Reports 24 Community Solar Garden Projects are Beginning Construction

Xcel Energy filed its monthly report for the Community Solar Garden program with the Public Utilities Commission last week, revealing that 24 projects are moving to the beginning stages of construction.

Xcel also reports that, “after receiving over 600 applications in the surge to submit co-located projects, the pace has slowed considerably.” There are currently 615 applications in the interconnection queue and 925 applications being reviewed for completeness, but the utility believes that “many of these projects in the application stage are ‘placeholders’ that may not be actively pursued by developers.” Xcel adds that “63% of pending applications are in the application stage, 35% are either being studied or waiting for payment, and 2% have moved into construction.”

The report contains information on applications deemed incomplete or for which Xcel has not met the Section 10 tariff interconnection process timeline, in compliance with the PUC’s August 6, 2015 Order. It also discusses the study queue process and the application system. Xcel reports that one project has completed the interconnection process and is now in production, with 60% small commercial and 40% residential subscribers.


Effort to Revolutionize CA’s Electric Utility System Clears First Hurdle to 2016 Ballot

Supporters aiming to transform California’s electric utility system are taking another shot at getting the issue on the ballot in 2016. The ballot measure would establish the publicly owned California Electric Utility District and would eliminate the state’s investor owned utilities (“IOUs”) like Pacific Gas and Electric, Southern California Edison, and San Diego Gas & Electric, while municipal utilities would have the option to join. The state would be divided into 11 districts, with a board of directors made up of a representative from each district. The measure is one step closer to getting on the ballot after the California Secretary of State cleared it last week. Now proponents must collect the signatures of 365,880 registered voters by April 26, 2016 in order to qualify for the November 2016 ballot. They fell short of the required number of signatures when they attempted to get the measure on the ballot in 2014.


Citing Costs and Timing, PUC Denies Xcel Energy’s Request for Contested Case

During a public hearing yesterday, the Public Utilities Commission denied Xcel Energy’s request for a contested case hearing for the next stage of developing the Minnesota Community Solar Garden Program (the “CSG Program”). Instead, the PUC decided to proceed with the notice and comment process similar to the previously utilized process for the CSG Program. The fundamental issue in the next round of comments are to focus on the appropriate subscriber bill credit design. Also at issue will be appropriate methods for boosting minority and low-income participation in the CSG Program.

Xcel Energy had requested that the PUC refer these issues to an administrative law judge (ALJ) for a contested case hearing so that the factual issues could be sufficiently examined and verified through that process. Xcel Energy expressed concern that the price for solar needs to be revisited because it was set before the program rolled out. Some Community Solar developers supported this approach.

Representatives from Fresh Energy, SunShare, and the Department of Commerce, however, opposed Xcel Energy’s request, arguing that the added cost and time of a contested case hearing outweighed the benefits. These stakeholders also expressed concern that fewer interested parties would have the resources to participate in a contested case hearing, which makes the notice and comment process a more attractive option at this point.

The commissioners acknowledged the importance of carefully considering the issues in the rulemaking, but also noted that time is of the essence for solar developers who may lose the Federal Investment Tax Credit at the end of 2016. On Commissioner Lipschultz’s motion, the PUC voted unanimously to set a deadline of April 1, 2016 for comments from interested parties on the subscriber bill credit design and encouraging minority and low-income participation. For these comments, any factual assertions should be in the form of verified pleadings or sworn affidavits. The PUC delegated to the Executive Secretary the task of setting the schedule for reply comments, and also delegated to the Executive Secretary to set a schedule for notice and comment on other issues related to the CSG Program.

Xcel Delivers Final – For Now – Community Solar Garden Program Rules

Xcel filed its revised tariff for the Community Solar Garden Program yesterday, in compliance with and response to the Minnesota Public Utility Commission’s August 6, 2015 and October 15, 2015 orders. The revised tariff contains numerous changes to Xcel’s September 15, 2015 draft tariff proposal, a few of which are highlighted below.

  1.  Xcel clarified that the company will view two projects as being co-located when they are within 1 mile of one another and share common ownership, as opposed to language it had borrowed from state siting and tax statutes that proved difficult to administer. Further, Xcel confirmed that its signing a standard form contract under the program will relieve the developer from any further tests or inquiry by the company on co-location.
  2. The tariff lays out procedures for an applicant with a co-located project to “scale down” the project if it exceeds the applicable co-located limits set by the Commission. Projects that scale down and complete additional requirements no later than Friday, November 8, 2015 will be in a position to move their applications forward and retain their queue positions.
  3. In accordance with the Commission’s October 15, 2015 order, Xcel also limited the circumstances under which it will not proceed with interconnection to a finite list of material upgrades rather than the nonexclusive list contained in the September 15 filing.
  4. The tariff also now states that an applicant cannot “transfer the Study Queue Position of any Community Solar Garden application to a different entity,” whereas after considerable deliberation the Commission decided to limit this restriction to the portion of any project exceeding the aggregate size caps set by the Commission.

Xcel’s tariff will become effective on October 27, 2015 unless an objection is filed or the Commission indicates otherwise.

MPUC Sets Community Solar Tariff Schedule and Clarifies Previous Order

On Thursday, October 15, the Minnesota Public Utilities Commission (MPUC) released an order addressing several issues in the Community Solar Garden Program proceeding. The order requires Xcel to file compliance tariffs for the program within five days, and the MPUC will order that the tariffs become effective seven days after filing, “unless the Department or another party files an objection or the Commission through its Executive Secretary issues a notice indicating otherwise.”

Although the MPUC denied the petitions for reconsideration filed by the Minnesota Department of Commerce and Sunrise Energy Ventures, the MPUC, on its own motion, clarified its August 6 order that established a cap on the total capacity of community solar garden projects that occur near one another, referred to as “co-located projects.” The October 15 order explains why the MPUC found it necessary to impose this co-location cap and describes how Xcel will “‘scale down’ noncompliant applications to the applicable cap level,” which is 5 MW for applications filed before September 25, 2015, and 1 MW for applications filed between September 25, 2015 and September 15, 2016. The MPUC states that “its August 6 order does not allow solar-garden applicants to transfer their queue position related to a solar-garden application to a different developer for that portion of the project that exceeds the caps established by the Commission.”

SCOTUS Entertains Oral Argument on FERC Order 745, the “Demand Response” Rule

The U.S. Supreme Court heard oral argument this morning in FERC v. Energy Power Supply Association. At issue is the validity of FERC’s Order 745, the so-called “demand response” compensation rule. Full text of the rule (PDF). As some of our readers may recall, I was FERC Chairman when Order 745 was issued.

While the legal arguments got duked out in court today, I thought our readers might like to review comments I provided earlier this year on the legal challenges to Order 745. I made the comments in a live interview with Malcolm Woolf, Senior Vice President, Policy and Government Affairs at Advanced Energy Economy (AEE). A recording of the interview is available. A transcript of the interview is also available.


The role of demand response is multiple.  First, it has the ability to in essence be an energy resource that is equivalent to generation resources and do so on a very robust way across our economy given the advances in technology.  So it can in fact provide energy capacity ancillary services and has demonstrated the ability to do so.  More importantly, because of its flexibility, it also has the ability to allow us to more fully integrate in the variable resources of sun and wind that are increasing in our society and become an increasing part of that energy and a necessary part of the energy mix to get us to a low carbon, no carbon society.  So, I see demand response as really the glue that could hold together a low carbon society.

[T]he reasoning of the majority in this case is somewhat opaque to me.  I in fact support and endorse the dissent that Judge Edwards wrote, which was a very lengthy and very detailed, and I think well-reasoned dissent, and does lay out a lot of the things that I’ve already talked about with respect to FERC’s authority and implicit authority under Sections 824(d) and (e) of the Federal Power Act.  But for some reason, the majority got it in their head in some way that because you have a retail customer who is changing their usage, that somehow is a retail product but ultimately it would be like saying that a generator buying a ton of coal at retail, therefore makes the generation coming out of that generator a retail product because they bought coal at retail to put into the steam turbine to make electricity.  What aggregators do is they buy something from a retail entity, that is a retail consumer, but they then aggregate it together and they put it into a wholesale market, and it effects wholesale markets, so it in no way is a retail product.

CPUC Set to Tackle Net Metering Debate with New Distributed Generation Tariff

The California Public Utilities Commission (CPUC) could soon make big changes to how rooftop solar installations function in the state. Under Assembly Bill 327, enacted in 2013, the CPUC has until December 31, 2015 to “develop a standard contract or tariff” that applies to “customer-generators” who own rooftop solar installations or other distributed generation and are located in the service territories of Pacific Gas and Electric (PG&E), Southern California Edison (SGE), or San Diego Gas and Electric (SDG&E). This “successor” tariff could replace the current system of net energy metering (NEM), which allows rooftop-solar owners to offset their own energy use with the energy they generate and get paid retail rates for the net energy they export to the grid. (The new tariff will not apply to those who already participate in net metering.)

PG&E, SCE, and SDG&E filed comments in early-August, arguing that a new tariff is needed in order to promote sustainable growth for rooftop solar that harmonizes with the entire grid. Utilities claim that the current NEM tariff does not adequately charge customer-generators for fixed costs of maintaining the grid and are proposing monthly grid access charges to address this imbalance. Solar industry associations have filed comments urging the CPUC to keep net metering largely intact, and have said that the utilities’ concerns over cost-shifting are unfounded.

A common feature of the utilities’ proposals would charge customer-generators at the retail rate for electricity they consume from the grid and would pay a lower rate for energy generated on rooftops and exported to the grid. However, solar industry advocates warn that the utilities’ proposals could expose rooftop solar owners to significant tax risk because the proposals could be interpreted as a bifurcation of rooftop energy generation and household energy consumption, in which case customer-generators could potentially be taxed on income they receive from selling energy to the grid without being able to deduct the cost of purchasing energy from the grid.

Another potential wrinkle in this proceeding is that the current NEM tariff caps net metering at 5 percent of a utility’s nameplate generation, and solar installers operating in San Diego are concerned that SDG&E might reach that cap soon, which would bar any new installations until the new tariff is finalized. If utilities don’t reach that threshold, the tariff will become effective July 1, 2017 and there will be no limit on installed distributed generation capacity thereafter.

In any event, we can be sure that this is not the last we will hear about potential restructuring of net metering schemes. Utilities in many states are proposing new rate designs for rooftop solar and distributed generation systems through traditional rate cases and separate proceedings.

BREAKING NEWS: Xcel Energy Announces Commitment to Cease Coal-Fired Operations at Sherco Units 1 and 2

Xcel Energy announced this afternoon its intent to cease coal-fired generation at Sherco Units 1 and 2 in 2026 and 2023, respectively, while adding 1,200 MW of new renewable sources (800 MW of wind and 400 MW of solar) by 2020.  According to the Xcel Energy website, Sherco Unit 1 has a generating capacity of 680 MW and Sherco Unit 2 has a generating capacity of 682 MW.  A summary of Xcel Energy’s filing, pulled directly from the filing, appears below.  The full filing can be found here.

“Our proposal has four primary elements:

1.    Accelerate the transition from coal energy to renewables. Our proposal includes:

  • Achieving 60 percent carbon emission reductions by 2030,
  • Ceasing coal generation at Sherco Unit 2 in 2023,
  • Ceasing coal generation at Sherco Unit 1 in 2026, and
  • Advancing the addition of substantial renewable generation (1,200 MW by 2020).

2.    Preserve regional system reliability. We propose to continue operation of our nuclear units during the current resource planning period and construct sufficient gas fired generation and infrastructure to maintain reliability with an appreciation of regional, state, and local community economic and policy considerations. To that end, we envision:

  • Reaffirming our commitment to nuclear energy through the current licenses of our existing units,
  • Adding a combustion turbine in North Dakota by 2025,
  • Studying a Sherco Unit 2 boiler conversion or combustion turbine alternative,
  • Studying gas infrastructure and transmission expansion, and
  • Replacing Sherco generation with a combined cycle no later than 2026.

3.    Pursue energy efficiency gains and grid modernization. We propose to continue our commitment to energy efficiency and new technologies, and we look to capitalize on these efforts rather than seeking to replace coal capacity megawatt for megawatt. We believe that modernizing the grid will further enable customer-driven solutions.

4.    Ensure customer benefits. We propose to work with the Commission, the MPCA, and our stakeholders to ensure our customers get the full benefit of our proposal by:

  • Working with the MPCA, along with its counterpart environmental agencies in our other states, on the CPP State Plans to maximize the benefits of compliance for our customers and communities, and
  • Pursuing rate plans and cost recovery mechanisms that smooth costs for our customers.”

U.S. Fish and Wildlife Service Determines Protection for Greater Sage-Grouse No Longer Warranted

In a speech at the Rocky Mountain National Wildlife Refuge, Interior Secretary Sally Jewell announced yesterday that the U.S. Fish and Wildlife Service (USFWS) will not list the greater sage-grouse under the Endangered Species Act (ESA). Finding that protection under the ESA is no longer warranted due to an “unprecedented conservation partnership,” the USFWS announced that it was withdrawing the species from the candidate list.   The decision comes roughly a week before a court-ordered deadline for a decision. Continue Reading

Community Solar Update: PV Magazine and Solar Industry Magazine

Community solar (“CSG”) is the topic of two articles we authored in the September editions of PV Magazine and Solar Industry Magazine. Titled “Care in the Community” (PV Magazine) and “Proof of Concept: Community Solar is Ready to Soar Despite Complications” (Solar Industry Mag), the articles consider the launch of The National Community Solar Partnership by the Department of Energy in July, ongoing wrangling over the definition of “community” and why the imposition of capacity caps on CSG programs is both inefficient and unnecessary.

Read more:

Care in the Community” (PDF)

Proof of Concept: Community Solar is Ready to Soar Despite Complications