January 2014

by Sara Bergan and Sarah Johnson Phillips

In May 2013, the Minnesota Legislature passed legislation that, among other things, set a solar standard, directed Xcel Energy to develop a community solar garden program, and provided for the development of an alternative tariff mechanism to net metering that would also serve as the rate for community solar garden programs. Under this new scenario and instead of traditional net-metering arrangements, customers would potentially buy all of their electricity from their local distribution utility and then sell all of their PV generation under that utility’s Value of Solar (VOS) tariff which would be designed to capture the societal value of PV-generated electricity.

The legislation directed the Department of Commerce to work with stakeholders to develop a VOS methodology and to deliver its recommendations to the Minnesota Public Utilities Commission (Commission) on Friday, January 31, 2014.  The Department’s filing today includes its recommendation, with a more in-depth document addressing the methodology.  The  Department’s recommendations do not set a rate, but rather propose the methodology for calculating a utility-specific rate for distributed PV solar (1 MW and smaller). If the Department’s sample calculation is any indicator of what’s to come, however, the value went from $0.126/kWh in its initial draft to $0.135/kWh in the documents filed this morning.Continue Reading What is the Value of Solar? Minnesota Agency Starts to Answer. . .

At the close of last year, Minnesota Administrative Law Judge Eric Lipman determined that the single solar proposal in a competitive resource acquisition process would provide the best value to Xcel ratepayers (see more here). Key to his decision was his conclusion that Xcel’s capacity needs in the timeframe considered were uncertain and potentially…

We last reported to you about Committee on Foreign Investment in the United States (CFIUS) activities in connection with the Ralls Corporation case. CFIUS is a multi-agency U.S. government committee charged with reviewing foreign acquisitions of U.S. businesses for national security implications

The committee recently released its unclassified Annual Report to Congress for 2013…

Nebraska filed suit against the U.S. Environmental Protection Agency (EPA) in federal court on Wednesday, challenging the agency’s newly proposed standards for greenhouse gas emissions from new power plants. Nebraska argues that EPA’s proposed regulation, officially released last week, violates the Energy Policy Act of 2005. The Act prohibits EPA from considering new technology or a level of emissions reduction to be “adequately demonstrated” under the Clean Air Act where the emissions reduction is achieved ‘solely by reason of the use of the technology’ by one or more facilities receiving funding under the Act. Under the Clean Air Act, any new source performance standard (NSPS) must be based on the “best system of emissions reduction” that EPA determines has been “adequately demonstrated.”

EPA has proposed a greenhouse gas NSPS for new fossil fuel-fired boilers, including coal-fired power plants, based on the partial implementation of carbon capture and storage (CCS). EPA’s notice of the proposed NSPS cites to various facilities that have successfully implemented CCS, adequately demonstrating the commercial viability of the technology as a basis for the stringent greenhouse gas emissions standard of 1,000 to 1,100 lb CO2/MWh. The flaw, Nebraska argues, is that the very CCS projects that support EPA’s determination have all received significant funding under the Energy Policy Act, which prohibits EPA from considering such technology as “adequately demonstrated.” Nebraska, and other critics of the proposed standard, argue that the proposed NSPS would severely limit the construction of any new coal-fired plants in the U.S. 

Nebraska’s lawsuit may be more of a political statement than anything, however. The suit challenges the proposed rule under the Administrative Procedure Act as a “final” action of EPA. The “proposed” NSPS was just released, however. The proposed rule is open for public comment until March 10, 2014 and may not be finalized by EPA until mid-2015. The Nebraska suit is wide open to challenge on the basis that the case is not ripe for judicial review until a final NSPS has been issued by EPA.

For more details on the proposed NSPS, including the standards proposed for natural gas-fired facilities,Continue Reading Nebraska Sues U.S. EPA Over Proposed Greenhouse Gas Emissions Standards for New Power Plants

Assembly Bill (AB) 327 took effect in California at the first of the year, giving the California Public Utilities Commission (CPUC) authority to expand the State’s 33% Renewable Portfolio Standard (RPS). This week, the CPUC extended its RPS proceeding to determine, before February 2015, how to implement the new law. AB 327 provides that the CPUC may …

Update: Initial exceptions to this ruling are due on January 21, 2014, see attached scheduling notice.

On December 31, 2013, Minnesota Administrative Law Judge Eric Lipman determined in a competitive bidding process that solar provided greater value to ratepayers than natural gas. In a first-ever competitive bidding process under Minn. Stat. §216B.2422, subd. 5, 4 bidders competed directly with Xcel Energy’s own natural gas proposal to fill an increasingly uncertain future need for capacity resources.  If the Minnesota Public Utilities Commission (the “Commission”) agrees with Judge Lipman, Edina-based Geronimo Energy will build 100 MW of solar energy across 20 different sites in rural Minnesota and additional procurement would be put off until better information is available for the timeframe beyond 2019.Continue Reading Minnesota Judge Rules Solar Provides Best Value for Ratepayers