OUCC opposes Duke Energy’s $1.9B Indiana upgrade plan; CAC agrees

Posted by Laura Arnold  /   November 20, 2014  /   Posted in Duke Energy, Indiana Utility Regulatory Commission (IURC), Office of Utility Consumer Counselor (OUCC)  /   No Comments

Consumer office opposes Duke Energy’s $1.9B Indiana upgrade plan
Associated Press, @ap 2:15 p.m. EST November 18, 2014

http://www.indystar.com/story/news/politics/2014/11/18/consumer-office-opposes-duke-energys-indiana-upgrade-plan/19227371/

Indiana’s utility customer advocate has recommended that regulators reject Duke Energy’s proposal for a $1.9 billion electric grid upgrade in the state.

The Office of Utility Consumer Counselor says Indiana’s largest electric utility hasn’t provided legally required details about its proposed spending on infrastructure updates, such as electrical lines, transformers and utility poles.

The utility counselor’s office says Duke’s seven-year plan includes spending not allowed in a rate-increase request, including radio system replacements, vegetation removal projects and a proposed $3 million energy learning center. It also faults Duke for not providing as much detail as Northern Indiana Public Service Co. and Vectren Corp. when they sought approval for similar projects.

“The information we found in Duke Energy’s filings does not meet the statute’s requirements, while also falling short of the standards established in previous cases involving the approval of other utilities’ plans,” consumer counselor David Stippler said.

Duke spokeswoman Angeline Protogere said the North Carolina-based company has provided hundreds of pages of documentation about its plans and has responded to about 500 information requests from the consumer counselor and others.

“Our electric grid is aging and many components need to be updated and replaced,” she said. “This plan is about modernizing our electric grid and bringing our system into the 21st century.”

If the Indiana Utility Regulatory Commission approves the plan, Duke says its roughly 800,000 Indiana customers would see rate increases averaging about 1 percent a year between 2016 and 2022.

Duke’s upgrade also would include installing new, advanced utility meters the company said would mean fewer and shorter electrical outages for its customers.

Kerwin Olson, executive director of Citizens Action Coalition, said the consumer advocacy group agrees with the utility counselor office.

“It’s a lot of money coming from ratepayers,” Olson said. “Duke has not met their legal burden of proof in showing what precisely these improvements are and how they will benefit the ratepayer.”

A state utility commission hearing on Duke’s request is scheduled to begin Dec. 18, with a March 27 decision deadline.

We Energies Wins a Round at Wisconsin PSC with Solar

Posted by Laura Arnold  /   November 19, 2014  /   Posted in Uncategorized  /   No Comments

Utility Wins A Round With Solar In Wisconsin

http://seekingalpha.com/article/2694545-utility-wins-a-round-with-solar-in-wisconsin?page=2

Nov. 19, 2014 5:31 AM ET | 2 comments | Includes: SCTY, VSLR, WEC
Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More…)

Summary

We Energies scored a significant victory over the solar industry in the most recent rate structure.
The new rate structure significantly protects We Energies from rapidly increasing solar penetration and makes it very difficult for companies like Vivint Solar and SolarCity to succeed in We territory.
We expect this is first in a series of likely utility rate changes that will reduce the growth of solar in the US residential market.

According to an article on GreenTechMedia, the Wisconsin Public Service Commission made several controversial decisions in the context of Wisconsin Energy’s (NYSE:WEC) 2015-2016 rate request. In a preliminary approval, the Public Utilities Commission voted 2-1 in favor of many We Energies’ proposals and deviated significantly from past precedents that have been helpful to the solar industry.

Among many things that the solar industry finds adversarial, the approval includes a larger fixed charge on residential monthly electric bills, and reduces the amount We Energies will pay for the power that customers generate with solar panels. In a series of articles on solar panel installers and utility rate structures, we have argued that with this type of rate structure changes on utilities part is imminent.

While the solar market in Wisconsin is small today and does not materially impact on any of the national installers, there are several takeaways from this PUC ruling. As we forecasted, utilities are starting to respond to the threat of solar and we expect the We Energies’ victory at the PUC a beginning of the tidal wave of utility rate structure changes across the industry.

Some of the salient points of Wisconsin PUC’s preliminary approval and their impacts are as follows:

– Customers who install solar systems on their own property will be required to pay We Energies $3.80 per KW per month. For example, a homeowner with a 5 KW solar system will be required to pay $228 annually to We Energies for owning solar. This fee is a major setback to the growth of solar in We Energies’ territory. This single change will make many marginal solar systems uneconomical. This type of fee is a significant headwind to the solar industry and especially installers like SolarCity (NASDAQ:SCTY) and Vivint Solar (NYSE:VSLR) that depend on favorable utility rate structures.

– The fixed charge on all residential bills will increase from about $9 to $16 a month – a 75% increase. The amount paid per kilowatt hour will be reduced one-half cent to $0.1349/KWH from $0.139/KWH. Coupled with the above per KW charge, this KWH change will make several solar systems uncompetitive in the state.

– The new rate structure constitutes approximately 1.8% average increase for residential customers. Note that this rate of increase is substantially lower than the escalators that SolarCity and Vivint Solar use in their contracts. We expect that over the next several years the rate increases will initially moderate and then will start declining. This is one of the many headwinds that will destroy the SCTY and VLSR business models over time.

– According to the new tariff, business customers will see a slight decrease in electric bills in 2015 and an increase of about 1% in 2016. This, once again, this type of rate structure is to be expected as Utilities will increasingly make an effort to retain their high value commercial customers from migrating to renewable alternatives.

– We Energies will change net metering from annual netting to monthly netting and will also reduce the credit for excess generation from the 14 cents/KWH to 3 cents/KWH. This is yet another change that can significantly reduce the economics of a solar system.

However, the PUC ruling is not all bad news for the industry. Hidden in the bad news are some concessions to the solar industry and companies like SolarCity and Vivint Solar.

– Existing owners of solar systems will be grandfathered for a period of 10 years. The new net metering changes will not apply to existing owners until December 31, 2024. If not for the grandfathering, any current solar PPA/lease contracts would have likely been immediately underwater.

– PUC denied We Energies’ request to ban solar or wind projects from connecting to the grid and net metering with the grid if it is not owned by the customer. This is about the only good piece of news in this PUC ruling for installers like SolarCity and Vivint Solar.

In what is likely an ominous sign for the solar industry, the 2-1 vote was on party lines. The vote was split down partisan lines with Gov. Scott Walker appointees Phil Montgomery and Ellen Nowak supporting the changes and Eric Callisto, an appointee of Gov. Jim Doyle, opposing the changes. With Republicans taking control of both houses of congress, and increasing their advantage in key states, this type of decision may be a harbinger of things to come.

While these types of changes will certainly impede the penetration of solar, we are optimistic that the solar technology cost curve will, over time, overcome the utilities resistance to solar. However, for companies like SolarCity and Vivint Solar that depend on favorable solar rate structures, the salad days may be coming to end.

Our sentiment on VSLR and SCTY: Avoid.

Richmond Power and Light approves $170,000 for solar panels at park

Posted by Laura Arnold  /   November 19, 2014  /   Posted in solar, Uncategorized  /   No Comments

RP&L approves $170K for solar panels at park

Bill Engle, bengle@richmond.gannett.com 6:35 a.m. EST November 18, 2014

Richmond Power & Light Board of Directors on Monday approved by a 7-1 vote a plan to invest $170,000 in construction of a solar paneled roof on a new downtown park, as long as the city administration is able to find and spend an equal amount on the project.

The downtown park is the city’s first and furthest-along of its Stellar Communities projects. The solar panels will cover a building in the new park that will house a farmers’ market.

City director of Metropolitan Development Tony Foster told board members that the project was $600,000 over budget and asked for help after former RP&L General Manager Jim French suggested a partnership.

Foster said some reductions were being made, but that the partnership would be the best way to reduce the overrun. He said without the partnership there would be no farmers’ market building at the park.

Foster said the design firm hired for the project was “at a point where they have to know if they can move forward.”

“We’re not asking you for a check. We’re asking you to set aside dollars so we can move ahead with the project,” Foster said.
Board members Doug Goss, Kelley Cruse-Nicholson, Bruce Wissel, Don Winget, Larry Parker, Ron Oler and Phil Quinn voted in favor of the partnership while Misty Hollis voted against.

Goss said the partnership “gives us the opportunity to look at how we might work with companies who are considering using solar paneling in the future.”

“I think it’s a positive thing. It’s a project we will have total control over,” he said.

But Hollis said, “From my personal preference, I just don’t it’s a project that RP&L should be funding.”

“They are coming to us because they could not find other funding. That disturbs me,” she said.
Randy Baker, RP&L corporate services director, supported the project and built it into the utility’s 2015 budget.

Baker said the panels will produce 500 kilowatts of electricity per day and estimated that it would bring in about $173,000 during the 20-year life of the project.

The electricity will go to the Indiana Municipal Power Agency but proceeds will benefit RP&L. The electricity generated will be used locally.

Foster said he was pleased with the vote even though the administration must now find the additional $170,000 for the project.

“I’m very excited the RP&L board agreed to partner with us. I think this is a great project,” he said.
Foster said he hopes to have bid information out to possible contractors in January or February.

“We are ready to move ahead,” he said.

Staff writer Bill Engle: (765) 973-4481 or bengle@pal-item.com Follow him on Twitter at http://twitter.com/billengle_PI.

Wisconsin PSC approves 75% increase in monthly fixed charges and “solar tax”

Posted by Laura Arnold  /   November 17, 2014  /   Posted in Uncategorized  /   No Comments

Public Service Commission Approves We Energies’ Rate Hikes & “Solar Tax”

RELEASED FRIDAY, NOVEMBER 14, 2014

MADISON, WI – With a 2-1 vote voiced at an open meeting Friday afternoon, the Wisconsin Public Service Commission approved a 75% increase in monthly fixed charges and sweeping changes that will pile additional charges on customers who choose to install solar energy panels starting in 2015. The vote was split down partisan lines with Gov. Scott Walker appointees Chairperson Phil Montgomery and Commissioner Ellen Nowak supporting the changes; and Commissioner Eric Callisto, an appointee of Gov. Jim Doyle, opposed.

“Under this decision, customers who use more will see lower bills and customers who use less will see higher bills. It sends the wrong price signals on energy efficiency because it makes it harder for customers to control their monthly bills,” said Robert Kelter, senior attorney with the Environmental Law & Policy Center.

“The Public Service Commission has effectively approved a new tax to be collected from residential and small business customers that would like to create some of their own energy, such as with solar panels,” said Tyler Huebner, executive director of RENEW Wisconsin. “This decision is bad for job creation, bad for energy independence, bad for the environment, and bad for customers. Today our Republican-appointed Commissioners approved a new tax, killed jobs, and restricted energy choice in Wisconsin.”

“The commission has ignored the facts in this case and decided whether you embrace energy efficiency, or want to generate some of your own electricity with solar panels, you should pay more,” Kelter said.

“It also ignored a record level of over 1,900 public comments, 89% of which were opposed to these changes,” Huebner added.

The Public Service Commission decision will:

• Increase monthly fixed fees from $9.13 to $16.00

• Impose a $3.79 monthly tax on every kilowatt of a solar installation (a 4 kilowatt system would pay $181.97 a year)

• Transfer about 40% of the value of solar installation from the homeowner to We Energies through changes in payments and charge

• Pay just 4.2 cents for every kilowatt-hour of energy generated by customer renewable energy systems

Commission staff proposal would encroach on Arizonans’ freedom to choose how they use energy

Posted by Laura Arnold  /   November 10, 2014  /   Posted in Uncategorized  /   No Comments

ACEEE BLOG POST

Media Contact: Patrick Kiker
pkiker@aceee.org, (202) 507-4043

Commission staff proposal would encroach on Arizonans’ freedom to choose how they use energy

By Annie Gilleo, State Policy Research Analyst

Voters made many decisions on Election Day. Governors were chosen and new laws were adopted. But one choice Arizona voters didn’t get to make may raise utility costs for families and businesses in the state. On November 4th, while Arizona voters were focused on exit polls and election results, the Arizona Corporation Commission (ACC) staff quietly released a proposal for new energy efficiency rules that would eliminate the state’s ambitious electricity and natural gas savings standards.

The proposed rules would be a major step backward for the state. In recent years, Arizona has staked a place as an energy efficiency leader in the Southwest. The state saved more energy than any other state in the region in 2013. In fact, the nearly 1.75% electricity savings Arizona achieved was fourth highest in the country. Arizona has reached these high levels of savings for utility customers as a direct result of its energy efficiency standards, which were established in 2010 by a unanimous and bipartisan ACC decision. Since then, Arizona has climbed from the 29th to the 15th most energy efficient state in the country, with electricity savings more than doubling. Doing away with these energy savings requirements would be costly to utility customers in the state.

According to the Southwest Energy Efficiency Project (SWEEP), the standards have saved Arizona consumers and businesses more than $540 million in just three years. These programs, through measures like lighting and equipment upgrades, help homeowners improve the efficiency of their homes and businesses cut waste. Without these strong standards to guide the utilities, investments in efficiency would likely drop significantly, leaving customers with higher energy bills and fewer resources available to help them become more efficient.

It’s also important to note that utilities have been spending wisely on efficiency. The current rules require utilities to invest only in efficiency that is cost effective. That means that every dollar that goes into efficiency programs must save customers far more. In fact, energy efficiency programs are the least-cost option available to utilities to meet demand. So why roll back the efficiency rules now?

Even former commissioners can’t quite see the logic. In a recent article in AZ Central, former ACC chairwoman Kris Mayes called the proposal “crazy.” Mayes went on to say that “nothing in the record suggests the standard is not working.” Others share Mayes’ indignation. Efficiency advocates worked hard this week to make sure that Arizonans recognize the importance of the state’s energy efficiency targets. Just two days after the ACC issued its proposal, a group of advocates filed comments pointing to analysis by the Lawrence Berkeley National Laboratory that found that the efficiency standard would produce $9 billion in bill savings for Arizona customers by 2030.

Things are moving quickly in Arizona. Comments on the ACC staff proposal are due November 18th. For those interested in commenting on the issue, SWEEP has additional information, including directions for commenting, posted on their website.

Arizonans have a choice. They can move backwards, using more energy and paying higher bills, or they can move forward with incentives that encourage everyone in the state to use energy smarter. Utilities can continue to partner with their customers to help them take control of how and when they use energy or, pushed backwards by the proposal, they can take on the one-dimensional role of bill collectors. There’s plenty of proof that Arizona’s efficiency goals are working well for customers in the state. The ACC proposal is a step-no, a giant leap-in the wrong direction.

To read more posts, visit ACEEE’s Blog: http://aceee.org/blog

About ACEEE: The American Council for an Energy-Efficient Economy acts as a catalyst to advance energy efficiency policies, programs, technologies, investments, and behaviors. For information about ACEEE and its programs, publications, and conferences, visit aceee.org.

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