Shifting Regulatory Landscapes: I m pacts on Renew ables in Verm ont Prepared for the REV Conference October 13, 2016 By: Andrew Raubvogel, Partner Dunkiel Saunders Elliott Raubvogel & Hand PLLC
The Shifting Landscape Regulatory changes Net Act 174 Metering PURPA Role of RES Towns 2
…Alters Potential Developm ent Smaller NM More Bilateral Regs PPAs Shorter Higher PPAs costs More Town Input 3
Net Metering 2 .0 : Revised PSB Rule 5 .1 0 0 Act 99 (2014) -- entire section 219a will be replaced by a revised Rule 5.100, effective Jan. 1, 2017. PSB Order of 6/30/16: changes intended to reduce ratepayer costs, moderate pace of development, & reduce environmental impacts Current status: in process of being issued as a final rule ICAR approved the proposed rule on October 10 th Next step – file with SOS, 30 day comment period, and public hearing
Project Size/ Siting Siting – No more typical 500 KW greenfield sites All solar systems 150 kW and larger must be located on a “preferred site” Preferred sites -- parking lots, existing structures or impervious surfaces, brownfields, landfills, gravel pits/quarries, CERCLA sites, municipally designated locations, same parcel/adjacent parcel to a customer using >50% of output, etc. 5
Rule 5 .1 0 0 Changes Rates – all rates reduced; no more Solar Adder Statewide Blended Residential Rate – $0.14919/kWh (down from $0.19) Site Adjustor – Rate adjusted by project category: Category I (non-hydro, up to 15 kW) +$0.01/kWh Category II ( non-hydro, 15–150 kW, preferred site) +$0.01/kWh Category III (non-hydro, 150–500 kW, preferred site) -$0.01/kWh Category IV (non-hydro, 15–150 kW, non preferred site) -$0.03/kWh Hydro None 6
Rule 5 .1 0 0 Changes ( cont’d) REC Adjustor –based on whether RECs are retained RECs to utility +$0.03/kWh RECs retained -$0.03/kWh Hydro None Site & REC Adjustors– positive adjustors apply for 10 years after commissioning; negative adjustors apply in perpetuity. Non-Bypassable Charges -- apply to customers regardless of whether they are NM. Cannot be offset by NM credits. 7
Rule 5 .1 0 0 Changes ( cont’d) Application process – different approval process based on size: Up to 15 kW systems or roof-mounted up to 500 kW 15–50 kW systems (not rooftop) 50 kW to 500 kW systems Major Amendments – essentially requires going back through permit process Increasing nameplate capacity by > 5% or reducing by > 60% Moving disturbance limits by more than 50 feet Changing fuel source Any change PSB determines is likely to have significant impact under one or more 248 criteria 8
Pre-Existing NM System s Must have filed a complete CPG application prior to 1/1/17. Applicable Rules : 5.100 as it existed prior to revised Rules. Applicable Rates : for 10 years from COD, the incentive provided in old section 219a (19 cents). At the end of this 10-year period, for an additional 10 years, credited for excess generation at blended residential rate. Non-Bypassable Charges : For 10 years from COD, may apply any accrued NM credits irrespective of whether it’s non-bypassable. Adjustors : Not Applicable to Pre-existing Net-Metering Systems . 9
Bottom Line for New Net Metered Projects Can a 500 kW solar project still be developed? Only on a preferred site (>150 to 500) Incentive to transfer RECs to utilities More visual screening mitigation likely Hydro facilities up to 500 kW, but no adjustors Higher costs, lower revenue 10
Tem porary W ind Sound Rule ≤ 500 kW – not in excess of 10 dBA above L90 ambient level, or 45 dBA at exterior of residence, whichever is less. > 500 kW: 45 dBA ext. of residence, 30 dBA interior bedroom. Residences presumed to have windows open May –Sept., partially open April and October, and closed during remaining months. Measurement time interval to be established on a case-by-case basis but cannot exceed one hour. Post construction monitoring -- by the State, paid for by CPG Holder. 11
Perm anent W ind Sound Rule First statewide sound rule for wind energy. Sound limits can constrain siting, impacting feasibility of wind development in VT. PSB soliciting public comment and conducting workshops prior to filing a proposed rule. To take effect no later than 7/1/17. 12
I nitial I ssues/ Questions Posed by PSB Attenuation at residences, interior standards Type of standard: absolute, relative, based on wind-speed Low frequency and infrasound (dBA vs. dBC) Time intervals (Lmax, L10 min, Leq 1 hr) Methods for conducting sound measurements Pre-construction modeling Setbacks 13
Municipal Solar Screening Ordinances 14
Overview Act 56 (2015) -- Section 248(B)(1) revised to include compliance with duly adopted municipal solar screening requirements Unless , PSB finds that requiring compliance would prohibit or have the effect of prohibiting the installation of such a facility or have the effect of interfering with the facility's intended functional use. Allows municipalities to determine what screening, if any, should be required for solar projects of any size Evidence of compliance needs to be part of section 248 petition. Just starting to see towns use the authority. 15
Scope of Screening Standards 24 V.S.A. §§ 4414(15), 2291(28) – Authority to pass municipal screening bylaws and ordinances for solar projects Screening reqs. and recommendations “ shall become a condition of a certificate of public good ” as long as they don’t prohibit or interfere with facility function. Screening defined as “ reasonable aesthetic mitigation measures to harmonize a facility with its surroundings and includes landscaping, vegetation, fencing, and topographic features.” Screening requirements cannot be more restrictive for solar projects than commercial development in the municipality. Cannot require a municipal permit for solar plants 16
Screening Standards ( cont.) Screening ordinances passed (or are in process) in Shelburne, Addison, Cornwall, Bennington and possibly other towns. DPS and Dept of Housing and Community Development to report to Legislature on screening ordinances by 1/15/17. Does the ordinance/bylaw exceed its statutory authority? Under existing statue and VT Supreme Court case law, zoning is pre - empted for section 248 projects Some municipalities have sought to include procedural requirements, such as submission and review of Project plans by Selectboard Some have combined screening elements with other PSB-established standards outside of what is listed in definition of “screening” 17
Exam ples of Ordinances that m ay go too far Full screening from residential and public road views Year round visual barrier for nearby residences or small percentage of allowable visibility (e.g. no more than 5% of field of view from any residence, 150 feet of residence, or public highway) Plantings sufficient to achieve screening from day of planting Setbacks Burial of lines, lighting, signs , etc. Project review by Selectboard beyond screening Site plan, erosion control, decommissioning plans 18
Other Regulatory Changes Aesthetic Mitigation, Decommissioning Rules (Act 174) CPG Complaint Protocol (Act 130) Public Access to PSB (Act 174) Standard Offer Program changes Revised Interconnection rule Vermont Wetland Rules e-PSB 19
Aesthetic Mitigation, Decom m issioning ( Act 1 7 4 ) Board to adopt rules with conditions on postconstruction inspection/maintenance of aesthetic mitigation, and on decommissioning. § 11. Rules to ensure that aesthetic mitigation is performed/maintained and that facilities are removed at end of life. Board’s actions could require additional initial financial securities on projects less than 1 MW. 20
CPG Com plaint Protocol DPS required to adopt protocol for complaints re CPG compliance. Act 130 § 5c. DPS website for complaints: http://publicservice.vermont.gov/cpg-complaint-protocol Protocol does not materially change current approach: DPS seeks informal resolution, pursues formal remedies through Board process. DPS maintains complaint database, reports annually. 21
Public Access to PSB ( Act 1 7 4 ) Access to PSB Working Group created to promote easier citizen participation. § 15. Workgroup established to review PSB processes for citizen participation in proceedings. Monthly meetings w/ recommendations due December 2016 to the legislature then workgroup disbands. Recommendations could include easing intervention rules, possibly resulting in increased litigation burden. 22
Standard Offer Program One-year pilot project under Act 174 allocating one-third of annual standard-offer allotment to projects on preferred locations. § 12a. Currently in workshop. 1/6 allocated to parking lots/lot canopies, 1/6 allocated to other “preferred locations” PSB Investigation into transmission charges -- Dkt 8693. Initiated due to wheeling charges between the DUs. Could result in changes to the Program, such as: temporarily barring further development in a service territory; adding indicative wheeling cost figures to bids of projects; qualitatively considering a project’s location in evaluation of bids; and assessing wheeling costs directly to standard offer projects. 23
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