Currents

An Energy Newsletter for Local Governments

Local Government Renewable Energy Self-Generation Program

The City of San Jose sponsored legislation this past session to authorize local governments to over-generate renewable electricity at one municipal site and credit the excess generation to another municipal account. AB 2466 (Laird) significantly improves the ability of cities, counties, special districts, school districts, and other public agencies (but not state agencies or joint powers authorities) to maximize the amount of renewable generation within their jurisdictions and the state in a more cost-effective way than before the legislation was signed.

Before AB 2466, customers could ‘net meter’ their electric generation over a period of one year for the account where the electricity is generated. Any amount generated above the amount consumed at that site would be provided into the grid for no cost. Local governments can now oversize systems, for example at water treatment plants or other large facilities that would not consume all of the generation, and be able to reduce their utility costs at other municipal sites.

Some important restrictions:

• The generating account must be a time-of-use electric service account of the local government;
• The benefiting account(s) must be one or more electric service accounts within the geographical boundaries of the local government that are mutually agreed upon by the local government and the utility; and
• The eligible renewable generating facility must have a capacity of no more than one megawatt; be an eligible renewable energy resource under the State’s Renewable Portfolio Standard Program; and be located within the geographic boundary of, and is owned, operated, or on property under the control of, the local government, and is sized to offset all or part of the electric load of the benefiting account(s).

For these purposes, premises that are leased by a local government (for example under a Power Purchase Agreement) are under the control of the local government.

The California Public Utilities Commission (CPUC) is charged with implementing AB 2466. The expected sequence of events at the CPUC is:

• Utilities will file formal Advice Letters detailing the new tariff rates for local governments with the CPUC in early January, when the law officially goes into effect.  (We’ve heard that the Utilities want to do this quickly.)
• There will be a 30-day period for comments on those Advice Letters.
• If there are no protests, the Advice letters as filed by the Utilities would go into effect with the CPUC releasing a ruling as such.
• If protests are minor, the CPUC would address them in a resolution. If there are significant protests, the CPUC would issue a ruling to address those, giving an opportunity for more dialogue.

This is an issue being followed by the Local Government Sustainable Energy Coalition, which participate in the proceeding at the CPUC.

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