65-407-313 Me. Code R. § 3

Current through 2024-25, June 19, 2024

Section 407-313-3 - NET ENERGY BILLING REQUIREMENTS

A.Customer Qualification. Any customer of a transmission and distribution utility that has a financial interest or a shared financial interest in an eligible facility may elect net energy billing.

B.Contact Person

1.Single customer facilities. A single customer participating in net energy billing, or the customer's designee, shall be the contact person responsible for all communications with the transmission and distribution utility regarding the net energy billing arrangement. The contact person shall be responsible for requesting, executing, and complying with the provisions of a net energy billing agreement. In the event that the customer designates more than one applicable meter or accounts to receive credits from its eligible facility, the contact person shall inform the transmission and distribution utility of the allocation of net energy or bill credits among that customer's meters and accounts subject to net energy billing. The contact person shall promptly inform the transmission and distribution utility of any needed changes to the net energy billing agreement, including changes to the allocation of net energy or bill credits among meters or accounts subject to net energy billing.

2.Shared financial interest customer facilities. A project sponsor or the project sponsor's designee shall be the contact person responsible for all communications with the transmission and distribution utility regarding the net energy billing agreement. The contact person shall be responsible for requesting, executing, and complying with the provisions of a net billing agreement and shall inform the transmission and distribution utility of the allocation of net energy or bill credits among the meters and accounts of the participating shared financial interest customers. The contact person shall promptly inform the transmission and distribution utility of any changes to the financial interests or arrangements of the shared financial interest customers, including any changes in the meters or accounts of participating customers or the allocation of interest shares among meters or accounts.

3.Timeframes. The specific timeframes for the exchange of information between the contact person and the transmission and distributionutility and the effective date of any related changes shall be contained in the applicable net energy billing agreement.

4.Record maintenance. The transmission and distribution utility and the contact person shall maintain all records related to the net energy billing agreement for the term of the agreement.

C.Shared Financial Interest Provisions

1.Transfer. Any person or entity may transfer or assign a shared financial interest to the associated project sponsor or to any person or entity eligible to participate in the shared financial interest facility. A project sponsor must provide a process for assignment or transfer of shared financial interests among participating customers or entities. A project sponsor may not impose transfer fees on a person or entity that moves to a different location within the same utility service territory.

2.Shared financial interest customer classes. A shared financial interest net energy billing - kilowatt-hour credit arrangement may include both residential and non-residential customers. A shared financial interest net energy billing-tariff rate arrangement may only include commercial and institutional customers. A single shared financial interest net energy billing arrangement may not include both net energy billing-kilowatt-hour credit customers and net energy billing-tariff rate customers, unless allowed by the applicable market rules

3.Competitive Electricity Provider. A project sponsor or its representative or agent that participants in a shared financial interest net energy billing arrangement pursuant to this section shall not be considered a competitive electricity provider under Title 35-A, chapter 32.

4.Consumer-owned Utility Exemption. Consumer-owned transmission and distribution utilities are not required to provide shared financial interest net energy billing arrangements pursuant to this section. Consumer-owned transmission and distribution utilities may elect to provide shared financial interest ownership net energy billing arrangements in accordance with this Section.

D.Application. The contact person must submit to the transmission and distribution utility an application for a net energy billing agreement that contains the information specified in this subsection and other information that the transmission and distribution may reasonably require.

1.Customer identities. The names, addresses, telephone numbers and account numbers for all participating customers.

2.Financial interest. Documentation that the shared financial interest customers have a valid financial interest in the shared financial interest facility as required by this Chapter.

3.Contact information. The name, mailing address, telephone number, and e-mail address of the contact person.

4.Accounts. A designation of the meters and accounts that will be subject to the net energy billing agreement.

5.Allocation specification. A designation of the share of the output of the eligible facility to be allocated between and among meters or accounts. The allocation must be consistent with the provisions of this Section 3(F) of this Chapter.

6.Facility. A description of the eligible facility, including the facility's location, capacity, and fuel type or generating technology.

7.Affidavit. The application required under this subsection shall be accompanied by an affidavit attesting to the truth of the information provided.

E.Eligible Facilities. An eligible facility must be a discrete generating facility that is less than 5 megawatts, except that, if a municipality is a customer participating in a net energy billing-kilowatt-hour credit arrangement, the nameplate capacity of a distributed generation resource located in that municipality that may be used for the net energy billing may be 5 megawatts or more, as long as less than 5 megawatts of metered electricity from the resource is used for net energy billing. An eligible facility located in a service territory of a consumer-owned transmission and distribution utility must have an installed capacity of 100 kW or less unless the consumer-owned transmission and distribution utility elects to allow facilities with an installed capacity of up to less than 5 MW

F.Allocation Methodology. Fornet energy billing agreements that include multiple meters or accounts, kilowatt-hours or bill credits may be allocated as follows;

1) a cascading allocation in which kilowatt-hours or bill credits are allocated in the priority order specified in the application;

2) a fixed percentage allocation in which kilowatt-hours or bill credits are allocated on a fixed percentage as specified in the application; or

3) any other allocation methodology that can be reasonably accommodated by the transmission and distribution utility.

G.Micro Combined Heat and Power Systems. Micro combined heat and power systems that have a net energy arrangement on the effective date of this Chapter may continue net energy billing under that agreement for a period of twenty years.

H.Service Territory. The eligible facility and the customer accounts subject to net energy billing must be located within a service territory of a single transmission and distribution utility.

I.Number of Accounts. Customers or shared financial customers of an investor-owned transmission and distribution utility may designate any number of accounts or meters to participate in net energy billing, except that the number of accounts or meters is limited to 10 for customers or shared financial interest customers located in a service territory administered by the Northern Maine System Administrator or any successor of the independent system administrator for northern Maine unless the Commission determines through an Order that the investor-owned transmission and distribution utility's billing system can accommodate more than 10 accounts or meters for the purpose of net energy billing. Consumer-owned utilities may limit the number of accounts or meters to ten.

J.Net Energy Billing - Kilowatt-Hour Credits Requirements. A customer or shared financial interest customers qualifying under this section must be billed by transmission and distribution utilities on a net energy basis as follows:

1.Excess Generation. If the electricity generated during the billing period by the eligible facility plus any kilowatt-hour credits from prior billing periods exceed the customer's or the shared financial interest customers' kilowatt-hour usage during the billing period, the excess shall be applied to the customer's bill or the shared financial interest customers' bills for the following billing period as a reduction in the customer's kilowatt-hour usage.

2.Excess Usage. If the customer's or the shared financial interest customers' kilowatt-hour usage exceeds the electricity generated by the eligible facility during the billing period plus any kilowatt-hour credits pursuant to subparagraph 1, the customer or the shared financial interest customers shall be billed for the excess kilowatt-hour usage at the applicable retail rate for electricity service.

3.Unused Credits. A customer or shared financial interest customers may accumulate unused kilowatt-hour credits and apply them against kilowatt-hour usage over a 12-month rolling period. At the end of each 12-month rolling period, any accumulated unused kilowatt-hour credits may not be applied against any future kilowatt-hour usage. The customer or the shared financial interest customers will receive no compensation for unused kilowatt-hour credits. Beginning on April 1, 2022 and on or before every April 1 thereafter, transmission and distribution utilities that participate in the arrearage management program pursuant to Title 35-A, section 3214 (2-A) shall determine the monetary value of unused and expired kilowatt-hour credits during the prior calendar year and apply this value to reduce the account balances of customers participating in the arrearage management program in an equal dollar amount unless such reduction would be in excess of the customer's account balance. Any such excess amounts shall be allocated in an equal dollar amount to the account balance amounts of other customers participating in the arrearage management program. Transmission and distribution utilities that participate in the arrearage management program shall submit terms and conditions to implement the requirements of this provision.

4.Non-usage Charges. Net energy billing-kilowatt-hour credits only applies to kilowatt-hour usage charges. Net energy billing customers or the shared ownership customers are responsible for all other charges applicable to the customer's rate class and recovered either through fixed amounts or over units other than kilowatt-hours.

5.Billing. The transmission and distribution utility may place net energy billing accounts on the same billing cycle. The transmission and distribution utility shall allocate the generation output during the billing period and any kilowatt-hour credits from prior billing periods between and among the net energy billing accounts based on the allocation methodology specified pursuant to Section 3(D)(5) of this Chapter.

6.Generation Providers. Customers or the shared financial interest customers that elect net energy billing-kilowatt-hour credits may obtain generation service from any competitive electricity provider that agrees to provide service on a net energy basis. If the customer or the shared financial interest customers receives standard offer service, the standard offer provider shall provide service on a net energy basis

7.Treatment of Facility Output. The transmission and distribution utility shall apply the facility output of the eligible facility against supplier load obligations or, as applicable, to otherwise maximize the value of the output. The respective obligations of the transmission and distribution utilities, project sponsors and NEB customers shall be contained in the standard net energy billing agreement.

K.Net Energy Billing-Tariff Rate Requirements. A commercial or institutional customer or commercial or institutional shared financial interest customers qualifying under this section must receive a bill credit as follows:

1.Bill Credit. Commercial or institutional customers shall receive a bill credit equal to the applicable tariff rate multiplied by the customer's share of the facility output during the applicable period. The bill credit shall apply against the total amount of the bill issued to the customer by the transmission and distribution utility. The bill credit may not result in a negative customer bill.

2.Unused Credits. Commercial or institutional customers may accumulate unused bill credits and apply them against their bill over a 12-month rolling period. At the end of each 12-month rolling period, any accumulated unused bill credits shall be eliminated and may not be applied against any future bill. The customer will receive no compensation for unused bill credits.

3.Billing. The transmission and distribution utility may place net energy billing-tariff rate accounts on the same billing cycle. The transmission and distribution utility shall allocate the generation output during the billing period and any bill credits from prior billing periods between and among net energy billing accounts based on the allocation methodology specified by customers pursuant to and as required by Section 3(F) of this Chapter.

4.Establishment of Tariff Rate. The Commission shall establish the initial tariff rates by December 1, 2019 and subsequent tariff rates prior to January 1 of each year. The Commission delegates to the Director of Electric and Gas Industries the authority to establish the tariff rates in accordance with the provisions of this rule.

a. For eligible facilities that comply with the requirements of this paragraph, the tariff rate shall equal the standard offer service rate established under Title 35-A section 3212 that is applicable to the net energy billing-tariff rate customer receiving the bill credit plus 75% of the effective transmission and distribution rate for the rate class that includes the smallest commercial customers of the customer's investor-owned transmission and distribution utility.

b. The effective transmission and distribution rate shall be established for a 12-month period. In the event that the applicable standard offer rate varies by month, the standard offer rate for purposes of the tariff rate will be a single rate based on the average over the twelve-month period. In the event that the applicable standard offer rate is set based on an index or otherwise unknown, the standard offer rate for purposes of the tariff rate will be a single rate based on the average rate over the prior twelve-month period.

c. The tariff rate established in accordance with this paragraph applies to:

i. eligible facilities with a nameplate capacity of 1 megawatt or less;

ii. eligible facilities that are greater than 1 megawatt if the eligible facility has (a) achieved mechanical completion prior to September 1, 2022 or (b) before September 1, 2022, the project sponsor has commenced on-site physical work of a significant nature on the eligible facility and, since then, the project sponsor has made continuous on-site construction efforts. Eligible facilities that achieve mechanical operation by September 1, 2023 will be considered to have engaged in continuous on-site construction efforts. Project sponsors of eligible facilities that have not achieved mechanical completion by September 1, 2023 may submit a petition to the Commission for determination of whether the continuous on-site construction efforts regarding the eligible facility has occurred.

iii. eligible facilities that are collocated with the facility or facilities of a net energy billing customer or customers that are subscribed to at least 50% of the facility's output.

d. To demonstrate eligibility for the tariff rate established in accordance with section 3(K)(4)(a) , an eligible facility with nameplate capacity of greater than 1 MW that has not achieved mechanical completion prior to September 1, 2022 must provide (i) a sworn affidavit and supporting documentation by October 31, 2022, signed by a duly authorized officer or other legally authorized representative of the eligible facility certifying that on-site physical work of a significant nature commenced prior to September 1, 2022 and (ii) a sworn affidavit and supporting documentation after mechanical completion. The affidavit and supporting documentation must be consistent with an affidavit form and content approved by the Commission. The Commission delegates to the Director of Electric and Gas Industries the authority to approve the affidavit form and content.

e. For eligible facilities that do not satisfy the requirements of Section 3(k)(4)(a)(b)(c) and (d) , the tariff rate for credits received in 2022 shall be the applicable tariff rate that was established by the Commission for NEB credits received during calendar year 2020. Beginning on January 1, 2023 and for each subsequent year, the tariff rate shall be that rate increased by 2.25% each year.

5.Registration and Treatment of Facility Output. The commercial or institutional customer, or project sponsor, or a representative or agent must, if required by the market rules, register the eligible facility in the ISO-NE or NMISA market, as applicable, and provide for and pay the costs of required meters and associated equipment. The project sponsor, or the transmission and distribution utility, as designated by the net energy billing agreement, shall use commercially reasonable efforts to monetize the value of the energy, capacity, and all other market products relating to the facility output in a manner that maximizes that the value of the output of the resource to ratepayers. The respective obligations of the project sponsor and transmission and distribution utility in this regard shall be established by the net energy billing agreement.

6.Renewable Energy Credits. Renewable energy credits shall not be transferred to the transmission and distribution utility.

7.Cost and Benefit Allocation. The costs and benefits incurred or realized by the investor-owned transmission and distribution utility shall be reviewed by the Commission on an annual basis for inclusion in the utility's stranded cost rates. The process established by the Commission shall be consistent with the allocation of costs and benefits specified in Title 35-A, section 3210- F. Eligible costs and benefits include: incremental administrative costs, payments or bill credits, and revenue from the monetization of the output of the eligible facility.

L.Additional Meters. Nothing in this section shall prohibit a utility from installing additional meters to record purchases and sales separately, provided, however, that unless requested by the customer or shared financial interest customers or required by the allocation methodology contained in Section 3(F) of this Chapter, no customer or the shared financial interest customers shall be charged for the cost of the additional meters or other necessary equipment. A customer or shared financial interest customer may request that additional meters be installed if required by the allocation methodology designated by the customer or shared ownership customers. The transmission and distribution utility shall maintain Terms and Conditions that set forth the requirements and charges associated with this metering.

M.Interconnection Requirements. A customer or project sponsor that elects net energy billing must comply with all interconnection, safety and reliability requirements of the transmission and distribution utility applicable to the eligible facility.

N.Standard Contract and Application. Each investor-owned transmission and distribution utility shall develop a separate standard contract and application form for both net energy billing-kilowatt-hour credits and net energy billing-tariff rate consistent with the provisions of this Chapter. The standard contracts shall allow project sponsors or individual customers to choose a contract with a term length of up to twenty years. The standard contract shall include a provision that obligates the parties to negotiate in good faith to revise the contract terms if there is a change in statute or rule that materially alters any right or obligation of a contracting party. Each investor-owned transmission and distribution utility shall submit draft standard contracts and application forms for Commission approval. The submission of the draft standard contracts and application forms shall occur by December 15, 2019. Additional submissions of draft standard contracts and application forms shall be made within 30 days of the effective date of any rule amendments that require the documents to be modified. The Commission may approve deviations from the standard contracts. The Commission delegates to the Director of Electric and Gas Industries the authority to approve the standard contracts and application forms, and any deviation from the standard contracts or application forms.

O.Dispute Resolution. A transmission and distribution utility, a customer, or a project sponsor may dispute any matter governed by this Chapter by filing a Notice of Dispute with the Commission. If a transmission and distribution utility is disputing any aspect of an application for a net energy billing agreement, it must file a Notice of Dispute within 21 days of the submission of the application. A transmission and distribution utility, a customer or a project sponsor must engage in good faith efforts to the resolve the dispute before a Notice of Dispute is filed. The Commission or the Consumer Assistance and Safety Division shall resolve disputes filed pursuant to this provision.

P.Reporting and Commission Review

1.Commission Review. A transmission and distribution utility shall notify the Commission if the cumulative capacity of generating facilities subject to the provisions of this Chapter reaches ten percent of its peak demand. Upon such notification or by September 19, 2022, the Commission will initiate a review this Chapter to consider the effectiveness of net energy billing in achieving State policy goals and providing benefits to ratepayers. Upon the conclusion of the review, the Commission shall submit a report to the Legislature.

2.Quarterly Report. On the 15^th day following each calendar quarter, or otherwise upon request from the Commission, investor-owned transmission and distribution utilities shall file with the Commission a net energy billing report. The net energy billing report shall, at a minimum, include:

(1) a list of all net energy billing agreements in the transmission and distribution utility's service territory;

(2) the capacity, energy output and fuel type or generating technology of each eligible facility;

(3) the number of accounts or meters associated with each net energy billing arrangement;

(4) an estimate of (i) the actual revenue loss from net energy billing-kilowatt-hour credit arrangements and (ii) the cost of bill credit amounts from net energy billing-tariff rate arrangements; and other costs incurred to implement the requirements of this Chapter including, but not limited to, billing system upgrades and administrative costs.

65-407 C.M.R. ch. 313, § 3