Oregon is at the head of the class in implementing net metering and interconnection standards, according to the 2009 Edition of Freeing the Grid, a policy guide that grades states on their current net metering and interconnection practices.
Together these two policies empower energy customers to use solar and other renewables to meet their own electricity needs. This third edition of the report finds that, although net metering and interconnection policies still vary widely, states have made significant strides in adopting the best practices that drive renewable energy market growth and job creation.
“Understanding these policies is critical because each provision in a state’s rules for net metering and interconnection has the potential to be a powerful incentive or a poison pill for the growth of renewables in that state,” said Kyle Rabin, Executive Director of Network for New Energy Choices (NNEC)(www.newenergychoices.org), which produced the report.
Interconnection Standards are the technical requirements and legal procedures that allow a customer-sited generator to “plug-into” the electricity grid. To ensure best practices and eliminate the potential for utility interference, this interconnection process should be governed by a transparent, non-arbitrary set of provisions that facilitate rather than hinder connection to the grid.
The new edition of Freeing the Grid reports 15 states with A or B grades in interconnection standards, a significant improvement from only one state in 2007. Virginia is the first and only state to receive an A for excellent interconnection rules.
Net Metering is a simple billing arrangement that allows solar customers to get fair retail credit for the excess electricity their systems generate during daytime hours. Under best practices, 1 kWh generated by the customer has the exact same value as 1 kWh consumed by the customer. There should not be arbitrary limits on the size of the systems nor the total number of systems allowed to participate.
The new edition of Freeing the Grid reports 27 states with A or B grades in net metering standards, up from 13 in 2007. Eight states (Alabama, Alaska, Idaho, Mississippi, South Carolina, South Dakota, Tennessee and Texas) still do not have statewide net metering programs.
Best Practices Case Study
Using best practices proven in other states as a starting point, Oregon has implemented net metering and interconnection standards that put the state at the head of the class. Oregon’s inclusive net metering program goes beyond standard practices with its aggregation rule that allows customers, such as farmers, who may have more than one electric meter on their property, to use net metering credits at multiple sites, allowing more cost effective use of renewable energy.
State regulators have set up simplified interconnection procedures and reduced unnecessary safety requirements for smaller systems. By combining strong net metering and interconnection procedures with an over-all comprehensive renewable energy strategy–which includes generous rebates and a strong RPS with a 20-megawatts (MW) solar carve-out–Oregon is set to expand renewable energy statewide.
“Looking at how many of these states have moved from lackluster to stellar grades in just three years, it’s clear that there is a growing understanding of the benefits that these policies deliver,” said Adam Browning, Executive Director of Vote Solar. “Although we still have much room for improvement, this country is moving quickly toward a place where these once-obscure concepts–good net metering and interconnection standards–are becoming accepted best practices for supporting customer investment in renewable energy.”
“Along with incentives and fair utility rate structures, these two policies form the backbone of our nation’s rooftop solar energy markets and the local jobs they create. If unnecessary hurdles are removed and customers are fairly compensated for delivering clean electricity to the grid, U.S. homes and businesses can and do go solar,” said Jane Weissman, Executive Director of the Interstate Renewable Energy Council.
2009’s Freeing the Grid also explores best practices and market implications for some new mechanisms including: third-party Power Purchase Agreements, community net metering, and Feed-in Tariff incentive structures.
About NNEC: Network for New Energy Choices (NNEC) promotes policies that ensure safe, clean, and environmentally responsible energy options.
The full report is available at the link below.
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