HOUSE BILL No. 5674

 

June 12, 2014, Introduced by Reps. VerHeulen, Switalski, Irwin, Roberts, Dianda, Barnett, McBroom, Schmidt, Kivela, Zemke, Townsend, Lamonte, Singh, Robinson, Kelly and Hovey-Wright and referred to the Committee on Energy and Technology.

 

     A bill to amend 2008 PA 295, entitled

 

"Clean, renewable, and efficient energy act,"

 

(MCL 460.1001 to 460.1195) by adding part 5A.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

PART 5A COMMUNITY RENEWABLE ENERGY GARDENS

 

     Sec. 182. (1) As used in this part:

 

     (a) "Community renewable energy garden" or "system" means a

 

renewable energy electric generation system that meets all of the

 

following conditions:

 

     (i) The system has a generating capacity of 2 megawatts or

 

less.

 

     (ii) The beneficial use of the electricity generated by the

 

system belongs to a minimum of 10 subscribers to the community

 

renewable energy garden.

 


     (iii) The owner is either an electric provider or a person who

 

contracts to sell the output from the community renewable energy

 

garden to an electric provider that serves the community in which

 

the community renewable energy garden is located.

 

     (b) "Subscriber" means a retail customer of the electric

 

provider who owns a subscription.

 

     (c) "Subscriber organization" means an organization with the

 

sole purpose of beneficially owning and directly operating a

 

community renewable energy garden, or indirectly operating it

 

through a third party under contract with the subscriber

 

organization. A subscriber organization may be any for-profit or

 

nonprofit entity permitted by law.

 

     (d) "Subscription" means a proportional interest in renewable

 

energy electric generation system installed at a community

 

renewable energy garden and in the renewable energy credits

 

associated with or attributable to that system.

 

     (2) Each subscription shall be sized to represent at least 100

 

watts of the community renewable energy garden's generating

 

capacity and to supply no more than 120% of the average annual

 

consumption of electricity by the subscriber at the premises to

 

which the subscription is attributed, net of the average annual

 

amount generated by any existing renewable energy system at the

 

premises.

 

     (3) A subscription in a community renewable energy garden may

 

be transferred or assigned to a subscriber organization or to any

 

other person or entity that qualifies to be a subscriber under this

 

part.

 


     Sec. 182a. A subscriber organization may enter into ownership

 

and operating agreements to implement the purposes of this act.

 

     Sec. 182b. The owners of and subscribers to a community

 

renewable energy garden are not public utilities subject to

 

regulation by the commission solely as a result of their interest

 

in the community renewable energy garden. Prices paid for

 

subscriptions in community renewable energy gardens are not subject

 

to regulation by the commission.

 

     Sec. 182c. (1) The commission shall require in each new plan

 

or review of the renewable energy plan of an electric provider

 

pursuant to section 21, 23, or 25 that the plan include the

 

purchase of electricity and renewable energy credits from community

 

renewable energy gardens over the period covered by the plan.

 

     (2) In the first plan or review plan adopted after the

 

effective date of the amendatory act that added this section, each

 

electric provider shall include plans to issue 1 or more standard

 

offers to purchase the output from community renewable energy

 

gardens of 500 kilowatts or less at prices that are comparable to

 

the prices offered by the electric provider under standard offers

 

issued for on-site renewable energy generation. During that plan

 

period, the electric provider shall plan to acquire, through these

 

standard offers, 1/2 of the renewable energy garden generation it

 

plans to acquire, to the extent the electric provider receives

 

responses to its standard offers. For that plan period, the

 

electric provider is not obligated to purchase more than 6

 

megawatts of energy generated by community renewable energy gardens

 

that were not included in a prior plan period.

 


     (3) For each review plan adopted after a plan described in

 

subsection (2), the commission shall determine the minimum

 

purchases of electrical output an electric provider shall plan to

 

make from community renewable energy gardens that were not included

 

in a prior plan period. In addition, as necessary, the commission

 

shall formulate and implement policies consistent with this part

 

that encourage all of the following:

 

     (a) Customer ownership of subscriptions in community renewable

 

energy gardens and of other forms of distributed generation, to the

 

extent the commission finds there is customer demand for that

 

ownership.

 

     (b) Residential retail customer, including low-income

 

customer, and agricultural producer ownership of subscriptions in

 

community renewable energy gardens, to the extent the commission

 

finds there is demand for that ownership.

 

     (c) Development of community renewable energy gardens with

 

attributes that the commission finds result in lower overall total

 

costs for the electric provider's customers.

 

     (d) Successful financing and operation of community renewable

 

energy gardens owned by subscriber organizations.

 

     (e) The achievement of the goals and objectives of this act.

 

     Sec. 182d. (1) The output from a community renewable energy

 

garden shall be sold only to an electric provider serving the

 

geographic area where the community renewable energy garden is

 

located. After a community renewable energy garden is part of an

 

electric provider's renewable energy plan that is approved by the

 

commission, the electric provider shall purchase all of the

 


electricity and renewable energy credits generated by the community

 

renewable energy garden. The amount of electricity and renewable

 

energy credits generated by each community renewable energy garden

 

shall be determined by a production meter installed by the electric

 

provider or third-party system owner and paid for by the owner of

 

the community renewable energy garden.

 

     (2) An electric provider shall purchase the output of a

 

community renewable energy garden by a net metering credit against

 

each community renewable energy garden subscriber's electric bill

 

for the premises set forth in the subscriber's subscription. The

 

net metering credit shall be calculated by multiplying the

 

subscriber's share of the electricity production from the community

 

renewable energy garden by the electric provider's total aggregate

 

retail rate as charged to the subscriber, minus a reasonable charge

 

as determined by the commission to cover the provider's costs of

 

delivering an amount of electricity equal to the subscriber's share

 

of the electricity generated by the community renewable energy

 

garden to the subscriber's premises, integrating the renewable

 

energy generation with the provider's system, and administering the

 

community renewable energy garden's contracts and net metering

 

credits. The commission shall ensure that this charge does not

 

reflect costs that are already recovered by the electric provider

 

from the subscriber through other charges. If, and to the extent

 

that, a subscriber's net metering credit exceeds the subscriber's

 

electric bill in any billing period, the net metering credit shall

 

be carried forward and applied against future bills.

 

     (3) The electric provider and the owner of the community

 


renewable energy garden shall agree on whether the purchase of the

 

renewable energy credits from subscribers will be accomplished

 

through a credit on each subscriber's electricity bill or by a

 

payment to the owner of the community renewable energy garden.

 

     Sec. 182e. (1) The owner of the community renewable energy

 

garden shall provide real-time production data to the electric

 

provider to facilitate incorporation of the community renewable

 

energy garden into the electric provider's operation of its

 

electric system and to facilitate the provision of net metering

 

credits.

 

     (2) The owner of the community renewable energy garden shall

 

notify the electric provider of the percentage share of each

 

subscriber for use in determining the net metering credit to each

 

subscriber. The information shall be provided on a monthly basis

 

and within reasonable periods set by the electric provider. If the

 

electricity output of the community renewable energy garden is not

 

fully subscribed, the electric provider shall purchase the

 

unsubscribed renewable energy and the renewable energy credits at a

 

rate equal to the electric provider's average hourly incremental

 

cost of electricity supply over the immediately preceding calendar

 

year.

 

     Sec. 182f. (1) Each electric provider shall provide for

 

including low-income customers as subscribers to a community

 

renewable energy garden in its proposed renewable energy plan. The

 

electric provider may give preference to community renewable energy

 

gardens that have low-income subscribers.

 

     (2) An electric provider is eligible for the incentives and

 


subject to any ownership limitations set forth in this part for

 

investments in community renewable energy gardens and may recover

 

through rates a margin, determined by the commission, on all energy

 

and renewable energy credits purchased from community renewable

 

energy gardens. These incentive payments are excluded from the cost

 

calculations for life-cycle cost of renewable energy under this

 

act.