April 24, 2018, Introduced by Reps. Glenn, Rabhi, Barrett and Dianda and referred to the Committee on Energy Policy.
A bill to amend 2008 PA 295, entitled
"Clean and renewable energy and energy waste reduction act,"
by amending section 22 (MCL 460.1022), as added by 2016 PA 342, and
by adding part 8.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
Sec. 22. (1) Renewable energy plans and associated revenue
recovery mechanisms filed by an electric provider, approved under
former section 21 or 23 or found to comply with this act under
former
section 25, and in effect on the effective date of the 2016
amendatory
act that added this section, April
20, 2016, remain in
effect, subject to amendments as provided for under subsections (3)
and (4).
(2) For an electric provider whose rates are regulated by the
commission, amended renewable energy plans shall establish a
nonvolumetric mechanism for the recovery of the incremental costs
of compliance within the electric provider's customer rates. The
revenue recovery mechanism shall not result in rate impacts that
exceed the monthly maximum retail rate impacts specified under
section 45. The revenue recovery mechanism is subject to adjustment
under sections 47(4) and 49.
(3)
Within 1 year after the effective date of the 2016
amendatory
act that added this section, By
April 20, 2018, the
commission shall review each electric provider's plan pursuant to a
filing schedule established by the commission. For an electric
provider whose rates are regulated by the commission, the
commission shall conduct a contested case hearing on the plan
pursuant to the administrative procedures act of 1969, 1969 PA 306,
MCL 24.201 to 24.328. After the hearing, the commission shall
approve, with any changes consented to by the electric provider, or
reject the plan and any amendments to the plan. For all other
electric providers, the commission shall provide an opportunity for
public comment on the plan. After the applicable opportunity for
public comment, the commission shall determine whether any
amendment to the plan proposed by the provider complies with this
act. For alternative electric suppliers, the commission shall
approve, with any changes consented to by the electric provider, or
reject any proposed amendments to the plan. For cooperative
electric utilities and municipally owned utilities, the proposed
amendment is adopted if the commission determines that it complies
with this act.
(4) If an electric provider proposes to amend its plan after
the review process under subsection (3), whether as required under
part 8 or otherwise, the electric provider shall file the proposed
amendment with the commission. For an electric provider whose rates
are regulated by the commission, if the proposed amendment would
modify the revenue recovery mechanism, the commission shall conduct
a contested case hearing on the amendment pursuant to chapter 4 of
the
administrative procedures act of 1969, 1969 PA 306, MCL 24.201
to
24.328. 24.271 to 24.287. After the hearing and within 90 days
after the amendment is filed, the commission shall, subject to
subsection (5), approve, with any changes consented to by the
electric provider, or reject the plan and the proposed amendment or
amendments to the plan. For all other electric providers, the
commission shall provide an opportunity for public comment on the
amendment. After the applicable opportunity for public comment and
within 90 days after the amendment is filed, the commission shall
determine whether the proposed amendment to the plan complies with
this act. For alternative electric suppliers, the commission shall
approve, with any changes consented to by the electric provider, or
reject any proposed amendments to the plan. For cooperative
electric utilities and municipally owned utilities, the proposed
amendment is adopted if the commission determines that it complies
with this act.
(5) For an electric provider whose rates are regulated by the
commission, the commission shall approve the plan or amendments to
the plan if the commission determines:
(a) That the plan is reasonable and prudent. In making this
determination, the commission shall take into consideration
projected costs and whether or not projected costs in prior plans
were exceeded.
(b) That the plan is consistent with the purpose and goal set
forth in section 1(2) and (3) and meets the renewable energy credit
standard through 2021.
(c) That the plan complies with this act.
(6) If the commission rejects a proposed plan or amendment
under this section, the commission shall explain in writing the
reasons for its determination.
PART 8 COMMUNITY RENEWABLE ENERGY GARDENS
Sec. 231. As used in this part:
(a) "Community renewable energy garden" or "garden" means a
renewable energy electric generation system that meets all of the
following conditions:
(i) The system has a generating capacity of 5 megawatts or
less.
(ii) The system is connected to the electric distribution grid
serving this state.
(iii) The system has 10 or more subscribers.
(iv) No subscriber holds more than a 40% proportional interest
in the output of the system.
(v) At least 40% of the system's subscriptions are for 25
kilowatts or less.
(vi) The system is located in the service territory of an
electric provider filing a plan under section 235.
(vii) The system is located on a single parcel of land.
(b) "Cooperative subscriber organization" means a group of
subscribers organized under the consumer cooperative act, chapter
11 of the nonprofit corporation act, 1982 PA 162, MCL 450.3100 to
450.3192, for the purposes of owning or creating a community
renewable energy garden.
(c) "Garden owner" means a cooperative subscriber organization
or other person that owns the community renewable energy garden.
(d) "Low-income customer" means individuals or families whose
income does not exceed the eligibility threshold set by the Low-
Income Home Energy Assistance Act of 1981, Public Law 97-35.
(e) "Low-income service organization" means a nonprofit
organization or governmental agency providing services to
individuals or families whose eligibility for services is
contingent on having an income below a certain threshold.
(f) "Subscriber" means a person that is a retail customer of
an electric provider and who is a party to 1 or more subscriptions
to a community renewable energy garden.
(g) "Subscription" means a contract between a garden owner and
a retail customer of an electric provider assigning the customer a
proportional interest in the beneficial use of the renewable energy
produced by a garden, for the purpose of reducing the customer's
retail electricity bill for premises in the same electric provider
service territory as the garden.
(h) "Unsubscribed portion" means the beneficial use of the
renewable energy produced by a garden in excess of that assigned to
subscribers.
Sec. 232. (1) A subscription shall be sized to represent at
least 100 watts of the community renewable energy garden's
generating capacity and to supply not more than 120% of the average
consumption of electricity provided from the distribution grid to
the subscriber at the premises to which the subscription is
attributed.
(2) A subscription may be transferred or assigned as specified
in the subscription contract to a cooperative subscriber
organization or to any other person that qualifies to be a
subscriber.
(3) A garden owner may buy back a subscription from a
subscriber as specified in the subscription. The proportional
interest of a subscription becomes unsubscribed when it is sold
back to the owner.
(4) A garden owner may hold more than 40% of the proportional
interest in the garden's output as an unsubscribed portion.
Sec. 233. A garden owner may contract with another person to
administer or operate the garden.
Sec. 234. A garden owner and the operator and subscribers of a
community renewable energy garden are not public utilities subject
to regulation by the commission solely as a result of their
interest in the garden. Prices paid for subscriptions in community
renewable energy gardens are not subject to regulation by the
commission.
Sec. 235. (1) The commission shall ensure that each electric
provider purchases annual amounts of electricity and renewable
energy credits from community renewable energy gardens in
proportion to that provider's 2018 peak demand.
(2) The commission shall require that each renewable energy
plan provide for the purchase of electricity generated by community
renewable energy gardens and associated renewable energy credits
over the period covered by the plan.
(3) Within 1 year after the effective date of the 2018
amendatory act that added this section, the commission shall review
each electric provider's renewable energy plan in the manner
provided
in section 22(3).
(4) Every 2 years after the adoption of an amended plan
pursuant to subsection (2) or (3), each electric provider shall
amend its plan in the manner provided in section 22(4). The amended
plan shall specify minimum purchases, as determined by the
commission, of electricity that the electric provider shall make
from community renewable energy gardens in excess of purchases in
the 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 subscriptions in community renewable energy
gardens and of other forms of distributed generation, to the extent
the commission finds there is customer demand for those
subscriptions.
(b) Subscriptions by residential customers, including low-
income customers, agricultural producers, and low-income service
organizations that are retail customers, to the extent the
commission finds there is demand for those subscriptions.
(c) Ownership of community renewable energy gardens by
cooperative subscriber organizations, low-income service
organizations, and nonprofit entities.
(d) Development of community renewable energy gardens with
attributes that the commission finds result in lower overall total
costs for the electric provider's customers.
(e) Creation, financing, and operation of community renewable
energy gardens owned by cooperative subscriber organizations.
(f) Subject to section 234, affordability of subscriptions for
all retail customers, including those receiving energy assistance
through the Michigan low income home energy assistance program.
(g) Development of mechanisms, incentives, and financing
options to provide economic benefits to low-income communities
through community renewable energy gardens, including, but not
limited to, siting gardens in low-income communities, creating
employment programs to build and administer gardens, fostering the
ownership of gardens by institutions and cooperative subscriber
organizations located in low-income communities, and coordinating
with appropriate governmental agencies, community stakeholders, and
low-income service organizations.
(h) The achievement of at least 250 megawatts in total
community renewable energy garden generation by 2025.
Sec. 236. (1) The owner of a community renewable energy garden
shall sell the electrical output from the garden only to an
electric provider serving the geographic area where the garden is
located. After a community renewable energy garden is part of an
electric provider's renewable energy plan, the electric provider
shall purchase all of the electricity generated by the garden and
the associated renewable energy credits. 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 garden.
(2) The commission shall create uniform standards and
procedures for interconnection of a community renewable energy
garden to the distribution grid.
(3) An electric provider shall purchase the output of a
community renewable energy garden by applying a net metering credit
against each subscriber's electric bill for the premises designated
in the subscriber's subscription contract. The net metering credit
shall be calculated by multiplying the subscriber's share of the
electricity production from the garden by the electric provider's
total aggregate retail rate as charged to the subscriber, minus a
reasonable charge determined by the commission pursuant to section
22 to cover the provider's costs of delivering an amount of
electricity equal to the subscriber's share of the electricity
generated by the garden to the subscriber's premises,
interconnecting the garden with the provider's distribution grid,
and administering the 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.
Sec. 237. (1) The owner of the community renewable energy
garden shall provide real-time generation data to the electric
provider to facilitate incorporation of the garden into the
electric provider's operations and to facilitate the grant of net
metering credits.
(2) The owner of the community renewable energy garden shall
notify the electric provider of the current proportional interest
of each subscriber for use in determining the net metering credit
owed to each subscriber. The information shall be provided in an
electronic format approved by the commission. The information shall
be provided on a monthly basis, or more frequent basis if required
by the commission, and within a reasonable period of time set by
the commission so that subscriber bills can be credited as provided
under subsection (3).
(3) The electric provider shall credit subscribers' bills for
the billing cycle immediately following the cycle during which the
energy was generated by the community renewable energy garden. The
electric provider shall add, remove, or change the proportional
interest of a subscriber within 1 month after receiving notice from
the garden owner of a change. The customer's bill for the
immediately following month shall reflect the updated information.
(4) If the electricity generated by a garden is not fully
subscribed, the electric provider shall purchase the unsubscribed
renewable energy and the renewable energy credits from the garden
owner at the rate determined under section 6v of 1939 PA 3, MCL
460.6v, and section 210 of title II of the Public Utility
Regulatory Policies Act of 1978, 16 USC 824a-3.
Sec. 238. (1) Each electric provider shall provide for the
inclusion of low-income customers as subscribers to a community
renewable energy garden in its renewable energy plan. The electric
provider may give preference to gardens that have low-income
subscribers and to gardens owned by low-income service
organizations.
(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 purchases
of energy generated by gardens and associated renewable energy
credits. These incentive payments are excluded from the cost
calculations for the life-cycle cost of renewable energy under this
act.
Enacting section 1. This amendatory act takes effect 90 days
after the date it is enacted into law.