How much credit solar power producers get for their net metered production is only one of the bad aspects of HB2201. HB2201 also wrote into law several of the current PSC rules on standards for connecting solar producers to power companies, also called interconnection. The PSC rule-making process is more deliberate and informed than the legislative process. The PSC rule-making process is also more flexible and responsive to problems as they arise.
HB2201 puts into law three interconnection standards that were already in PSC interconnection rules:
- A statewide limit of 3% of aggregate peak demand for the previous year, of which .5% is reserved for residential solar power producers,
- Compliance of all solar power systems with IEEE standards,
- A requirement that all solar power systems have a “readily accessible” disconnect switch from the utility’s system.
The amount of solar-generated electricity is still very small in WV. We are nowhere near the .5% limit for residential solar power production.
However, a number of other states are approaching their established limits for solar penetration. Hawaii has hit their limit, and is in the process of re-evaluating their past policies. CA and MN, because of their solar-friendly policies are facing similar situations.
Renewable Energy World has an interesting account of the broader picture of interconnection rules that is useful for us in WV:
Say you’re thinking about adding another story onto an old house. You probably wouldn’t want to start building without first having a structural engineer make some calculations to ensure the house could support the addition. Now keep that image in mind as you consider interconnection policy as one of the main load-bearing walls in our solar market “house.” If not properly designed to match the growing market conditions, state interconnection policies may cause the house to come crashing down…or at least cause some major cracks to form.
Take Hawaii, for example. You may have heard about the dramatic slow-down of distributed solar interconnections, and accompanying loss of solar jobs, due to higher penetrations of solar on many circuits. This situation arose largely because the interconnection standards and grid planning policies in the state were not designed to efficiently accommodate additional distributed solar systems once high penetrations of solar were reached.
Hawaii is not the only state that has faced, or will face, these interconnection challenges. Through our participation in interconnection efforts in California, Massachusetts, and most recently in North Carolina, IREC is seeing a growing trend: rapid solar market growth is placing considerable pressure on state interconnection standards that were originally developed with considerably lower penetrations of distributed solar generation in mind. Even states like these that have experienced sustained solar growth for a number of years are facing the need to update and refine their interconnection procedures to reflect changing market conditions and technologies.
Imagine, then, the effect that an overnight, groundbreaking policy might have on a less-developed market. For example, Minnesota recently adopted an ambitious community solar gardens (CSG) program that resulted in a rush of reservations and interconnection applications – in the first week, Xcel Energy received 427 applications for a total of 420 megawatts (MW). To put this in context, 420 MW is roughly 23 times the amount of distributed solar currently installed in the North Star State. Shared solar projects, like all others, still need a clear path to interconnection—a prospect that may seem daunting in the face of so much new solar.
Minnesota’s Solar Energy Jobs Act (2013 HF 729), the same bill that enacted the state’s community solar gardens program, also required Xcel to “establish uniform standards, fees, and processes for the interconnection of community solar garden facilities.” Seeing the writing on the wall during the CSG docket, IREC emphasized to the Commission the importance of making needed updates to Minnesota’s interconnection procedures to avoid any potential slow-downs or backlogs once the CSG program launched. As expected, the impressive volume of CSG applications has indeed raised immediate questions about the appropriate process for reviewing these projects. In light of continued debates in the proceeding (MN PUC Docket 13-867), we are pleased to see interconnection issues now being discussed more proactively and look forward to diving in further to assist Minnesota as they shore up the foundation of their burgeoning solar market.
These states are far in advance of WV, in both policy and solar penetration, but the issues are essentially the same: how do solar power producers interact with existing power companies.