California PUC Issues Proposed Resolution Involving 3 Companies
- Sep 1, 2021 3:47 pm GMT
Approves the Behind-the-Meter Microgrids (Schedule BTMM) tariffs for the respective service territories for
* There is no direct impact on safety as these tariffs rely upon existing safety protocols in existing tariffs.
* There is no cost impact.
By Advice Letters PG&E AL 6170-E, SDG&E AL 3742-E, and
This Resolution approves each of the behind-the-meter microgrid tariffs (Schedule BTMM - Behind-The-Meter Microgrids) proposed by
D.21-01-018 Ordering Paragraph 4 (OP 4) instructed
Notice of PG&E AL 6170-E, SDG&E AL 3472-E, and
PG&E AL 6170-E, SDG&E AL 3472-E, and
AMR protested that
In its protest, CESA advocated that the Commission should reject the SCE requirement for a generator interconnection application process for microgrid backup generators that operate only during a grid outage. CESA argues that in lieu of SCE requiring a generator interconnection application, the Commission should require customers to notify SCE of the location of the generator and its transfer switch. CESA states that its preferred approach is consistent with
Each of the utilities,
This section of the Resolution will discuss the two primary issues raised in Protests, namely a) AMR's objection that natural gas energy resources are ineligible resources in the behind the meter microgrid tariff; and b) SCE's requirement for a Generator Interconnection Application process applicable for customers using backup generators that operate only during a grid outage.
A) Ineligibility of Natural Gas Energy Resources
AMR protested that
In its Reply to Protests,
PUC 8371(d) states:
"...(d) Without shifting costs between ratepayers, develop separate large electrical corporation rates and tariffs, as necessary, to support microgrids, while ensuring that system, public, and worker safety are given the highest priority. The separate rates and tariffs shall not compensate a customer for the use of diesel backup or natural gas generation, except as either of those sources is used pursuant to Section 41514.1 of the Health and Safety Code, or except for natural gas generation that is a distributed energy resource."
The CPUC recognizes that PU Code. Section 8371(d) restricts specific categories of fuels (namely diesel and natural gas) from compensation under the rates and tariff specifically established by the CPUC to support microgrid commercialization pursuant to 8371(d). However, the statute does not require that the Commission develop rates or tariffs. It does not ensure that any tariff the Commission chooses to create compensates fossil resources when those specific circumstances are met. Instead, the statute gives the Commission the option to develop separate rates and tariffs to facilitate microgrid commercialization. The statute provides the separate option of compensating natural gas or diesel under such rates and tariffs under specific conditions. The Commission is free to avail itself, or not, of either option.
Notwithstanding the underlying AMR protest,
AMR's protest attempts to relitigate policy already determined in the D.21-01-018, which is expressly contrary to
Staff notes that D.21-01-018 indicated that the Commission may choose to exercise its authority under P.U.C. 8371(d) to compensate microgrids supported by fossil-fueled resources based on a more developed record in the future, and directed a working group to further explore the issue:
Third, when implementing Option 5, we direct the
In conclusion, AMR's protest is contrary to
B) SCE Requirement for a Generator Interconnection Application For Backup Generators
CESA objects to SCE requiring a generator interconnection application for microgrid generators acting as backup generators. CESA offers that the Commission should require customers to notify SCE of the location of the generator and its transfer switch instead of completing a separate interconnection application. CESA states that its preferred approach is consistent with
In its reply comments, SCE explains that customers seeking to operate backup generators in isolated mode (i.e., not in parallel with SCE's electric grid) are not required to obtain an interconnection agreement with SCE, but are required to submit an interconnection application consistent with Electric Rules 2 and 21, when they seek to operate in parallel operation. SCE asserts that SCE must review and approve a proposed transfer switch or operating scheme prior to operation to ensure that the generator will never operate in parallel with SCE's electric system. SCE's interconnection application process involves requiring the customer to submit an interconnection application with a single line drawing, site/plot plan drawing, and diagrams, manufacturer's data, and written descriptions of the switching device or scheme proposed. SCE states that if the generators operate only in an isolated (non-parallel) mode, it does not impose an application or review fee.
Staff finds the approach described by SCE to a be a reasonable way to promote safe operation of backup generators that are part of microgrids. Moreover, Ordering Paragraph 4 directed utilities to incorporate applicable existing tariffs into the new microgrid tariff by reference, without changing or redefining terms. Staff agrees with
In contrast, CESA's request would involve making a change to the terms of an existing policy, which would be contrary to the direction of D.21-01-018. According to
Commission has reviewed the three Advice Letters and the protests of AMR and CESA. Additionally, the Commission has reviewed the replies of
D.21-01-018 Ordering Paragraph 4 required
We verified that the Advice Letters addressed the required content including sections 3.3.3 of D.21-01-018, based on the following criteria: a) Consistency with D.21-01-018; b) Consistency with
Public Utilities Code section 311(g)(1) provides that this Resolution must be served on all parties and subject to at least 30 days public review. Any comments are due within 20 days of the date of its mailing and publication on the Commission's website and in accordance with any instructions accompanying the notice. Section 311(g)(2) provides that this 30-day review period and 20-day comment period may be reduced or waived upon the stipulation of all parties in the proceeding.
The 30-day review and 20-day comment period for the draft of this resolution was neither waived nor reduced. Accordingly, this draft resolution was mailed to parties for comments, and will be placed on the Commission's agenda no earlier than 30 days from today.
1. Public Utilities Code 8371(d) authorizes but does not require the Commission to create rates and tariffs to facilitate the commercialization of microgrids.
2. Public Utilities Code 8371(d) authorizes but does not require the Commission to include fossil resources in any rates or tariffs it establishes to facilitate the commercialization of microgrids, if certain conditions are met.
3. D.21-01-018 directed
4. D.21-01-018 required utilities to limit eligibility to resources that are individually eligible for a net energy metering successor schedule that reflects the orders in D.16-01-044. The Decision's reference to NEM effectively prohibits natural gas generation from being part of the microgrid's that qualify for use of the BTMM schedules.
5. D.21-01-018 required that
6. Advice Letters PG&E 6170-E, SDG&E AL 3472-E and
7. Protests to the Advice Letters were timely filed by AMR and CESA.
8. The exclusion of fossil resources from the proposed behind-the-meter microgrid tariffs follows explicit policy direction in D.21-01-018.
9. The AMR Protest is without merit because it would re-litigate resource eligibility policy determined in D.21-01-018.
10. The AMR Protest does not provide any valid grounds for protest outlined in
11. The requirement in SCE's behind-the-meter microgrid tariff that customers seeking to operate a backup generator in isolated mode as part of a microgrid file an interconnection application represents a reasonable way to promote safe operation and is consistent with pre-existing tariffs and policies.
12. The requirement in SCE's behind-the-meter microgrid tariff that customers seeking to operate a backup generator in isolated mode as part of a microgrid file an interconnection application follows the policy direction ordered by D.21-01-018 because it is an existing requirement for other backup generators that are not part of a microgrid.
13. The CESA Protest is without merit because it would re-litigate policy determined in D.21-01-018 that prohibits changing or redefining existing tariff terms.
14. The CESA Protest does not provide any valid grounds for protest outlined in
15. Advice Letters
THEREFORE IT IS ORDERED THAT:
1. The request of the
This Resolution is effective today.
I certify that the foregoing resolution was duly introduced, passed and adopted at a conference of the
* * *
1/ D.21-01-018, " Decision Adopting Rates, Tariffs, And Rules Facilitating The Commercialization Of Microgrids Pursuant To Senate Bill 1339 And Resiliency Strategies", Issued 01/18/21, at page 53.
2/ For example, see PG&E Electric Rule 2, Sheet 14, Section E. Protective Devices, paragraph 6 which states, "Any non-
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