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Net Metering Update

Don Loweburg

©1996 Don Loweburg

On April 10, 1996 the California Public Utilities Commission (CPUC) adopted a revised Southern California Edison rate case decision eliminating all standby charges for net metering customers. This is good news and is the result of work by the California PV Collaborative. The Collaborative is distributing a sample tariff and connection agreement to all California utilities. If any Home Power readers would like one, you may contact me. Two major Northern California utilities, PG&E and SMUD, still don't have an acceptable net metering policy.

Rate Based Incentives

Tom Jensen of Strategies Unlimited and Michael Welch did an extensive Home Power article on this subject a few months ago. They described how through local initiative, funding can be developed and made available to stimulate PV system purchases. Power produced with PV is purchased at premium rates using the fund. Under this program only performance is rewarded. No public funding is used to purchase hardware. Equipment and services purchased are made on the competitive market, thus stimulating and growing the local PV economy.

On April 26 at the California PV Collaborative meeting in Sacramento, Tom Jensen provided follow up information on how these programs are growing and flourishing in Europe. In the Swiss town of Burgdorf, where the first program began in 1991, there are now over 186 KW of installed PV. This is especially remarkable since the town has a population of only 15,000. In Germany equally impressive programs are taking off. Programs exist in many cities including Munich and Hamburg. The German programs started in 1995 with 100 KW of PV. The 1996 level of deployed PV is expected to exceed 1.5 MW, a ten fold increase in one year.

California may be the site of the first Rate Based Incentive (RBI) program in the United States. The city of Davis is exploring such a program. Hopefully we will have more information on this project in the coming months. Readers in other communities wishing more information and contacts for RBI feel free to contact IPP.

More California PV Collaborative News

The California PV Collaborative met on April 26, 1996 with reports and information on a number of on-going projects designed to accelerate the commercialization of PV.

Financing and Marketing

Joel Davidson of Solec reported on the marketing committee. Information on net metering will be sent to California utilities and their customers. Also discussed was setting up an information clearing house on successful PV projects and encouraging installers and others to use press releases to inform the general public about these projects. Joel also announced that Sumitomo, Solec's parent company, will be providing financing for qualifying PV projects. Vince Schwent of the California Energy Commission informed the group that REDI (Renewable Energy Development Institute) has begun a project to form a financing database of renewable energy projects. Keith Rutledge of the Bank of Willits, California will be in charge.

Southern California Edison's on-grid PV approved March, 1996

The CPUC, after many months of delay, approved Edison's on grid PV advice filing. Because SCE did not ask for ownership of customer sited systems, IPP did not oppose this program. Edison's program will be very much like the off grid program approved two years ago. In both programs Edison will provide a financing-lease mechanism by which the customer can own the system. There are two ways an Edison customer can use the program. If a customer requests, Edison will design the system and put the job out for bid with the successful contracting company selling, installing and servicing the system. The second option allows the customer to preselect a PV provider and then go to Edison for financing. The financing charge per month in both cases is determined by the system cost multiplied times .016. For more information and a list of IPP contractors drop me a line. In both cases, the customer must be in Edison's service territory. Doug Whyte of SCE stated that the on-grid program is slated for a June 1, 1996 roll out.

PVUSA Under New Management

PVUSA is an extensive deployment of utility scale PV projects. Until last year the project was operated by Pacific Gas and Electric (PG&E). The project has served as a valuable test bed for PV modules of different technologies and manufacturers and system related equipment such as inverters and connectors. In the next few months the CEC will take over the management of the project while Sacramento Municipal Utility District (SMUD) will do plant operations. Nancy Jenkins, CEC manager of the project, solicited suggestions from the collaborative in shaping the future of PVUSA. Two suggestions were made. Joel Davidson of Solec requested that PVUSA continue to accept demonstration installations. He stated that the site serves as a showcase for PV technology and therefore should allow new projects. The second suggestion from IPP was that the site be used to train PV interns, possibly university students but not limited to them.

Renewables Portfolio (Restructuring)

As stated in the last issue, the CPUC has stated the desirability of protecting renewables in a restructured competitive energy market. Several months of meetings are scheduled in order to develop a plan for the commission's consideration. One possible plan was presented to the Collaborative by Vince Schwent of the CEC. His plan would divide renewable energy into bands. These bands would represent both specific technologies and also correlate to technology cost. For instance wind is almost competitive with other generation, therefore wind has a big band but small price subsidy (in the form of a saleable Renewable Energy Credit, REC). The smallest band would represent the least deployed (or developed) technology, PV. The market share is small but the subsidy per kwh is greatest In general, IPP doesn't have a problem with this plan but the issue of PV system ownership is not addressed. We would have problems with any plan that allowed utility ownership of customer sited systems. Theoretically under restructuring and retail electric power competition, the utilities are getting out of the generation business and this should not be an issue. . Another detail that is not spelled out is how utility connected net metering customers are treated. An incentive program that rewards investors for developing PV generation capacity should also reward endusers (home owners) for doing so.

What's Happening in Idaho

I got this information from an IPP member just as we are going to press. I was told that Idaho power is attempting to rescind an existent net metering policy. This is really going backwards. The Idaho public needs to get on this. I also found in documents on file with the Idaho Public Utilities Commission that Idaho Power has passed on to the ratepayers over $660,000 in costs related to their pilot offgrid program. To quote Idaho Public Utility Commission order No. 25880 "We find the ten-year amortization period is appropriate in this case, as it is consistent with the previous Order of the Commission. This adjustment for accumulated photovoltaic expense increases rate base and reduces expenses by $66, 222 (this is per year, so the total being rate based is $662,000 and change)." This is exactly the opposite of the situation in California. Here the CPUC specifically prohibits the passing of offgrid costs onto the ratepayers due to anti competitive concerns. The ratepayers in Idaho are subsidizing the utility while it competes with private businesses.


Author: Don Loweburg, IPP, PO Box 231 North Fork, CA 93643 • 209 877 7080 • Internet Email [email protected]

To join IPP or send tax-deductible donations: IPP, PO Box 231,North Fork, CA 93643 • E-mail: [email protected] • 209-841-7001 or 916-475-3402

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