| 1 | 1 | | 81R14719 T |
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| 2 | 2 | | By: Coleman H.B. No. 3706 |
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| 3 | 3 | | |
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| 4 | 4 | | |
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| 5 | 5 | | A BILL TO BE ENTITLED |
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| 6 | 6 | | AN ACT |
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| 7 | 7 | | relating to the creation of a Tex Sun solar energy system rebate |
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| 8 | 8 | | program. |
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| 9 | 9 | | BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: |
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| 10 | 10 | | SECTION 1. Section 39.905. GOAL FOR ENERGY EFFICIENCY. |
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| 11 | 11 | | (a) It is the goal of the legislature that: |
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| 12 | 12 | | (1) electric utilities will administer energy savings |
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| 13 | 13 | | incentive programs in a market-neutral, nondiscriminatory manner |
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| 14 | 14 | | but will not offer underlying competitive services; |
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| 15 | 15 | | (2) all customers, in all customer classes, have a |
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| 16 | 16 | | choice of access to energy efficiency alternatives, solar electric |
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| 17 | 17 | | incentives, and other choices from the market that allow each |
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| 18 | 18 | | customer to reduce energy consumption, peak demand, or energy |
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| 19 | 19 | | costs; and |
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| 20 | 20 | | (3) each electric utility and retail energy provider |
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| 21 | 21 | | shall provide through targeted market transformation programs |
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| 22 | 22 | | solar electric incentives to customers of retail electric providers |
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| 23 | 23 | | and competitive energy service providers, including providers of |
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| 24 | 24 | | solar electric systems, that are sufficient to acquire on-site |
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| 25 | 25 | | solar electric generation systems under the TEXSUN Solar Electric |
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| 26 | 26 | | Rebate Program. (a) In this section, "solar electric system" means |
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| 27 | 27 | | a device that: |
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| 28 | 28 | | (1) uses solar resources to generate electricity; |
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| 29 | 29 | | (2) has a generating capacity of not more than 1,000 |
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| 30 | 30 | | kilowatts; and |
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| 31 | 31 | | (3) is installed with a five-year warranty against |
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| 32 | 32 | | breakdown or undue degradation. |
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| 33 | 33 | | (b) The commission shall ensure timely and reasonable cost |
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| 34 | 34 | | recovery through a nonbypassable distribution fee of 35 cents per |
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| 35 | 35 | | megawatt hour in year one of the program; 35 cents per megawatt hour |
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| 36 | 36 | | in year two of the program; 45 cents per megawatt hour in year three |
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| 37 | 37 | | of the program; 55 cents per megawatt hour in year four of the |
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| 38 | 38 | | program; and 65 cents per megawatt hour in year five of the program |
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| 39 | 39 | | for utility expenditures made to provide customer solar electric |
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| 40 | 40 | | rebates to meet the market transformation objectives of the TEXSUN |
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| 41 | 41 | | Solar Electric Rebate Program under 39.905. |
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| 42 | 42 | | (c) For the purposes of this section, a "low-income electric |
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| 43 | 43 | | customer" is an electric customer: |
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| 44 | 44 | | (1) whose household income is not more than 125 |
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| 45 | 45 | | percent of the federal poverty guidelines; or |
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| 46 | 46 | | (2) in whose household resides a person who: |
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| 47 | 47 | | (A) receives food stamps from the Health and |
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| 48 | 48 | | Human Services Commission or medical assistance from a state agency |
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| 49 | 49 | | administering a part of the medical assistance program; |
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| 50 | 50 | | (B) receives federal housing assistance; |
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| 51 | 51 | | (C) has a child enrolled in the national school |
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| 52 | 52 | | lunch program for free or reduced-price lunches; or |
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| 53 | 53 | | (D) receives lifeline telephone service. |
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| 54 | 54 | | (d) The commission shall not impose the fee for the TEXSUN |
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| 55 | 55 | | program on a low-income electric customer, as defined by Subsection |
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| 56 | 56 | | (c) of this section. |
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| 57 | 57 | | (e) The commission shall not impose the fee for the TEXSUN |
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| 58 | 58 | | program on customers who receive service at transmission level, as |
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| 59 | 59 | | defined by the commission. |
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| 60 | 60 | | (f) The commission shall not impose a fee on the retail |
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| 61 | 61 | | electric customers of an electric cooperative or a municipally |
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| 62 | 62 | | owned utility regardless of whether the electric cooperative or |
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| 63 | 63 | | municipally owned utility has implemented customer choice. |
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| 64 | 64 | | (g) The commission shall provide oversight and adopt rules |
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| 65 | 65 | | and procedures to ensure a transmission and distribution utility |
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| 66 | 66 | | provides a market transformation incentive to a customer that |
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| 67 | 67 | | interconnects an eligible solar electric system to the utility's |
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| 68 | 68 | | transmission and distribution system. The program shall begin on |
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| 69 | 69 | | or before January 1, 2008, and the initial incentive offer shall be: |
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| 70 | 70 | | (1) $4.50 per watt for a residential customer; |
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| 71 | 71 | | (2) $4.00 per watt for a nonresidential customer that |
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| 72 | 72 | | installs a solar electric system with a generating capacity of not |
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| 73 | 73 | | more than 200 kilowatts; and |
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| 74 | 74 | | (3) $3.50 per watt for a non-residential customer that |
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| 75 | 75 | | installs a solar electric system with a generating capacity of |
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| 76 | 76 | | greater than 200 kilowatts. |
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| 77 | 77 | | (h) The Commission shall calculate the amount of each |
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| 78 | 78 | | incentive offer based on the direct current rating of the system's |
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| 79 | 79 | | photovoltaic module multiplied by the efficiency of the direct |
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| 80 | 80 | | current to alternative current inverter. The Commission by rule |
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| 81 | 81 | | shall provide for the incentive offer to decline by an average rate |
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| 82 | 82 | | of 10 per cent each year of the market transformation incentive |
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| 83 | 83 | | program. |
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| 84 | 84 | | (i) The Commission by rule shall adopt mechanisms to ensure |
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| 85 | 85 | | that money allocated for this section is efficiently used. Each |
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| 86 | 86 | | fiscal biennium, the Commission shall attempt to allocate to the |
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| 87 | 87 | | TEXSUN program all amounts collected for purposes of this Section |
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| 88 | 88 | | under Section 39.905. Funds collected from the program under |
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| 89 | 89 | | Section 39.905 that are not used for market transformation purposes |
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| 90 | 90 | | shall be used for purposes of this section in the following fiscal |
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| 91 | 91 | | year. |
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| 92 | 92 | | (j) The commission shall hold a workshop twice a year for |
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| 93 | 93 | | interested parties for the purposes of determining if the incentive |
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| 94 | 94 | | offers are set at a level that encourages an efficient and steady |
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| 95 | 95 | | flow of customer investments in, and rate of interconnections of, |
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| 96 | 96 | | solar electric systems in Texas. |
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| 97 | 97 | | (k) The commission may increase or decrease the amount of |
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| 98 | 98 | | the incentive offers based on existing market conditions, including |
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| 99 | 99 | | changes to or the expiration of the federal solar investment tax |
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| 100 | 100 | | credit. The commission shall immediately reduce the amount of the |
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| 101 | 101 | | incentive offer by 10 percent if more than 50 percent of the money |
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| 102 | 102 | | projected to be collected under Section 39.905 for this section |
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| 103 | 103 | | during a program year is allocated in the first three months of that |
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| 104 | 104 | | program year. After the reduction of the incentive offer, the |
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| 105 | 105 | | commission shall initiate a meeting of stakeholders to determine if |
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| 106 | 106 | | an efficient and steady rate of installations of solar electric |
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| 107 | 107 | | systems is being maintained. A previous reduction of the incentive |
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| 108 | 108 | | offer must be considered when determining additional reductions of |
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| 109 | 109 | | the incentive offer. |
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| 110 | 110 | | (l) A transmission and distribution utility shall determine |
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| 111 | 111 | | the amounts allocated to provide incentives to residential and |
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| 112 | 112 | | nonresidential customers based on the percentage of funds collected |
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| 113 | 113 | | for this section under Section 39.905 from each class of customer. |
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| 114 | 114 | | Amounts allocated for incentives to one class of customers may not |
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| 115 | 115 | | be reallocated for incentives for another class of customers. |
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| 116 | 116 | | (m) A transmission and distribution utility may not |
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| 117 | 117 | | allocate more than five percent of the money collected under |
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| 118 | 118 | | Section 39.905 for this section to administer the TEXSUN incentive |
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| 119 | 119 | | program. |
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| 120 | 120 | | (n) The commission by rule shall adopt procedures for |
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| 121 | 121 | | requiring a transmission and distribution utility to submit an |
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| 122 | 122 | | annual report to the commission regarding the actions taken by the |
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| 123 | 123 | | transmission and distribution utility to comply with the rules |
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| 124 | 124 | | adopted by the commission under Subsection (f). The report must |
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| 125 | 125 | | include: |
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| 126 | 126 | | (1) the total amount of money available to the utility |
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| 127 | 127 | | under this section; |
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| 128 | 128 | | (2) the number of solar rebates allocated by the |
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| 129 | 129 | | utility; |
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| 130 | 130 | | (3) the total amount of money allocated by the utility |
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| 131 | 131 | | for solar rebates; and |
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| 132 | 132 | | (4) the cumulative generation capacity from installed |
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| 133 | 133 | | solar energy systems. |
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| 134 | 134 | | (o) This section expires December 31, 2012 |
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| 135 | 135 | | (4) (3) each electric utility will provide, through |
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| 136 | 136 | | market-based standard offer programs or limited, targeted, |
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| 137 | 137 | | market-transformation programs, incentives sufficient for retail |
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| 138 | 138 | | electric providers and competitive energy service providers to |
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| 139 | 139 | | acquire additional cost-effective energy efficiency equivalent to |
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| 140 | 140 | | at least 10 percent of the electric utility's annual growth in |
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| 141 | 141 | | demand. |
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| 142 | 142 | | SECTION 2_. Sec. 39.9032. INTERCONNECTION OF DISTRIBUTED |
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| 143 | 143 | | RENEWABLE GENERATION. (a) In this section: |
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| 144 | 144 | | (1) "Distributed renewable generation" means electric |
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| 145 | 145 | | generation with a capacity of not more than 2,000 kilowatts |
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| 146 | 146 | | provided by a renewable energy technology, as defined by Section |
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| 147 | 147 | | 39.904, that is installed on a retail electric customer's side of |
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| 148 | 148 | | the meter. |
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| 149 | 149 | | (2) "Distributed renewable generation owner" means |
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| 150 | 150 | | the owner of distributed renewable generation. |
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| 151 | 151 | | (3) "Interconnection" means the right of a distributed |
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| 152 | 152 | | renewable generation owner to physically connect distributed |
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| 153 | 153 | | renewable generation to an electricity distribution system, and the |
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| 154 | 154 | | technical requirements, rules, or processes for the connection. |
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| 155 | 155 | | (4) "Net electricity" means the difference in meter |
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| 156 | 156 | | registration between in-flowing and out-flowing electricity moving |
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| 157 | 157 | | across a bidirectional meter, or an equivalent meter, during a |
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| 158 | 158 | | billing period. |
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| 159 | 159 | | (b) A transmission and distribution utility or electric |
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| 160 | 160 | | utility shall allow interconnection if: |
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| 161 | 161 | | (1) the distributed renewable generation to be |
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| 162 | 162 | | interconnected has a five-year warranty against breakdown or undue |
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| 163 | 163 | | degradation; and |
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| 164 | 164 | | (2) the rated capacity of the distributed renewable |
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| 165 | 165 | | generation does not exceed the service entrance capacity. |
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| 166 | 166 | | (c) A customer may request interconnection by filing an |
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| 167 | 167 | | application for interconnection with the transmission and |
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| 168 | 168 | | distribution utility or electric utility. Procedures of a |
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| 169 | 169 | | transmission and distribution utility or electric utility for the |
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| 170 | 170 | | submission and processing of a customer's application for |
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| 171 | 171 | | interconnection shall be consistent with rules adopted by the |
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| 172 | 172 | | commission regarding interconnection. |
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| 173 | 173 | | (d) The commission by rule shall establish safety, |
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| 174 | 174 | | technical, and performance standards for distributed renewable |
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| 175 | 175 | | generation that may be interconnected. In adopting the rules, the |
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| 176 | 176 | | commission shall consider standards published by the Underwriters |
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| 177 | 177 | | Laboratories, the National Electric Code, the National Electric |
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| 178 | 178 | | Safety Code, and the Institute of Electrical and Electronics |
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| 179 | 179 | | Engineers. |
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| 180 | 180 | | (e) A transmission and distribution utility, electric |
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| 181 | 181 | | utility, or retail electric provider may not require a distributed |
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| 182 | 182 | | renewable generation owner whose distributed renewable generation |
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| 183 | 183 | | meets the standards established by rule under Subsection (d) to |
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| 184 | 184 | | purchase an amount, type, or classification of liability insurance |
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| 185 | 185 | | the distributed renewable generation owner would not have in the |
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| 186 | 186 | | absence of the distributed renewable generation. |
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| 187 | 187 | | (f) A transmission and distribution utility or electric |
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| 188 | 188 | | utility shall offer interconnection of distributed renewable |
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| 189 | 189 | | generation with a single bidirectional meter. An alternative meter |
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| 190 | 190 | | that has an outcome equivalent of a single bidirectional meter may |
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| 191 | 191 | | be installed if a bidirectional meter is unavailable or if the |
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| 192 | 192 | | transmission and distribution utility or electric utility and the |
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| 193 | 193 | | distributed renewable generation owner agree to the installation of |
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| 194 | 194 | | the alternative meter. A transmission and distribution utility or |
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| 195 | 195 | | electric utility shall supply and install the meter at no cost to |
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| 196 | 196 | | the distributed renewable generation owner. The distributed |
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| 197 | 197 | | renewable generation owner is responsible for the cost of any meter |
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| 198 | 198 | | changes made subsequently. |
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| 199 | 199 | | (g) A transmission and distribution utility, electric |
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| 200 | 200 | | utility, or retail electric provider shall credit to the account of |
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| 201 | 201 | | the distributed renewable generation owner the retail value of the |
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| 202 | 202 | | kilowatt-hours of electricity generated in excess of the amount of |
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| 203 | 203 | | kilowatt-hours of electricity supplied to a distributed renewable |
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| 204 | 204 | | generation owner during the billing period. A credit applied to an |
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| 205 | 205 | | account during a billing period may be carried over to subsequent |
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| 206 | 206 | | billing periods until the credit has been redeemed. A credit |
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| 207 | 207 | | applied to an account may not be redeemed for cash and expires on |
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| 208 | 208 | | the date a distributed renewable generation owner terminates an |
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| 209 | 209 | | agreement for electric service with the transmission and |
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| 210 | 210 | | distribution utility, electric utility, or retail electric |
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| 211 | 211 | | provider, but only in relation to the account terminated. |
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| 212 | 212 | | (h) A transmission and distribution utility, electric |
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| 213 | 213 | | utility, or retail electric provider may charge the distributed |
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| 214 | 214 | | renewable generation owner for the net electricity supplied during |
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| 215 | 215 | | the billing period only if the amount of electricity supplied |
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| 216 | 216 | | exceeds the amount of electricity provided by the distributed |
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| 217 | 217 | | renewable generation owner. |
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| 218 | 218 | | (i) A transmission and distribution utility, electric |
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| 219 | 219 | | utility, or retail electric provider shall charge a distributed |
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| 220 | 220 | | renewable generation owner for the net electricity supplied at the |
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| 221 | 221 | | same rate applicable to service provided to other customers in the |
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| 222 | 222 | | same service class. A transmission and distribution utility, |
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| 223 | 223 | | electric utility, or retail electric provider may not charge a |
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| 224 | 224 | | distributed renewable generation owner a fee or charge that would |
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| 225 | 225 | | increase the distributed renewable generation owner's minimum |
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| 226 | 226 | | monthly charge to an amount greater than that of other customers in |
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| 227 | 227 | | the same rate class. |
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| 228 | 228 | | (j) A renewable energy credit that is earned by a |
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| 229 | 229 | | distributed renewable generation owner through the interconnection |
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| 230 | 230 | | of a renewable electric system is the sole property of the |
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| 231 | 231 | | distributed renewable generation owner unless the distributed |
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| 232 | 232 | | renewable generation owner engages in a transaction to sell or |
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| 233 | 233 | | trade the credit under Section 39.904. |
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| 234 | 234 | | SECTION 3. (a) Except as provided by Subsection (b) of this |
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| 235 | 235 | | section, this Act takes effect September 1, 2007. |
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| 236 | 236 | | (b) Section 39.9032, Utilities Code, as added by this Act, |
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| 237 | 237 | | takes effect January 1, 2009. |
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