New York PSC investigating net metering crediting procedures

 Beginning in late January the NYS PSC initiated a proceeding requiring all utilities in the state to explain how they credit net metered customers for export.

As specified in the current net metering rules residential solar, farm waste, residential wind, and farm service wind customers are reimbursed at the utility’s avoided cost for any excess in generation production over usage remaining at the end of an annual period. Some utilities require that a residential solar net metering customer cash-out the reimbursement of the annual excess credits over production exactly at one year intervals from the date the customer’s solar facility commenced operation. If that date falls soon after the summer period of high solar production, credits the residential solar customer may have accumulated during that period would be cashed out at avoided cost, which is substantially less than the tariff rate that would be subtracted from bills during periods of lower solar production in the following fall and winter months, but for the cash-out. An adjustment to the timing of the date for the annual cash-out would avoid this disadvantage to residential solar customers.

For demand net metered customers, the excess generation, in kWh, accumulated during a billing period is multiplied by the applicable tariffed kWh rates and that credit is subtracted from the current bill. If the amount of the credit exceeds the amount of the bill, the excess amount is converted, at tariffed kWh rates, back to a kWh figure, which is subtracted from usage during the next billing period before the next credit, if any, is calculated.

As specified in the order (linked below) it appears that utilities may not be properly reflecting all kWh rates set forth in their tariffs when calculating the billing credit and converting any excess credits back to a kWh figure, even though they reflect the statutory language in their tariffs, and those tariffs resemble each other. The treatment of various kWh delivery charges, and of other items like the Systems Benefits Charge (SBC), the Renewable Portfolio Standard (RPS) charge, the Energy Efficiency Portfolio Standard (EEPS) charge, and the Temporary State Assessment Surcharge, may differ among utilities.

Moreover, the order notes that residential solar net metered customers should not be disadvantaged by the timing of their annual cash-out of their avoided cost reimbursement, as happens when that cash-out takes place soon after the summer period. To prevent this outcome, a residential solar customer should be permitted to exercise a one-time waiver of its annual cash-out date, delaying the cash-out until the next subsequent May 1 date. Thereafter, the cash-out would occur annually on May 1 of each year.

Accordingly, the six major electric utilities that offer net metering were required to submit, by March 4, 2011, a statement evidencing that they either: 1) already recognize all kWh rate components, including, but not limited to, any charge for delivery (including adjustment charges) and the SBC, RPS, EEPS, and Temporary State Assessment Surcharge charges, in their calculations of net metering credits; or 2) will revise their calculation methods to so recognize all such components by June 1, 2011; or, 3) protest that should not be interpreted as requiring them to recognize all kWh charges in performing the calculation.

Reply comments to both the utility and interested party filings are due on April 4, 2011.

See the initial order for Case Matter 10-E-0645 for more information.


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