Shared Renewable Energy Model Program Rules Webinar June 26, 2013 Photo credit: Clean Energy Collec@ve
Why do we need shared renewables? • People really want to green their energy supply • But, only about 25% of residents and businesses are able to install solar or other renewables on their own property
How does Shared Renewables work? The ‘No Roof’ Solution = Everyone Can ParticipateWe can stop leaving customers out of the renewable energy market
How shared renewables can help • Shared renewables works for the other 75% • Gives renters, many schools and public buildings, millions of home and business owners aﬀordable access to clean energy for the ﬁrst @me • Simple for customers to par@cipate • Crowdfunding can help solve ﬁnancing challenges for developers • Systems can be installed in op@mal loca@ons and achieve lower cost/WaP through economies of scale • 5% of U.S. households subscribing to 5kW of shared solar = 28GW of new clean energy capacity 4
Shared Renewables: An Idea Whose Time Has Come “The Power of Sharing in the Internet Economy” -‐ Forbes “The Sky’s the Limit for the Sharing Economy” -‐ Fast Company “The New Sharing Economy Values Access Over Ownership” -‐ CS Monitor U0lity associa0ons are telling their members…
Model Rules for SharedRenewable Energy ProgramsLaurel PasseraIREC WebinarJune 26, 2013
About IREC• Participated inregulatoryproceedings in over35 states• Works to expandconsumer access toclean energy
Shared Renewables– SharesAspects with other ProgramsNet MeteringDonation-based modelsGroup PurchasingCrowd funding
Critical Elements of the Model• Program Administration• Allocating the benefits of participation• Valuation of the energy produced• Facility and Program Size• Facility ownership• Additional Considerations (# ofparticipants, portability/transferability, lowincome, restructured states)
Program AdministrationWho can administer a program?– Utility—most existing shared renewablesprograms are administered by utilities– Third party—for example, Clean EnergyCollective– Participants—for example, Vermont’s groupbillingIREC does not specify a program administrationrecommendation
Allocating the Benefits ofParticipationBy check– Simplicity is initially appealing– However, raises security and tax considerationsthat can complicate thingsBy bill credit mechanism– kWh credit vs. dollar credit– Relatively easy to administer– Avoids security and tax concerns– Familiar to participants and utilitiesIREC recommends a monetary bill credit
Valuation of the Generation• Embedded-cost approach—based on participants’retail rate– Credit based on generation, transmission and/ordistribution rate components (similar to NEM)– Can get even more complicated with TOU rates andnon-kWh rate components, e.g., demand charges• Value-based approach—based on the value of thegeneration to the utility– Costs = lost revenue, administrative costs, incentives– Benefits = avoided generation costs, avoided linelosses, capacity benefits avoided T&D costs, avoidedenvironmental compliance costs, others?IREC provides language for both approaches
OwnershipOwnership directly affects financing. Typicaloptions being used:• Direct ownership (residential, commercial,non-profit, and/or governmental)• Third-party ownership—for example,Clean Energy Collective• Utility ownership—for example, FloridaKeyes Electric Cooperative (participantslease panels from the utility)IREC recommends allowing all forms of ownership
Facility and Program SizeSize and location depend on stakeholdergoals and priorities– Smaller systems can usually take advantageof faster interconnection (e.g., < 2 MW)– Program could encourage locations thatmaximize grid benefits and/orenvironmental benefitsIREC recommends unlimited program size and does notmake a recommendation on facility size
Additional Recommendations• Minimum of 2 program participants• Allow both portability and transferability ofparticipation• Minimum subscription size – one panel• Maximum size - 120% of a participant’sannual electrical consumption• Encourage low-income consumerparticipation
Restructured StatesPolicy is not generally necessary to create programs inthese states, but could potentially facilitate programsSome considerations include:• More complex billing arrangements• State requirements to offer RE programs do notalways transfer to retail suppliers• Contracts length and penalties for early termination• Customers served by different suppliers
Shared Renewables Policies and Campaigns www.sharedrenewables.org
Policy & Project Highlights • Colorado Solar Gardens well into implementa@on, with thousands of customers par@cipa@ng. • CA SB 43 poised to create 600MW pilot program • MN passed bill crea@ng Solar Gardens program • NY likely to consider shared renewables legisla@on in 2014 • U@li@es proac@vely launching shared renewables programs to meet customer preferences.
For more informa4on: Laurel Passera IREC email@example.com 510-‐314-‐8384 Erica Schroeder IREC firstname.lastname@example.org 510-‐314-‐8206 Hannah Masterjohn Vote Solar email@example.com 607-‐431-‐8811 23 Resources • IREC’s Model Program Rules serve as a star@ng point for stakeholders looking to launch programs in their state/community • SharedRenewables.org is a central info source on shared renewables policies and projects • IREC is available for technical assistance on program design and implementa@on • Contact Vote Solar regarding legisla@ve campaigns
SHARED RENEWABLES Mul4ple customers/accounts sharing the power and economic beneﬁts from one solar project, via their individual u4lity bills Broadening Access to Renewable Energy How do we bring clean energy to ALL customers? Note: Each of these structures represents a complex set of rapidly evolving business models – this summary is designed to provide a basic understanding of the “typical” structures in use today Company (e.g. Mosaic) manages individuals’ investments in renewable energy projects, oﬀers aPrac@ve returns While this business model does not involve customers’ energy bills, it does enable individuals to directly support solar projects RENEWABLE ENERGY PROJECT INVESTMENTS
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