Public Power Magazine - July/August 2015

PUBLIC POWER

AMERICAN PUBLIC POWER ASSOCIATION • JULY/AUGUST 2015

The Community Solar Issue

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EDITORIAL TEAMJoe NipperSenior Vice PresidentRegulatory Affairs and Communications

Meena DayakVice PresidentIntegrated Media & Communications

Paul CiampoliNews Director

Jeannine AndersonNews Editor

Laura D’AlessandroIntegrated Media & Communications Editor

Robert ThomasCreative Director

Sharon WinfieldLead Designer, Digital & Print

INQUIRIES

[email protected] 202-467-2900

SUBSCRIPTIONS [email protected] 202-467-2900

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Public Power (ISSN 0033-3654) is published six times a year by the American Public Power Association, 2451 Crystal Drive, Suite 1000, Arlington, VA 22202-4804. ©Copyright, 2015, American Public Power Association. Opinions expressed in articles are not necessarily policies of the association. Periodical postage paid in Arlington, Va., and additional mailing offices.

For permission to reprint articles, contact [email protected].

4 Public Power Lines by Sue Kelly

34 Washington Report

35 Engineering

36 Security

37 Innovation

38 Resources: Making AMI Work for a Small Utility

40 100 Years of Pride in Public Power

8 Find Fertile Ground in Public PowerPublic power was an early adopter of the community solar trend.

14 Fund a Solar SuitcaseGive the gift of electricity to save lives.

20 Healthy ChoicesChoosing the best distributed generation rate design for your utility.

26 Customer PerspectivesCommunity solar customers are informed and eager participants.

32 The Many Dimensions of LeadershipAn interview with Doug Hunter, chairman of the American Public Power Association.

41 What Is Community Solar?Captain Public Power explains how community solar works.

FEATURES

CONT ENT S

Cover illustration by Richard Weiss

The Community Solar Issue

#PublicPower

Search for American Public Power and Connect with us

Customer preferences for how they get their electricity are changing. Increasingly, customers want to have more than one source of power. They want more independence and choice. They want to cut their utility bills. They want to make the most of the sunshine and profit from any excess power they might generate from it. All this is driving increased interest in distributed generation, energy efficiency and demand response.

The demand for DG, particularly solar, is growing fast. As of October 2014, just under 8,000 MW of solar capacity was in-stalled on residential and business rooftops throughout the United States. However, the National Renewable Energy Laboratory estimates that 49 percent of U.S. households cannot access rooftop solar for various reasons. This is a prime opportunity for community solar, which in many ways is made for public power utilities with roots in the community.

Community solar allows a public power utility to install a solar power source in a common location and share the output - even the ownership - with customers through vari-ous business models.

Community solar projects are good for customers, who get the benefit of locally produced solar power without having to install rooftop panels; and good for the utilities, as they can better manage reliability and rate impacts. This issue of Public Power maga-zine has various examples of innovative community solar projects that many public power utilities have implement-ed. And we know there are many more around the country.

In addition to community solar, there are other options for you to keep up with customer preferences.

As Joe Nipper, APPA’s senior vice president for regulatory affairs and communications, said in a recent email to members, “If your public power community hasn’t seen inter-est in solar yet, it doesn’t mean you won’t in the near future. And no matter what your customers want, you want to be a step ahead. You want to anticipate their needs. Whatever options they’re considering, you want them to think of you as an expert resource.”

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Engaging Customers Through Community SolarBy Sue Kelly • President & CEO, American Public Power Association

PUBLIC POWER LINES

@CEOPublicPower • blog.publicpower.org

Solar Engagement Options for Public Power, a book published by APPA’s Demonstration of Energy & Efficiency Developments program, explains the four ways — purchased power, utility ownership, customer engagement and community solar — your utility can integrate solar into your energy mix.

An Introduction to Community Shared Solar Programs for Public Power Utilities, also offered by APPA’s DEED program,

explains the process for developing utility-driven solar projects with multiple participants who share ownership, costs and benefits. With case studies from different types of utilities, the publication explains how utilities that take or share leadership of solar projects can realize benefits, with limited risk.

APPA is here to help you handle the widespread inter-est in solar. We recently put together some key messages

and talking points for members to adapt and use to educate your customers, board and council members, media, and policymakers about solar DG.

Our latest book, Distributed Generation: A Guidebook for Public Power Utilities, pres-ents an overview of small-scale energy supply systems — thermal, renewable, fuel cell and energy storage technologies — and discusses a five-step process you can use to prepare for the poten-

tial outcomes of DG integration.And a new white paper, Rate

Design for Distributed Generation: Net Metering Alternatives, dis-cusses new rate designs that help you recoup more of your costs and encourage rooftop solar deployment.

In this very magazine, you’ll find tips and easy-to-read info-

graphics that you can reproduce and share with your customers. If you need anything else, just let

us know. APPA is here to help as you keep up with your community’s

changing needs and embody the true public power spirit of responsiveness

to customer needs.

4 Public Power / July-August 2015

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T O P - N O T C H L E A R N I N G A N D N E T W O R K I N G F O R U T I L I T Y P E R S O N N E LExecutive leadership • Legal • Accounting & finance • HR and administration • Operations & engineering

Utility Education & Training

Your One Stop Shop for All Business & Financial ConferenceSept. 13 – 16, New Orleans, LouisianaA refresher for seasoned professionals and in-depth learning for those new to utility business and administration. Five key tracks — Accounting & Finance, Customer Accounting & Services, Human Resources & Training, Information Technology, and Pricing & Market Analysis. Sessions on regulatory accounting, bonds and compliance, internal controls, GASB 68, management reporting, the EPA Clean Power Plan, financial forecasting, repurposing a power plant, and more.

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Fall Education InstituteOct. 5 – 9, Savannah, GeorgiaIn-depth training courses for all skill levels. Focus on a single topic or spend the week in multiple classes for comprehensive training and networking with peers. Earn CEUs, PDHs and CPEs, while receiving top-notch instruction from professionals with extensive public power experience. Courses in five tracks — Accounting, Cost of Service & Retail Rate Design, Performing a Utility Financial Check–Up, Key Accounts Certificate Program, Underground Distribution Systems and Executive Leadership.

Public Power Leadership WorkshopOct. 7–9, Savannah, GeorgiaOverview of challenges facing public power and the skills and knowledge leaders need to guide utilities through change. Ideal for seasoned, new, and aspiring general managers and CEOs. Learn where the industry is heading and how your peers are handling tough issues such as planning for strategic resources, ensuring a utility’s financial health and performance, managing change, and developing effective leadership styles for the future.


Legal SeminarOct. 11–14, Key West, FloridaProfessional development opportunity for in-house and outside counsel attorneys. Covers the latest legal and regulatory issues affecting public power as well as the practical legal issues facing municipal utilities. Essential learning and networking for anyone who oversees utility policy, including senior and mid-level utility managers and elected and appointed policymakers.

Customer Connections ConferenceOct. 18–21, Austin, TexasUnparalleled training and exchange of ideas in Customer Service, Economic Development, Energy Services, Key Accounts and Public Communications. Sessions on new trends and developments in creating a customer service culture, video production, social media, distributed generation, energy efficiency, community engagement and more.

***NEW***Public Power Forward SummitOct. 26–27, Alexandria, VirginiaAPPA’s new strategic plan tags the opportunities and challenges of the future — distributed generation, energy storage, microgrids, energy services utilities, and more — as “Public Power Forward.” Electricity industry technologies, customer perspectives, distribution models, government policies, the fuel mix and more are changing fast. What’s hype and what’s reality? Join APPA’s first-ever Public Power Forward Summit to preview the future. Explore the policies, programs and tools that will help public power utilities ride the wave of change.

T O P - N O T C H L E A R N I N G A N D N E T W O R K I N G F O R U T I L I T Y P E R S O N N E L • Customer service • Key accounts • Energy services • PR and communications • Economic development

W E B I N A R S

A C C O U N T I N G & F I N A N C E S E R I E S

Industry Trends and Future Rate Structures / July 9

Sustainability Accounting and Reporting / Aug. 11

P U B L I C U T I L I T Y G O V E R N A N C E S E R I E S

Rate Making for Utility Boards and City Councils / July 14

O T H E R T O P I C A L W E B I N A R S

Negotiating Power Purchase Agreements: A Practical Guide / July 22

Protecting Public Power Utilities Eligibility for FEMA Assistance / July 28

In-House Training Program If it’s difficult for your staff and governing board to attend education courses outside of the office, let the APPA Academy come to you. We can bring any existing course to your facility or customize an agenda based on your needs. For more information, contact Heidi Lambert at 202/467-2921 or [email protected]



Ask us your questions about

#CommunitySolar @PublicPowerOrg


Public power was an early adopter of the community solar trend and continues to drive its popularity.

By Elisa Wood, Contributing Writer

Community Solar Gardens Find Fertile Ground in Public Power


People like solar energy, but not everyone has a sunny roof-top or the money for solar panels. Until recently, that pre-vented a large swath of Americans from going solar.

But no more. Community solar — also known as solar gardens — provides a way to bring solar to just about anyone. So not surprisingly, it’s making its way into utility markets at a road-runner pace.

The Solar Electric Power Association has been tracking the phenomenon — or at least making a valiant effort to do so.

Growth is occurring so quickly that “it’s hard to polish something up for public consumption without it being dated before it’s even released,” said Becky Campbell, SEPA senior research manager. “It’s frustrating, but it’s a great frustration to have — this market segment is exploding.”

Strong credit goes to publicly owned utilities for driving the trend early — and doing so still.

Take for example Seattle City Light. The Washington utility championed the idea well before most had heard of it, and has created four community solar projects with more than 1,300 participants.

Seattle City Light traces its community solar program to 2008 when it was designated by the U.S. Department of En-ergy as one of 25 Solar America Cities.

At the time, the municipal utility had some pro-solar ini-tiatives. But Seattle had an image problem. Few of its resi-dents thought to pursue solar. Who would in a place where it’s cloudy so often?

So the city formed what it called the Emerald City Solar Initiative, a team of experts in renewable energy, project

development, policy, advocacy and public outreach. The goal was to make the public aware that Seattle had even more solar potential than Germany, the world leader in so-lar development.

Among other things, the group helped push forward legislation that allowed community solar to receive a pro-duction incentive.

Seattle’s community solar program works in a fairly straightforward way. The utility pays the upfront cost to build and maintain a solar array, which feeds into the electric grid. Community members buy shares in the output for $150 each.

Customers in turn are paid back for the investment through state and utility production credits that run through 2020. The credits are $1.08/kWh from the state and $0.0764/kWh from Seattle City Light. Ownership will be transferred in 2020 over to the customers, who are able to take advantage of the stable-priced solar electricity.

In March 2012 Seattle City Light completed its first community solar project at Jefferson Park where 23.4 kW of rooftop solar is installed on three picnic shelters. The utility sold 471 shares in the project.

The utility’s next project signaled just how popular community solar would become. Seattle City Light offered 1,850 shares in a 44.4-kW system installed on the Seat-tle Aquarium’s south-facing roof in December 2013. The shares sold out in six weeks.

Since then, Seattle City Light has installed two more community solar projects.

Continued on page 16


What Is Community Solar?Modeled after the idea of the community vegetable garden, community solar gives homeowners and businesses an alternative to installing solar on their own premises. The solar project instead is built in a central location and its benefits are shared among many participants.

Exactly how it’s done varies, often based on state law or utility preferences.

Projects are typically grid-connected and may be operated or hosted by utilities, solar developers, property owners, schools, nonprofits or others. In its purest form, the concept leads to ownership of the facility by those who buy shares or units in a project.

The owners gain various benefits from the project, most notably clean energy at stable pricing over a long term. They or their financial partners also might gain economic benefit through tax credits or other incentives.

In some states, like Massachusetts, virtual net metering helps spur community solar. Virtual net metering allows several households or businesses to share the net metering credits generated by a facility although the solar panels are somewhere off-site.

The National Renewable Energy Laboratory estimates that 49 percent of U.S. households cannot access solar for various reasons. Perhaps they are renters or their rooftops are shaded. Community solar opens up the possibility of extending solar to all consumers.

With solar prices dropping, the community solar concept has taken off over the last five years. Community solar grew 150 percent from 2013 to 2014 alone, according to SEPA, which has identified 85 utility programs — both public and investor-owned.

“I actually think that’s a very conservative figure. The co-ops have been especially tricky to track as they often don’t attract a lot of national attention with new programs. SEPA is hoping to do some closer coordination with organizations like APPA and NRECA so that we can ensure we have the best data available to share with utilities,” said Becky Campbell, SEPA senior research manager.

Community power and publicly owned power have proven to be especially compatible, given their laser focus on the customer. Not subject to the same regulatory burden as investor-owned utilities, “public power utilities have been a little more nimble at getting programs pulled together through a fairly streamlined timeline,” Campbell said. n

Read moreLearn about rate models for utilities on page 20

Learn more from Captain Public Power on the inside back cover.


Community Solar Makes Participation Affordable in DelawareCommunity solar has helped the Delaware Municipal Electric Corporation take strides toward meeting the state renewable portfolio standard — but it’s done a lot more, too.

The joint action agency, which serves nine municipal utilities in Delaware, could have purchased renewable energy credits to meet the RPS. But it wanted to use the RPS to bring solar to communities, according to Scott Lynch, energy services manager.

Moreover, DEMEC saw an opportunity to fill a “hole” in solar availability, Lynch said. Solar has largely been a “doctor or lawyer” product; it’s not been affordable to the average person.

So DEMEC decided it was going to make solar affordable for all and found an innovative way to do so.

Each participant pays a low entry fee of $50 to join a community solar project. The money is used to install energy efficiency measures that will benefit the entire community, such as LED street lighting. The money saved through the energy efficiency benefits everyone in the community, even if they don’t participate in the community solar project, Lynch said.

DEMEC also set up the program so that it can accept financial donations from those who want to give community solar an extra boost.

In addition, the community solar project offers its output below retail market rates. The program is able to keep costs down because the community solar projects avoid several costs, such as the utility’s need to buy SRECs and provide net metering credits.

As a result, the program offers blocks of solar to community participants at one cent less than they would otherwise pay for electricity.

“Because we have all of these savings, we buy down the cost of the system for the customer,” Lynch said. “If you do the math, in just over four years, participation pays for itself at a faster rate than if a customer owned the system, and there is no maintenance.”

In addition, the approach is so administratively easy the cost is too small to measure, he said.

The approach turns the table for solar. Typically, solar is a premium product. But by factoring in true system costs and savings, DEMEC has found an innovative way bring the cost below market. n

A 15-MW solar project in Milford, Delaware, was completed in 2012. The Delaware Municipal Electric Corporation purchases all the power generated by the project. Photo courtesy of DEMEC.


Resources from APPAAPPA wants to help you be prepared to handle the widespread

interest in solar. We’ve put together some tools and templates

to help.

You can access the resources listed below at PublicPower.org

under Topics/Distributed Resources.

• SolarDGKeyMessages

Talking points for utilities to adapt and use to educate

customers, board and council members,

media and policymakers about solar DG.

• MakingSolarWorkforYou

Blog post by Michele Suddleson,

APPA’s DEED program director, on

the four common business models —

purchased power, utility ownership,

customer engagement and community

solar — public power utilities are

using to offer solar to customers. The

blog summarizes a DEED book, Solar

Engagement Options for Public Power

Utilities.

• DistributedGeneration: AGuidebookforPublicPower

Utilities

New APPA book that presents an

overview of small-scale energy supply

systems — thermal, renewable, fuel

cell and energy storage technologies —

and discusses how utilities can craft a

strategic response and follow a five-step

process to prepare for a full range of

potential outcomes from DG integration.

• DistributedGeneration: AnOverviewofRecentPolicyandMarket Developments

APPA white paper examines how

utilities can encourage DG development

without unduly burdening other

customers or adversely impacting utility

operations and fiscal stability.

• DistributedGenerationIssueBrief

Backgrounder for policymakers describes the basics of DG and

summarizes Congressional activity and APPA’s position.

• CommunitySolarCaseStudies

APPA’s Public Power Daily and Public Power Weekly include

multiple feature stories on community solar projects of various

sizes implemented by public power utilities and joint action

agencies around the country.

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It is a special landmark time in our organization. This year, the American Public Power Association is celebrating its 75th anniversary as a national organization.

Our 75th anniversary is an opportunity to look back at the roots laid by

our founders. It’s an opportunity to reflect on what we as public power have achieved in the face of tremendous challenges over the years. We’ve emerged from many battles stronger and more successful than ever. We won because we came together and leveraged our strength in numbers. We focused on the public good.

Our tenacity, our resilience, and our strength come from

Let’s Give the Gift of Electricity to Save Lives:Fund a Solar Suitcase and Dispel the DarknessBy Paula DiFonzoImmediate Past Board Chair, APPA and CEO, New Braunfels Utilities, Texas

our purpose and vision founded and grounded in our community service and community-owned principles. And here we are today, serving one in seven of America’s electricity customers in more than 2,000 towns and cities.

Even as we celebrate our successes and prepare to take on new challenges, we want to think beyond ourselves, to those who are less privileged.

APPA saw our 75th anniversary as an opportunity to give to a worthy charitable cause relevant to our core mission. After much exploring, we identified We Care Solar, a global project that powers the less privileged.

We Care Solar is a nonprofit organization founded by an OB-GYN and energy educator to save the lives of mothers and newborns in developing countries. Maternal mortality accounts for 300,000 deaths a year in developing countries. Many deaths occur because sporadic electricity impairs the operation of surgical wards, delivery wards,

Nurse Christine Wanyana poses with a Solar Suitcase at Bussi Health Centre 3 on Bussi Island in Uganda. (Photo by Jake Lyell).

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essential hospital equipment and hospital communications.

So We Care Solar designed a compact solar electric system that fits in a suitcase. The portable solar suitcase includes solar panels, a battery, charge controller, outlets, and LED lights. It can also be expanded to power larger medical equipment. We Care Solar provides training, monitoring and on-site servicing of the solar suitcases through staff and local field partners. Suitcases are deployed in 24 countries including Haiti, Liberia, Uganda, Sierra Leone and Malawi. This year, We Care Solar plans to expand its programs into Ethiopia, Tanzania and the Philippines.

Solar suitcases have saved many lives and prevented health complications. Improved lighting is essential for health workers to treat patients and allows emergency C-sections to be performed at night. Solar-powered cell phones allow nurses to alert medical teams when obstetric emergencies arise. With blood bank refrigeration, lifesaving transfusions

APPA’s new online system makes applying a breeze!

Find out how reliable your utility is. Submit your Reliable Public Power Provider (RP3) application by September 30.

RP3-designated utilities enjoy many benefits, including:• National recognition as a safe and reliable utility• Cost savings on workers compensation and insurance• Improved bond ratings• Community respect and appreciation for keeping the lights on

For information on RP3 and to apply online, visit www.PublicPower.org/RP3 or contact [email protected].

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occur without delay.

The cost of a solar suitcase is about $1,500. The cost of deploying the suitcase — including shipping and training people in how to use it — is about $2,500.

With the budget we have, APPA can fund the deployment of two solar suitcases. I urge you to give as you can to supplement public power’s contribution. Information about how to give is on APPA’s website at PublicPower.org/GiveSolar.

The public power spirit of giving — whether in our communities around the country where we serve diverse customers, or in parts of the world that need the gift of power — is who we are.

As Dr. Seuss says, “Unless someone like you cares a whole awful lot, nothing is going to get better. It’s not.” So thank you for caring and for considering giving to those in need. n


The 74.79 kW Phinney Ridge Project is the state’s largest community solar installation. Housed on a historic building and at the Woodland Park Zoo, the project went online in October 2014 and has sold out its 2,671 shares.

The latest installation, a 25.92 kW project, began operat-ing late last year in the Capitol Hill EcoDistrict, and is also sold out with 925 shares. The project is a testing ground for sustainability in a densely populated urban area. The solar panels are installed on a 30-unit affordable housing apart-ment building.

Suzanne DuRard, who manages the community solar program at Seattle City Light, sees many advantages to the program.

The low $150/share cost of entry allows a broad segment of customers to participate, not just those with disposable income. This aligns with the city’s social goals, she said.

“And because those community solar participants are see-ing annual credits on their electric bills, they are also poten-tially more open to messages about conservation, as they look for ways to make those credits go farther,” DuRard added.

Seattle can claim early market entry. But so can the state of Colorado, which has developed into a kind of hub for com-munity solar, in part because it is home to the Solar Gardens

Institute, which provides advocacy for community solar.Colorado is also home to the company often credited with

getting the community solar concept off the ground, Clean Energy Collective, which helps utilities develop community solar. One of the original developers of the community solar concept, CEC, led the way working out many of the gnarly legal and economic issues associated with developing the projects.

“Community solar is a simple concept. But it is very dif-ficult to implement,” said Paul Spencer, CEC founder and president. Among other things, projects often must carefully navigate tax code and Securities & Exchange Commission regulation.

CEC’s first community solar project was built in 2010. The 338-panel array in western Colorado was “subscribed out overnight to 19 different people,” Spencer said. The company now works with 18 utility partners in eight states and has 51 projects to its credit. These include two publicly owned projects.

The Colorado Springs Utilities Community Solar Array is a 497-kW project with 2,210 panels, located on four acres of utility-owned property adjacent to a substation in Colorado Springs. The first part of the two-part project was completed

Continued from page 10


in December 2012. The second part will be built when the first is sold out.

Fort Collins Utilities Community Solar Ar-ray is a 620-kW project with 2,000 panels on a six-acre brownfield site. The project was ini-tially going to be 330-kW. But early demand prompted CEC to nearly double the final sys-tem capacity. CEC expects it to be finished this spring.

Several other municipal utilities, coopera-tives, joint action agencies and publicly owned utilities have since either installed community solar or are on the way to doing so.

The Delaware Municipal Electric Corpora-tion has several projects developed or up and running. The projects are successful, in part, because of a unique approach the joint action agency took.

These include: • A 10-MW Dover SUN Park. The first com-

munity solar project in the region, it supplies enough power for over 1,700 homes.

• The 15-MW community solar farm in the city of Milford. Built on 80 acres in Kent Coun-ty, Delaware. The $50 million project complet-ed construction in the fourth quarter of 2012.

• The 230-kW McKees Solar Park is on a former landfill in Newark, Delaware. The city invested $600,000 in the project.

Meanwhile, Austin Energy in June negoti-ated an agreement for a 3 MW community so-lar installation. The request for proposals drew healthy bidding — about a dozen companies offered more than 20 proposals, according to Danielle Murray, the utility’s manager of solar energy services.

A private company, chosen from a request for proposals, will build the ground-mounted proj-ect near a substation on a 26-acre site owned by the utility. The Austin project includes solar storage to provide voltage and reactive power that will help modulate the renewable energy.

The project “will barely begin to scratch the demand” for community solar in Austin, Mur-ray said. Austin is known for its green leanings. But the city also has many shady heritage trees that prevent rooftop solar.

Austin Energy views community solar as

a service “that will improve customer service and satisfaction,” Murray said.

Several other publicly owned utilities share Austin’s view. Projects are operating or being developed in a diverse array of cities: Kalona, Iowa; Orlando, Florida; San Antonio, Texas; Springfield, Missouri and Los Angeles and Palo Alto, California, to name a few.

“We’re really seeing growth all over, but what’s interesting is that we’re seeing growth in states that aren’t widely recognized for past

solar developments. Programs have started to emerge in places like Iowa and Indiana. States that have some form of enabling legislation continue to be popular — Minnesota, Mas-sachusetts, Colorado,” said SEPA’s Campbell.

So five years after the U.S. saw its first com-munity solar gardens spring up, the seeds are still spreading, and the full bloom has yet to come. When it does, publicly owned power will be known as one of its master gardeners. n

Read moreSee page 28 to read about customers at Colorado Springs Utilities

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Share this infographic with your customers. To request

a digital version, email [email protected]


Selecting from the distributed generation rate menu

By Laura D’AlessandroIntegrated Media Editor, APPA

Healthy Choices


Choosing the best distributed generation rate design for your utility depends largely on your community.


no standard, according to a whitepaper from ICF International. The paper said calculations used to find the true value of solar are “all over the map.” The consulting firm proposed its own ap-proach to fully capture the value of distributed generation of all types, which includes assessing avoided energy generation, avoided or deferred generation capacity, avoided transmission and distribution losses and capacity, grid support services provided by the generation and envi-ronmental value as an emissions-free source.

The Austin AlgorithmAustin Energy is one public power utility that has put its own formula and number on the

true value of solar. The utility worked with Clean Power Research to develop a rate that incorporates six value components. Similar to what ICF found in surveying traditional value of solar components, Austin included in its algorithm loss savings, energy savings, generation capacity savings, fuel price hedge, transmission and distribution capacity savings, and environmental benefits.

Through Austin’s program, customers are billed for their total energy use at the retail elec-tric rate and then receive credit from the utility for their solar production at the rate calculated through the algorithm. Austin implemented this rate structure in 2012. ICF suggests utili-ties using such calculations evaluate them fre-quently — Austin has done so annually since adopting the rate structure.

In reviewing its rate structure for solar cus-tomers, Austin found that the value of solar has fluctuated annually due to natural gas futures prices, which impact the calculation on energy savings and fuel price hedging. In 2014, Austin modified its review to address concerns about the tariff’s volatility. Natural gas futures prices are now evaluated at five-year rolling averages. Before adopting this methodology, Austin used a net metering rate structure.

Nothing but net meteringUtilities more commonly choose — or at least start out with — net metering as the rate structure for their solar customers. Net metering simply credits customers for the amount of energy they produce beyond their consumption and export to the grid.

In Lakeland, Florida, for example, the pub-lic power utility operated under a standard net metering tariff for several years. Customers with

solar installations were charged for each kWh they received from the utility on a monthly basis, but also credited for each kWh they sent to the utility, and the credit was the same as the energy charge.

Through routine cost of service and pricing analysis,

For many utilities, solar is all about

the customer. Customers are inundated with flyers and mailers that say they should go solar today — and that they can even save money by doing so. As a result, many customers want solar, and utilities have to facilitate their needs. What customers often don’t understand is just how that investment affects their bill.

Thus, as distributed generation, particularly rooftop and community solar, grows at an in-creasing rate, utilities must more frequently confront the question of how best to value its output for customers.

But like any decision a municipality makes, the answer truly hinges on what’s best for the community and is determined by its character and needs. Factors include locally specific costs and benefits, applicable subsidies and the de-gree of cost shifting among utility customers, all of which must be kept in balance with paro-chial interests and customer perspectives. With so many variables, many of which are based on public perception, communities can expect considerable debate.

Looking for true valueSome utilities may choose to simply value solar generation at the same retail price that it sells power to its customer — about 12 cents per kilowatt-hour as of February 2015, according to the Energy Information Administration. But some experts would argue that the retail price for existing generation and that of new distributed solar generation don’t match.

Many factors can go into calculating what is considered the true value assigned to the solar energy that customers are producing. Common factors considered include the energy generation avoided at other sources, avoided or deferred generation capacity from other sources, avoided transmission and distri-bution losses, grid sup-port services, and finan-cial hedging. Other, less straightforward factors include social values and environmental costs and benefits.

As to which factors utilities should include in their calculation, there is

What is net metering? Net metering is a rate mechanism that credits customers for the amount of energy they produce beyond what they use; it pays them for what they export to the grid. Read more about net metering on page 34.

Finding the True Value of Solar, an infographic, is available on PublicPower.org under News>Public Power Magazine


Lakeland found that the standard net metering structure it was using did not properly align fixed revenue and fixed costs. So, the utility changed the structure.

Under the new tariff, which is set to take effect for new PV customers in October 2015, owners or leasers of solar photovoltaic systems will pay a separate demand pricing rate. They will still be credited at the regular retail energy rate, though that rate will be lower. The tariff includes what is called a demand charge. For Lakeland, that charge is based on the maxi-mum, 30-minute integrated kilowatt demand for the month, which is meant to represent the capacity that the utility needs on standby to serve the customer.

Pay to playThe demand charge employed by Lakeland is one way for utilities to recoup the costs of doing business with solar customers. The charge enables solar customers to continue to receive billing credits that are the same as their energy charge, but they will pay a higher proportion of their overall cost to the utility.

Similarly, Santee Cooper in South Carolina added a demand charge to its net metering pro-gram. Santee Cooper’s solar customers pay a $24-per-month charge as well as an on-peak demand charge of $11.34/kW per month and an off-peak demand charge of $4.85/kW per month. Energy credits and energy charges are also calculated at on-peak and off-peak rates.

Ratepayers reactWhile it would seem likely that ratepayers would shy away from anything that would bring more charges to their bills, utilities that have instituted demand charges or calculated the value of solar have encountered favorable results.

Lakeland Electric held a series of workshops with community stakeholders before imple-menting its demand charge. The reaction has been positive, the utility said. It continues to monitor the tariff’s performance and will make changes as necessary.

Austin Energy’s program has been viewed fa-vorably, especially within the solar community, the utility said. Other utilities instituting similar rate structures have used Austin’s structure as a model. n

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751383_Hendrix.indd 1 6/26/15 10:41 PM




Through the Sunglasses

Customer Perspectives on Community Solar


By Ethan HowlandContributing Writer

Being geeky about energy, Di Graski and her husband were disappointed when they found out about 10 years ago that their home wasn’t ideal for solar panels.

Then when their utility — Colorado Springs Utilities — started a community solar pilot proj-ect, the couple pounced and became one of the first to sign up to buy electricity from two pan-els at the Venetucci solar farm, which came online in late 2011.

“The panels were wisely situated and we avoided the expenses related to net metering,” Graski said. “We were thrilled.”

So thrilled that Graski and her husband signed up to buy the elec-tricity from 11 more panels. The community solar purchases essen-tially cover all the electricity for their home and hybrid car, Graski said.

Graski views her participation in the CSU community solar program as a way to encour-age a shift toward renewable energy in the United States. “We want to be part of that group that says we believe we can do it,” Graski said. “We’re excited about the breakthroughs in the technology.”

Nick Kittle, a residential customer who also participates in the Venetucci solar farm, said his interest in solar was spurred by a basic philoso-

phy about energy. “Clean energy was important to me and my family,” he said.

But Kittle also believes that community so-lar offers some practical advantages. He pointed to his ability to hedge the risk that his electrici-ty bills would increase over time. “This is about doing what energy companies do at a personal level: hedging your risk,” he said. “Fixing a por-

tion of your cost and knowing what it looks like for 20 years.”

Through CSU’s community solar program, Kittle entered into a 20-year contract for the output from two panels at the Venetucci proj-ect, which will have a roughly 10-year payback period, he said.

Also, under the CSU community solar pro-gram, residential customers can keep their stake in the solar panels when they move, Kittle said. And if a program participant decides the program is no longer for them, they can sell

their share to someone else, he explained.“It was transferable, which was a huge advan-

tage for us,” he said. “You could treat it like an asset and sell it.”

Saving money is the main reason homeown-ers consider buying “clean” energy, according to a survey released in April that was conducted by Zogby Analytics for SolarCity, a solar develop-

er, and Clean Edge, a research firm. Eighty-two percent of the survey re-spondents said they were primarily motivated by lowering the electricity costs when considering renewable energy. About 34 percent said cutting their environmental impact was their top priority, according to the survey, which let customers pick two top rea-sons for considering renewables.

When asked about solar, 64 percent said sav-ing money on their electric bill would have the highest impact on their decision to install solar panels.

Cost appears to be the top consideration for homeowners, such as Graski and Kittle, but cus-tomer concerns about the environment also play a role in their decisions, according to the Solar City survey. About 65 percent of Americans con-sider environmental issues at least sometimes when making big-ticket purchasing decisions and 75 percent of respondents say they take at


Photo courtesy of SunShare.

“We want to be part of that group that says we believe we can do it,” Graski said. “We’re excited about the breakthroughs in the technology.”


least some actions to help reduce greenhouse gas emissions, according to the survey.

It’s not just homeowners jumping into com-munity solar. Last year, Adams County, which borders Denver, signed up to participate in a community solar project developed by Sun-Share, the same company that built the CSU so-lar farms, according to Kittle, who is the coun-ty’s performance, innovation and sustainability manager.

For Adams County, the initial case for par-ticipating in community solar was financial, according to Kittle. The county was able to use the solar energy to offset the electricity used at seven county facilities that had especially high demand charges. Cutting the demand charges meant there was no upfront cost to joining the community solar program offered by Xcel En-ergy. The county expects to lower its electric bill by about $300,000 over 20 years, Kittle said.

So how are utilities responding to the de-mand for community solar? First, they are quickly expanding their programs.

In Colorado, CSU is finishing up its 2-MW pilot project, with SunShare building a final 500-kW facility under the program. The pilot was open to residential customers and schools.

The utility is doubling the size of the pro-gram and opening it up to all customer classes. SunShare, which won a solicitation process, is building the new capacity.

In California, the Sacramento Municipal Utility District is also moving from a pilot phase to a permanent program, according to Jim Burke, manager of the utility’s SolarShares pro-gram, which started in 2008 as one of the first community solar programs in the United States.

Partly driven by demand from commercial and industrial customers, SMUD plans to grow the program to 75 MW by the end of the de-cade, up from 1 MW now, according to Burke. “I think it’s got huge potential,” he said.

In a sign of customer interest, the utility al-ready has received tentative commitments on about 9 MW from industrial customers, he said.

SMUD designed its community program to make solar available to anyone, Burke said. It’s less hassle than a rooftop system, the solar shares stay with a customer when they move and it runs on a month-to-month basis, allow-ing customers to easily drop out of the program, he said. Also, the program provides an option to

customers who want to support a faster deploy-ment of solar energy, according to Burke.

Burke said that although customers paid more for their electricity under the program, it was fully subscribed within six months and has never been less than 92 percent subscribed.

Based on a 2010 survey, SMUD found that cost was not a main concern when customers

were considering signing up for the SolarShares program, according to Burke. At 38 percent, fighting global warming and protecting the envi-ronment was the top reason for participating in the program, followed by participating in solar at 27 percent and encouraging solar production at 13 percent. Only 7 percent of customers said they wanted to save money. n

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741883_Power.indd 1 05/05/15 11:11 PM


Millions Stand Behind Solar PowerAmericans strongly support solar and think there should be a

larger role for the technology in the United States energy mix,

according to recent polls.

More Americans – 79 percent – think the United States should

put an increased emphasis on solar energy than any other power

source, according to a poll conducted in March by Gallup News

Service, a polling firm. In a sign that solar’s popularity may be

growing, 76 percent of Americans thought solar should get more

emphasis, according to a similar poll two years ago.

In contrast, 70 percent of the survey’s respondents thought wind

should get more emphasis, followed by natural gas at 55 percent,

oil at 41 percent, nuclear power at 35 percent and coal at

28 percent.

Another recent survey found similar attitudes toward solar.

When asked which energy sources were most important to the

future of the United States, solar came out on top with half of

the respondents selecting that fuel source, followed by wind at

42 percent, natural gas at 33 percent and energy efficiency at

25 percent, according to the results of a survey released in April

(respondents to the question could pick three top choices).

The top four energy sources came in the same rank among all

regions of the country, according to the survey conducted for


SolarCity, a solar developer, and Clean Edge, a research firm.

The survey found that support for solar and wind was similar

across all age groups, while the enthusiasm for natural gas and

nuclear power was less strong among younger people. Only

1 percent of people in the 18-24 age group thought nuclear power

was most important for America’s future.

Eighty percent of respondents said the United States should rely

more on solar, more than any other energy sources, according to a

poll conducted in December for Center for American Progress, a

liberal advocacy group. n

736609_TEA.indd 1 5/30/15 2:54 AM


and educate member utilities, facilitate shar-ing of concerns, assuage fears, and disseminate information.

During his term as APPA board chair, Hunt-er plans to focus on three things — leadership, strategic plan implementation, and growth in membership.

Cultivating leadersLeadership is key, explains Hunter, quoting John F. Kennedy who said, “Knowledge and leadership go hand in hand.” Hunter believes that people who know what’s going on tend to be the leaders. He wants every APPA member to be confident enough to be a leader because they know their community and their business best. “We need to educate our communities. We need to take on and solve the problems of our communities. That’s leadership.”

APPA gives members the knowledge and confidence to be leaders — what seems daunt-ing for members to take on becomes easier with the support of APPA experts, as Hunter himself has experienced. For example, APPA’s CEO Cli-mate Change and Generation Policy Task Force has already provided much guidance in prepar-ing for the Clean Power Plan.

It’s especially been his privilege to work with strong women in leadership, said Hunter. Caro-lyn McNeil, former general manager of UAMPS, was a wonderful mentor and leader early in his career. Today, he is honored to follow in the foot-steps of Paula DiFonzo, CEO of New Braunfels Utilities in Texas, who just completed her term as board chair. He also looks forward to work-ing closely with Sue Kelly, APPA’s first woman president and CEO.

Offering direction and support for imple-mentation of APPA’s strategic plan for 2016 - 2018, recently approved by the board, is another of Hunter’s priorities for his term as board chair.

Membership growth is a third area of fo-cus. “There are 2,000 public power utilities in America and 1,400 are APPA members. I want to help get the other 600 in,” he says. “APPA has always been a great organization but in recent years has been elevated to new levels of quality, accountability, and innovation.”

APPA’s high-quality conferences and educa-tional events such as the CEO Roundtable and the popular Reliable Public Power Provider pro-gram are examples of the leadership opportuni-ties the association offers, he said.

“My vision is that APPA be the nation’s pre-mier electricity association. I want every mem-ber of Congress to come to us first to get answers to their electricity questions.”

Making the most of itWith these lofty goals, it’s going to be a challenging year as Hunter juggles leadership of UAMPS and APPA. However he “feels up to it” and knows he can accomplish a lot, thanks to the support of staff at both associations. And thanks to the backing of his “wonderful life partner, Tana.”

“Tana lets me be the workaholic I like to be. I use weekends to catch up on all the work I can’t get done on weekdays,” says Hunter.

As much as he loves his work, Hunter does not let it get in the way of making the most of life. He likes to retreat to his home in a rural part of central Utah to recharge. His dogs are great friends and he enjoys walks and hikes with them. He’s also into bird watching. Hunter “reads a lot for work and pleasure.” He’s read-ing The Men Who United the States by Simon Winchester and The Sellout by Paul Beatty. And he “loves a good beer.”

Hunter looks forward to his year as APPA board chair and is deeply appreciative of the support of APPA and UAMPS staff, board and members.

“We’re all the same people and we do the same things but we do them differently. That’s what APPA represents and I’m looking forward to learning and contributing,” said Hunter. n

In June 2015, Doug Hunter, CEO of the Utah Associated Municipal Power Systems, was appointed board chair of the American Public Power Association. Hunter talked to Public Power magazine about his career in public power, priorities for APPA, and his philosophies on leadership and life.

Doug Hunter started his career in public power in April 1979 as assistant resource analyst for the Intermountain Consumer Power Associ-ation, a joint action agency for rural cooperative and municipal electric utilities.

“I quickly got infatuated with public power,” said Hunter. “I didn’t even know it existed. But the not-for-profit, community service aspects hit a tone with me.”

In October 1980, the cooperatives and public power utilities in the Intermountain Consumer Power Association split up to build their own power plants. UAMPS was formed and Hunter became the municipal resource analyst. As UAMPS grew, Hunter took on the roles of chief operating officer and then assistant general man-ager. In 1995, he became the general manager.

Under Hunter’s leadership, UAMPS has grown from 21 to 45 members in Utah, Arizona, California, Idaho, Nevada, New Mexico, Oregon and Wyoming.

Power in discussionHunter sees his UAMPS experience translating to APPA in his ability to facilitate discussion between members of different types and sizes.

“APPA is like a large joint action agency at the national level. APPA can do more to facilitate re-gional discussions among public power utilities given its leadership role and national perspec-tive,” Hunter said.

Hunter sees APPA’s staff expertise as a great strength and would like to facilitate these ex-perts spending more time in the field, visiting members and sharing knowledge and experi-ence. “Members are thrilled when APPA visits. I used to visit every UAMPS member at least once a year and now I have someone else do it be-cause I don’t have as much time,” he said.

Hunter believes APPA has already done a great job and can do even more to organize

The Many Dimensions of LeadershipA Conversation with Doug Hunter, APPA Board Chair, 2015-2016

By Meena Dayak, Vice President, Integrated Media & Communications, APPA

Read more about Hunter’s work with UAMPS on PublicPower.org


highly inflated price derived from net metering, a primitive and unsophisticated relic of the age of dumb prices.

The effect of the status quo on net metering is to require consumers to pay a higher price for a designated technology — distributed solar PV — and provide less market opportunity for other, more efficient producers. This is a point that was noted in a recent MIT study on “Future of Solar,” which stated that solar DG should not be given a price advantage over larger-scale, more efficient solar, and that pricing solar based on kilowatt hours produced, rather than stimulating solar energy could, in fact, impede its development. The logic is quite simple. Subsidizing without end a product that is inefficient and not competitive with other sources of comparable energy rewards lack of productivity and provides absolutely no incentive for improvement.

Utility-proposed alternatives to net metering would certainly not deprive solar generators of the right to compete. In fact, quite the opposite is the case. Utilities can enable solar PV to participate in the market on a fair, relatively level and open basis.

Many utilities are prepared to purchase any energy produced by distributed solar that is in excess of what is required on the premises of the solar host. In fact, this would provide some competitive advantage to distributed solar installations because it would provide an assurance of purchase without asking for a reciprocal commitment of guaranteed delivery.

If utilities pay all energy producers, large or small, central or distributed, at the locational market price, they have the advantage of bundling both transmission costs or savings and energy costs. It is a rather level playing field for all generators, with a slight advantage to distributed solar generation because it assures purchase without assured delivery. n

Read the full blog post, Net Metering: The Dark Cloud in a Sunny Sky, on blog.publicpower.org/sme

Solar photovoltaic technology can realize its full potential as a distributed generation resource and benefit all parties, especially electricity customers, only with updated pricing policies.

As solar takes hold with consumers, some vendors, accustomed to taking advantage of flaws in tariff structures to enhance their profits, paint utilities as the villains who want to keep the sun from shining on their customers. These vendors are seizing on the arcane nature of ratemaking to mislead the media and the public about costs and prices.

In reality, the growth of solar is impeded not by utilities but by well-intentioned but flawed policies and rate structures that have evolved with little or no thought in many states and fail to appropriately price the value and output of distributed solar.

Distributed solar generation has some very real benefits and long-term potential. The marginal costs of producing this energy are zero. Carbon emissions from the actual process of producing the energy itself, without taking the secondary effects into consideration, are also zero. The costs of solar PV panels have declined significantly in recent years, adding to its potential long-term viability, although as a recent study has pointed out, those reduced panels costs are being accompanied by increased installer charges which effectively preclude consumers from seeing the full savings associated with the declining costs.

In its current, most common configuration, however, solar PV has some drawbacks — it is intermittent, requiring backup from other generation sources. Its energy value is entirely dependent on when it is produced and its capacity value, given its intermittent availability is, at best, marginal.

To fully develop solar as a cost-effective energy resource, it is imperative to provide pricing that offers incentives for productivity and reliability. The objective should be price signals that incentivize efficiency and productivity, that result in cost savings for consumers, and that are not socially regressive.

Net energy metering reduces the competitiveness of the market. What some in the solar industry are seeking is not the right to compete, but rather the right to be compensated at arbitrarily high levels justified only by the

Net Metering: A Cautionary TaleBy Ashley BrownExecutive Director, Harvard Electricity Policy Group


Public Power Utilities Use Variety of Distributed Generation Rate DesignsBy Paul Ciampoli, News Director, APPA

WASHINGTON REPORT

A new report from the American Public Power Association details how a number of public power utilities have adopted new rate designs to serve distributed generation customers, with the designs either supplementing net metering by recouping more of their fixed costs through fixed charges or offering comprehensive alternatives to net metering.

APPA’s “Rate Design for Distributed Generation” report examines rate design options for solar and other DG. It discusses how utilities have educated customers about new rates, as well as how DG and non-DG customers responded.

“While the rate design options have some drawbacks and might not be technically feasible for all utilities, they offer the industry new models that account for the rate impacts of distributed generation,” the report states.

The report was prepared by Paul Zummo, manager of policy research and analysis at APPA.

“The report offers a variety of examples of how public power utilities are taking a number of innovative approaches to net metering alternatives and underscores the point that one size does not fit all when it comes to rate design and distributed generation,” Zummo said.

The use of DG, particularly rooftop solar photovoltaic, is growing fast, the report goes on to say, noting that as of October 2014, just under 8,000 megawatts of solar capacity was installed on residential and business rooftops across the U.S.

“The growth of DG has been spurred by environmental concerns and economic considerations. Federal and state tax incentives are a driving force behind solar PV installations and can together cover up to 70 percent of the total cost of solar panels in some states,” the report said. Declining solar panel prices have also fueled growth in rooftop solar. “Utility rate structures for distributed generation have provided a significant benefit to solar customers,” the report adds.

The report notes that most U.S. utilities use net metering to measure and compensate customers for the generation they produce.

“However net metering has several shortcomings and results in non-DG customers subsidizing DG customers,” the report said, pointing out that utilities have options other than traditional net metering.

Net metering “causes revenue shortfalls for utilities, and creates a situation where one class of customers is subsidizing another,” Zummo writes. “In the long run, this is untenable, especially as more customers install DG systems. Utilities should consider modified approaches to net metering, or completely new billing arrangements.”

Many public power utilities have adopted new rate designs to serve DG customers. “Some of these rate designs supplement net metering by recouping more of their fixed costs through fixed charges, while other de-signs provide comprehensive alternatives to net metering,” the report said.

Case studiesThe report includes a section that details how a number of public power utilities have adopted different rate designs to serve DG customers.

The case studies looked at the experiences of Austin Energy (Texas),

Lincoln Electric System (Nebraska), Lakeland Electric (Florida), Sacramento Municipal Utility District (California), City of Whitehall (Wisconsin), Santee Cooper (South Carolina), and Concord Light (Massachusetts).

The case studies show that these public utilities have taken a variety of paths in terms of net metering alternatives.

The report notes that Austin Energy is the only utility in the U.S. to have implemented a value of solar, or VOS, rate.

VOS is a measure of electric system attributes such as transmission costs, generation costs, environmental externalities, and other inputs, and of how distributed solar energy positively and negatively affects each.

“VOS is an effort to associate a quantifiable benefit with each kWh of distributed solar exported to the grid. Presumably, that number would become the kWh rate at which solar DG would be compensated,” the report explained.

“VOS represents a departure from net metering. Austin Energy’s VOS rate is based on a ‘buy-all, sell-all’ approach where the DG customer buys all of the electricity it consumes from the distribution utility at one rate, and then separately sells all of its distributed generation output to the utility at the VOS rate,” the report noted.

For its part, Lakeland, which has been operating under a traditional net metering tariff for several years, decided to modify its net metering program and establish a new tariff that incorporates a residential demand charge. The move came after the utility engaged in a rate analysis.

The report notes that the purpose of the modified tariff is to better align revenue to costs. “Residential demand charges will ensure solar PV customers receive a billing credit for surplus energy they provide to the utility, while paying a fixed charge for demands they place on the utility system, especially during peak hours,” the report said.

Utilities can’t afford to take “wait and see” approach A key point made in the report is that utilities cannot afford to sit on the sidelines when it comes to DG and rate design issues.

“We are beyond the initial stages of DG,” the report said. “More and more customers are installing DG, and there is no sign that this trend will slow in the immediate future. Utilities can no longer afford to take a wait and see approach when it comes to rate design, nor should they assume that their existing rate design — especially a net metering design that was adopted before the escalation in the number of DG installations — will suffice to recover the utility’s revenue requirements and send good price signals to its customers.” n

Read MoreFind the full report on publicpower.org under Topics>Distributed Resources.


ENGINEERING

No industry is immune to disruption and distributed en-ergy technologies could be one of the biggest disruptions to the electric utility industry. Public power utilities will be better positioned to meet this challenge if they proactively shape their approach rather than reactively respond to it.

Developing a DG strategy that aligns with customer needs and desires is particularly important for public power utilities as they are owned by customers and have community-based business models. A public power utility may face political pressure to encourage DG even if it reduces revenue or affects operational stability. The utility must fully understand the impacts of DG on its system and finances and be able to explain those impacts to its board, city council and community.

While DG is growing and impacting some utility markets, it is na-scent and causing minimal disruption in others. Some in the industry question whether the current attention indicates future proliferation of DG or simply the latest trend. Regardless, DG penetration is likely to continue, driven by factors that vary by state, service territory, and customer type.

Mass appealDG appeals to customers because it offers more choices. Residential and commercial customers are assessing DG alternatives for environ-mental, economic, reliability, power quality, or self-sufficiency benefits. Additionally, the upfront cost may be very low, especially for solar technologies. Cost declines can be attributed to economies of scale, lower equipment costs, technology efficiencies, reduction in soft costs, and the commercial maturing of third-party providers.

In the past, policy-driven economic support for DG — especially solar — and motivation to use renewable energy for environmental reasons led to the expansion of the DG market. While supportive poli-cies remain, DG’s value proposition is tied more to economics — tariff savings for customers, as well as perceived value of enhanced reliabil-ity and power quality.

Customer controlRate design and customers’ desire for more control over their energy supply will drive DG’s future growth as much as technology costs and regulation.

Well-designed, utility-owned DG can help the utility or system operator improve grid reliability by providing ancillary services like support for voltage and frequency, reactive power, and fast-start ramping. As independent, not-for-profit entities, public power utilities have the opportunity to include distributed resources in their genera-tion fleet and develop solutions fully aligned with customer needs. All else being equal, the lower cost of financing (because of high credit ratings) can allow public power to offer cost-competitive DG solutions compared to those that third parties can offer.

Come Out on the Front End of Distributed GenerationBy Ursula Schryver, Vice President, Education and Customer Programs, APPA

While public policy still plays an important role in the support of DG, particularly photovoltaic DG, utilities must understand the drivers of DG and the impacts and opportunities that may arise from increased DG adoption. As DG’s value proposition increases, so too do the prospects for a wide range of financial, planning, and operational impacts on electric utilities, which magnify with increasing levels of DG on a given utility’s system. n

Read more: Download the Distributed Generation Guidebook executive summary from PublicPower.org or order the book in the APPA product store.

725042_Krenz.indd 1 12/12/14 11:51 PM


Physical security standards are evolving and sharing is increasing between industry players, but the goal remains

the same: to secure the most critical assets and primary control centers. Any generation assets, whether centralized,

remote or distributed — think community solar installations — can and should be secured. Utilities can take steps to

minimize potential expenses due to vandalism, sabotage or malicious intrusions where these assets are located.

Three Steps To Keep Physical Assets SecureBy Puesh Kumar, Engineering & Operations Director, APPA

SECURITY

Deteranddetectthreats: The most effective

intrusion deterrents used by industry security

professionals include live video surveillance, smart

locks, access card systems, employee screening,

security fencing, locks, vehicle barriers, adequate

lighting, signage and guards.

Threatplanning: To create an intrusion plan,

assess threats and vulnerabilities, identify security

measures, create a method for observation,

identify random security measures, and decide

how to respond and communicate accordingly.

Reachout: Get help with your security planning

form the North American Electric Reliability

Corp, the Electricity Sector Information Sharing

and Analysis Center and the American Public

Power Association. Visit ESISAC.com to register

for the information sharing portal and report

malicious activity at [email protected] or call the

24-hour hotline, 404/442-9780.

123

717604_Sterling.indd 1 22/10/14 2:07 PM


NYPA CEO Takes Helm of Research Group’s Board at Pivotal TimeBy Laura D’Alessandro, Integrated Media Editor, APPA

INNOVATION

The New York Power Authority’s president and CEO has been select-ed as leader of the Electric Power Re-search Institute’s board of directors.

Gil Quiniones, who formerly served as vice chair of EPRI’s board, said he is looking forward to over-seeing the organization’s research while the industry is undergoing a transformation.

“We’re in the midst of innovation and rapid change in the industry,” Quiniones said. “I think EPRI’s role is to be that unbiased, inde-pendent R&D entity to help in the transformation.”

One issue at the forefront is distributed generation and its integra-tion into the grid. EPRI has already released several studies on the issue. Quiniones said the organization has “captured it perfectly.”

“Changes are happening and changes will be happening as we transform this power grid into what’s called the integrated grid,” he said. “Especially at the edge of the grid where you have distributed resources — whether they’re solar, demand response, energy efficiency — all of that is happening. EPRI’s role is to do the necessary R&D and technology innovation to enable that.”

EPRI was created in 1965 after a massive blackout in the Northeast left 30 million people without power. Since then, the institute has been looking for innovation through researching a range of issues that change with the times and technology. And that research, Quiniones said, is not for the benefit of the utility business, but rather for the people it serves.

“EPRI is a great institution — its mission in the end is really for the benefit of the public,” Quiniones said in an interview. “This is what people sometimes really miss about EPRI. People think it’s the R&D arm of the industry, of the utilities, and therefore its work is about enhancing the utilities. But really, EPRI’s mission is to do R&D in the electricity space for the benefit of the public.”

Quiniones said EPRI’s work is even more relevant as the grid changes and evolves with new technology, customer preferences and regulatory changes.

NYPA has been leading distributed generation innovation, as well. The utility is working on developing a laboratory devoted to energy technol-ogy innovation and rapid deployment of smart-grid technology. NYPA was also recently selected to participate in the first phase of the PY Prize Community Microgrid Competition. n

R

DEED membersFall cycle grant applications are due August 15. For more information or to apply visit publicpower.org/DEED or contact us at [email protected] or 202/467-2960.

Access forward thinking.

Transcend commodity engineering. For decades, the experts at Leidos have helped utilities optimize operations and prepare for what’s next. Our solutions in system planning, grid engineering, and Smart Grid as a Service transform your utility, with the future always in mind.

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749427_Leidos.indd 1 27/05/15 12:35 PM


A rural community in North Carolina, Kings Mountain, has owned and operated its own utility system for more than 100 years and now serves about 6,000 electric, natural gas and water/sewer customers. A former tex-tile area on the North and South Carolina borders, Kings Mountain has developed a successful formula that combines technology and a progressive outlook to attract a mix of new industry.

The city’s electric, water and natural gas services are monitored and managed utilizing an advanced metering infrastructure system for assis-tance. The city’s leadership determined that the rollout of these technolo-gies would be open and transparent to make sure the community not only accepted the new technology, but also welcomed it.

“About four years ago, the city of Kings Mountain evaluated its then-manual meter reading system. With one supervisor and three meter read-ers, the data collection was accurate with a very low error rate. However, by reading each meter only once a month, the utility did not have suf-ficient usage data on hand to respond to high bill complaints or questions from customers in a manner that was acceptable to the city,” said Marilyn Sellers, city manager in Kings Mountain.

“To provide city staff and customers with more useful consumption data, as well as to improve cash flow for the utility, we evaluated the advanced metering systems suitable for utilities of our size,” said Holly Black, an engineering and compliance specialist with the city. “We con-ferred with our fellow members of ElectriCities of North Carolina and the American Public Power Association. We visited several AMI installations across the Southeast. Ultimately, we selected the AMI solution from the Leidos Engineering and Elster Team.”

Kings Mountain uses Smart Grid as a Service, a fully hosted and man-aged solution provided by Leidos that is built on the Elster EnergyAxis AMI system.

After working through a detailed pilot project, Kings Mountain fully deployed AMI for the electric and natural gas meters by January 2015. Full deployment of the advanced water meters will take several more months. “We are extremely excited as to what the end result will bring for us,” said Jean Wyte, the billing director for the city.

With the deployment of Leidos’ Smart Grid as a Service and the Elster AMI system, the staff of the Kings Mountain Energy and Water Depart-ment said it is working more efficiently and finding it much easier to an-swer questions from customers. “Our customer service representatives can call up on the utility web portal very detailed data covering 13 months of usage, correlated with weather data for each day,” Sellers said. “We can help customers understand what was happening at certain times of the month to drive up their charges, which was particularly valuable during this past winter when temperatures were unusually low.”

In addition to the web portal for utility personnel, Kings Mountain maintains a web-based smart meter portal through which customers may log in to view their account history and usage data.

“With data being collected at 15-minute intervals 24/7, we are now

Making Advanced Metering Infrastructure Work for a Small UtilityBy Susan Ryba, Hometown Connections

RESOURCES

able to engage in a very positive dialog with our residential and com-mercial customers,” said Dennis Wells, water resources director. “For example, along with explaining days of higher cost usage, we can look at the data and detect when water lines may be leaking or heat pumps short cycling. Ultimately, we are able to suggest solutions for helping our customers better manage their energy costs.”

The Kings Mountain Energy Department maintains a very robust SCADA system. The SCADA system coupled with the data from the AMI system enables the utility to better pinpoint trouble spots and improve its outage management capabilities.

As a region that has lost textile manufacturing, Kings Mountain views advanced technology deployments as critical to its economic develop-ment activities. For example, when the city decided to connect all of its facilities — including electric substations and natural gas regulator stations — with a fiber optic loop for data communications, it leased its unused dark fiber to local businesses at very competitive rates, said Mayor Rick Murphrey.

“Our community is very fortunate to be led by a city manager, mayor and city council members who share an understanding about the valu-able potential of new technologies,” said Nick Hendricks, energy services director. “As a case in point, our leadership believed that by deploying the AMI system, the energy department would be enhancing our mis-sion to provide safe and reliable services at the lowest cost possible using sound economic reasoning while protecting environmental resources.”

Hendricks said the city had three primary goals for the AMI system: for it to pay for itself, to impose no rate increase on customers, and to en-counter no reduction in personnel. “We are on track to achieve all three of these goals,” he said. n

Ad IndexAmerican Transmission Company .............................www.atcllc.com ........................................................5Asplundh Tree Expert Co. ........................................www.asplundh.com ..................................................17Burndy Electrical ........................................................www.burndy.com ......................................................1GridLiance .................................................................www.gridliance.com ....................................................2Hendrix Wire & Cable, Inc. .....................................www.hendrix-wc.com ................................................ 23Krenz & Company Inc..............................................www.krenzvent.com .................................................35Leidos Corporation ...............................................www.leidos.com/activate ............................................. 37PhoneTree® .................................................... www.phonetree.com/APPA2015 ........................................14Power Engineers .................................................. www.powereng.com/pd .....................Inside Front CoverPower System Engineering, Inc. ...........................www.powersystem.org ...............................................29Solar Power International 2015 ...................www.solarpowerinternational.com ..................................... 39Sterling Security Systems ..................................www.sterlingpadlocks.com ...........................................36TEA - The Energy Authority .........................................www.teainc.org ..................................................... 31Thomas & Betts ...............................................www.tnb.com/stormhardening ............Outside Back CoverUtilismart Corporation ..........................................www.utilismartcorp.com ..............................................13

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Cedar Falls, Iowa

Cedar Falls Utilities was nationally recognized in 2014 when President Barack Obama visited to high-light community broadband, but the Iowa utility has been providing electric service for more than 100 years. Innovation has colored its history since long before community broadband.

Meeting fast growing load is a challenge for many utilities. In 1973, load in Cedar Falls was growing at 7 percent per year. The utility made a watershed decision in 1973 when it decided to partner with an investor-owned utility that was planning a new 600-megawatt gen-eration plant in the state. Cedar Falls invested in the plant and transmission lines. The utility was the first munici-pal utility in Iowa to partner with an IOU in this way.

In Cedar Falls, the community un-derstands and values the advantages of public power. Community ownership gives the utility a measure of control over its own density — which is why Cedar Falls owns not only its electric utility, but also water, natural gas and broadband. Delivering value to its com-munity is how Cedar Falls measures its success.

The utility completed a three-year upgrade to its broadband system in 2013 that replaced the 1995 system. The upgrade made gigabit Internet ser-vice available throughout its footprint and became Iowa’s first gigabit city. The city’s next project is community solar, slated for construction this fall. Depending on the level of inter-est, Cedar Falls expects to build 500 to 1,500 kW of solar capacity through the project. n


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