Colorados Solar Policies

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Colorados Solar Policies

• Western Solar Policy Dialogue
• WCPSC Meeting 2008
• Presentation of
• Ron Binz, Chairman
• Colorado Public Utilities Commission
• June 15, 2008

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Outline of this presentation

• Introduction to the Colorado PUC
• The Colorado Solar Energy Story
• Solar Drivers
• Solar Progress
• Solar Impediments
• Solar Opportunities
• Lessons learned

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Caveat

• I am one of three equal commissioners
• My positions are my own
• I am confused by many things and have not made up
  my mind on much at all
• I dont even agree with some of the things I say
• Good advice

dont believe everything you think
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The Colorado PUC
The Public Utilities Commission's mission is to
achieve a flexible regulatory environment that
provides safe, reliable and quality services to
utility customers on just and reasonable terms,
while managing the transition to effective
competition where appropriate.

• Independent agency, created in the constitution
• Three Commissioners, appointed by the Governor
• Four year terms
• Partly judicial, partly legislative
• Ninety-member staff is an agency within the
  Department of Regulatory Agencies

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Colorado Commissioners
Matt Baker
Ron Binz
Jim Tarpey
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What are the primary drivers behind the desire to
increase solar activity in your state?    What
is the level of consumer demand or RPS-driven
demand for utility solar generation in your
state? For all those who claim solar is just too
expensive, how are you making it a cost-effective
generation option?  How are the utilities under
your regulation thinking about integrating solar
resources into their business model? What were
the major implementation barriers with utilities
and then separately with the solar industry?
What suggestions do you have for others about
hashing out the complex details with utilities
and the solar industry? How have rising costs for
new generation, including the imminence of carbon
controls and/or taxes, changed utilities and
regulators outlook on solar generation? Are
there flaws in the implementation of policies,
incentives, or verification systems that you put
in place that you would caution other states to
avoid?
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Outline

• Introduction to the Colorado PUC
• The Colorado Solar Energy Story
• Solar Drivers
• Solar Progress
• Solar Impediments
• Solar Opportunities

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Solar Drivers in Colorado

• Voter-approved Renewable Energy Standard (2004)
• Solar set-aside
• Net metering required
• Rebate specified
• Rate impact cap
• Political Leadership
• Governor Ritter
• New Energy Economy (2006)
• Climate Change Action Plan (2008)
• General Assembly
• Doubled RES requirement to 20 (2007)
• Passed Utility Scale Solar Legislation (2008)

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Solar Drivers in Colorado, contd

• Regulatory Response of the Colorado Public
  Utilities Commission
• RES Rules (2006)
• Revised Resource Planning Rules (2007)
• The Commission Road Trip (2007)
• Public Service Company ERP Filing (2008)
• Xcel Energy moving from opposition to support
• Good solar resources
• Healthy solar industry
• Strong state research capability
• Acceptable rate impact

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• Reduce Colorados carbon emissions by 20 below
  2005 levels by 2020
• Reduce Colorados carbon emissions by 80 below
  2005 levels by 2050

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HB 1281 Colorados Renewable Energy Standard

• IOUs -- 20 renewables by 2020
• REAs, Munis -- 10 renewables by 2020
• For IOUs, 4 of renewables must be solar, half
  on-site
• 1.25x for in-state resources
• 1.5x for community-based projects
• 3.0x for REAs use of solar
• Maximum rate impact 2 for IOUs, 1 for Munis and
  REAs

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The Colorado Regulatory Response
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Elements Of A State Energy Strategy

• Boost Efficiency
• Customer education
• Utility engagement
• Rate structure changes
• Stress renewable resources
• Regulators and utilities with a commitment to
  addressing climate change
• State RPS
• Progressive resource planning at Commission
• Healthy renewables industry
• Advanced generation development
• Research and demonstration for carbon
  sequestration

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Resource Planning in Colorado
New Rule
Prior Rule

• Least Cost Planning

• Resource Planning

• Fuel Neutrality

• Clean Energy Preference

• Utility models new portfolio

• Independent Evaluator

• Utility selects bid resources

• Optional Post-bid Review

• New DSM emphasis

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PROGRESS
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Outline

• Introduction to the Colorado PUC
• The Colorado Solar Energy Story
• Solar Drivers
• Solar Progress
• Solar Opportunities
• Solar Impediments

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In 2007, Colorado ranked fourth in the nation,
behind California, New Jersey and Nevada, in the
amount of solar-power generation installed during
the year, according to SEIA (Solar Energy
Industries Association)
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Illustrative Solar Activity in Colorado

• 8.2 MW SunE Alamosa PV project online in 2007
• Numerous other larger PV projects
• Denver Federal Center (1 MW)
• Denver International Airport (2 MW)
• Fort Carson Army Base (2 MW)
• Belmar New Urban Development (1.7 MW)
• Residential and agricultural solar continues to
  grow
• Large utility-scale concentrating solar under
  consideration

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• Denver Museum of Nature and Science
• 100 KW Photovoltaic
• 134 MWh per year
• Hybrid Energy Group (Denver)

There's probably no better place in this country
to demonstrate the power of solar and wind energy
than Colorado. -- Denver Mayor John
Hickenlooper, 6/12/08
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• DIA Denvers airport
• 2.0 MW Photovoltaic
• Tied with Fresno as largestsolar at an airport
• 7.5 acres
• 3500 MWh/year
• WorldWater and Solar, Inc.MMA Renewable
  Ventures
• Ready for DemocraticNational Convention

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• Fort Carson US Army Base, Colorado Springs

• 2.0 MW Photovoltaic
• Largest Army solar facility
• 12 acre site of old landfill

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Outline

• Introduction to the Colorado PUC
• The Colorado Solar Energy Story
• Solar Drivers
• Solar Progress
• Solar Opportunities
• Solar Impediments

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Projected Colorado Electric Energy Growth
2007-2025
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The Take-Aways

• Colorados demand for electric energy services is
  projected to grow 60 in the next seventeen
  years.
• Think of this curve as demand for energy services
  denominated in kilowatt-hours
• Projection does not include transportation
  applications for electricity (plug-in hybrids).

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Colorado Electric Generation by Fuel
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Generation Fuels in Colorado
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EPRI Prism Analysis
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Progress of Concentrating
Concentrating solar w/storage

Other baseload (coal w CCS nuclear)
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Solar Electric Density

• Concentrating Solar
• 100 MW/square mile (Ken Zweibel)
• 128 MW/mile2 (Mark Mehos, NREL)
• 136 MW/mile2 (Solar One, Nevada)
• Photovoltaics
• 67 MW(dc)/mile2 (SunE Alamosa)
• 69 MW(dc)/mile2 (Nellis AFB)
• 171 MW(dc) mile2 (DIA)

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Solar Electric Density

• Use 100 MW(ac)/mile2
• Colorado Peak Integrated Demand 11GW
• Result 110 mile2 required land area

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2
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Testimony in the Pending Public Service Company
ERP
because we want to be able to effectively
manage the integration and development of
concentrating solar thermal with energy storage,
we request that the Commission limit the
acquisition of this new clean energy technology
to 600 MW during 2007-2015 and that it be
brought on line in increments over
time. -Rebuttal Testimony of Karen T. Hyde,
June 9, 2008
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IMPEDIMENTS
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Outline

• Introduction to the Colorado PUC
• The Colorado Solar Energy Story
• Solar Drivers
• Solar Progress
• Solar Opportunities
• Solar Impediments

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Solar Impediments (and growing pains)

• Uneven requirements across utilities
• RES levels
• Solar requirements
• Net metering policies
• Utility rebate requirement for on-site solar
• Rate structure challenges
• Industry fears of solar boom and bust
• Intra-industry competition
• Customer understanding and acceptance

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Types of Colorado Utilities
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THIS SECTION DOES NOT EXPAND OR CONTRACT THE
COMMISSION'S JURISDICTION OVER COOPERATIVE
ELECTRIC ASSOCIATIONS UNDER THIS TITLE.
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Are those alien crop circles...?
Rate Structure Issues
Joes, Colorado
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½ mile
126 acres
5.8 acres
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Electric Rate Structures

• Net metering rules apply in this situation
• meter spins backwards
• Commercial rate (up to 25 kW demand)
• 8.98 Service and Facility Charge
• 9.3 per kWh
• A 50 horsepower pump has a 40 kW demand
• Secondary General (above 25 kW demand)
• 25.00 Service and Facility Charge
• 14.77/Monthly Peak KW
• 3.0 per kWh

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New law effective July 1, 2008
(b) AS PART OF ANY INQUIRY OR INVESTIGATION INTO
RATE STRUCTURES OF REGULATED ELECTRIC UTILITIES
UNDERTAKEN ON OR BEFORE JULY 1, 2009, THE
COMMISSION SHALL CONSIDER WHETHER TO ADOPT RETAIL
RATE STRUCTURES THAT ENABLE THE USE OF SOLAR OR
OTHER RENEWABLE ENERGY RESOURCES IN AGRICULTURAL
APPLICATIONS, INCLUDING, BUT NOT LIMITED TO,
IRRIGATION PUMPING.
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Colorados Customer Incentive Docket

• Investigation of Rate Structures
• Seasonal rates
• Inverted-block rates
• Time of use rates
• Rate structures and renewable energy
• Impact of smart grid technologies

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Longer-term Health of the Colorado Solar Industry
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Customer Education
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Two 75-watt Compact Fluorescent Lights will
reduce CO2 emissions by One Metric Tonne over
their lifetime
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Income Distribution of Customers with Small
Solar Installations
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Why should we subsidize rich people to put solar
panels on their roof?

• Solar must be seen as a system resource
• Solar adopters are system solar hosts
• We must decode the subsidy notion
• Solar hosts probably pay more for electricity
  than neighbors without solar
• Regulators must get out in front on message
• Option target some roof-top solar to low-income
  projects

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Thanks for the invitation.
I look forward to your questions.