Oregon Addresses Procurement Requirements
As a first step, the Oregon Public Utility Commission has approved an initial framework for the development of community solar programs within the state, but it said that it expects the plans to be supplemented and fleshed out further in future proceedings.
The commission explained that it was prompted to act under a newly passed state law that requires the commission to establish by rule a program for utility procurement of electricity from community solar projects. According to the commission, the legislation mandates that it adopt rules and regulations prescribing what projects qualify for participation in the program. The law also charges the commission with setting forth the form and manner by which project managers may apply for certification under the program, with the commission then tasked with certifying eligible projects.
In addition, the legislation directs the commission to consider ways to incentivize participation, minimize cost shifting, advance the public interest, and protect participants from undue financial hardship (where an electric company is the project manager). The law further establishes a carve-out standard by which 10% of the total generating capacity from the solar projects participating in the program is made available for use by low-income residential customers. The law states that once a community solar facility is declared qualified, electric utilities must enter into a 20-year power purchase agreement with the project.
To assist it in overseeing the community solar initiative, the commission will be enlisting the services of an outside program administrator. It said it will be utilizing a competitive bidding process for selecting that administrator. Although other technical activities will be involved, the commission outlined the following as the primary duties of the program administrator:
- Registration of project managers,
- Review of applications for project pre-certification, and
- Certification and confirmation of participant eligibility.
The commission asserted that each electric utility will be required to collaborate with the program administrator in developing and obtaining commission approval of an on-bill payment model that will allow for multiple ownership and subscription configurations to assess and remit fees owed by participants.
As to project location, the commission adopted certain limitations, including that a qualifying project must be located within the Oregon service territory of an electric company, and that a customer may participate in projects located anywhere within the service territory of its designated electric utility. Although generally frowning on co-location of projects, the commission agreed to an exception to the prohibition on co-location so as to avoid the inadvertent impeding of multiple community solar projects comprised of aggregated rooftop systems from being located within a single municipality or urban area.
Regarding customer participation requirements, the commission listed the following rules for owners of, or subscribers to, projects certified during the initial program capacity tier:
- A participant and its affiliates may own or subscribe up to a total of four megawatts across multiple projects; and
- A lone participant may own or subscribe up to a total of two megawatts across multiple projects.
The commission found that the four-megawatt limitation for a participant and its affiliates would give customers with multiple site addresses an opportunity for higher levels of participation, while preventing any single large business or government entity from securing a significant portion of the initial program capacity tier. In endorsing the limits on the initial program capacity tier, the commission stated that its goal is to promote diversity of participation among various types of customers and customer classes yet maintain the distinction between the community solar program and the direct access program. Re Rules Regarding Community Solar Projects, AR 603, Order No. 17-232, June 29, 2017