Chief Sponsor: Fred C. Cox

Senate Sponsor: ____________


8     General Description:
9          This bill amends provisions relating to the net metering of electricity program.
10     Highlighted Provisions:
11          This bill:
12          ▸     amends definitions;
13          ▸     requires an electrical corporation to pay cash to certain customers who produce
14     customer-generated electricity;
15          ▸     specifies requirements for an electrical corporation to charge an interconnection fee
16     for an interconnection of a customer generation system to the electrical corporation's
17     system; and
18          ▸     makes technical changes.
19     Money Appropriated in this Bill:
20          None
21     Other Special Clauses:
22          None
23     Utah Code Sections Affected:
24     AMENDS:
25          54-15-102, as last amended by Laws of Utah 2014, Chapter 53
26          54-15-104, as last amended by Laws of Utah 2015, Chapter 324
27          54-15-106, as last amended by Laws of Utah 2014, Chapter 53


29     Be it enacted by the Legislature of the state of Utah:
30          Section 1. Section 54-15-102 is amended to read:
31          54-15-102. Definitions.
32          As used in this chapter:
33          (1) "Annualized billing period" means:
34          (a) a 12-month billing cycle beginning on April 1 of one year and ending on March 31
35     of the following year; or
36          (b) an additional 12-month billing cycle as defined by an electrical corporation's net
37     metering tariff or rate schedule.
38          (2) "Customer-generated electricity" means electricity that:
39          (a) is generated by a customer generation system for a customer participating in a net
40     metering program;
41          (b) exceeds the electricity the customer needs for the customer's own use; and
42          (c) is supplied to the electrical corporation administering the net metering program.
43          (3) "Customer generation system":
44          (a) means an eligible facility that is used to supply energy to or for a specific customer
45     that:
46          (i) has a generating capacity of:
47          (A) not more than 25 kilowatts for a residential facility; or
48          (B) not more than two megawatts for a non-residential facility, unless the governing
49     authority approves a greater generation capacity;
50          (ii) is located on, or adjacent to, the premises of the electrical corporation's customer,
51     subject to the electrical corporation's service requirements;
52          (iii) operates in parallel and is interconnected with the electrical corporation's
53     distribution facilities;
54          (iv) is intended primarily to offset part or all of the customer's requirements for
55     electricity; and
56          (v) is controlled by an inverter; and
57          (b) includes an electric generator and its accompanying equipment package.
58          (4) "Eligible facility" means a facility that uses energy derived from one of the

59     following to generate electricity:
60          (a) solar photovoltaic and solar thermal energy;
61          (b) wind energy;
62          (c) hydrogen;
63          (d) organic waste;
64          (e) hydroelectric energy;
65          (f) waste gas and waste heat capture or recovery;
66          (g) biomass and biomass byproducts, except for the combustion of:
67          (i) wood that has been treated with chemical preservatives such as creosote,
68     pentachlorophenol, or chromated copper arsenate; or
69          (ii) municipal waste in a solid form;
70          (h) forest or rangeland woody debris from harvesting or thinning conducted to improve
71     forest or rangeland ecological health and to reduce wildfire risk;
72          (i) agricultural residues;
73          (j) dedicated energy crops;
74          (k) landfill gas or biogas produced from organic matter, wastewater, anaerobic
75     digesters, or municipal solid waste; or
76          (l) geothermal energy.
77          (5) "Equipment package" means a group of components connecting an electric
78     generator to an electric distribution system, including all interface equipment and the interface
79     equipment's controls, switchgear, inverter, and other interface devices.
80          (6) "Excess customer-generated electricity" means the amount of customer-generated
81     electricity in excess of the customer's consumption from the customer generation system during
82     a monthly billing period, as measured at the electrical corporation's meter.
83          (7) "Fuel cell" means a device in which the energy of a reaction between a fuel and an
84     oxidant is converted directly and continuously into electrical energy.
85          (8) "Governing authority" means:
86          (a) for a distribution electrical cooperative, its board of directors; and
87          (b) for each other electrical corporation, the Public Service Commission.
88          (9) "Inverter" means a device that:
89          (a) converts direct current power into alternating current power that is compatible with

90     power generated by an electrical corporation; and
91          (b) has been designed, tested, and certified to UL1741 and installed and operated in
92     accordance with the latest revision of IEEE1547, as amended.
93          (10) "Net electricity" means the difference, as measured at the meter owned by the
94     electrical corporation between:
95          (a) the amount of electricity that an electrical corporation supplies to a customer
96     participating in a net metering program; and
97          (b) the amount of customer-generated electricity delivered to the electrical corporation.
98          (11) "Net metering" means measuring the amount of net electricity for the applicable
99     billing period.
100          (12) "Net metering program" means a program administered by an electrical
101     corporation whereby a customer with a customer generation system may:
102          (a) generate electricity primarily for the customer's own use;
103          (b) supply customer-generated electricity to the electrical corporation; and
104          (c) if net metering results in excess customer-generated electricity during a billing
105     period, receive cash or a credit as provided in Section 54-15-104.
106          (13) "Switchgear" means the combination of electrical disconnects, fuses, or circuit
107     breakers:
108          (a) used to:
109          (i) isolate electrical equipment; and
110          (ii) de-energize equipment to allow work to be performed or faults downstream to be
111     cleared; and
112          (b) that is:
113          (i) designed, tested, and certified to UL1741; and
114          (ii) installed and operated in accordance with the latest revision of IEEE1547, as
115     amended.
116          Section 2. Section 54-15-104 is amended to read:
117          54-15-104. Charges or credits for net electricity.
118          (1) Each electrical corporation with a customer participating in a net metering program
119     shall measure net electricity during each monthly billing period, in accordance with normal
120     metering practices.

121          (2) If net metering does not result in excess customer-generated electricity during the
122     monthly billing period, the electrical corporation shall bill the customer for the net electricity,
123     in accordance with normal billing practices.
124          (3) Subject to Subsection (4), if net metering results in excess customer-generated
125     electricity during the monthly billing period:
126          (a) (i) (A) if a customer elects to receive cash payment, the electrical corporation shall
127     pay cash to a customer for the excess customer-generated electricity based on the meter reading
128     for the billing period at rates established under Title 54, Chapter 12, Small Power Production
129     and Cogeneration, for facilities of up to three megawatts; or
130          (B) if the customer elects to receive credit, the electrical corporation shall credit the
131     customer for the excess customer-generated electricity based on the meter reading for the
132     billing period at a value that is at least avoided cost, or as determined by the governing
133     authority; and
134          (ii) all credits that the customer does not use during the annualized billing period
135     expire at the end of the annualized billing period; and
136          (b) as authorized by the governing authority, the electrical corporation may bill the
137     customer for customer charges that otherwise would have accrued during that billing period in
138     the absence of excess customer-generated electricity.
139          (4) At the end of an annualized billing period, an electrical corporation's avoided cost
140     value of remaining unused credits described in Subsection (3)(a) shall be granted:
141          (a) to the electrical corporation's low-income assistance programs as determined by the
142     governing authority; or
143          (b) for another use as determined by the governing authority.
144          Section 3. Section 54-15-106 is amended to read:
145          54-15-106. Customer to provide equipment necessary to meet certain
146     requirements -- Governing authority may adopt additional reasonable requirements --
147     Testing and inspection of interconnection.
148          (1) Each customer participating in a net metering program shall provide at the
149     customer's expense all equipment necessary to meet:
150          (a) applicable local and national standards regarding electrical and fire safety, power
151     quality, and interconnection requirements established by the National Electrical Code, the

152     National Electrical Safety Code, the Institute of Electrical and Electronics Engineers, and
153     Underwriters Laboratories; and
154          (b) any other utility interconnection requirements as determined by the commission by
155     rule made in accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking Act.
156          (2) After appropriate notice and opportunity for public comment, the governing
157     authority may by rule adopt additional reasonable safety, power quality, and interconnection
158     requirements for customer generation systems that the governing authority considers to be
159     necessary to protect public safety and system reliability.
160          (3) (a) If a customer participating in a net metering program complies with
161     requirements referred to under Subsection (1) and additional requirements established under
162     Subsection (2), an electrical corporation may not require that customer to:
163          (i) perform or pay for additional tests; or
164          (ii) purchase additional liability insurance.
165          (b) An electrical corporation may not be held directly or indirectly liable for permitting
166     or continuing to permit an interconnection of a customer generation system to the electrical
167     corporation's system or for an act or omission of a customer participating in a net metering
168     program for loss, injury, or death to a third party.
169          (4) An electrical corporation may test and inspect an interconnection at times that the
170     electrical corporation considers necessary to ensure the safety of electrical workers and to
171     preserve the integrity of the electric power grid.
172          (5) The electrical function, operation, or capacity of a customer generation system, at
173     the point of connection to the electrical corporation's distribution system, may not compromise
174     the quality of service to the electrical corporation's other customers.
175          (6) (a) Except as provided in Subsection (6)(b), an electrical corporation administering
176     a net metering program:
177          (i) may not charge a customer an interconnection fee of more than $2 during a monthly
178     billing period for an interconnection of a customer generation system to the electrical
179     corporation's system if the customer has zero power consumption during a monthly billing
180     period; or
181          (ii) may not charge a customer an interconnection fee of more than $2 during a
182     monthly billing period for an interconnection of a customer generation system to the electrical

183     corporation's system if the customer is enrolled in a net-metering credit program as described in
184     Subsection 54-15-104(3)(a)(i)(B) or (3)(b).
185          (b) An electrical corporation may charge a customer an interconnection fee of more
186     than $2 during a monthly billing period for an interconnection of a customer generation system
187     to the electrical corporation's system if the customer is selling excess customer-generated
188     electricity for cash as described in Subsection 54-15-104(3)(a)(i)(A).

Legislative Review Note
Office of Legislative Research and General Counsel