​PG&E Implements Successor Net Energy Metering Tariff

Pacific Gas & Electric Company (“PG&E”) reached its cap of 2,409 MW for the original net energy metering (“NEM”) tariff on December 15, 2016. (PG&E Advice Letter 4999-E, Jan. 17, 2017.) Upon reaching the cap, PG&E began implementation of the NEM successor tariff for customer-sited renewable distributed generation.

The NEM tariff overlies an applicable electric service rate schedule and allows customer-generators to offset their charges for consumption with the electricity provided by their on-site system. Customer-generators receive a credit for the power generated by their system that is fed back to the grid, and this credit is the per kWh price that customers would have otherwise been charged for electricity consumed. In Decision 16-01-044, the California Public Utilities Commission (“CPUC”) kept this basic NEM structure, but added new charges and rules for the successor NEM tariff. These include, in part, the following:

• Customer-generators are required to pay reasonable interconnection fees.
• Customers on the successor NEM are subject to nonbypassable charges (e.g., public purpose program and nuclear decommissioning charges) for electricity consumed from the grid, regardless of monthly netting of kWh obtained from the utility and kWh exported to the grid.
• The successor NEM tariff is only available to customers that take service under a time-of-use (“TOU”) rate schedule. However, Resolution E-4792 allows customers who do not have the option to take service on a TOU rate to participate in the NEM successor program.
• NEM successor tariff customers on TOU rates prior to implementation of default TOU rates for all residential customers may remain on the TOU rate they have chosen for up to five years.
• For San Diego Gas & Electric (“SDG&E”) residential customers, the TOU rate requirement will not be imposed until TOU rates being developed in A.15-04-012 are in effect. SDG&E residential customers on the successor NEM tariff may also stay on their tiered rate (i.e., non-TOU) for up to five years.
• NEM is extended to customer-sited facilities larger than one megawatt, so long as the customer pays Rule 21 interconnection study and distribution system upgrade fees for the facility.
• Customer-generators must verify that installations meet minimum warranty and safety requirements.

Customer-generators may continue to take service on the NEM successor tariff for 20 years from the year of interconnection. The CPUC plans to review the NEM program again in 2019, which is the target year for the initiation of default TOU rates for residential customers. At that time, the CPUC plans to consider adjustments to the successor tariff that include a compensation rate that takes into account locational and time-differentiated values.

Posted by: Chase Kappel Maxwell