SF997

Purpose

• This bill changes how community solar garden programs work by requiring that subscribers live in the same county as the solar garden facility that generates the power.

Main Provisions

• Target: The plan applies to community solar garden programs that generate electricity from solar photovoltaic (ground-mounted or roof-mounted) facilities and allow subscribers to receive bill credits based on their share of the output.
• Locations and eligibility:
  • Each solar garden must be located in the service territory of the public utility that files the plan.
  • Subscribers must be retail customers of that public utility and live in the same county or a neighboring (contiguous) county where the facility is located.
  • A solar garden must have a nameplate capacity of no more than 1 megawatt (MW); each subscription represents at least 200 watts and cannot exceed 120% of the subscriber’s average annual electricity use at the related premises.
• Ownership and purchase:
  • The solar garden can be owned by a public utility or another entity that sells the generated power to the utility under existing law.
  • The public utility must buy all energy produced by the solar garden, at the rate determined by statute or as approved by the commission.
  • A portion of the energy purchase is credited to each subscriber’s bill.
  • Solar gardens are eligible for incentives offered under existing incentive programs.
• Plan content and process:
  • The public utility commission may approve, modify, or disapprove a community solar garden plan.
  • Plans must outline how to create, finance, and provide access to solar gardens, including uniform standards, interconnection fees, and processes that allow the utility to recover reasonable interconnection costs.
  • Plans must not set different requirements for utility vs. nonutility solar gardens and must align with the public interest.
  • Plans must specify what information will be provided to potential subscribers to fairly disclose future costs and benefits, include an implementation schedule, identify proposed rules/fees/charges, and describe how the program will be promoted.
• Participant status and crediting:
  • Neither the manager of a solar garden nor the subscribers are considered a utility merely because they participate in a solar garden.
  • Within 180 days after plan approval, the utility must start crediting subscriber accounts for each solar garden facility in its service area and file a description of its crediting system with the state’s commerce agency.
• Definitions and transitional provisions:
  • The bill defines “subscriber” (a retail utility customer who owns one or more subscriptions) and “subscription” (a contract between a subscriber and the solar garden owner).
  • The provision about credits and definitions applies to solar gardens approved before January 1, 2024.

Notable Changes from Current Law

• Location-Based Subscriber Requirement: A major change requiring subscribers to reside in the same county (or a contiguous county) as the generating facility.
• Expanded Plan Requirements: Adds detailed requirements for plan content, interconnection standards, and subscriber disclosures.
• Crediting Timeline: Establishes a concrete 180-day deadline for starting subscriber crediting after plan approval and requires a formal description of the crediting system to be filed with the commerce agency.
• Non-Utility Status Clarification: Explicitly states that participation in a solar garden does not by itself make someone a utility.

Potential Impacts

• Localized participation: May increase local engagement and limit out-of-county subscribers.
• Credit clarity: Aims to improve transparency around costs and benefits for subscribers.
• Interconnection and costs: Standardizes how interconnection costs are recovered, potentially affecting project economics.

Significant Definitions

• Subscriber: a retail utility customer who owns subscriptions.
• Subscription: a contract between a subscriber and the solar garden owner.
• Solar garden facility: the generating site (≤ 1 MW) whose output is allocated to subscribers.

Relevant Terms - community solar garden, CSG - subscriber - subscription - solar garden facility - county, contiguous counties - service territory - public utility - crediting system - interconnection - interconnection costs - incentive programs, 116C.779 - plan approval, commission - commissioner of commerce - not a utility by participation - nameplate capacity, 1 MW - watt, kilowatt, megawatt - rate, purchase price - five subscribers per garden, 40 percent cap (from legacy program) - photovoltaic, solar photovoltaic - gross energy vs. bill credit - credits to subscriber accounts - approval before Jan 1, 2024 (transitional applicability)