2018 -- H 8020
STATE OF RHODE ISLAND
IN GENERAL ASSEMBLY
JANUARY SESSION, A.D. 2018
A N A C T
RELATING TO PUBLIC UTILITIES AND CARRIERS - NET METERING
Introduced By: Representatives Marshall, O'Brien, Kennedy, and McKiernan
Date Introduced: March 29, 2018
Referred To: House Finance
It is enacted by the General Assembly as follows:
SECTION 1. Section 39-26.4-2 of the General Laws in Chapter 39-26.4 entitled "Net
Metering" is hereby amended to read as follows:
39-26.4-2. Definitions.
Terms not defined in this section herein shall have the same meaning as contained in
chapter 26 of title 39 of the general laws. When used in this chapter:
(1) "Community remote-net-metering system" means a facility generating electricity
using an eligible net-metering resource that allocates net-metering credits to a minimum of one
account for system associated with low or moderate housing eligible credit recipients, or three (3)
eligible credit-recipient customer accounts, provided that no more than fifty percent (50%) of the
credits produced by the system are allocated to one eligible credit recipient, and provided further
at least fifty percent (50%) of the credits produced by the system are allocated to the remaining
eligible credit recipients in an amount not to exceed that which is produced annually by twenty-
five kilowatt (25 kW) AC capacity. The community remote-net-metering system may transfer
credits to eligible credit recipients in an amount that is equal to or less than the sum of the usage
of the eligible credit recipient accounts measured by the three-year (3) average annual
consumption of energy over the previous three (3) years. A projected annual consumption of
energy may be used until the actual three-year (3) average annual consumption of energy over the
previous three (3) years at the eligible credit recipient accounts becomes available for use in
determining eligibility of the generating system. The community remote-net-metering system
may be owned by the same entity that is the customer of record on the net-metered account or
may be owned by a third party.
(2) "Electric-distribution company" shall have the same meaning as § 39-1-2, but shall
not include block island power company or Pascoag utility district, each of whom shall be
required to offer net metering to customers through a tariff approved by the public utilities
commission after a public hearing. Any tariff or policy on file with the public utilities
commission on the date of passage of this chapter shall remain in effect until the commission
approves a new tariff.
(3) "Eligible credit recipient" means one of the following eligible recipients in the
electric-distribution company's service territory whose electric service account or accounts may
receive net-metering credits from a community remote net-metering system. Eligible credit
recipients include the following definitions:
(i) Residential accounts in good standing.
(ii) "Low- or moderate-income housing eligible credit recipient" means an electric service
account or accounts in good standing associated with any housing development or developments
owned or operated by a public agency, nonprofit organization, limited-equity housing
cooperative, or private developer, that receives assistance under any federal, state, or municipal
government program to assist the construction or rehabilitation of housing affordable to low- or
moderate-income households, as defined in the applicable federal or state statute, or local
ordinance, encumbered by a deed restriction or other covenant recorded in the land records of the
municipality in which the housing is located, that:
(A) Restricts occupancy of no less than fifty percent (50%) of the housing to households
with a gross, annual income that does not exceed eighty percent (80%) of the area median income
as defined annually by the United States Department of Housing and Urban Development (HUD);
(B) Restricts the monthly rent, including a utility allowance, that may be charged to
residents, to an amount that does not exceed thirty percent (30%) of the gross, monthly income of
a household earning eighty percent (80%) of the area, median income as defined annually by
HUD;
(C) That has an original term of not less than thirty (30) years from initial occupancy.
Electric service account or accounts in good standing associated with housing
developments that are under common ownership or control may be considered a single low- or
moderate-income housing-eligible credit recipient for purposes of this section. The value of the
credits shall be used to provide benefits to tenants.
(iii) "Educational institutions" means public and private schools at the primary,
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secondary, and postsecondary levels.
(4) "Eligible net-metering resource" means eligible renewable-energy resource, as
defined in § 39-26-5 including biogas created as a result of anaerobic digestion, or generated from
eligible biomass fuels as defined in § 39-26-2(6) but, specifically excluding all other listed
eligible biomass fuels.
(5) "Eligible net-metering system" means a facility generating electricity using an eligible
net-metering resource that is reasonably designed and sized to annually produce electricity in an
amount that is equal to, or less than, the renewable self-generator's usage at the eligible net-
metering-system site measured by the three-year (3) average annual consumption of energy over
the previous three (3) years at the electric-distribution account(s) located at the eligible net-
metering-system site. A projected annual consumption of energy may be used until the actual
three-year (3) average annual consumption of energy over the previous three (3) years at the
electric-distribution account(s) located at the eligible net-metering-system site becomes available
for use in determining eligibility of the generating system. The eligible net-metering system may
be owned by the same entity that is the customer of record on the net-metered accounts or may be
owned by a third party that is not the customer of record at the eligible net-metering system site
and which may offer a third-party, net-metering financing arrangement or net-metering financing
arrangement, as applicable. Notwithstanding any other provisions of this chapter, any eligible net-
metering resource: (i) Owned by a public entity, educational institution, hospital, nonprofit, or
multi-municipal collaborative or (ii) Owned and operated by a renewable-generation developer
on behalf of a public entity, educational institution, hospital, nonprofit, or multi-municipal
collaborative through net-metering financing arrangement shall be treated as an eligible net-
metering system and all accounts designated by the public entity, educational institution, hospital,
nonprofit, or multi-municipal collaborative for net metering shall be treated as accounts eligible
for net metering within an eligible net-metering-system site.
(6) "Eligible net-metering-system site" means the site where the eligible net-metering
system or community remote net-metering system is located or is part of the same campus or
complex of sites contiguous to one another and the site where the eligible net-metering system or
community remote-net-metering system is located or a farm in which the eligible net-metering
system or community remote-net-metering system is located. Except for an eligible net-metering
system owned by or operated on behalf of a public entity, educational institution, hospital,
nonprofit, or multi-municipal collaborative through a net-metering financing arrangement, the
purpose of this definition is to reasonably assure that energy generated by the eligible net-
metering system is consumed by net-metered electric service account(s) that are actually located
in the same geographical location as the eligible net-metering system. All energy generated from
any eligible net-metering system is, and will be considered, consumed at the meter where the
renewable-energy resource is interconnected for valuation purposes. Except for an eligible net-
metering system owned by, or operated on behalf of, a public entity, educational institution,
hospital, nonprofit, or multi-municipal collaborative through a net-metering financing
arrangement, or except for a community remote-net-metering system, all of the net-metered
accounts at the eligible net-metering-system site must be the accounts of the same customer of
record and customers are not permitted to enter into agreements or arrangements to change the
name on accounts for the purpose of artificially expanding the eligible net-metering-system site to
contiguous sites in an attempt to avoid this restriction. However, a property owner may change
the nature of the metered service at the accounts at the site to be master metered in the owner's
name, or become the customer of record for each of the accounts, provided that the owner
becoming the customer of record actually owns the property at which the account is located. As
long as the net-metered accounts meet the requirements set forth in this definition, there is no
limit on the number of accounts that may be net metered within the eligible net-metering-system
(7) "Excess renewable net-metering credit" means a credit that applies to an eligible net-
metering system or community remote-net-metering system for that portion of the production of
electrical energy beyond one hundred percent (100%) and no greater than one hundred twenty-
five percent (125%) of the renewable self-generator's own consumption at the eligible net-
metering-system site or the sum of the usage of the eligible credit recipient accounts associated
with the community remote-net-metering system during the applicable billing period. Such excess
renewable net-metering credit shall be equal to the electric-distribution company's avoided cost
rate, which is hereby declared to be the electric-distribution company's standard offer service
kilowatt hour (kWh) charge for the rate class and time-of-use billing period (if applicable)
applicable to the customer of record for the eligible net-metering system or applicable to the
customer of record for the community remote-net-metering system. The commission shall have
the authority to make determinations as to the applicability of this credit to specific generation
facilities to the extent there is any uncertainty or disagreement.
(8) "Farm" shall be defined in accordance with § 44-27-2, except that all buildings
associated with the farm shall be eligible for net-metering credits as long as: (i) The buildings are
owned by the same entity operating the farm or persons associated with operating the farm; and
(ii) The buildings are on the same farmland as the project on either a tract of land contiguous
with, or reasonably proximate to, such farmland or across a public way from such farmland.
(9) "Hospital" means and shall be defined and established as set forth in chapter 17 of
title 23.
(10) "Multi-municipal collaborative" means a group of towns and/or cities that enter into
an agreement for the purpose of co-owning a renewable-generation facility or entering into a
financing arrangement pursuant to subdivision (14).
(11) "Municipality" means any Rhode Island town or city, including any agency or
instrumentality thereof, with the powers set forth in title 45 of the general laws.
(12) "Net metering" means using electrical energy generated by an eligible, net-metering
system for the purpose of self-supplying electrical energy and power at the eligible net-metering-
system site, or with respect to a community remote-net-metering system, for the purpose of
generating net-metering credits to be applied to the electric bills of the eligible credit recipients
associated with the community net-metering system. The amount so generated will thereby offset
consumption at the eligible net-metering system site through the netting process established in
this chapter, or with respect to a community remote-net-metering system, the amounts generated
in excess of that amount will result in credits being applied to the eligible credit-recipient
accounts associated with the community remote-net-metering system.
(13) "Net-metering customer" means a customer of the electric-distribution company
receiving and being billed for distribution service whose distribution account(s) are being net
metered.
(14) "Net-metering financing arrangement" means arrangements entered into by a public
entity, educational institution, hospital, nonprofit, or multi-municipal collaborative with a private
entity to facilitate the financing and operation of a net-metering resource, in which the private
entity owns and operates an eligible net-metering resource on behalf of a public entity,
educational institution, hospital, nonprofit, or multi-municipal collaborative, where: (i) The
eligible net-metering resource is located on property owned or controlled by the public entity,
educational institution, hospital, or one of the municipalities, as applicable, and (ii) The
production from the eligible net-metering resource and primary compensation paid by the public
entity, educational institution, hospital, nonprofit, or multi-municipal collaborative to the private
entity for such production is directly tied to the consumption of electricity occurring at the
designated net-metered accounts.
(15) "Nonprofit" means a nonprofit corporation as defined and established through
chapter 6 of title 7, and shall include religious organizations that are tax exempt pursuant to 26
U.S.C. § 501(d).
(16) "Person" means an individual, firm, corporation, association, partnership, farm, town
or city of the State of Rhode Island, multi-municipal collaborative, or the State of Rhode Island or
any department of the state government, governmental agency, or public instrumentality of the
(17) "Project" means a distinct installation of an eligible net-metering system or a
community remote-net-metering system. An installation will be considered distinct if it is
installed in a different location, or at a different time, or involves a different type of renewable
energy.
(18) "Public entity" means the federal government, the state of Rhode Island,
municipalities, wastewater treatment facilities, public transit agencies, or any water distributing
plant or system employed for the distribution of water to the consuming public within this state
including the water supply board of the city of Providence.
(19) "Renewable net-metering credit" means a credit that applies to an eligible net-
metering system or a community remote-net-metering system up to one hundred percent (100%)
of either the renewable self-generator's usage at the eligible net-metering-system site or the sum
of the usage of the eligible credit-recipient accounts associated with the community remote net-
metering system over the applicable billing period. This credit shall be equal to the total kilowatt
hours of electrical energy generated up to the amount consumed on-site, and/or generated up to
the sum of the eligible credit-recipient account usage during the billing period multiplied by the
sum of the distribution company's:
(i) Standard offer service kilowatt hour charge for the rate class applicable to the net-
metering customer, except that for remote public entity and multi-municipality collaborative net-
metering systems that submit an application for an interconnection study on or after July 1, 2017,
and community remote-net-metering systems, the standard offer service kilowatt-hour charge
shall be net of the renewable energy standard charge or credit;
(ii) Distribution kilowatt-hour charge;
(iii) Transmission kilowatt-hour charge; and
(iv) Transition kilowatt-hour charge.
Notwithstanding the foregoing, except for systems that have requested an interconnection
study for which payment has been received by the distribution company, or if an interconnection
study is not required, a completed and paid interconnection application, by December 31, 2018,
the renewable net-metering credit for all remote public entity and multi-municipal collaborative
net-metering systems shall not include the distribution kilowatt hour charge commencing on
January 1, 2050.
(20) "Renewable self-generator" means an electric distribution service customer of record
for the eligible net-metering system or community remote-net-metering system at the eligible net-
metering-system site which system is primarily designed to produce electrical energy for
consumption by that same customer at its distribution service account(s), and/or, with respect to
community remote-net-metering systems, electrical energy which generates net-metering credits
to be applied to offset the eligible credit-recipient account usage.
(21) "Third party" means and includes any person or entity, other than the renewable self-
generator, who or that owns or operates the eligible net-metering system or community remote-
net-metering system on the eligible net-metering-system site for the benefit of the renewable self-
(22) "Third-party, net-metering financing arrangement" means the financing of eligible
net-metering systems or community remote-net-metering systems through lease arrangements or
power/credit purchase agreements between a third party and renewable self-generator, except for
those entities under a public entity net-metering finance arrangement. A third party engaged in
providing financing arrangements related to such net-metering systems with a public or private
entity is not a public utility as defined in § 39-1-2.
SECTION 2. This act shall take effect upon passage.
BY THE LEGISLATIVE COUNCIL
This act would expand the definition of eligible net metering resources by including
"eligible biomass fuels" as defined in § 39-26-2(6).
This act would take effect upon passage.