Value and Cost of

Distributed Generation2nd ACC Workshop

June 20, 2014

The SSVEC PerspectiveDavid Bane, Key Account Manager

dbane@ssvec.com

Major DifferencesSSVEC doesn’t own generation assetsPower Purchasing Contract (Partial

Requirements)Large monthly fixed cost element

46% of Bill prior to November 2013 51% after November 2013 rate change

Low Demand charge (no time of day differences)

$4.38 per kW (Average) prior to November 2013 $4.52 per kW (Average) after November 2013 rate

changeFixed kWh charge (no time of day differences)

Baseline kWh charge $0.02975 (80% of needs) Average kWh Cost is $0.0307 (period ending 5/31/14)

Fixed Costs collected in a kWh charge (variable)

A portion of our Fixed Costs and all Margins are recovered from the sale of each kWh

For SSVEC Rate R this is $0.047404 per kWh

STANDARD RATE R

 

 

 

Power Supply

 

 

Distribution Charges 

Total Rate

Metering Meter Reading

Billing Access  

Service Availability Charge

($/Customer/Mo)

     

$3.67

 

$0.10

 

$6.04

 

$0.44

 

$10.25

 

$10.25

Energy Charge ($/kWh/Month)

All kWh

 

 

$0.078634

 

 

 

 

 

 

 

 

 

 

 

$0.047404

 

 

$0.047404

 

 

$0.126038

Estimated Impact in 2013

There was 6,926kW of PV installed as of 12/31/13

Estimated production of = 12,693,019 kWhThere were 2,956,968 of kWh Sales to PV

Customers to meet additional needs (as a group not a Net Zero Customer)

The following chart shows the impact of lost kWh sales

Impact of 12,693,019 kWh Reduction in SalesFixed Cost Percentage 90%Margin Percentage 10%

Fixed Cost and Margin loss (Distribution Adder) 581,099$ per yearFixed Cost Losses 522,989$ per yearMargin Reduction 58,110$ per yearEstimated Demand Savings from PV (115,313)$ per year

Non Recovered Costs = 465,786$

Determining the per kW LossEstimated Loss of Fixed Cost and Margins =

$465,786Loss Divided by 1,252 PV systems = $31 per

MonthFull recovery of losses based on system size

would need a $5.04 per kW Surcharge Average charge would be $28.25 per monthNot likely to be accepted by our Members or

the ACC Although the ACC approved a $0.70 per kW charge

for APS

SSVEC’s cost to serve a meter is between $39.00 to $40.00 per month.

Where is the problem?Is it really NET Metering?

Or

An historic rate design philosophy that needs to be revised so that Net Metering is not an issue where:Fixed Costs are covered in a Fixed ChargeDe-coupled Rates where the kWh is a pass

through Non-solar Customers are NOT supporting Solar

Customers

Thank you

Questions?