Resolution- Adoptation of Microgrid...
89
1 GOVERNMENT OF PUERTO RICO PUERTO RICO ENERGY COMMISSION IN RE: REGULATION ON MICROGRID DEVELOPMENT CASE NO.: CEPR-MI-2018-0001 Subject: Adoption of Proposed Regulation on Microgrid Development RESOLUTION 1. Through this Resolution, the Puerto Rico Energy Commission (“Commission”) adopts and publishes the Regulation on Microgrid Development (“Final Microgrid Regulation”). As further explained below, the Final Microgrid Regulation sets the legal and regulatory framework required to promote and encourage the development of microgrid systems in Puerto Rico, enable customer choice and control over their electric service, increase system resiliency, foster energy efficiency and environmentally sustainable initiatives and spur economic growth by creating a new and emerging market for microgrid services. I. Legal Basis 2. The Commission adopts and publishes this Resolution and the Final Microgrid Regulation pursuant to Act 57-2014, as amended, known as the Puerto Rico Energy Transformation and RELIEF Act; Act 82-2010, as amended, known as the Public Policy on Energy Diversification by Means of Sustainable and Alternative Renewable Energy in Puerto Rico Act; Act 83-2010, known as the Green Energy Incentives Act; and Act 38-2017, known as the Uniform Administrative Procedure Act of the Government of Puerto Rico (“LPAU”, for its Spanish acronym). II. Introduction and Brief Background 3. On October 27, 2017, the Commission began an investigation with regards to the state of Puerto Rico’s electrical system as result of Hurricane Marı́a’s landfall on the Island (“October 27 Resolution”). 1 As a result of the damages to the electrical system and considering the critical role of the electric service in the economic development of the Island and the day to day lives of its citizens, the Commission determined that the restoration of electric service was one of the main objectives in the short term. The Commission also determined, however, that it was insufficient to identify strategies that allow for the restoration of electric service in the shortest possible amount of time if those strategies were 1 Case No. CEPR-IN-2017-0002, In Re: Energy Commission Investigation Regarding the State of the Puerto Rico Electric System after the Passing of Hurricane Marı́a.
Transcript of Resolution- Adoptation of Microgrid...
1
GOVERNMENTOFPUERTORICO
PUERTORICOENERGYCOMMISSION
INRE:REGULATIONONMICROGRIDDEVELOPMENT
CASENO.:CEPR-MI-2018-0001
Subject:AdoptionofProposedRegulationonMicrogridDevelopment
RESOLUTION
1. ThroughthisResolution,thePuertoRicoEnergyCommission(“Commission”)
adopts and publishes the Regulation on Microgrid Development (“Final MicrogridRegulation”).Asfurtherexplainedbelow,theFinalMicrogridRegulationsetsthelegalandregulatory framework required topromoteandencourage thedevelopmentofmicrogridsystems in Puerto Rico, enable customer choice and control over their electric service,increase system resiliency, foster energy efficiency and environmentally sustainableinitiativesandspureconomicgrowthbycreatinganewandemergingmarketformicrogridservices.I. LegalBasis
2. TheCommissionadoptsandpublishesthisResolutionandtheFinalMicrogridRegulation pursuant to Act 57-2014, as amended, known as the Puerto Rico EnergyTransformationandRELIEFAct;Act82-2010,asamended,knownasthePublicPolicyonEnergyDiversificationbyMeansofSustainableandAlternativeRenewableEnergyinPuertoRicoAct;Act83-2010,knownastheGreenEnergyIncentivesAct;andAct38-2017,knownastheUniformAdministrativeProcedureActoftheGovernmentofPuertoRico(“LPAU”,foritsSpanishacronym).
II. IntroductionandBriefBackground
3. OnOctober27,2017,theCommissionbegananinvestigationwithregardsto
the state of PuertoRico’s electrical system as result ofHurricaneMarıa’s landfall on theIsland(“October27Resolution”).1Asaresultof thedamagesto theelectricalsystemandconsideringthecriticalroleoftheelectricserviceintheeconomicdevelopmentoftheIslandandthedaytodaylivesofitscitizens,theCommissiondeterminedthattherestorationofelectric service was one of the main objectives in the short term. The Commission alsodetermined, however, that it was insufficient to identify strategies that allow for therestorationofelectricserviceintheshortestpossibleamountoftimeifthosestrategieswere 1CaseNo.CEPR-IN-2017-0002,InRe:EnergyCommissionInvestigationRegardingtheStateofthePuertoRicoElectricSystemafterthePassingofHurricaneMarıa.
2
notfollowedandsupportedbylong-termpoliciesdesignedtopromotethedevelopmentofaresilient,modernandagileelectricsystem.
4. On November 10, 2017, the Commission issued a Resolution and Order("November10Resolution") identifying the installationofdistributedgeneration, energystorageandmicrogridsystemsasviablealternativesforassistingin:
(i)thespeeding-upoftheelectricservicerestorationthroughouttheIsland,through the deployment of distributed generation projects financed,developed and operated by private or non-governmental entities; (ii) thestrengthening of the electric system, reducing dependence on centralizedsourcesof generation; (iii) the facilitationof electric service restorationonfuture occasions through the use of distributed generation systems andmicrogrids capableofoperating independently from the restof theelectricgrid; and (iv) the transferring of the responsibility of the restauration andprovisionofelectricservicetomultipleentities,allowingforgreateraccesstoeconomic,technicalandhumanresources.2
5. OnJanuary3,2018,theCommissionissuedaNoticeofProposedRulemakingthroughwhichitpublisheditsproposedRegulationonMicrogridDevelopment(“ProposedMicrogridRules”).PursuanttoLPAU,theCommissionaffordedthegeneralpublica30-dayperiodtofilewrittenpubliccommentsandsuggestedamendmentsandrecommendationstotheProposedMicrogridRules.
6. TheCommissionreceivedatotalof38writtencommentsfrompersonsand
entities with a broad range of interests and experiences, from customers interested ingainingaccesstosuchservicestoentitiesengagedinthedevelopmentofmicrogridsystems.Thefollowingentitiesfiledcomments:DTEnergyConsultants(“D-TEC”),OrganizaciónJovenPiensa,RicardoLópezRivera,JavierTorresEspino,DynamicEnergyNetworks(“DEN”),KORServicesLLC,ElectrIQPower(“ElectrIQ”),JohnR.Henry,SchneiderElectric,S&CElectricCo.,Compañía de Fomento Industrial (“CFI”), Puerto Rico Association of Renewable EnergyConsultants and Contractors (“ACONER”), Sunrun, Institute for Energy Economics andFinancialAnalysis(“IEEFA”),EnlaceLatinodeAcciónClimática(“ELAC”),ThePuertoRicoElectric PowerAuthority (“PREPA”), Tesla Inc., National Public FinanceGuarantee Corp.,Assured Guaranty Corp. and Assured Guaranty Municipal Corp. (“NPFGC”), McConnellValdés,AdHocGroupofPREPABondholders(“AdHocBondholders”),BloomEnergyCorp.,SierraClubdePuertoRico,CámaradeComerciodePuertoRico(“CCPR”), ChrisEvanich,FranciscoLaboy,KevinW.Shockey,EnergySolutionsPuertoRico,RobertoD.Acosta,OficinaIndependiente de Protección al Consumidor (“OIPC”), Instituto de Competitividad ySostenibilidadEconómicadePuertoRico(“ICSE”),NewYorkStateSmartGridConsortium,CAMBIO,MunicipiodeBayamón(“Bayamón”),Energy&EnvironmentalConsultingServicesCorp.(“ESCOPR”),NaturalResourcesDefenseCouncil(“NRDC”),USGreenBuildingCouncil(“USGBC”),andtheConformityAssessmentSteeringCommittee(“CASC”). 2Id.atp.2.
3
7. The Final Microgrid Regulation intends to promote the development of
Microgrid systems by enabling their implementation through different business andoperational models. The Final Microgrid Regulation recognizes three main types ofmicrogridsystems:(i)PersonalMicrogrids;(ii)CooperativeMicrogridsand(iii)Third-PartyMicrogrids.
8. PartIIIofthisResolutiondetailsthemainrevisionsandamendmentsmadetotheProposedMicrogridRulesandincorporatedintotheFinalMicrogridRegulation.PartIVaddresses additional issues raised by commenters or which are relevant to the FinalMicrogrid Regulation. Attachment A of this Resolution consists of the Final MicrogridRegulation. Attachment B of this Resolution contains a redlined version of the FinalMicrogrid Regulation providing a comparison of the FinalMicrogrid Regulation and theProposedMicrogridRules.III. Main Revisions and Amendments Incorporated into the Final Microgrid
Regulation
9. This part identifies and addresses the main revisions and amendments
incorporated into theFinalMicrogridRegulation.Aside from thosedescribedherein, theCommissionmadenumerousadditionalchangesdesignedtoprovideuniformityandclaritytothelanguageandpurposesoftheRegulation.Toreviewsuchchanges,pleaserefertotheredline version of the Final Microgrid Regulation included as Attachment B to thisResolution. A. §1.08–Definitions
10. The Commissionmade several revisions to the definitions included in the
Proposed Microgrid Rules in order to simplify its content, increase their clarity andappropriateness, and exclude those deemedunnecessary or superfluous that, because ofrevisionsmadetoothersections,wherenolongernecessary.
11. The terms “Cooperative Member”, “Distributed Generation”, “MicrogridOperator”,“RenewableResource”,“PersonalMicrogrid”and“Third-PartyMicrogrid”whereadded to the definitions in Section 1.08 of the Final Microgrid Regulation. Of specialimportancearetheterms“PersonalMicrogrid”,“CooperativeMicrogrid”and“Third-PartyMicrogrid”whichencompassthethreemaintypesorclassesofMicrogridsystems.
12. PersonalMicrogridsconsistofsystemsownedbynomorethantwo(2)energyconsumersanddesigned,primarily,tosupplytheenergyneedsofsuchconsumers.ThistypeofMicrogrid isnotsubject to specific regulatory requirementsunder theFinalMicrogridRegulation,exceptforthoseprovidedinSection2.02oftheFinalMicrogridRegulation.
13. Theterm“Cooperative”includedintheProposedMicrogridRuleswasrevised
to“CooperativeMicrogrid.”CooperativeMicrogridspermitthreeormoreenergyconsumersto organize and jointly own and develop amicrogrid system. The primary purpose of a
4
CooperativeMicrogridistoservetheenergyneedsofitsCooperativeMembers.CooperativeMicrogrids could provide energy and other grid services to a person other than itsCooperative Members, subject to the provisions of Section 2.02 of the Final MicrogridRegulation.
14. Additionally,thedefinition“CooperativeMicrogrid”wasfurtheramendedto
clarify that, forpurposesof theFinalMicrogridRegulation, said termrefers to the joint-ownershipofaMicrogridsystembythreeormorePersonsandthattheterm“Cooperative”doesnotrefertosuchtermasitisusedinAct239-2004,asamended,knownastheGeneralCooperative Associations Act. Accordingly, under the Final Microgrid Regulation, aCooperativeMicrogridmayconsistof an informalagreementbetween the correspondingpartiesormaybeorganizedpursuanttoeithertheAct164-2009,asamended,knownasthePuertoRicoGeneralCorporationsAct,Act239-2004,oranyotherapplicablelaw. 15. Third-PartyMicrogridsrefertosystemsdevelopedforthepurposeofsellingenergyservicestocustomers,whohavenoownershipinterestoverthemicrogridsystem,regardless of whether the owner of the system also receives energy services from themicrogrid.Insuchcases,themicrogridprovidesservicessimilarlytohowatraditionalutilitywouldprovideservicestoitscustomersand,therefore,Third-PartyMicrogridsaresubjecttoadditionalrequirementsdesignedtodefinetherightsandresponsibilitiesofthemicrogridowner/operatoranditscustomers.
16. Theterms“AncillaryServices”,“EnergyProducer”,“InterconnectionCharge”,“Load”,“NetMeter”,“PowerPurchaseAgreement”and“TransmissionInfrastructure”wereremovedfromtheFinalMicrogridRegulationbecausetheywereeithernotusedthroughouttheRegulationorwereno longernecessarygivenchangesmade toothersectionsof theRegulation. Finally, the term “Green Energy” was replaced by the term “RenewableResources”tobetterreflecttheconceptbeingdefined.
17. Certain commenters, mainly the Municipality of Bayamón (“Bayamón”)
expressedconcernsthattheProposedMicrogridRuleslimitedtheabilityofmunicipalitiesto engage in the development and operation ofmicrogrid systems.3 These concerns arefurther addressed in the discussion related to the amendments to Section 2.01 of theProposedMicrogridRules.However, theCommissionamendedthedefinitionof theterm“Person”sothatitincludesmunicipalitiesandothergovernmententities(excludingPREPA).Accordingly,anymunicipality,orgroupofmunicipalities(includingmunicipalconsortiums)mayown,developoroperatemicrogridsystems.
18. Finally,theCommissiondecidedtoremovetheterm“CommunitySolar”fromthedefinitionsincludedinSection1.08oftheFinalMicrogridRegulation.WhileamicrogridmayoperateinamannerconsistentwithwhatisreferredtoasCommunitySolar,Microgridand Community Solar are not interchangeable concepts. Community Solar refers to acommunity sharing ownership of a solar generating facility or agreeing to purchase theenergy generated by such solar facility. Community Solarmay refer to small, distributed 3CommentsoftheMunicipalityofBayamónatp.12.
5
generationsystems,operatedandstructuredinamannersimilartoamicrogrid,ormayreferto utility scale generating facilities. Act 133-2016 requires the Commission to defineCommunity Solar. Because the Commissionhas yet to define the termCommunity Solar,doing so as part of this procedure would prevent the Commission from developing adefinitionandreachingthepolicydeterminationsthatbestpromotethedevelopmentofsuchinitiatives.TheCommissionwill,atalaterdate,initiateaprocedureaimedataddressingtheopportunitiesandbenefitsandsocietalvaluesthatmaybederivedfromCommunitySolarinitiatives.
19. TheCommissionalsofindsthatremovingthetermCommunitySolardoesnot
negatively impactordiminish thedevelopmentofmicrogridsnor theoverarchingpublicpolicycontainedintheFinalMicrogridRegulationpromotingthedevelopmentofrenewableandhighlyefficientdistributedenergyresources. B. §2.01–MicrogridClassification
20. The Proposed Microgrid Rule classified microgrid systems based on three
characteristics:ownership structure, sizeandwhetherornot theyengaged in the saleofenergyservicesand/orothergridservices.Section2.01(B)oftheProposedMicrogridRulesidentified numerous types of ownership structures, including sole proprietorships,partnerships, cooperatives,municipalities, corporations, non-profit organizations, amongothers.
21. Section 2.01(C) of the Proposed Microgrid Rules then divided microgridsystemsintothreecategoriesbasedonsize:(i)Individual,Small,andLarge.Finally,Section2.01(D) of the ProposedMicrogridRules established thatmicrogrid systems designed toproduce energy primarily for the consumption by the owner(s) of the systemwould beclassified as “self-supply microgrids” and prohibited such systems from selling energyservicestoanyotherpersonotherthanPREPA.
22. The Final Microgrid Regulation amended Section 2.01 to incorporate onlythreetypes(orclasses)ofmicrogridsystems:Personal,Cooperative,andThird-Party.Anyofthesetypesofmicrogridsystemsmaybeownedoroperatedbyanytypeofperson,entity,municipality or government entity (other than PREPA) under whichever ownershipstructureandoperatingagreementtheydeemmostappropriate.ForpurposesoftheFinalMicrogridRegulation,thekeyidentifyingfactoriswhetherthemainpurposeofthesystemis tosupply theneedsof the system’sownersorengage in the saleof energyservices tocustomerswhoarenot,inturn,ownersofthesystem.
23. Based on these factors, microgrid systems are categorized into two main
groups:PersonalMicrogridsandCooperatives,whichprimarypurposeistosupplytheneedof its owners, and Third-Party, which primary purpose is to provide energy service tocustomers.
24. Withregardstosize,underSection2.01(C)oftheProposedMicrogridRules,
SmallMicrogridswerethosewith3-10customersandgeneratingcapacityof250kWorless,
6
whileLargeMicrogridswerethosewithmorethan10customersandgeneratingcapacityinexcessof250kW.TheCommissionfoundthatthenumberofcustomercriterionwouldcreatean undue burden on Small Microgrids whose overall generating capacity increasednominallybutarenolongerconsideredSmallMicrogridsduetoexceedingthenumberofcustomersby,forexample,one.
25. Identifying the size of a microgrid is useful for determining whether a
microgridsystemwillberequiredtocomplywithcertainreportingrequirements.Becausethoserequirementsmainlyrelatetomattersassociatedwiththegenerationofelectricity,adifferentiation between system sizes based on quantity of customers is unnecessary.Additionally,sizedifferentiationisonlyapplicabletoCooperativeMicrogrids,becauseThird-Party Microgrids are subject to the same regulatory requirements, regardless of theirgeneratingcapacity.
26. Accordingly,theFinalMicrogridRegulationremovesfromSection2.01(B)the
provisionsrelatedtosystem’ssizeandincorporatessuchprovisionsasanewSection4.02withinArticle 4,which contains the provisions specific to CooperativeMicrogrids. SmallCooperativeMicrogrids,therefore,arethosewithageneratingcapacityof250kWorless,whileLargeCooperativeMicrogridarethosewithageneratingcapacityexceeding250kW.LargeCooperativeMicrogridsarerequiredtocomplywiththereportingrequirementssetforthinSection4.05oftheFinalMicrogridRegulation.
27. Section2.01(E)oftheProposedMicrogridRulesidentifiedthesectionsofthe
ProposedMicrogridRulesthatwouldapplytoeachtypeofmicrogrid,basedonthethreetypesofclassificationspreviouslyused:ownershipstructure,sizeandengagement in thesale of energy services. Section 2.01(B) of the FinalMicrogrid Regulation replaces priorSection2.01(E)byusingonly the threemicrogrid categories—Personal,CooperativeandThird-Party—asthebasisforidentifyingtherelevantsectionsoftheRegulation.
28. ACONERsuggestedthatthesizedivisionbetweensmallandlargebesetat500
kW.4CCPRsuggestedthat250kWistoosmalltobeareasonablethreshold.5Teslasuggestedthe threshold be 500 kW and 20 customers.6 IEEFA expressed concern that the divisionbetweensmallandlargesystemswasambiguousandsuggestedthenumberofcustomersbetheonlydifferentiatorbetweensmallandlargesystems.7Asdescribedbefore,thedistinctionbetween small and large Microgrids only apply to Cooperative Microgrids. LargeCooperativeMicrogridsarerequiredtosubmitannualreportsonfuelusage,generationandsales, as well as copies of any reports required by the US EPA and the Puerto Rico 4ACONERComments,p.2.5CCPRComments,p.4.6TeslaComments,p.2.7IEEFAComments,p.2.
7
EnvironmentalQualityBoard.Basedonthenatureofthesereports,theCommissiondecidedtoretainthethresholdbetweensmallandlargeMicrogridsat250kW.
29. Finally, the Final Microgrid Regulation does not preclude PREPA fromdevelopingmicrogrids.Nordotheylimittheabilityofamunicipalitytoenterintoacontractwithathird-partyprovidertodevelopamicrogridassuggestedbyBayamón.8Amunicipalitycanpursuethedevelopmentofamicrogriditselforhireathird-partytodoso.Forexample,amongothers,amunicipalitycould(i)developamicrogridsystemdesignedtosupplytheneedsofasportscomplexownedbythemunicipality(PersonalMicrogrid),(ii)alongwithtwoormorepersonsorentities,jointlyownanddevelopaMicrogriddesignedtosupplytheneedsofneighboringstructuresownedbythemicrogrid’sowners,and(iii)develop,byitselforalongwithotherpartiesormunicipalities,amicrogridsystemdesignedtoprovideenergyservicestoaparticulargroupofconstituents—regardlessofwhethertheserviceisprovidedforaprofitornot.
C. §2.02–SaleofEnergyServicesand/orotherGridServices
30. TheFinalMicrogridRegulation incorporatesanewSection2.02addressingthe sale of energy services and/or other grid services by Personal Microgrids andCooperativeMicrogrids systems. As a general rule, PersonalMicrogrids and CooperativeMicrogridsarelimitedtoprovidingenergyandgridservicesonlytoitsowners(ormembers,inthecaseofCooperativeMicrogrids)and/orenterintootheragreementswithPREPAinordertoprovidesuchservices.
31. Section2.02(C),however,providesanexemptionfromtheabove-mentioned
general rule for Personal Microgrids and Cooperative Microgrids to, after Commissionauthorization,provideexcessenergyorgridservices topersonswhoarenotowners (orcooperative members) of the system. Accordingly, Personal Microgrids and CooperativeMicrogridsmayrequesttheCommission’sauthorizationtoprovide(eitherfreeofchargeornot)excessenergyservicesand/orothergridservicestoneighboringcustomers,withoutbeingrequiredtocomplywiththerequirementsapplicabletoaThird-PartyMicrogrid.
32. There is one basic principles delineating this exception: The sale of excess
energy or the provision of other grid services to these neighboring customers must beincidental to the operation of the microgrid. The primary purpose in designing anddevelopingthesystemcannotbetoengageinthesaleofenergyservicesand/orothergridservicestocustomersotherthantheownersormembersofthesystem.
33. The purpose of including the exception described in Section 2.02(C) is to
recognize the economical and societal benefits derived from allowing Personal andCooperativeMicrogridstoprovide,fromtimetotime,energyservicesorothergridservicestoneighboringcustomerswhoarenotthemselvesownersormembersofthemicrogrid.Theownersormembersofthesystemmayderiverevenuesfromthesaleoftheseserviceswhichwouldhelpalleviatefinancing,maintenanceandoperationalcosts.Neighboringcustomers, 8BayamónComments,p12.
8
ontheotherhand,maygaineasyaccesstoenhancedenergyorgridservices,suchasreducedenergy costs, back-up power, and enhanced reliability, among others, without requiringchangestotheorganizationalstructureofthemicrogridsystem.
D. §3.02–EligibleGenerationResources
34. The Final Microgrid Regulation compiles within a single section, the
requirementsandprovisionsregardingtypesofgenerationresourcesthatmaybeusedbyamicrogrid previously scattered throughout Sections 3.02, 3.03 and 3.04 of the ProposedMicrogridRules.
35. Section3.02of theFinalMicrogridRegulationmaintains the75-25percentratio between renewable and fossil fuel generation but amends the standard to refer toenergyoutputratherthanenergyinput.Accordingly,undertheFinalMicrogridRegulation,arenewableenergymicrogridrefers toasystemofwhich75%of its totalenergyoutputduringa12-monthperiod isderived fromaRenewableResource.Theremaining25%ofenergyoutputmaybederivedfromfossil-fuelgenerators.TheCommissiondeterminedthatfocusingonenergyoutput,ratherthan input,allowsforsufficientandachievablereliableoperationatreasonablecosts.
36. Act133-2016introducedtheconceptofmicrogridsystemswithinthegeneralframeworkestablishedbyAct82-2010.Act82-2010setsforththepublicpolicygoalsrelatedtothedevelopmentofrenewableenergyresources,thereductionoftraditionalfossilfuelgenerationandtheadoptionofenergyefficiencymeasuresasmeanstoreduceenergycosts,diversifyenergyresourcesandreducetheimpactofenergygenerationontheenvironment.Accordingly,microgridsystemsinPuertoRicomustbe,overall,consistentwithsuchpolicygoals. The Commission found that requiring renewable microgrid systems to meet aminimumthresholdof75%of itsenergyoutput tobederivedfromrenewableresources(plusstorage),ensurescompliancewithAct82-2010.
37. Additionally,theCommissionaddedefficiencyrequirementsforthefossilfuelgenerationportionofthemicrogridbyrequiringthefuelusedbythenon-renewableportionofthegenerationtonotexceed2,500Btupertotalenergyproducedbythemicrogridandlimittheheatrateatfulloutputofthenon-renewableportionofthesystemtonotexceed13,000 Btu/kWh.9 These requirements ensure that renewable microgrids continue tocomplywiththepublicpolicygoalsofAct82-2010.
38. For combinedheadandpower (“CHP”)microgridsystems, theCommission
maintainedtherequirementsthattheusefulthermalenergyoutputofthesystembenoless
9Asanexample,thisstandardmaybemetbyageneratoroperatingat10,000Btu/kWh,providing25%oftheMicrogridelectricenergy.
9
than50%thetotalenergyoutputandthatfuelinputminususefulenergyoutputisnogreaterthan7,000BtuperkWhofgeneratoroutput.10
39. The Final Microgrid Regulation retains the concept of hybrid microgrid
systems.ByhybridmicrogridsystemstheCommissionreferstoamicrogridthatusesenergyfrombothaCHPsystemandarenewablesystem,withupto25%oftheenergyoutputoftherenewablesystembeinggeneratedbyfossilfuels.Asanexample,assumeahybridmicrogridsystemwere60%ofitstotalenergyoutputissuppliedbytheCHPportionofitsgenerationand the remaining 40% is supplied by the renewable portion of its generation. If therenewableportion(40%oftotalgeneration)iscomprisedofamixofsolarandfossilfuelgenerators,only25%ofitsoutput(i.e.10%oftotalgeneration)canbegeneratedfromfossilfuels.
40. Because the renewable portion of the microgrid must comply with therequirementsapplicable torenewablemicrogridsystems,75%of thetotalenergyoutputgenerated by the renewable portion of the microgrid would be derived from the solargenerators and the remaining 25% would be derived from fossil fuel generators.Accordingly, thetotalenergyoutputbygenerationresourcewouldbeas follows:60%oftotalgenerationwouldbederivedfromCHP,30%fromarenewablesourceand10%fromfossilfuelgenerators.
E. §3.03–FormsofDemonstratingCompliance
41. TheFinalMicrogridRegulationadoptsanewSection3.03whichcontainsthe
mechanismsfordemonstratingthatamicrogridsystemcomplieswiththerequirementsforeachtypeofgenerationresource:renewable,CHPorhybrid,asapplicable.
42. Consistent with the revisions to the 75-25 percent ratio of energy outputthresholdestablishedforrenewablemicrogridsystems,theCommissionrevisedfrom12.511to3.50gallonsthemaximumfuelconsumptionpermittedforarenewablemicrogridwithgenerating assets limited to solar photovoltaic and diesel-fired generators contained inSection3.03(A)(3)oftheFinalMicrogridRegulation.
10AsdetailedinAppendixBoftheFinalMicrogridRegulation,aCHPsystemwithaFuelinputof1,000MMBtuandausefulthermaloutputof700MMBtu(whichrepresentsanetinputof300MMBtu),thathasanetelectricoutputof60MWhwillmeettheserequirementssinceitsusefulthermaloutputis70%anditsefficiencyis5,000Btu/kWh.Ontheotherhand,aCHPsystemwithaFuelinputof1,000MMBtuandausefulthermaloutputof350MMBtu(whichrepresentsanetinputof650MMBtu),thathasanetelectricoutputof70MWhwillnotmeettheserequirementssinceitsusefulthermaloutputis35%anditsefficiencyis9,286Btu/kWh.11 It should be noted, however, that the original amount of 12.5 gallons was a typographical error. TheCommissionoriginallyintendedforsuchamounttobe1.25gallons.
10
F. §3.04–CodesandStandards
43. The Final Microgrid Regulation removes references to specific codes and
standardsandadoptsageneralrequirementthatmicrogridsystemsmustbecompliantwiththeapplicablecodesandstandards,asthosecodesandstandardsareidentifiedfromtimetotimebytheCommissionthroughresolutionand/ororder.Becausecodesandstandardsaresubjecttoperiodicrevisionsandchangesinordertokeepupwithtechnologicaladvances,incorporating specific references in the regulation would make it difficult for theCommission to keep such codes and standards up to date, since doing sowould requireinitiatinganamendmentprocesstotheexistingregulations.Accordingly,theCommissiondeterminedtoidentifytheapplicablecodesandstandardsthroughresolutionand/ororder,which would be revised from time to time to keep up with industry best-practices andprevailingtechnologicaladvances.ThecodesandstandardsthatshallapplyatthistimeareidentifiedinResolutionNo.CEPR-MI-2018-0007.
G. §3.05–InterconnectiontotheElectricPowerGrid
44. Similar to theFormsofDemonstratingCompliance, the sectionauthorizing
microgrid systems to interconnect with PREPA’s Electric Power Grid were spreadthroughoutseveralarticles,applicabletoeachtypeofmicrogridsystem.Becausetheyarethe same requirement for all systems, incorporating them into a single section providesclarity,reducesduplicationandincreasessimplicity.
45. A microgrid may interconnect with PREPA's system in accordance with
applicableregulationsadoptedbyPREPAforself-generatingcustomersofcomparablesizeandvoltage.Thenecessary interconnectionregulationsshallbedevelopedbyPREPAandsubmittedtotheCommission forreview.Untilanapproved interconnectionregulation isavailable, amicrogridmay operate in “island”mode. OnMay 16, 2018, the CommissionissuedOrderNo.CEPR-MI-2018-0008directingPREPAtodevelopandfileforCommissionreviewproposedinterconnectionregulation,withinatermnottoexceed120days.
46. CAMBIO, ElectrIQ and NPFGC stated that the regulations should be clearregarding the interconnection process with PREPA, since a potential ambiguity of theinterconnectionprocessmayresultinastumblingblockforfuturegridintegration.12IEEFAraisedconcernsregardingwhetherPREPAwouldhaveanobligationtoserveinterconnectedmicrogridcustomersintheeventthatthemicrogriddoesnotserveitsowncustomers.13Inaddition,NPFGCraisedan issuethatPREPAmayneedtoconductsystemredesigning forPREPA assets now integrated into microgrid systems.14 Tesla recommended thatinterconnectionrequirementsbedefinedordetailedwithsufficientcriteriatoensurethat 12CAMBIOCommentsat3;ElectrIQPowerCommentsat9;NPFGCCommentsat5-6.13IEEFAcommentsat4.14NPFGCCommentsat6.
11
interconnectioncostsdonotbecomecost-prohibitive.15OIPCalsorecommendstimeperiodsandregulationstointerconnectmicrogridsystemstothePREPAsystem.16
47. The Commission recognizes the importance of having clearly defined
interconnectionrequirements,standardsandtimetables.Accordingly,asstatedabove,theCommission has issued an order directing PREPA to develop and submit suchinterconnection regulation for Commission review within a term of 120 days. TheCommissionlooksforwardtocommenterviewsontheproposedPREPAregulation.17
H. Articles4-RequirementsforCooperativeMicrogrids
48. InlinewiththeamendmentsmadeinSection2.01regardingthemannerin
whichmicrogridsystemsaretobeclassified,theFinalMicrogridRegulationamendedArticle4oftheProposedMicrogridRulessothatitisapplicabletoallCooperativeMicrogrids.Allrequirements,includingregistrationrequirements,ownershipandsalerestrictions,andtheprovisions related to the allocation of cost among cooperative members are equallyapplicabletoallCooperativeMicrogrids,regardlessofsize.
49. UndertheProposedMicrogridRules,therequirementsestablishedinArticle4(applicabletoSmallCooperativeMicrogrids)andthoseestablishedinArticle5(applicableto Large Cooperative Microgrids) were identical, except for the reporting requirementapplicableonlytoLargeCooperativeMicrogrids.Therefore,thereisnoneedforbifurcatingtherequirementsapplicabletoCooperativeMicrogridsintotwoseparatearticles.
50. TheCommissionnotesthatthesectiononformsofdemonstratingcomplianceincludedinArticle5(applicabletoLargeCooperativeMicrogrids)oftheProposedMicrogridRuleswasnotincludedaspartoftheprovisionsofArticle4applicabletoSmallCooperativeMicrogrids.TheCommissioninadvertentlyomittedfromArticle4oftheProposedMicrogridRulestherequirementthatSmallCooperativeMicrogridsalsodemonstratebeingcompliantwith the requirements applicable to renewable, CHP or hybrid types of generation.Accordingly, under Article 4 of the Final Microgrid Regulation, both Small and LargeCooperativeMicrogridsmustdemonstratecompliancewiththerequirementsapplicabletogenerationresources.
I. Article5–RequirementsforThird-PartyMicrogrids
51. InlinewiththeamendmentsmadeinSection2.01regardingthemannerin
whichmicrogridsystemsaretobeclassifiedandtheamendmentsmadetoArticle4,theFinalMicrogridRegulationremovedArticle5oftheProposedMicrogridRulesandreplaceditwith 15TeslaComments,p.3.16OIPCComments,p.9-10.17 It should also be noted that existing PREPA interconnection regulations specifically exclude microgridsystems,thustheneedforthedevelopmentofnew,microgridspecific,interconnectionregulations.
12
anewArticle5,whichincorporatestherequirementsapplicabletoThird-PartyMicrogrids.The term Third-Party Microgrid encompasses any microgrid systems owned and/oroperatedforthepurposeofsellingenergyand/orothergridservicestocustomers,includingthoseownedand/oroperatedbymunicipalitiesorothergovernmententities(otherthanPREPA).
52. Accordingly,Article5oftheFinalMicrogridRegulationremovestheportionsofArticle6oftheProposedMicrogridRuleswhichdistinguishedbetweenmunicipalsystemsandthird-party.
J. §5.04–RateofService
53. A number of commenters expressed concerns that the proposed rate cap
shouldbeincreased,eliminated,ornotappliedinallsituations.
54. NPFGCsuggestedthatthepricecapbeincreasedbytheapproved$0.031perkWhtransitioncharge,eventhoughnosuchchargeiscurrentlyineffect.18McConnellValdéssuggests adding to the price cap undefined amounts of fees for interconnection,administration and infrastructure, reserves for improvements, and penalties for non-payment,onthegroundsthattheaddedlanguagewouldallowforthereasonableandfairrecoveryofexpenses,costs,andlossesnotrelatedtoamountstiedtorates.19
55. SchneiderElectricsuggeststhatMicrogridSystemsshouldhaveratesthataresimilar towhat thegridtypicallyprovidesandrequests flexibilityontheraterestriction,giventhenumerouschallengesinterrain,thenatureoftheconnectiontothemaingrid,theproposedrestrictionontheuseoffuelandgas,andotherconsiderations.20
56. ICSEopinesthattherulesshouldnotestablishacapforprices;rather,itshould
considerothermeansforpriceregulation,limitedtowhenthemicrogridisthesoleoptionfortheratepayerorthegroupofratepayersforenergysecurity,quality,orreliability.ICSEfurtherarguesthatfixingapricewilllimitthecapacityofpotentialmicrogriddevelopersthatofferservicesandcoststailoredtocustomerneeds(suchasacustomerpayingahigherpriceforadditionalserviceswhichwouldnotbepossibleonapredeterminedcap).21
57. Sunrunassertsthatcertainprojectsmayofferpremiumservicessuchas100percentrenewablegenerationoran increased levelofpowerquality.22ACONERsuggests
18NPFGCComments,p.4.19McConnellValdésComments,p.8.20SchneiderElectricComments,p.2.21ICSEComments,p.2–3.22SunrunComments,p.3.
13
thatthecostofenergynotbedefinedatacertainperiod;rather,thatitbedefinedbythemarketandcompetitionandthattheaveragerateatwhichenergyandgridservicesaresoldbebasedonmarketforces.23
58. Othercommenterssuggestedthatthe$0.2022perkWhcapmightbetoohigh.Energy Solutions suggests that establishing such a price ceiling is an invitation for alldeveloperstochargetheceilingpricetotheircustomersandthatareasonablemarginonthereturnshouldbeestablishedbytheFERCtyperulingswithcommunityparticipation.”24 59. TheCommissionamended the sections related to rateof service forThird-Party Microgrids and removed the $0.2022 rate cap established in Section 6.05 of theProposedMicrogridRules. 60. Section5.04oftheFinalMicrogridRegulationreplacestheproposedratecapwithaproject-specific,cost-basedrate.Byremovingtheproposedratecapandreplacingitwithaproject-specificandcost-basedrate, theCommission intendstoprovidemicrogridowners with sufficient flexibility to develop systemswhich best address the customer’sneedsandpriorities.
61. However, the Final Microgrid Regulation maintains basic consumer-protectionrequirements,suchasthattheratesareuniformacrosscustomerclasses(inthosecases in which a system serves different classes of customers—such as residential andcommercial)andthatsuchratesarenon-discriminatory.
62. Additionally,Third-PartyMicrogridownersand/oroperatorsarerequiredto
submitforCommissionreviewtheirproposedrates,alongwithsupportingdocumentation.InevaluatingtheproposedratesofeachThird-PartyMicrogrid,theCommissionwillensurethatratesarejustandreasonable,assuchstandardisusedinAct57-2014,andthattheyrepresenttheownerand/oroperator’sactualcostsplusareasonablerateofreturn.
63. The Commission believes this approach aligns the interests of microgrid
ownerand/oroperatorswiththoseofitscustomers,bygrantingownerand/oroperatorsflexibility to develop systems tailored to address the customer’s needs and preferences,while ensuring the rates charges for energy services are just and reasonable and notdiscriminatory.
K. §5.05–Deposits
64. Section5.05oftheFinalMicrogridRegulationmaintainstheauthorizationto
Third-PartyMicrogridstorequireprospectivecustomersthepaymentofadeposit.However,theFinalMicrogridRegulationsimplifiestherequirementsestablishedinSection6.06ofthe
23ACONERComments,p.6.24EnergySolutionsPuertoRicoComments,p.3.
14
ProposedMicrogridRulesbyonlyrequiringthatsuchdepositsbereasonableanduniformacrosscustomerclasses.
L. §5.08–ComplaintProcedure
65. TheFinalMicrogridRegulationaddsanewSection5.08requiringThird-Party
Microgridstodevelopandnotifytocustomerstheprocedurethroughwhichcustomersmaynotifyanycomplaintsorgrievances(otherthanbillobjections,addressedinSection5.07)relatedtotheservicesprovidedbythemicrogrid.Ratherthanimposingaspecificprocedureon themicrogrid owner/operator, Section 5.08 directs themicrogrid owner/operator todevelop the procedure and notify such to each customer. This provision ensures thatcustomers have an appropriate process to notify any complaints or grievances to themicrogridowner/operator,whileprovidingtheowner/operatortheopportunitytoaddresssuch complaints and grievances before they are notified to the Commission for formalresolution.
M. §5.09–StandardContract
66. Microgrid owner and/or operators are required to develop a standard
contractformwhichshallapplyuniformlythroughoutcustomerclasses.WhileSection5.09does not require specific terms and conditions, it does identify basic contractual clauseswhichmicrogridowners/operatorsmustincludeinallofitscustomercontracts.Section5.09oftheFinalMicrogridRegulationamendsSection6.09oftheProposedMicrogridRulestoexpandontheclausesrequiredtobeincludedincustomercontracts.ThepurposeofSection5.09 is toensurecustomershavetheopportunity to fully familiarizethemselveswiththetermsandconditionsoftheservicestheyaretoreceive,aswellastheirrightsandobligationsundersuchserviceagreement.Thissection,alongwithitsamendments,alsoseekstoensuretransparency and clarity during the contracting period, so as to reduce the likeliness ofcomplaints or grievances arising from obscure, complex or unintelligible terms andconditions.
N. §5.11–ContractLengthandExitRequirements
67. IEEFAraisestheconcernthatunderSection6.11oftheProposedMicrogrid
Rules,contractsmayrequireanoticeperiodforservicetermination,nottoexceed60days,butdoesnot stateaminimum.25McConnellValdés states that the timeperiod shouldbeextendedto120days.26
68. Section 5.11 of the FinalMicrogrid Regulation amends Section 6.11 of theProposedMicrogridRulestoprovidethat,intheeventofaterminationofthecontractualagreement, such termination must be preceded by at least a 30-day notice, therefore
25IEEFAComments,p.3.26McConnellValdésComments,p.10.
15
establishingaminimumnotificationperiodandeliminatinganyconstraintonthemaximumamountofpriornoticeallowed.
69. IEEFAalsosoughtclarificationthatintheeventofadefaultbythemicrogridownerthatPREPAwouldberequiredtobethedefaultprovider.Sections5.11(C)(5)and(6)of the Final Microgrid Regulation address this concern by detailing the rights andresponsibilitiesoftheMicrogridOperatorincaseofadefault.Insuchcases,theMicrogridOperatormayexerciseduediligencetoidentifyanewoperator,ensurecustomercontinuereceivinguninterruptedenergyservicesfromPREPA,offercustomertheoptionofassumingtheownershipoftheMicrogridthroughaCooperativeorprovideanyotherguarantee,suchas,butnotlimitedto,performancebonds,whichensurecontinuedanduninterruptedservicetocustomersintheeventofadefault.
70. IEEFAalsosuggeststhatafterfiveyears,customersshouldbeabletotransfer
theircontracttothesubsequenthomeowner.2771. TheCommissionclarifiesthattheprovisionsrelatedtothepaymentofanexit
fee applies to situation in which the existing customer wishes to terminate his/heragreementwithamicrogridsystemownerand/oroperator.NothingintheFinalMicrogridRulespreventsor limits the customer’s ability to transferhis/her contract formicrogridservice to a new customer. For example, a customerwhosells his/herhomemay freelytransferhis/hercontractformicrogridservicestothenewhomeowner,withouttheneedforpaymentofanexitfeeifsuchtransferoccurswithinthefirstfiveyearsofthecontract.
O. RateReview
72. McConnellValdéssuggeststhattheCommissionandcustomersbeprohibited
fromreviewingmicrogridratesforthreeyearsafterregistrationofthemicrogrid,butthat“systemowners”beallowedtopetition forratereview“atanymomentafterapprovalofregistration.”28
73. TheCommissionbelievesamicrogridsystemownerand/oroperatorhasthecapabilityofproposinginitialratesthatwillbesufficienttorecovercostsplusareasonablerateofreturnforthefirstthreeyearsofthesystem’soperation.Moreover,theCommissiondoesnotagreethatthereshouldbeaprohibitiononthecustomersortheCommissionfromexercisingthesamerightsthatthesystemownersseek.
P. Article6–RegistrationProcess
74. Under Article 7 of the Proposed Microgrid Rules, the registration of a
microgridsystemoccurredafterthesystemhadbeendesignedandbuilt.UnderArticle6oftheFinalMicrogridRegulation,theCommissionadoptedatwo-tierregistrationprocess.The
27IEEFAComments,p.3.28McConnellValdésComments,p.11.
16
firstpartoftheprocessencompassestheinitialregistrationofthesystem.Duringthisstep,themicrogrid’sownerand/oroperatorprovidestheCommissiontheinformationidentifiedinSections4.02(applicabletoCooperativeMicrogrids)and5.03(applicabletoThird-PartyMicrogrids), the Commission then evaluates said information and, if the information isdeemedcompleteandcomplaint,theCommissionwillgrantregisteredstatustothesystem.
75. The second step consistsof the filing of compliance certifications once themicrogrid system has been fully built. Filing of these compliance certifications is pre-requisite for the microgrid to be authorized to begin operation. However, once suchinformationhasbeenfiled,themicrogridmaybeginoperationwithouttheneedforfurtherCommission authorization. The filing of the certifications shall be considered as apresumptionthatthemicrogridwasbuiltandwilloperatewithintheparametersinitiallyidentifiedintheapplicationforregistration.Amicrogridsystemmaynotbeginoperationprior to filing such certificationswith the Commission. The Commissionwill review thecertifications provided and will notify the microgrid owner/operator the result of suchevaluation.
76. Thepurposeof thisamendment is toreducetheregulatory impediment formicrogrid systems to begin operation. The Commission will rely on the good faith ofmicrogrid owners and/or operators certifying that the microgrid systems were builtconsistent with the information and designs originally submitted to the Commission.However, if, as part of the Commission’s evaluation of the certifications provided by themicrogrid owners and/or operators or as part of any investigative proceeding, theCommissiondetermines that a systemwasbuiltor isbeingoperated inamannerwhichsubstantially diverge from the information originally provided to the Commission, theCommissionmayordersuchownerand/oroperatortotemporarilysuspendoperationsuntilafinaldeterminationismade.
77. The Commission believes that these amendments address commenterconcernsthattheregistrationprocesstakesplacefollowingtheinvestmentofcapitalfortheproject,butattheriskofnothavingtheprojectapprovedbytheCommission.29
Q. Article7–Exemptions
78. Several commenters raised issues that demonstrated that an exemption or
modificationtotherulesmaybeappropriate.30Asoriginallyproposed,Article8(nowArticle7 of the Final Microgrid Regulation) addressed only exemptions from Article 2. TheCommissionconcursthattherecouldbeothercircumstancesthatmayjustifyanexemptionfromaspecificregulation.TheCommissionthereforehasbroadenedthelanguageinArticle7 to cover the ability of any party to file for an exemption to any provision of the FinalMicrogridRegulation.Moreover,thisopportunitytofileforanexemptionshallbeextended
29McConnellValdésComments,p.13.30Seeforexample,InstituteforEnergyEconomicsandFinancialAnalysis(IEEFA),p.2.
17
toafteramicrogrid is inoperation in theeventof ananticipatedorproposedchange incircumstances.IV. OtherIssues
A. TheConceptofMicrogridOwnerandMicrogridOperator
79. In thecontextof theFinalMicrogridRegulation, theterm“owner”refers to
eitherthePerson(s)whodirectlypurchasethemicrogridequipmentorthePerson(s)wholeasetheequipment fromamicrogridequipmentvendororreceivethird-party financingservicesfromsuchvendor.Inbothcases,thePerson(s)makingamonetarydisbursementfortherighttousetheequipmentisthePerson(s)consideredastheownerofthemicrogridforpurposesoftheFinalMicrogridRegulation.Theentitysellingorleasingtheequipment,orthatoffersthird-partyfinancingservicestothemicrogridowner,hasnoobligationsundertheFinalMicrogridRegulation,providedsuchentitydoesnotofferEnergyServicesand/orOtherGridServices,assuchtermsaredefinedintheRegulation,ordoesnototherwiseactasMicrogridOperator.
80. The Microgrid Operator, on the other hand, refers to the Person(s) whooperatethesystem.Insomecases,theMicrogridOwnermayalsobetheMicrogridOperator.Inothercases,theMicrogridOwnermayoutsourcesuchfunctiontoathird-party,whothenbecomes the Microgrid Operator. The Microgrid Operator is the person responsible foroverseeingtheoperationofthemicrogridequipment,providingthecontractedservicestothecustomers(ormembers,inthecaseofacooperativemicrogrid)andcustomerbilling,when applicable. The majority of the responsibilities during the operational phase of amicrogridfallonthePersondesignatedastheMicrogridOperator.
B. Cost-BenefitAnalysis
81. BayamónarguesthatSection2.5ofthePuertoRicoUniformAdministrative
ProcedureAct requires that anynewregulation includea justificationanda cost-benefitanalysis.31Bayamónsubmitsthatvariousaspectsoftheregulationshavepotentialsystemcostandeconomicfeasibilityimpacts.
82. TheCommissionfindsthattheseconcernsarenotwell-founded.Theoverall
benefitoftheFinalMicrogridRegulationisthattheyempowercustomerstoself-generate,inamannerthatprovideseconomicbenefitstothosecustomers,notonlyintermsofthepotentialcostofelectricity,butalsoinprovidingbusinesseswiththeabilitytooperatewhereelectricserviceisnotavailableornotreliable.Theavailabilityofamicrogridoptionisfullyconsistentwith existing public policyunderAct 57-2014, theGovernor’s statements and
31BayamónComments,p.10
18
PREPA’s comments on the importance of microgrids.32 Given current circumstances,includingcontinuedoutages,PREPA’slimitedresources,andvolatilefossilfuelcosts,amongothers,theabilitytoreceivepowerfromamicrogridoutweighsanycoststhatmayarisefromcomplyingwiththeseregulations.Thealternativeofnothavingpower,giventhecurrentstateofPREPA’sgrid,isclearlysufficienttomeetacost-benefitanalysisrequirement.
83. GiventheoutagesexperiencedduringhurricanesIrmaandMariaandtheneedto diversify energy resources, reduce dependency on fossil fuel and foster energyindependence as a choice, any burden created by the need to comply with theserequirementsisnominalwhencomparedtothebenefitsderived,bythecustomer,ononehand,whomreceivesgreatercontroloverhisenergyneeds,andmicrogriddevelopers,ontheother,whoareable tomake informedandobjective investmentdecisionsbasedonapredictableregulatoryframework.
84. Furthermore,theserulesdonotimpose,norintendtoimpose,undueburdenonmicrogridownerand/ordevelopers,becausemostoftheinformationtobeprovidedtotheCommissionisinformationtheywouldotherwiseneedtoproduceorprovide,eitheraspartofthedesignanddevelopmentprocessoraspartofpermittingproceduresbeforeothergovernmententities.Additionally,theinterestsofmicrogriddevelopersarealsoalignedwiththeinterestofconsumers,byrequiringtransparencyandfulldisclosureofallinformation,rightsandresponsibilities,sothatcustomersandmicrogridowners/developersareawareoftheirrightsandobligations.
85. Finally,manyoftheamendmentsdescribedinPartIIIaboveweremadewith
the purpose of providing greater flexibility, reducing unnecessary requirements, andprovidingbothdevelopersandcustomersgreateraccesstomicrogridservicealternativesandmarkets.
C. CompliancewithOtherRegulations
86. Several parties pointed out that there are many other requirements for a
microgrid owner or operator to comply with, including siting, construction, andenvironmentalconcerns.33TheCommissionemphasizesherethatmeetingtherequirementsofthesemicrogridrulesdoesnot,inanyway,exemptsanymicrogridowner/operatorfromanyotherrequirementsoftheCommonwealthandfederallawsandregulations,anditisthe
32Act57,§2,6;“Iam100percentbackingrenewables.ThisisanopportunitytomakemicrogridsinPuertoRicosotheycanbesustainedindifferentareas.”StatementofGovernorRicardoRossellótotheSenateEnergyandNatural Resources Committee, November 14, 2017. https://www.vox.com/energy-and-environment/2017/10/19/16431312/elon-musk-richard-branson-clean-energy-puerto-rico-solar-batteries-microgrid.“BuildBackBetter:ReimaginingandStrengtheningthePowerGridofPuertoRico,”preparedbyPREPAet.al.forGovernorRosselló,December2017.PREPAAmended&RestatedFiscalPlan,January24,2018;PREPAComments,p.1.33AdHocGroupofPREPABondholders(AdHocBondholders),p.12.
19
responsibilityofeverymicrogridownerand/oroperatortoensurethatitsmicrogridprojectis incompliancewithallCommonwealthandfederalrulesandregulations, includinganyapplicablelocalrulesandregulations.Accordingly,theCommissionhasclarifiedthispointinSection1.17.
87. Further,severalpartiescommentedthattheCommissionshouldplayarolein,
orsettingforthpoliciesfor,determiningappropriatesitingformicrogrids.34Sitingissuesarebeyond the scope of the Commission’s jurisdiction and should be addressed before theappropriategovernmentagencies.
D. QualifiedHydropower
88. TheMunicipality ofBayamón commented that the definitionof Alternative
RenewableEnergyResourcecontainedintheProposedMicrogridRegulationexcludestheterm“QualifiedHydropower”andthatsuchexclusioniscontrarytoAct133-2016.35
89. QualifiedHydropowerisincludedinthedefinitionofSustainableRenewableEnergyResources.TheCommissionusedtheterm“SustainableRenewableEnergy”,definedinAct82-2010,asamendedbyAct133-2016,asthebasisfordefiningthisterminboth,theProposed Microgrid Rules and the Final Microgrid Regulation. As such, Qualifiedhydropower is a source of generation expressly contemplated in the Final MicrogridRegulation.
E. UseofPREPAInfrastructure
90. TheProposedMicrogridRulescontemplatedmicrogridsystemspurchasingorleasingPREPAequipment(suchaslines,poles,etc.)sothatsaidequipmentwouldbeusedbythemicrogridsystem.TheProposedMicrogridRulesthenestablishedtheproceduretodeterminethefeestobepaidtoPREPAforthepurchaseorleaseofsuchequipment. 91. PREPAraisesconcernsas towhethertheCommissioncanorderthesaleorlease of PREPA property, and whether those actions would require the approval of theFederalCourt,givenPREPAhadfiledforPROMESATitleIIIrestructuring.36Similarly,theAdHoc Bondholders argued that the PREPA 1974 Trust Agreement, under which PREPA’sbondshavebeenissued,requiresbondholderconsentforthesaleorleaseofpropertyownedbyPREPA.37 92.TheCommissiondeterminedtoremovefromtheFinalMicrogridRegulationtheprovisionsrelatedtotheuseofPREPAinfrastructure.TheCommission’soriginalintention 34Seeforexample,CAMBIOComments,p.3.35BayamónCommentsatp.9.36PREPACommentsat5.37AdHocBondholdersCommentsat2.
REGULATIONONMICROGRIDDEVELOPMENT
2
TABLEOFCONTENTS
CHAPTERI-GENERALPROVISIONS....................................................................................................4 ARTICLE1.-GENERALPROVISIONS....................................................................................................4
Section1.01.-Title...........................................................................................................................................4 Section1.02.-LegalBasis.............................................................................................................................4 Section1.03.-PurposeandExecutiveSummary.............................................................................4 Section1.04.-Applicability.........................................................................................................................5 Section1.05.-Interpretation......................................................................................................................5 Section1.06.-ProvisionsofOtherRegulations................................................................................5 Section1.07.-UnforeseenProceedings................................................................................................5 Section1.08.-Definitions.............................................................................................................................5 Section1.09.-ControllingVersion...........................................................................................................9 Section1.10.-Severability...........................................................................................................................9 Section1.11.-Forms.......................................................................................................................................9 Section1.12.-ModeofSubmission......................................................................................................10 Section1.13.-EffectofSubmission......................................................................................................10 Section1.14.-ConfidentialInformation............................................................................................10 Section1.15.-Validity.................................................................................................................................10 Section1.16.-PenaltiesforNon-Compliance.................................................................................10 Section1.17.-CompliancewithOtherApplicableLegalRequirements...........................11
CHAPTERII-MICROGRIDPROVISIONS..........................................................................................11 ARTICLE2.-MICROGRIDCATEGORIES...........................................................................................11
Section2.01.-MicrogridClassification..............................................................................................11 Section2.02.-SaleofEnergyServicesandotherGridServices............................................12
ARTICLE3.-MICROGRIDTECHNICALREQUIREMENTS.........................................................12 Section3.01.-MicrogridComposition................................................................................................12 Section3.03.-EligibleGenerationResources.................................................................................12 Section3.04.-FormsofDemostratingCompliance.....................................................................14 Section3.05.-CodesandStandards.....................................................................................................15 Section3.06.-InterconnectionwithPREPA’sSystem................................................................16
ARTICLE4.-REQUIREMENTSFORCOOPERATIVEMICROGRIDS......................................16 Section4.01.-OwnershipRestriction.................................................................................................16 Section4.02.-SizeofCooperativeMicrogrids................................................................................16 Section4.03.-ApplicationandRegistration....................................................................................16 Section4.04.-RateforService................................................................................................................17 Section4.05.-AdditionalRequirementsApplicabletoLargeCooperatives...................18
ARTICLE5.-REQUIREMENTSFORTHIRD-PARTYMICROGRIDS.......................................18 Section5.01.-OwnershipandSalesRestrictions.........................................................................18 Section5.02.-Certification.......................................................................................................................18 Section5.03.-Registration.......................................................................................................................19 Section5.04.-RateStructure...................................................................................................................20 Section5.05.-Deposits...............................................................................................................................21 Section5.06.-Billing....................................................................................................................................21 Section5.07.-BillObjectionsandSuspensionofService.........................................................21
3
Section5.08.-ComplaintProcedure....................................................................................................21 Section5.09.-StandardContract..........................................................................................................22 Section5.10.-Non-Discrimination.......................................................................................................22 Section5.11.-ContractLengthandExitRequirements............................................................23 Section5.12.-Reporting............................................................................................................................24 Section5.13.-RateReview.......................................................................................................................25
CHAPTERIIIPROCEDURES...................................................................................................................25 ARTICLE6.-REGISTRATIONPROCESS............................................................................................25
Section6.01.-RegistrationForm..........................................................................................................25 Section6.02.-CommissionReview......................................................................................................25 Section6.03.-ComplianceCertifications..........................................................................................26 Section6.04.-FilingFee.............................................................................................................................27
ARTICLE7.-EXEMPTIONS.....................................................................................................................27 ARTICLE8.-RECONSIDERATIONANDJUDICIALREVIEW....................................................27
Section8.01.-RequestforReconsideration....................................................................................27 Section8.02.-JudicialReview.................................................................................................................28
4
REGULATIONONMICROGRIDDEVELOPMENT
CHAPTERI-GENERALPROVISIONS
ARTICLE1.-GENERALPROVISIONS
Section1.01.-Title.
ThisRegulationshallbeknownastheRegulationonMicrogridDevelopmentofthePuertoRicoEnergyCommission.
Section1.02.-LegalBasis.
This Regulation is adopted pursuant to Act 57-2014, as amended, known as thePuerto Rico Energy Transformation and RELIEF Act; Act 82-2010, as amended,knownasthePublicPolicyonEnergyDiversificationbyMeansofSustainableandAlternativeRenewableEnergyinPuertoRicoAct;Act83-2010,knownastheGreenEnergy Incentives Act; and Act 38-2017, known as the Uniform AdministrativeProcedureActoftheGovernmentofPuertoRico(“LPAU”,foritsSpanishacronym).
Section1.03.-PurposeandExecutiveSummary.
The Puerto Rico Energy Commission (“Commission”) adopts and enacts thisRegulationtoassistinthedevelopmentofMicrogridsthroughoutPuertoRico.TheprolongedoutagesanditsimpactsonthecitizensofPuertoRicocausedbyHurricanesIrmaandMariahighlightstheneedtofosterthecreationofMicrogridsasameansofdeliveringreliableenergyservicestocustomersinneed,avoidingthelossofpowerat critical facilities, promoting customer choice, reducing carbon pollution andspurring economic development while integrating new technology and industrytrends into Puerto Rico’s energy market. Accordingly, Microgrids and otherdistributedgenerationresourcesareakeycomponentoftheGovernmentofPuertoRico’sstrategyforrebuildingandstrengtheningPuertoRico’selectricpowersystem.1
The Commission seeks to harness the potential of decentralized energy resourcesincludingthoseidentifiedassustainablerenewableoralternativerenewableenergyresources, as defined by Act 82-2010; combined heat-and-power; and otherdistributed resources, to strengthen the resiliency of the electric grid, empowercustomers,andincreaserelianceonrenewableandhighly-efficientresourcesacrossthe Commonwealth. One statutory goal of microgrids is to reduce energyconsumptionbasedonfossilfuelsthroughlocalrenewableenergygeneration.
BecauseMicrogridscanoperateinan“islanded”mode,disconnectedfromtheelectricgrid, they are able to independently provide electric service during grid outage
1SeeRequestforFederalAssistanceforDisasterRecovery,BuildBackBetterPuertoRico,November2017atpp.15-19.
5
periodsorinterruptions.Microgridscancontributetorapidrestorationofservice,asthere are areas where power could be restored quicker by the deployment ofMicrogridsratherthanwaitingreconnectiontothegridatlarge.
With this Regulation, the Commission intends to provide a stable and predictableregulatoryframework,capableoffosteringinnovationandeconomicgrowththroughcontinuedinvestmentsinthedevelopmentanddeploymentofMicrogridsystems.
Section1.04.-Applicability.
This Regulation shall apply to the registration, development and operation ofMicrogridsthatserveend-usecustomers.
Section1.05.-Interpretation.
ThisRegulationshallbeinterpretedinawaythatpromotesthehighestpublicgoodandtheprotectionoftheinterestsoftheresidentsofPuertoRico,andinsuchawaythatthedeploymentofMicrogridsarecarriedoutrapidly,justly,andeconomically.
Section1.06.-ProvisionsofOtherRegulations.
ThisRegulationmaybesupplementedbytheprovisionsofotherregulationsofthePuerto Rico Energy Commission that are compatible with the provisions of thisRegulation.
Section1.07.-UnforeseenProceedings.
When a specific proceeding has not been planned for in this Regulation, theCommissionmayattendtoitinanywaythatisconsistentwithAct57-2014.
Section1.08.-Definitions.
A. ThesedefinitionsaretobeusedforthisRegulationandarenotintendedtomodifythedefinitionsusedinanyotherCommissionregulationororder.
B. ForthepurposesofthisRegulation,thefollowingtermswillhavethemeaningestablishedbelow,exceptwhen the contextof the contentof anyprovisionclearlyindicatessomethingelse:
1. “Alternative Renewable Energy Resources” refers to the energysourceslistedinSection1.4(13)ofAct82-2010,specifically:
i. Conversionofmunicipalsolidwaste;
ii. Landfillgascombustion;
iii. Anaerobicdigestion;
iv. Fuelcells;and
6
v. AnyotherenergythattheCommonwealthEnergyPublicPolicyOffice may define in the future through regulations asalternativerenewableenergy.
2. “Combinedheat-and-power”(CHP)meansequipmentusedtoproduceelectric energy and forms ofuseful thermal energy (such as heat orsteam),usedforindustrial,commercial,heating,orcoolingpurposes,throughtheintegrateduseoftechnology.
3. “Commission”meansthePuertoRicoEnergyCommission.
4. “CooperativeMember”or“Member”meansaPersonwho,alongwithtwo or more Persons, share ownership interest in a CooperativeMicrogridandreceiveEnergyServicesand/orotherGridServicesfromtheCooperative.
5. “CooperativeMicrogrid”meansthejoint-ownershipofaMicrogridbythree or more Cooperative Members through formal or informalorganization or association. For purposes of this Regulation, aCooperativemay,butneednotbe,organizedoroperatedpursuanttoAct 164-2009, as amended, known as the Puerto Rico GeneralCorporationsActorAct239-2004,asamended,knownastheGeneralCooperativeAssociationsAct.Theprimarypurposeof aCooperativeMicrogrid is to supply Energy Services or Grid Services to itsCooperativeMembers.
6. “Customer”means any Person, as such term is defined herein,whoconsumesoruseselectricpowerorenergyservicesfromaThird-PartyMicrogrid.
7. “Distributed Energy Resources” means Distributed Generation orelectricenergystorage.
8. “DistributedGeneration”meansanelectricpowergenerationfacilityinPuerto Rico connected to the Distribution Infrastructure or to aMicrogridand/orproducingpowerforself-supplyorsale.
9. “Distribution Infrastructure”means the physical equipment used todistributeelectricpoweratvoltagesbelow38,000volts,includingbutnot limited to poles, primary lines, secondary lines, service drops,transformersandMeters.
10. “Distributed Renewable Energy” means Distributed GenerationpoweredbyRenewableResourceswhichgenerateselectricpowerforself-consumption,saletothird-partiesortosupplyanElectricServiceCompany.
7
11. “Electric Bill”means the document sent periodically by the ElectricServiceCompanytoaCustomerlistingallthecomponents,charges,orratesthatmakeupthefinalconsumptioncosteachCustomermustpay.
12. “ElectricPowerDistribution”or“Distribution”meansthedeliveryofelectric power from any electric substation or generator to anyCustomerthroughDistributionInfrastructure.
13. “Electric Power Grid” means the electric power transmission andDistributionInfrastructureoftheCommonwealthofPuertoRico.
14. “EnergyService”meanselectricityserviceprovidedtoaCustomerinPuertoRicobyanElectricServiceCompany.
15. "Electric Service Company" means any Person engaged in thegeneration, transmission, distribution, billing, or resale of electricpower.
16. “EnergyStorage”meansanyresourcelocatedintheMicrogridthatiscapableofreceivingelectricenergyfromtheElectricPowerGridoranyothergenerationresource,forlaterinjectionofelectricitybacktotheElectricPowerGridortoserveanyload.
17. “GridServices”includeancillaryservices,demandresponseandotherservicessupportingDistributionInfrastructureand/orElectricPowerDistribution.
18. “Interconnection” means the connection of Distributed EnergyResourcestoDistributionInfrastructure.
19. “Meter”means theequipmentused tomeasure consumptionand/orgenerationofenergyatthepointofconnectionbetweenanindividualCustomer or Cooperative Member and a Microgrid or DistributionInfrastructure, as well as associated communications and controlcapabilities.
20. “Microgrid” means a group of interconnected loads and DistributedEnergyResourceswithinclearlydefinedelectricalboundariesthatactsasasinglecontrollableentitythatcanconnectanddisconnectfromtheElectricPowerGridtoenableittooperateineithergrid-connectedoroff-the-grid(islanded)mode.
21. “Microgrid Operator”means the registered operator of aMicrogrid,which shall be the primary party responsible for overseeing theoperationof themicrogrid equipment (including, but not limited to,Distributed Energy Resources and Distribution Infrastructure),providingmaintenance,deliveringcontractedservices,billingforsuch
8
services, and servingas theprimarypointof contact.TheMicrogridOperatormayormaynotbetheowneroftheMicrogrid.
22. "Municipality"meansthelocalgovernmentlegalentityorganizedandexisting pursuant to Article VI, §1 of the Constitution of theCommonwealthofPuertoRicoandActNo.81ofAugust30,1991,asamended, known as the Autonomous Municipality Act of theCommonwealthofPuertoRico.
23. “Owner” refers to the Person or Persons with a direct proprietaryinterest in a Microgrid system. The proprietary interest over aMicrogrid system is separate and independent from the proprietaryinterestovertheequipmentusedbytheMicrogridtosupplyEnergyServices and/or Other Grid Services. As such, Microgrid equipmentvendorswholeaseorofferthird-partyfinancingoptionsarenotsubjecttotheprovisionsofthisRegulation,providedsuchequipmentvendorsdonotofferEnergyServicesand/orOtherGridServices,assuchtermsaredefinedherein,ordonototherwiseactasMicrogridOperator.
24. “Person”meansanaturalperson;alegalentitycreated,organized,orexisting under the laws of the Commonwealth of Puerto Rico, theUnitedStatesofAmerica,anystateoftheunion,oranyforeignstateorcountry; a Municipality or a consortium of Municipalities; or agovernmententity(otherthanPREPA).
25. “PersonalMicrogrid”meansaMicrogridownedbynomorethantwoPersonsproducingenergyprimarilyforconsumptionbyitsowner(s).
26. “PREPA”meansthePuertoRicoElectricPowerAuthority,acorporateentitycreatedbyvirtueofActNo.83ofMay2,1941,asamended,andanysuccessordistributionortransmissionowneroroperator.
27. “Renewable Resource” means any combination of AlternativeRenewable Energy Resources or Sustainable Renewable EnergyResources.
28. “SustainableRenewableEnergyResource”referstotheenergysourceslistedinSection1.4(15)ofAct82-2010,specifically:
i. Solarenergy;
ii. Windenergy;
iii. Geothermalenergy;
iv. RenewableBiomassCombustion;
v. RenewableBiomassGasCombustion;
9
vi. Combustionofbiofuelderivedsolelyfromrenewablebiomass;
vii. Qualifiedhydropower;
viii. Marine and hydrokinetic renewable energy, as defined inSection 632of the “Energy Independence and SecurityActof2007”(PublicLaw110-140,42,U.S.C.§17211);
ix. Oceanthermalenergy;or
x. Anyothercleanand/orrenewableenergythattheCommissionmay define in the future through regulation or order asrenewableenergy.
29. “Third-Party Microgrid” means a Microgrid that is not a PersonalMicrogrid or a Cooperative, and is owned and/or operated by anyPersonorPersonsfortheprimarypruposeofengaginginthesaleofEnergyServicesand/orOtherGridServicestoCustomers.
C. EverywordusedinthesingularinthisRegulationshallbeunderstoodtoalsoincludethepluralunlessthecontextindicatesotherwise.
Section1.09.-ControllingVersion.
ShouldanydiscrepancybetweentheSpanishversionandtheEnglishversionofthisRegulationarise,theprovisionsoftheEnglishversionshallprevail.
Section1.10.-Severability.
Ifanyarticle,provision,word,sentence,paragraph,orsectionofthisRegulationisdisputed,foranyreason,beforeacourtanddeclaredunconstitutionalorvoid,suchruling shall not affect, damage, or invalidate the remaining provisions of thisRegulation,buttheireffectshallbelimitedtothearticle,provision,word,sentence,paragraph, or section that is declared unconstitutional or void. The nullity orinvalidityofanyarticle,word,sentence,paragraph,orsection inanyspecificcase,shallnotaffectorjeopardizeinanywayitsapplicationorvalidityinanyothercase,exceptifitspecificallyandexpresslyinvalidatesallcases.
Section1.11.-Forms.
The Commission shall establish the forms it deems necessary to conduct theproceedingspursuanttothisRegulation,andshallinformthepublicviaitswebsite.Notwithstanding,thefactthattheCommissionhasnotadoptedoneormoreforms,isintheprocessofreviewingthem,ortheInternetwebsiteisoutofservice,shallnotrelease any party of its obligation to comply with the provisions stated herein,providetheinformationrequiredbythisRegulationorotherwisecomplywithanyapplicableCommissionorder.
10
Section1.12.-ModeofSubmission.
Theforms,documents,andappearancesrequiredbyvirtueofthisRegulationoranyorder of the Commissionmust be submitted before the Commission in electronicformat according to the instructions which, from time to time, the Commissionestablishesthroughanorderinrelationtotheelectronicfilingsystem.
Iftheelectronicfilingsystemistemporarilynotoperatingorfunctioning,theforms,documents,andappearancesrequiredbyvirtueofthisRegulationorbyanyorderoftheCommissionshallbesubmittedbeforetheCommissioninaccordancewithanyinstructionsthattheCommissionshallprovideatthattimethroughanorder.
Section1.13.-EffectofSubmission.
InfilinganydocumentbeforetheCommission,thepartyundersigningsuchdocumentshallbedeemedtohavecertifiedthatthecontentofsaiddocumentistrueandthat,according to the signer’s best knowledge, information, and belief, formed afterreasonable inquiry, the document is based on reliable and trustworthy facts,arguments,judicialsources,andinformation.
Section1.14.-ConfidentialInformation.
If incompliancewiththeprovisionsof thisRegulationoranyof theCommission’sorders,apersonhasthedutytodiscloseinformationtotheCommissionconsideredto be privileged, pursuant to applicable evidentiary privileges, said person shallidentifytheallegedprivilegedinformationandrequestinwritingfortheCommissiontotreatsuchinformationasconfidential,pursuanttoArticle6.15ofAct57-2014.Inidentifying privileged information and requesting confidential treatment by theCommission,therequestingpartyshallfollowtherulesandproceduresestablishedby the Commission inResolution CEPR-MI-2016-0009, as such resolutionmay beamended from time to time, for the filing, handling and treatment of confidentialinformation.Except in the caseof informationprotectedunder theattorney-clientprivilege, the claim of confidential treatment shall, under no circumstances, begroundsfordenyingsuchinformationfrombeingfiledwiththeCommission.
Section1.15.-Validity.
PursuanttoSection2.8oftheLPAU,thisRegulationshallenterintoeffectthirty(30)daysafteritssubmissiontotheDepartmentofStateandtheLegislativeLibraryoftheOfficeofLegislativeServices.
Section1.16.-PenaltiesforNon-Compliance
Any Person who fails to comply with any of the requirements set forth in thisRegulationmaybesubjecttoaNoticeofNon-CompliancepursuanttoChapterIVofRegulation85432andmay, asa resultof suchnon-compliance, lose its statusasa 2RegulationonAdjudicative,NoticeofNoncompliance,RateReviewandInvestigationProcedures.
11
registered Microgrid system or be subject to any other applicable administrativesanctionorpenaltydeemedappropriatebytheCommission.
Section1.17.-CompliancewithOtherApplicableLegalRequirements
IndevelopingaMicrogridSystempursuanttothisRegulation,theowner,operatorand/ordeveloperofsuchMicrogridsystemshallalsoensuretofullycomplywithanyand all applicable legal and regulatory requirements established and enforced byother relevant local, state and federal government entities. The granting of anauthorizationtooperateasaregisteredMicrogridsystemunderthisRegulationshallnotrelieveapartyfromfullycomplyingwithotherapplicablelegalandregulatoryrequirementsenforcedbyanyothergovernmententity.
CHAPTERII-MICROGRIDPROVISIONS
ARTICLE2.-MICROGRIDCATEGORIES
Section2.01.-MicrogridClassification.
A. Microgridsshallbeclassifiedasonofthefollowing:
1. PersonalMicrogrid.
2. CooperativeMicrogrid.
3. Third-PartyMicrogrid.
4. Any other ownership or operational arrangement not contemplatedherein may be submitted for Commission review, along with anysupportinginformationtheCommissionmaydeemrelevant.
B. Microgrids shall be subject to various requirements based on theirclassification,asfollows:
1. ExceptasotherwisestatedinSection2.02ofthisRegulation,therearenootherrequirementsforPersonalMicrogridsunderthisRegulation.
2. TherequirementsforCooperativeMicrogridsaredescribedinArticle4ofthisRegulation.
3. TherequirementsforThirdPartyMicrogridsaredescribedinArticle5ofthisRegulation.
4. The requirements forMicrogridsownedordevelopedbyPREPAareoutsidethescopeofthisRegulation.PREPAproposedmicrogridsshallbeaddressedthroughapplicableresourceplanningprocesses.
5. Therequirementsforsystemsoftypesnotlistedabovearethesameasthose for Third Party Microgrids, except as determined by the
12
CommissionundertheexemptionsprocessdescribedinArticle7ofthisRegulation.
Section2.02.-SaleofEnergyServicesandotherGridServices.
A. Except as otherwise provided in sub-section (C) of this Section, PersonalMicrogrids may provide Energy Services and/or other Grid Services to itsOwner(s)ortoPREPA.
B. Exceptasotherwiseprovidedinsub-section(C)ofthisSection,CooperativeMicrogrids may provide Energy Services and/or other Grid Services to itsMembersortoPREPA.
C. Personal Microgrids and Cooperative Microgrids may sale excess EnergyServices and/orotherGrid Services to Person(s) other than those listed inSubsections(A)and(B)ofthisSection,asapplicable,subjecttoCommissionauthorization.Insuchcases,theMicrogridmustsubmit,duringitsapplicationoratanymomentthereafterbutbeforeengaginginthesaleofsuchEnergyServices and/or otherGrid Services, a detailed request to the Commissiondescribing the proposed arrangement between the Microgrid and thePerson(s). Such Microgrids must provide any information relevant to theproposed arrangement or that may be required by the Commission. TheCommissionshallissueadeterminationontherequestwithinthirty(30)daysofreceipt.
ARTICLE3.-MICROGRIDTECHNICALREQUIREMENTS
Section3.01.-MicrogridComposition
AMicrogridshallconsist,ataminimum,ofgenerationassets,loadsandDistributionInfrastructure. Microgrids shall include sufficient generation, storage assets andadvanceddistributiontechnologies3toserveloadundernormaloperatingandusageconditions.IfaMicrogridincludesMeters,allmembersofeachcustomer-classmustbeequippedwithcomparablemeteringtechnology.
Section3.03.-EligibleGenerationResources
Microgrids may use either “renewable,” “combined heat-and-power,” or “hybrid,”generationresources,eachdescribedasfollows:
A. “Renewable” Microgrids – Renewable Microgrids have the followingqualifications:
3Advanceddistributiontechnologiesareequipmentsuchassensors,powerconditioningequipmentand other equipment suitable for regulation of voltage and/or frequency, control systems,communicationsystems,andautomationtechnologies.
13
1. The primary energy source of the Microgrid must be one or moreRenewableResource(s)asdefinedinSection1.08ofthisRegulation.
2. ForRenewableResourcestobethe“Primaryenergysource”:
a. Seventy-fivepercent(75%)oftheenergyoutputofthesystemduring the 12-month period beginning with the date theMicrogrid first produces electric energy and each 12-monthperiodthereaftermustbefromaRenewableResource;4
b. The fuelusedbynon-renewablegenerationmustbenomorethan2,500Btupertotalenergyprovidedbythemicrogrid5;
c. Thenon-renweablegenerationmustoperateataheatrateofnomorethan13,000Btu/kWhatfulloutput;and
d. Thesumofinstalledrenewableenergygeneratingcapacityandelectricalenergystoragecapacity(inMW)oftheMicrogridshallexceedtheexpectedpeakdemandoftheMicrogrid.
3. Exceptasotherwiseprovideherein,useof fossil fuelbyaMicrogridmaynot,intheaggregate,exceedtwenty-fivepercent(25%)ofthetotalenergy output of the system during the 12-month period beginningwiththedatetheMicrogridfirstproduceselectricenergyandeach12-monthperiodthereafter.
4. UseoffossilfuelbyaMicrogridislimitedtothosepurposesidentifiedin18C.F.R.§292.204(b)(2)ortooperatetheMicrogridduringperiodswhentheRenewableResourcesareunavailable.6
5. ARenewableMicrogridOperatormayapplyforanexemption,underArticle7ofthisRegulation,ofthetwenty-fivepercent(25%)limiton
4Formicrogriddeliveringpowerasalternatingcurrentoutputwillbemeasuredatthealternatingcurrentterminalsofthegenerator,afteranyinverterconvertingdirectcurrentpowertoalternatingcurrent. Formicrogrids delivering power as direct current, outputwill bemeasured at the directcurrentterminalsofthegenerator,afteranyinverterconvertingalternatingcurrentpowertodirectcurrent.5Asanexample,thisstandardmaybemetbyageneratoroperatingat10,000Btu/kWh,providing25%oftheMicrogridelectricenergy.6Useofoil,naturalgasandcoalbyaMicrogrid,underSection3(17)(B)oftheFederalPowerAct,islimitedtotheminimumamountsoffuelrequiredforignition,startup,testing,flamestabilization,andcontrol uses, and the minimum amounts of fuel required to alleviate or prevent unanticipatedequipmentoutages,andemergencies,directlyaffecting thepublichealth, safety,orwelfare,whichwouldresultfromelectricpoweroutages.
14
energy output from fossil fuels due to electrical equipment damagefromforcemajeureevents.
B. “Combined heat-and-power” (CHP) Microgrids – CHP Microgrids mustmeetthefollowingrequirementsduringthe12-monthperiodbeginningwiththe date the Microgrid first produces electric energy and each 12-monthperiodthereafter:7
1. The useful thermal energy outputof the system is no less than fiftypercent(50%)ofthetotalenergyoutput.
2. Thefuelinput,minustheusefulthermalenergyoutput,isnomorethan7,000BtuperkWhofgeneratoroutput.
C. HybridMicrogrids – In order to be considered as a “Hybrid”, aMicrogridmustcomplywiththefollowing:
1. The renewable portion of its generation capacity must meet therequirementsofRenewableMicrogridsestablishedinSubsectionAofthisSection;and
2. Thecombinedheat-and-powerportionofitsgenerationcapacitymustmeettherequirementsofCHPMicrogridsestablishedinSubsectionBofthisSection.
3. Any application for a Hybrid Microgrid under this Regulation shallexplainhowtherenewable,CHPandanystorageandbackupcapacitywill operate and comply with the requirements described in thisSection.
Section3.04.-FormsofDemostratingCompliance
A. RenewableMicrogridsmustdemonstratecompliancewiththequalificationsin Section 3.03(A) of this Regulation. The following three alternatives fordemonstrating compliance are acceptable. Applicants shall select thepreferredalternativeandidenfitysuchintheapplicationforregistration.
1. OperationalPlan.
IncludeanoperationalplandescribingthetypeofgenerationassetsontheMicrogridandhowtheywillbeusedtomeetanticipateddemandsand, for each year thereafter, submit an annual operational reportdetailing fuel usage and demonstrating compliance with thequalificationinSection3.03(A)ofthisRegulation.
7AppendixBofthisRegulationcontainsseveralexamplesonhowtomeettheserequirements.
15
2. Oil-andgas-firedgenerators.
Renewable Microgrid with generating assets limited to solarphotovoltaicsandoil-ornaturalgas-firedgeneratorsshallbeassumedtocomplywiththeserequirementsifitconsumeslessthanamonthlyfossilfuellimit,ascalculatedusingthetemplateprovidedinAppendixA of this Regulation and submitted along with its application.Microgrids shallmaintainmonthly records of fuel consumption, andsubmitanannualfuelconsumptionreportforeachyeartheMicrogridisinoperation.
3. Diesel-firedgenerators.
Any Renewable Microgrid with generating assets limited to solarphotovoltaicsanddiesel-firedgeneratorsshallbeassumedtocomplywiththeserequirementsifitconsumeslessthan3.5gallonsofdieselfuelpermonthperkilowattofphotovoltaiccapacity.Microgridsshallmaintainmonthlyrecordsoffuelconsumption,andsubmitanannualfuelconsumptionreportforeachyeartheMicrogridisinoperation.
B. CHP Microgrids must demonstrate compliance with the qualifications inSection3.03(B)ofthisRegulation,asfollows.
1. Applications for CHP Microgrids shall include a description of thegenerationandheat-recoveryequipmenttobeinstalledandtheuseofthethermalenergy,aswellasaheatflowplanshowingthefuelinput,electricgenerationandusefulthermalenergyoutputandconsumptionfortypicaloperatingconditions.Wheremorethanonegeneratoristoserve theMicrogrid, theapplicationshalldescribeall thegenerationassetsandhowtheywillbedispatchedtomeetanticipatedelectricandthermaldemands.
2. Microgrids shall be required to submit annual operational reportsdetailing fuel usage, electric generation, and thermal energyconsumption, demonstrating compliance with the qualification inSection3.03(B)ofthisRegulation.
C. HybridMicrogrids shall submit separate demonstrations of compliance forboththerenewableportionandtheCHPportionoftheMicrogrid.
Section3.05.-CodesandStandards
Microgridsshall complywith theapplicable codesandstandards identifiedby theCommission through resolutionand/ororder.TheCommissionmay, from time totime,reviewand,whennecessary,modifyandupdate,thecodesandstandardsthatshallapplytoMicrogridsunderthisRegulation.
16
Section3.06.-InterconnectionwithPREPA’sSystem
Microgrids may interconnect with the Electric Power Grid in accordance withapplicableregulationsorproceduresadoptedbyPREPA,itssuccessorortheoperatoroftheElectricPowerGrid.
ARTICLE4.-REQUIREMENTSFORCOOPERATIVEMICROGRIDS
Section4.01.-OwnershipRestriction
No singleMember of a CooperativeMicrogridmay possess or controlmore thanthirty-fivepercent(35%)ownershipstake.
Section4.02.-SizeofCooperativeMicrogrids
CooperativeMicrogridsshallbeclassifiedbasedonsizeaccordingtothefollowing:
1. SmallCooperativeMicrogridsarethosewithatotalgeneratingcapacityof250kWorless;and
2. Large Cooperative Microgrids are those with a generating capacityexceeding250kW.
Section4.03.-ApplicationandRegistration
Any Person interested in developing a Cooperative Microgrid must submit anapplication for registration as described in Article 6 of this Regulation. Thisapplicationshallcontainatleastthefollowinginformation:
A. Contactinformation:
1. Theapplicationmustprovidethefollowingcontactinformation:
a. NameoftheMicrogridOwner.
b. Name of the primary contact (Cooperative Microgrids mustdesignate at least one Coperative Member as the primarycontact).
c. Mailingaddres
d. E-mailaddress;and
e. Phonenumber.
2. Nameandcontact information(asdescribedabove)of theMicrogridOperator,ifsuchPersonisdifferentfromthePersonidentifiedastheMicrogridOwner.
B. Operationalstructure:TheapplicationshallidentifytheproposedMicrogridasaSmallorLargeCooperative,asapplicable.
17
C. Location:TheapplicationmustidentifytheMunicipality(orMunicipalities)inwhich the Microgrid is located, and a map showing the geographicalboundariesoftheproposedMicrogrid.
D. NumberofMembers:Theapplicationshall identify thenumberandtypeofCooperativeMembersthatwillbeservedbytheMicrogrid,suchas,butnotlimitedto:
1. Publichousingbuildingsandhouseholds,
2. Othermulti-familybuildingsandhouseholds,
3. Othersingle-familyhouseholds,
4. Critical facilities (e.g. hospitals, other medical facilities, water- andwaste-water-treatmentfacilities,policestationsandfirestations)
5. Irrigationcustomers,
6. Retailstores,and
7. Othercommercialandindustrialbuildings.
E. Type of Generation: The application must identify the type of generationproposedfortheMicrogrid,asprovidedinSection3.03ofthisRegulation,andtheformfordemonstratingcompliancetherewith,asprovidedinSection3.04ofthisRegulation.
F. System resources: The applicationmust list the planned sizes and types ofassets(including,asapplicable,generation,storage,inverters,andothermajorelectricalequipment)tobeaddedorconnectedtotheMicrogrid.
G. Equipment vendor: The application shall include the name and contactinformationfortheprimaryvendor(s)orinstaller(s)oftheMicrogrid.
H. CertificationofDesign:Prior toconstruction, theapplicationshall includeacertificationoftheMicrogriddesignsignedandstampedbylicensedengineer.
Section4.04.-RateforService
A. Thecost-per-shareshallbedeterminedbytheMembersof theCooperativeMicrogrid.
B. CooperativeMicrogridsmaycollectdepositsatthediscretionofitsMembers.Depositamountsshallbefair,just,andreasonable,andshallnotdiscriminateagainstanyindividualCooperativeMembers.
C. RatesforServicemaybebasedonconsumption,peakload,oranothermetricatthediscretionoftheMembersoftheCooperative,providedsuchratesare
18
fair, just, and reasonable, and not discriminatory against any individualMembersoftheCooperative.
Section4.05.-AdditionalRequirementsApplicabletoLargeCooperatives
Large Cooperatives shall also comply with the following reporting requirements.SmallCoopertivesarenotrequiredtoprovidetheinformationdescribedherein.
A. LargeCooperativesshallsubmitanannualreportonfuelusage,generation,andsalestotheCommission.Thisreportshallinclude:
1. Electricgenerationbyresourcetype;
2. ForCHPmicrogrids,usefulthermaloutputbyresourcetype;
3. Fuelusebyresourcetype;
4. Capacityfactorbymonthandyear;
5. Totalelectricityproduction(inkWh);
6. Any change in the number of Members, including additions anddeparturesofMembers;and
7. AnyotherinformationthattheCommissionmayrequire.
B. LargeCooperativesmustmaintainandsubmit to theCommissioncopiesofanyreportsrequiredbytheUSEPAandthePuertoRicoEnvironmentalQualityBoard.
ARTICLE5.-REQUIREMENTSFORTHIRD-PARTYMICROGRIDS
Section5.01.-OwnershipandSalesRestrictions
Third-Party Microgrids may sell Energy Services and/or other Grid Services toCustomerswhoaredirectlyconnectedtotheMicrogridsystemaswellastoPREPA,subjecttothenon-discriminationrequirementsinSection5.10ofthisRegulation.
Section5.02.-Certification
In addition to complying with the requirements set forth in this Regulation, anyMicrogridOperatorconsideredanElectricServiceCompany,assuchtermisdefinedinSection1.08(A)(5)ofRegulation8701,8shallcomplywithanyandallapplicablerequirementssetforthinRegulation8701.
ForthepurposesofthisRegulation,aMicrogridOperatoroverseeingtheoperationofa Third-PartyMicrogrid, or a group of Third-PartyMicrogrids, with an aggregategeneratingcapacityofonemegawatt(1MW)ormorewillbeconsideredanElectric
8AmendmenttoRegulationNo.8618onCertification,AnnualFees,andOperationalPlansforElectricServiceCompaniesinPuertoRico.
19
Service Company. In such cases, the Microgrid Operator shall comply with therequirementsofSection3.07(A)(1)(a),3.07(A)(2)andArticleIVofRegulation8701.
Section5.03.-Registration
Any Person interested in owning and/or operating a Third-PartyMicrogridmustsubmitanapplicationforregistrationasdescribedinArticle6ofthisRegulation.Thisapplicationmustcontainatleastthefollowinginformation:
A. Contactinformation:
1. Theapplicationmustprovidethefollowingcontactinformation:
a. NameofMicrogridOwner;
b. Mailingaddress;
c. E-mailaddress;and
d. Phonenumber.
2. TheapplicationshallidentifythenameofthePersonthatwillserveasMicrogridOperatorandthecontactinformationdescribedinitems(b),(c)and(d)above,ifdifferentfromthatoftheMicrogridOwner.
B. Operationalstructure:TheapplicationshallidentifytheproposedMicrogridasaThird-PartyMicrogrid.
C. Location:TheapplicationmustidentifytheMunicipality(orMunicipalities)inwhich the Microgrid is located, and a map showing the geographicalboundariesoftheproposedMicrogrid.
D. Number of customers: The application must include the total expectednumberofCustomerstobeservedbytheMicrogrid.
E. Type of Generation: The application must identify the type of generationproposedfortheMicrogrid,asprovidedinSection3.03ofthisRegulation,andtheformfordemonstratingcompliancetherewith,asprovidedinSection3.04ofthisRegulation.
F. System resources: The applicationmust list the planned sizes and types ofassets(including,asapplicable,generation,storage,inverters,andothermajorelectricalequipment)tobeaddedorconnectedtotheMicrogrid.
G. Equipment vendor: The application shall include the name and contactinformationfortheprimaryvendor(s)orinstaller(s)oftheMicrogrid.
H. CertificationofDesign:Prior toconstruction, theapplicationshall includeacertificationoftheMicrogriddesignsignedandstampedbylicensedengineer.
20
I. Sampledocuments:Theapplicationshallincludethefollowing:
1. AmodelcontractforCommissionreviewandapproval,inaccordancewithSection5.09ofthisRegulation.
2. AsamplebillforCommissionreviewandapproval.
3. Any prospective changes to the model contract or the bill formatsubmitted along with the application must be approved by theCommissionpriortotheirimplementation.
J. Billingmodel:
1. Third-partyMicrogridsshallbilltheircustomersonaper-kWhbasis.
2. Microgrids unable to bill on a per-kWh basis may requestauthorization from the Commission for an alternative paymentstructure.Suchrequestshallexplainthereasonswhytheuseofaper-kWhbillingmethodispreferable,aswellasthepreferredalternativepaymentstructureandthecalculationssupportingthatstructure,asdescribedinSection5.04(D)ofthisRegulation.
K. Proposedratestructure,asdescribedinSection5.04ofthisRegulation
Section5.04.-RateStructure
A. MicrogridOperatorsmustchargeuniformratesacrossallCustomersof thesamecustomer-classof asingleMicrogrid system.Withina customer-class,chargesmaybestructuredinanynon-discriminatorymanner,includingbutnotlimitedtoenergyratesvaryingbyusageblock,timeofuse,season,systemloadandcondition.
B. Therateatwhichenergyandgridservicesaresoldshallbeprojectspecificcost-based rates, supported by substantial documentation. It shall becomputed as the expected annual costs divided by expected sales. Theexpectedannualcostsshallbecalculatedasfollows:
1. The projected investment in the microgrid system, net of taxcredits,grantsorsubsidies,timesacarryingcharge,whichshallbethelevelizedpaymentatacostofcapitaloverthelifeoftheproject(inyears).
2. Plus the annual operating costs of the system, including fuel,maintenanceofgeneration,fees,regulatorycharges,meterreadingandbilling.
C. For non-metered Microgrids, Microgrid Operators may charge for EnergyServicesandGridServicesonanalternativebasis(forexample,perkilowatt
21
ofinstalledordiversifiedload,orpermonth).Inthiscase,MicrogridOperatorsmust provide, along with their applications, calculations supporting thisalternativecharge,demonstratingthatitdoesnotexceedthemaximumrateestablishedinparts(B)and(C)ofthissection.
D. MicrogridOperatorsshallsubmit,forCommissionapproval,aproposedratestructure,includingallsupportingdocumentation.
Section5.05.-Deposits
MicrogridOperatorsmayrequirepaymentofareasonabledeposit.SuchdepositshallbeuniformamongCustomer’softhesamecustomer-class.
Section5.06.-Billing
A. ElectricBillsshallberenderedinregularperiodicintervalsforallCustomerstaking service from theMicrogrid and in accordancewith the termsof thecontract.Paymentshallbeduewithinthirty(30)daysoftheissuanceoftheElectricBillwhichmaybeissuedelectronicallyorbymail.
B. AllElectricBillsmustbedraftedclearlyandplainlysothattheyareeasytounderstandwithoutrequiringthatreaderspossessanyspecializedknowledgefor their comprehension and must include the contact information of theCommissionandtheIndependentConsumerProtectionOffice.
Section5.07.-BillObjectionsandSuspensionofService
AllElectricBillobjectionsandsuspensionofserviceprocedureswillbeconductedinaccordancewithRegulation8863,RegulationontheProcedureforBillReviewandSuspensionofElectricService,oranyfutureregulationapprovedbytheCommissiontothateffect.
Section5.08.-ComplaintProcedure
Microgrid Operators shall develop and publish a procedure for addressing anycomplaints,otherthanbilldisputes,aCustomermayhavewithregardstotheEnergyServicesand/orotherGridServicesprovidedtotheCustomer.Theproceduresshallclearlydescribe theprocess throughwhichaCustomermay file any complaintorgrievancewiththeMicrogridOperatorandtheprocessthroughwhichtheMicrogridOperatorwilladdresssaidcomplaintorgrievance,includingthetimeperiodwithinwhichsuchcomplaintsorgrievanceswillbeaddressed.
AnyCustomerdissatisfiedwithadeterminationmadebytheMicrogridOperatorinrelation to a complaint or grievance made pursuant to this Section may file acomplaintwiththeCommissionforreviewofsuchdeterminationbytheMicrogridOperator.SuchcomplaintshallbefiledpursuanttoRegulation8543.
22
Section5.09.-StandardContract
Microgrid Operators shall develop a standard form contract to be used for allCustomers with the exception that rates may vary for each customer-class. Thecontractshallbewritteninplainlanguageandshallinclude,butnotbelimitedto:
1. Theeffectivedateofthecontract;
2. Theterminationdateofthecontract;
3. All rates and charges for which the customer shall be charged,including,butnotlimitedto,latepaymentfeesandreconnectionfees,asapplicable;
4. Thebillingperiod;
5. ThetermsandconditionsforthesuspensionofservicetotheCustomer,includingtherequirementsforreconnection;
6. AnexistingCustomer’sshallbeauthorizedtotransfertheirrightsandresponsibilitiesunderaMicrogridcontracttoasubsequentCustomer.
7. Forcemajeureprovisions
8. TermsandconditionsbywhichtheMicrogridOperatormayhavetherighttoentertheCustomer’spremises;
9. Provisionsagainstthetheftofpower.
10. ThenameandcontactinformationtowhomCustomersshalladdressanyinquiriesandcomplaints;
11. Theprocedureforaddressingandresolvingcomplaintsorgrievances,otherthanbillobjections,asrequiredbySection5.08ofthisRegulation.
12. ProvisionsforterminationofthecontractbyeitherpartyinaccordancewithSection5.11ofthisRegulation;
13. Aprovisionthat if thecontract isassigned,cededor transferred, thesametermsandconditionsshallapply;and,
14. ThecontractshallbegovernedandconstruedinaccordancewiththelawsandunderthejurisdictionoftheCommonwealthofPuertoRico.
Section5.10.-Non-Discrimination
A. MicrogridOperatorscoveredunderArticle5ofthisRegulationareprohibitedfrom unduly discriminating against individual Person in the immediatevicinity of a Microgrid if such Persons wishes to receive service from theMicrogrid.
23
B. Inordertodemonstratenon-discrimination:
1. Microgrid Operatorsmust submit amap of the proposedMicrogridboundariesshowingtheloadstobeinterconnectedtotheMicrogrid.
2. TheCommissionatitsdiscretionmayreviewthemapsanddeterminewhether or not the proposed Microgrid boundaries constitutediscrimination.
C. Microgrid Operators may request reconsideration of a Commissiondeterminationofdiscrimination,inwhichcasetheyshalldemonstrateeitherofthefollowing:
1. Thatbasedoncost,itisnotfeasibletoconnectthePersonswhohavebeenexcluded.Inthiscase,theMicrogridOperatorsshallberequiredto submit a calculation showing that providing service to a specificPersonwould exceed the average cost of providing service to otherCustomers of the same customer-class such that the average ratecharged to the excluded Person would not permit the MicrogridOperatorstorecoveritscostsplusareasonablereturn,ifapplicable.
2. ThatitistechnicallynotfeasibletoconnectthePerson.Inthiscase,theMicrogridOperatorsshallberequiredtosubmitanaffidavitsignedbya licensed engineer describing the technical barriers that preventdeliveryofservicetoaspecificcustomer.
Section5.11.-ContractLengthandExitRequirements
A. ThelengthofthecontractshallbesufficienttoallowtheMicrogridOperatortorecoveritscostsplusareasonablereturn,butinnoevent,shallthecontractterm exceed twenty (20) years if a residential customer is one of thecontractingparties.
B. Microgrid Operators may terminate operation and/or remove equipmentuponreceivingpermissionfromtheCommission.
C. Terminationofservice:
1. All contracts shall contain language inwhicheach party agrees thateitherpartycanseekaterminationofservice.
2. TerminationofservicemaybetriggeredbyeitheraMicrogridOperatororaCustomer.
3. Anoticeperiodofnolessthanthirty(30)calendardaysshallbegivenby the terminating party to the other party before terminating acontract. The contract shall specify the circumstances under whicheither party may be entitled to terminate a contract. Notice of
24
terminationshallbemadeinwritinganddeliveredbyemailorregularpostalservice.
4. MicrogridOperatorsmaychargeareasonableexitfeeforterminationofserviceonmeteredandnon-meteredMicrogridsduringthefirstfive(5)yearsof thecontractperiod,provided,however, that incases inwhichaCustomertransferacontractobligationtoanotherCustomer,whomshallhenceforthusetheserviceprovidedtotheproperty, thetransferringCustomershallnotberequiredtopayanexitfee.
5. IntheeventaMicrogridOperator,forwhateverreasons,isunabletocontinueprovidingservicetoitsCustomers,suchMicrogridOperatorshallexerciseduediligencetofindanewoperatorwhoshallassumeresponsibilitytoprovideservicetotheCustomersundersimilartermsofservice.ShouldtheMicrogridOperatorbeunabletosecureanewoperator, suchMicrogridOperator shallworkwithPREPA toensurethat the Microgrid’s Customers continue to receive uninterruptedelectrical service once the Microgrid ceases prividing service.Alternatively,aMicrogridOperatormayofferitsCustomertheoptionof assuming ownership of the Microgrid, in which case, should theCustomers accept, shall apply to the Commission to register andconverttheMicrogridintoaCooperativeMicrogrid.
6. In lieu of the above, a Microgrid Operator may provide additionalservice guarantees, such as, but not limited to, performance bonds,providedsuchguranateesensureCustomerswillcontinuetoreceiveuninterrupted electrical service in the event of a default by theMicrogridOperator.
Section5.12.-Reporting
A. Microgrid Operators shall be required to submit an annual report on fuelusage,generation,andsalestotheCommission.Thisreportshallinclude:
1. Electricgenerationbyresourcetype;
2. Thermalgenerationbyresourcetype,forCHPMicrogrids;
3. Fuelusebyresourcetype;
4. Capacityfactorbymonthandyear;
5. Totalsales;
6. Any change in the number of Customers, including additions anddeparturesofCustomers;and
7. AnyotherinformationthattheCommissionmayrequire.
25
B. MicrogridOperatorsmustmaintainandsubmittotheCommissioncopiesofanyreportsrequiredbytheUSEPAandthePuertoRicoEnvironmentalQualityBoard.
Section5.13.-RateReview
A. Any Operator or Customer of a Third-party Microgrid may petition theCommissiontoconductaratereviewfortheserviceprovidedbytheThird-partyMicrogrid,subjecttothefollowingrestrictionsandrequirements:
1. MicrogridratesshallnotbesubjecttoreviewbytheCommissionforthe first three (3) years after the Commission approves theirapplicationforregistration.
2. Petitions for rate review may be brought by either Customers orMicrogridOperators.
a. Customersmaypetitionforratereviewonthebasisofunjustorunreasonable rates, on the basis of undue burden, or on thebasis of imprudence or inadequate service on the part of theMicrogridOperator.
b. MicrogridOperatorsmaypetitionforratereviewonthebasisofunjustorunreasonableratesoronthebasisofinsufficientcostrecovery.
CHAPTERIIIPROCEDURES
ARTICLE6.-REGISTRATIONPROCESS
Section6.01.-RegistrationForm
A. AnypersoninterestedindevelopingaMicrogridmustcompletearegistrationform,asapplicable,fortheclassificationoftheirMicrogrid.
B. Registration forms will be available at the Commission website, and willincludeataminimumtheinformationsetforthinSections4.03and5.03ofthis Regulation, as applicable. Applicants must submit this form to theCommissioninelectronicorpaperformat.
C. If the registration form is not available, applicants may provide theinformationrequiredfortherelevantMicrogridtypetotheCommissioninapaperorelectronicformatoftheirchoice.
Section6.02.-CommissionReview
A. The Commission shall review all applications for completeness andcompliancewiththisRegulation,pursuanttotheprovisionsofLPAU.
26
B. TheCommissionshallissueadeterminationoneachapplicationwithinthirty(30)daysofreceipt:
1. Granting the Microgrid status as a Registered Microgrid, subject tocompliancewithSection6.03ofthisRegulation;
2. Requiringadditionalinformationand/orspecificrevisions;or
3. DenyingregistrationoftheMicrogrid.
C. TheCommissionmayissueadeterminationofdenialofanyapplicationonthebasisofMicrogridlocation,cost,composition,orotherconsiderations.
D. Ongoing duty to notify. If, at any point prior to or after a CommissiondeterminationhasbeenmadepursuanttothisSection,anyoftheinformationprovidedbyaMicrogridownerand/oroperatoraspartofanapplicationforregistration changes or is expected to change, theMicrogridowner and/oroperator shall have the responsibility of notifying the Commission of suchchange no later than ten (10) days from the date the change takes place.Failuretopromptlyupdateandnotify theCommissionofanysuchchangesmay result in aNoticeofNon-Compliance, pursuant to Section 1.16 of thisRegulation.
Section6.03.-ComplianceCertifications
A. AfteraMicrogridhasbeenfullyconstructed,butpriortobeginningoperation,the Microgrid owner and/or developer shall file with the Commission thefollowing:
1. AwrittencertificationsignedbyalicensedengineerindicatingthattheMicrogrid, as built, complies with all regulations including, but notlimited to, regulations of the U.S. EPA, all codes and standards asorderedbytheCommissionunderSection3.05ofthisRegulation,andlocalsitingregulationsandordinances.
2. AcertificationoftheMicrogrid‘asbuilt’designsignedandstampedbyalicensedengineer.
3. Acertificationofinspectionsignedbyalicensedengineerorlicensedelectrician,whenauthorizedbylawtodoso.
B. ThefilingofthedocumentsandinformationrequiredinSub-section(A)ofthisSectionshallconstituteauthorizationtotheMicrogridownerand/oroperatortobeginoperationoftheMicrogrid.
C. TheCommissionmayreviewtheinformationprovidedandmayrequiretheMicrogridownerand/oroperatoranyadditionalinformationtheCommissiondeterminesnecessaryorconvenient.Intheeventofnon-complianceorifthe
27
Commissiondetermines, from the informationprovided, that theMicrogridfailstocomplywithanyoftherequirementssetforthinthisRegulation,theCommissionmay,atitsdiscretion,takeanyappropriateactionnecessarytoensure the safety and reliability of the service provided to the microgridsMembersorCustomers.
Section6.04.-FilingFee
A. Except for Microgrids covered under Section 5.02 of this Regulation, anyapplicationforregistrationofaMicrogridsystemshallincludepaymentofafilingfeeasfollows:
1. SmallCooperativeMicrogrids:$50.00
2. LargeCooperativeMicrogridsandThird-PartyMicrogrids:$100.00
B. MicrogridscoveredunderSection5.02ofthisRegulationshallbeexemptfrompayment under this Section. Proof of payment of the applicable fees underRegulation 8701 shall be provided in order to claim the exemption frompaymentestablishedherein.
ARTICLE7.-EXEMPTIONS
AnyMicrogridOperatormayfilearequestforexemptionormodificationofanyoftherequirementsunder thisRegulation.Any request forexemptionshalldescribe theprovision from which the applicant seeks exemption or for which the applicantrequests a modification and shall include a clear justification of the applicant’srequest.ThisopportunitytofileforanexemptionmayoccuratthetimeofseekingapprovaloratalaterdatesuchaswhentheMicrogridisalreadyinoperationduetoachangeincircumstances.Inrulingonsuchmotions,theCommissionshallconsiderthereasonablenessoftherequest;thecostimpactontheprojectandtheMembersorCustomersoftheMicrogridprojectincludingtheprudenceofincurredoranticipatedcosts, if applicable; whether the exemption is supported by the Members orCustomers or potential Members or Customers of the Microgrid; whether theexemptionisinthepublicinterestandanyotherrelevantfactorspertainingtotherequestedwaiver.
ARTICLE8.-RECONSIDERATIONANDJUDICIALREVIEW
Section8.01.-RequestforReconsideration
AnypersonthatisnotsatisfiedwithadecisionmadebytheCommissionunderthisRegulationmayfile,withinthetermoftwenty(20)daysfromthedatecopyofthenotice of such decision is filed by the Commission’s Clerk, a request forreconsiderationbeforetheCommissionwhereinthepetitionersetsforthindetailthe
1
AppendixAFuelLim
itCalculatorNote:tabshighlightedinyellow
requireuserstoinputvaluesthatarespecifictotheirproposedsytems.
AllowableFuel(AC).Seebelow
forAllowableFuel(D
C)Calculator.
InputUnits
ValueSource/Notes
FuelType
[A];U
serinput
PVCapacityonSystem
kW(AC)
[B];U
serinput
PVACCapacityFactor%
[C];U
serinput
HoursperYear
Hours
8760[D]
AnnualPVGenerationkW
h
[E]=[B]*[C]*[D
]
Minim
umgenerationfrom
PV%
75%[F];Lim
it
AllowableGenerationfrom
FuelkW
h/year
[G]=[E]*((1/[F])-1)
HeatRateofGenerator
BTU/kWh
[H];U
serinput
AllowableFuelEnergy
MMBTU/year
[I]=[G
]*[H]/1,000,000
FuelHeatContent
MMBTU/galorM
MBTU/cubicfoot
[J];SeeConversionstable
AllowableFuel
Gal/yearorCubicfoot/year
[K]=[J]/[I]
MonthsperYear
Months
12[L]
AllowableFuel
Gal/monthorCubicfoot/m
onth
[M]=[K
]/[L]
LitersperGallonLiters/gal
3.79[N];Conversionfactor
AllowableFuel
Liter/(month*kW
PV)
[O]=[M
]*[N](N
ote:notapplicablefornaturalgascalculations)
2
AllowableFuel(D
C)
InputUnits
ValueSource/Notes
FuelType
[A]';U
serinput
PVCapacityonSystem
kW(AC)
[B]';U
serinput
PVACCapacityFactor%
[C]';U
serinput
HoursperYear
Hours
8760[D]'
DC-to-ACRatio
1.15[E]'
AnnualPVGenerationkW
h
[F]'=[B]'*[C]'*[D
]'*[E]'
Minim
umgenerationfrom
PV%
75%[G]';Lim
it
AllowableGenerationfrom
FuelkW
h/year
[H]'=[F]'*((1/[G]')-1)
HeatRateofGenerator
BTU/kWh
[I]';U
serinput
AllowableFuelEnergy
MMBTU/year
[J]'=[H
]'*[I]'/1,000,000
FuelHeatContent
MMBTU/galorM
MBTU/cubicfoot
[K]';SeeConversionstable
AllowableFuel
Gal/yearorCubicfoot/year
[L]'=[J]'/[K]'
MonthsperYear
Months
12[M]'
AllowableFuel
Gal/monthorCubicfoot/m
onth
[N]'=[L]'/[M
]'
LitersperGallonLiters/gal
3.79[O]';Conversionfactor
AllowableFuel
Liter/(month*kW
PV)
[P]'=[N]'*[O
]'(Note:notapplicablefornaturalgascalculations)
3
ConversionFactorsTable
FuelTypeHeatContent
Unit
Diesel0.138
MMBTU/gal
NaturalGas
0.001MMBTU/cubicfoot
ResidualFuelOil0.150
MMBTU/gal
Kerosene0.135
MMBTU/gal
Source:https://w
ww.eia.gov/outlooks/aeo/pdf/appg.pdf
1
AppendixBSection 3.03(B)of this Regulation establishes that CHPMicrogridsmustmeet thefollowing requirements during the 12-month period beginning with the date theMicrogridfirstproduceselectricenergyandeach12-monthperiodthereafter:
1. Theusefulthermalenergyoutputofthesystemisnolessthanfiftypercent(50%)ofthetotalenergyoutput.
2. The fuel input,minus theuseful thermalenergyoutput, isnomore than7,000BtuperkWhofgeneratoroutput.
The following table contains fourdifferentexamplesofhypotheticalCHPsystems.Forillustrationpurposes,eachsystemhasaFuelInputof1,000MMBtu.
CHPUnit
FuelInput
(MMBtu)
UsefulThermalOutput(MMBtu)
UsefulThermalOutput(%)
NetInput(MMBtu)
NetElectricOutput(MWh)
HeatRate(Btu/kWh)
CHPUsefulThermalOutput>50%Input?
EfficiencyCHPHR<7,000
Btu/kWh?
[1] [2] [2]/[1]x100
[3]=[1]-[2] [4] [3]/[4]x
1,000
1 1,000 700 70% 300 60 5,000 Yes Yes
2 1,000 100 10% 900 150 6,000 No Yes
3 1,000 700 70% 300 40 7,500 Yes No
4 1,000 350 35% 650 70 9,286 No No
Inthepreviousexample,CHPSystems#1and#3metthefirstrequirement(usefulthermalenergyoutputofthesystemisnolessthanfiftypercent(50%)ofthetotalenergyoutput)andCHPSystems#1and#2metthesecondrequirement(fuelinput,minus the useful thermal energy output, is no more than 7,000 Btu per kWh ofgeneratoroutput).Therefore,CHPSystem#1metbothrequirements.
REGULATIONONMICROGRIDDEVELOPMENT
(ATTACHMENTB–REDLINECOMPARISSON)
2
TABLEOFCONTENTS
CHAPTERI-GENERALPROVISIONS....................................................................................................4 ARTICLE1.-GENERALPROVISIONS....................................................................................................4
Section1.01.-Title...........................................................................................................................................4 Section1.02.-LegalBasis.............................................................................................................................4 Section1.03.-PurposeandExecutiveSummary.............................................................................4 Section1.04.-Applicability.........................................................................................................................5 Section1.05.-Interpretation......................................................................................................................5 Section1.06.-ProvisionsofOtherRegulations................................................................................5 Section1.07.-UnforeseenProceedings................................................................................................5 Section1.08.-Definitions.............................................................................................................................5 Section1.09.-ControllingVersion...........................................................................................................9 Section1.10.-Severability...........................................................................................................................9 Section1.11.-Forms.......................................................................................................................................9 Section1.12.-ModeofSubmission......................................................................................................10 Section1.13.-EffectofSubmission......................................................................................................10 Section1.14.-ConfidentialInformation............................................................................................10 Section1.15.-Validity.................................................................................................................................10 Section1.16.-PenaltiesforNon-Compliance.................................................................................10 Section1.17.-CompliancewithOtherApplicableLegalRequirements...........................11
CHAPTERII-MICROGRIDPROVISIONS..........................................................................................11 ARTICLE2.-MICROGRIDCATEGORIES...........................................................................................11
Section2.01.-MicrogridClassification..............................................................................................11 Section2.02.-SaleofEnergyServicesandotherGridServices............................................12
ARTICLE3.-MICROGRIDTECHNICALREQUIREMENTS.........................................................12 Section3.01.-MicrogridComposition................................................................................................12 Section3.03.-EligibleGenerationResources.................................................................................12 Section3.04.-FormsofDemostratingCompliance.....................................................................14 Section3.05.-CodesandStandards.....................................................................................................15 Section3.06.-InterconnectionwithPREPA’sSystem................................................................16
ARTICLE4.-REQUIREMENTSFORCOOPERATIVEMICROGRIDS......................................16 Section4.01.-OwnershipRestriction.................................................................................................16 Section4.02.-SizeofCooperativeMicrogrids................................................................................16 Section4.03.-ApplicationandRegistration....................................................................................16 Section4.04.-RateforService................................................................................................................17 Section4.05.-AdditionalRequirementsApplicabletoLargeCooperatives...................18
ARTICLE5.-REQUIREMENTSFORTHIRD-PARTYMICROGRIDS.......................................18 Section5.01.-OwnershipandSalesRestrictions.........................................................................18 Section5.02.-Certification.......................................................................................................................18 Section5.03.-Registration.......................................................................................................................19 Section5.04.-RateStructure...................................................................................................................20 Section5.05.-Deposits...............................................................................................................................21 Section5.06.-Billing....................................................................................................................................21 Section5.07.-BillObjectionsandSuspensionofService.........................................................21
3
Section5.08.-ComplaintProcedure....................................................................................................21 Section5.09.-StandardContract..........................................................................................................22 Section5.10.-Non-Discrimination.......................................................................................................22 Section5.11.-ContractLengthandExitRequirements............................................................23 Section5.12.-Reporting............................................................................................................................24 Section5.13.-RateReview.......................................................................................................................25
CHAPTERIIIPROCEDURES...................................................................................................................25 ARTICLE6.-REGISTRATIONPROCESS............................................................................................25
Section6.01.-RegistrationForm..........................................................................................................25 Section6.02.-CommissionReview......................................................................................................25 Section6.03.-ComplianceCertifications..........................................................................................26 Section6.04.-FilingFee.............................................................................................................................27
ARTICLE7.-EXEMPTIONS.....................................................................................................................27 ARTICLE8.-RECONSIDERATIONANDJUDICIALREVIEW....................................................27
Section8.01.-RequestforReconsideration....................................................................................27 Section8.02.-JudicialReview.................................................................................................................28
4
REGULATIONONMICROGRIDDEVELOPMENT
CHAPTERI-GENERALPROVISIONS
ARTICLE1.-GENERALPROVISIONS
Section1.01.-Title.
ThisRegulationshallbeknownastheRegulationonMicrogridDevelopmentofthePuertoRicoEnergyCommission.
Section1.02.-LegalBasis.
This Regulation is adopted pursuant to Act 57-2014, as amended, known as thePuerto Rico Energy Transformation and RELIEF Act; Act 82-2010, as amended,knownasthePublicPolicyonEnergyDiversificationbyMeansofSustainableandAlternativeRenewableEnergyinPuertoRicoAct;Act83-2010,knownastheGreenEnergy Incentives Act; and Act 38-2017, known as the Uniform AdministrativeProcedureActoftheGovernmentofPuertoRico(“LPAU”,foritsSpanishacronym).
Section1.03.-PurposeandExecutiveSummary.
The Puerto Rico Energy Commission (“Commission”) adopts and enacts thisRegulationtoassistinthedevelopmentofMicrogridsthroughoutPuertoRico.TheprolongedoutagesanditsimpactsonthecitizensofPuertoRicocausedbyHurricanesIrmaandMariahighlightstheneedtofosterthecreationofMicrogridsasameansofdeliveringreliableenergyservicestocustomersinneed,avoidingthelossofpowerat critical facilities, promoting customer choice, reducing carbon pollution andspurring economic development while integrating new technology and industrytrends into Puerto Rico’s energy market. Accordingly, Microgrids and otherdistributedgenerationresourcesareakeycomponentoftheGovernmentofPuertoRico’sstrategyforrebuildingandstrengtheningPuertoRico’selectricpowersystem.1
The Commission seeks to harness the potential of decentralized energy resourcesincludingthoseidentifiedassustainablerenewableoralternativerenewableenergyresources, as defined by Act 82-2010; combined heat-and-power; and otherdistributed resources, to strengthen the resiliency of the electric grid, empowercustomers,andincreaserelianceonrenewableandhighly-efficientresourcesacrossthe Commonwealth. One statutory goal of microgrids is to reduce energyconsumptionbasedonfossilfuelsthroughlocalrenewableenergygeneration.
BecauseMicrogridscanoperateinan“islanded”mode,disconnectedfromtheelectricgrid, they are able to independently provide electric service during grid outage
1SeeRequestforFederalAssistanceforDisasterRecovery,BuildBackBetterPuertoRico,November2017atpp.15-19.
Deleted: andDeleted: ,
Deleted: system
5
periodsorinterruptions.Microgridscancontributetorapidrestorationofservice,asthere are areas where power could be restored quicker by the deployment ofMicrogridsratherthanwaitingreconnectiontothegridatlarge.
With this Regulation, the Commission intends to provide a stable and predictableregulatoryframework,capableoffosteringinnovationandeconomicgrowththroughcontinuedinvestmentsinthedevelopmentanddeploymentofMicrogridsystems.
Section1.04.-Applicability.
This Regulation shall apply to the registration, development and operation ofMicrogridsthatserveend-usecustomers.
Section1.05.-Interpretation.
ThisRegulationshallbeinterpretedinawaythatpromotesthehighestpublicgoodandtheprotectionoftheinterestsoftheresidentsofPuertoRico,andinsuchawaythatthedeploymentofMicrogridsarecarriedoutrapidly,justly,andeconomically.
Section1.06.-ProvisionsofOtherRegulations.
ThisRegulationmaybesupplementedbytheprovisionsofotherregulationsofthePuerto Rico Energy Commission that are compatible with the provisions of thisRegulation.
Section1.07.-UnforeseenProceedings.
When a specific proceeding has not been planned for in this Regulation, theCommissionmayattendtoitinanywaythatisconsistentwithAct57-2014.
Section1.08.-Definitions.
A. ThesedefinitionsaretobeusedforthisRegulationandarenotintendedtomodifythedefinitionsusedinanyotherCommissionregulationororder.
B. ForthepurposesofthisRegulation,thefollowingtermswillhavethemeaningestablishedbelow,exceptwhen the contextof the contentof anyprovisionclearlyindicatessomethingelse:
1. “Alternative Renewable Energy Resources” refers to the energysourceslistedinSection1.4(13)ofAct82-2010,specifically:
i. Conversionofmunicipalsolidwaste;
ii. Landfillgascombustion;
iii. Anaerobicdigestion;
iv. Fuelcells;and
Deleted: (forexample,theprolongedoutageacrosstheCommonwealthintheaftermathofHurricanesIrmaandMaria).
Deleted: Application
Deleted: governDeleted: contractterms,incorporationofpreexistingutilityequipment,
Deleted: ratesforproposedmicrogrids
Deleted: proceedings
Deleted: conductthem
Deleted: regulationsDeleted: orders
Deleted: ”meansthatDeleted: producedorgeneratedfromthefollowingresources,asdefined
6
v. AnyotherenergythattheCommonwealthEnergyPublicPolicyOffice may define in the future through regulations asalternativerenewableenergy.
2. “Combinedheat-and-power”(CHP)meansequipmentusedtoproduceelectric energy and forms ofuseful thermal energy (such as heat orsteam),usedforindustrial,commercial,heating,orcoolingpurposes,throughtheintegrateduseoftechnology.
3. “Commission”meansthePuertoRicoEnergyCommission.
4. “CooperativeMember”or“Member”meansaPersonwho,alongwithtwo or more Persons, share ownership interest in a CooperativeMicrogridandreceiveEnergyServicesand/orotherGridServicesfromtheCooperative.
5. “CooperativeMicrogrid”meansthejoint-ownershipofaMicrogridbythree or more Cooperative Members through formal or informalorganization or association. For purposes of this Regulation, aCooperativemay,butneednotbe,organizedoroperatedpursuanttoAct 164-2009, as amended, known as the Puerto Rico GeneralCorporationsActorAct239-2004,asamended,knownastheGeneralCooperativeAssociationsAct.Theprimarypurposeof aCooperativeMicrogrid is to supply Energy Services or Grid Services to itsCooperativeMembers.
6. “Customer”means any Person, as such term is defined herein,whoconsumesoruseselectricpowerorenergyservicesfromaThird-PartyMicrogrid.
7. “Distributed Energy Resources” means Distributed Generation orelectricenergystorage.
8. “DistributedGeneration”meansanelectricpowergenerationfacilityinPuerto Rico connected to the Distribution Infrastructure or to aMicrogridand/orproducingpowerforself-supplyorsale.
9. “Distribution Infrastructure”means the physical equipment used todistributeelectricpoweratvoltagesbelow38,000volts,includingbutnot limited to poles, primary lines, secondary lines, service drops,transformersandMeters.
10. “Distributed Renewable Energy” means Distributed GenerationpoweredbyRenewableResourceswhichgenerateselectricpowerforself-consumption,saletothird-partiesortosupplyanElectricServiceCompany.
Deleted: <#>“Ancillaryservices”meantheservicesnecessarytosupportthedeliveryofelectricpowerfromgeneratortoconsumerwhilemaintainingreliableoperationofaninterconnectedtransmissionanddistributionsystem.¶<#>
Deleted: <#>sequentialDeleted: <#>energyDeleted: “Deleted: ”createdbyvirtueofAct57-2014Deleted: non-profitentityconsistingofagroupofcustomers
Deleted: ofamicrogridsystem.¶“CommunitySolar”avoluntaryprogramwherebyasolar-electricsystemprovidespower
Deleted: /orfinancialbenefittomultiplecommunitymembersinwhichcommunitymembersmayormaynotown
Deleted: systemitself.
Deleted: naturalpersonorlegalentityDeleted: GeneratorDeleted: anynaturalpersonDeleted: legalentitythatownsDeleted: distributionsystemortoamicrogrid.¶“
Deleted: ”orDeleted: System”meanDeleted: andDeleted: aDeleted: GeneratorDeleted: sustainablerenewableenergyoralternativerenewableenergysupplying
Deleted: toanelectricpowerservicecompanyorgenerated
Deleted: orforDeleted: .CommunitySolarprojectsareconsidereddistributedrenewableenergyattheresidentiallevel.¶“
Deleted: PowerDistribution”or“Distribution”meansthedeliveryofelectricpowerfromanyelectricsubstationorgeneratortoanycustomerorconsumeratvoltagesbelow38,000voltsthroughDistributionInfrastructurethroughouttheCommonwealth.
7
11. “Electric Bill”means the document sent periodically by the ElectricServiceCompanytoaCustomerlistingallthecomponents,charges,orratesthatmakeupthefinalconsumptioncosteachCustomermustpay.
12. “ElectricPowerDistribution”or“Distribution”meansthedeliveryofelectric power from any electric substation or generator to anyCustomerthroughDistributionInfrastructure.
13. “Electric Power Grid” means the electric power transmission andDistributionInfrastructureoftheCommonwealthofPuertoRico.
14. “EnergyService”meanselectricityserviceprovidedtoaCustomerinPuertoRicobyanElectricServiceCompany.
15. "Electric Service Company" means any Person engaged in thegeneration, transmission, distribution, billing, or resale of electricpower.
16. “EnergyStorage”meansanyresourcelocatedintheMicrogridthatiscapableofreceivingelectricenergyfromtheElectricPowerGridoranyothergenerationresource,forlaterinjectionofelectricitybacktotheElectricPowerGridortoserveanyload.
17. “GridServices”includeancillaryservices,demandresponseandotherservicessupportingDistributionInfrastructureand/orElectricPowerDistribution.
18. “Interconnection” means the connection of Distributed EnergyResourcestoDistributionInfrastructure.
19. “Meter”means theequipmentused tomeasure consumptionand/orgenerationofenergyatthepointofconnectionbetweenanindividualCustomer or Cooperative Member and a Microgrid or DistributionInfrastructure, as well as associated communications and controlcapabilities.
20. “Microgrid” means a group of interconnected loads and DistributedEnergyResourceswithinclearlydefinedelectricalboundariesthatactsasasinglecontrollableentitythatcanconnectanddisconnectfromtheElectricPowerGridtoenableittooperateineithergrid-connectedoroff-the-grid(islanded)mode.
21. “Microgrid Operator”means the registered operator of aMicrogrid,which shall be the primary party responsible for overseeing theoperationof themicrogrid equipment (including, but not limited to,Distributed Energy Resources and Distribution Infrastructure),providingmaintenance,deliveringcontractedservices,billingforsuch
Deleted: <#>“ElectricPowerGenerationCompany”meansanynaturalpersonorlegalentityengagedintheproductionorgenerationofelectricpowerintheCommonwealthofPuertoRico.ThistermshallincludecogeneratorsalreadyestablishedinPuertoRicothatsupplyenergytoPREPAthroughaPowerPurchaseAgreement,andrenewableenergyproducers.¶<#>“ElectricPowerGrid”meanstheelectricpowertransmissionanddistributioninfrastructureoftheCommonwealthofPuertoRicocurrentlyoperated,supported,andadministeredbythePuertoRicoElectricPowerAuthority(“PREPA”).¶<#>“ElectricPowerService”or“EnergyService”meansanyserviceprovidedtoaCustomerinPuertoRicobyacertifiedelectricpowercompany.¶<#>“EnergyProducer”meansanynaturalpersonorlegalentitythatownsanelectricpowerproductionfacilityinPuertoRicothatisaneligiblebusinessinaccordancewithtotheprovisionsofActNo.73-2008,knownastheEconomicIncentivesActfortheDevelopmentofPuertoRico.¶<#>"ElectricBill"
Deleted: "ElectricDeleted: naturalpersonorlegalentityDeleted: InthecaseofPREPA,itshallalsoincludetransmissionanddistribution.
Deleted: gridDeleted: tostoreDeleted: gridDeleted: ,regardlessofwheretheresourceislocatedonthetransmissionsystem,distributionsystem,orbehindacustomer’smeter
Deleted: <#>“GreenEnergy”refersjointlytoSustainableRenewableEnergy,Alternative ... [1]Deleted: <#>suchasdemandresponseDeleted: or“ElectricInterconnection”Deleted: powerplantsDeleted: thesameelectricpowertransmissionand/ordistributionsystems
Deleted: <#>“InterconnectionCharge”meansthefairandreasonableamountofmoneythataperson... [2]Deleted: <#>customerandadistributionnetwork.Metersmay,butarenotrequired,tobeequipped... [3]Deleted: ,”Deleted: distributedenergyresourcesDeleted: withrespecttoPREPA’sgrid.Thegoalofmicrogridsistoreduceenergyconsumptionbasedon... [4]Deleted: PREPA’sgridDeleted: both
8
services, and servingas theprimarypointof contact.TheMicrogridOperatormayormaynotbetheowneroftheMicrogrid.
22. "Municipality"meansthelocalgovernmentlegalentityorganizedandexisting pursuant to Article VI, §1 of the Constitution of theCommonwealthofPuertoRicoandActNo.81ofAugust30,1991,asamended, known as the Autonomous Municipality Act of theCommonwealthofPuertoRico.
23. “Owner” refers to the Person or Persons with a direct proprietaryinterest in a Microgrid system. The proprietary interest over aMicrogrid system is separate and independent from the proprietaryinterestovertheequipmentusedbytheMicrogridtosupplyEnergyServices and/or Other Grid Services. As such, Microgrid equipmentvendorswholeaseorofferthird-partyfinancingoptionsarenotsubjecttotheprovisionsofthisRegulation,providedsuchequipmentvendorsdonotofferEnergyServicesand/orOtherGridServices,assuchtermsaredefinedherein,ordonototherwiseactasMicrogridOperator.
24. “Person”meansanaturalperson;alegalentitycreated,organized,orexisting under the laws of the Commonwealth of Puerto Rico, theUnitedStatesofAmerica,anystateoftheunion,oranyforeignstateorcountry; a Municipality or a consortium of Municipalities; or agovernmententity(otherthanPREPA).
25. “PersonalMicrogrid”meansaMicrogridownedbynomorethantwoPersonsproducingenergyprimarilyforconsumptionbyitsowner(s).
26. “PREPA”meansthePuertoRicoElectricPowerAuthority,acorporateentitycreatedbyvirtueofActNo.83ofMay2,1941,asamended,andanysuccessordistributionortransmissionowneroroperator.
27. “Renewable Resource” means any combination of AlternativeRenewable Energy Resources or Sustainable Renewable EnergyResources.
28. “SustainableRenewableEnergyResource”referstotheenergysourceslistedinSection1.4(15)ofAct82-2010,specifically:
i. Solarenergy;
ii. Windenergy;
iii. Geothermalenergy;
iv. RenewableBiomassCombustion;
v. RenewableBiomassGasCombustion;
Deleted: ,composedofaLegislativeandanExecutivePower,subordinateto
Deleted: itslaws,thatisresponsibleforageographicaldemarcationwithallofitswards(“barrios”),andwhichhasaspecificname.
Deleted: <#>“NetMeter”meansatoolusedtomeasureandregisterthetwo-wayflowofpower(bidirectional),thatis,suppliedandreceivedenergyinkilowatt-hourbyacustomerwhohasadistributedgenerationsysteminterconnectedtothepowergridofPREPA.¶<#>
Deleted: or
Deleted: .
Deleted: <#>“PowerPurchaseAgreement”or“PPA”meansanyagreementorcontractapprovedbytheCommissionwherebyanelectricpowergenerationcompanyisboundtosellelectricpowertoaperson,andsuchpersonis,inturn,boundtoacquiresaidelectricpoweratajustandreasonablerate.¶
Deleted: thatDeleted: generatedfromrenewableresourcesasdefined
Deleted: including
9
vi. Combustionofbiofuelderivedsolelyfromrenewablebiomass;
vii. Qualifiedhydropower;
viii. Marine and hydrokinetic renewable energy, as defined inSection 632of the “Energy Independence and SecurityActof2007”(PublicLaw110-140,42,U.S.C.§17211);
ix. Oceanthermalenergy;or
x. Anyothercleanand/orrenewableenergythattheCommissionmay define in the future through regulation or order asrenewableenergy.
29. “Third-Party Microgrid” means a Microgrid that is not a PersonalMicrogrid or a Cooperative, and is owned and/or operated by anyPersonorPersonsfortheprimarypruposeofengaginginthesaleofEnergyServicesand/orOtherGridServicestoCustomers.
C. EverywordusedinthesingularinthisRegulationshallbeunderstoodtoalsoincludethepluralunlessthecontextindicatesotherwise.
Section1.09.-ControllingVersion.
ShouldanydiscrepancybetweentheSpanishversionandtheEnglishversionofthisRegulationarise,theprovisionsoftheEnglishversionshallprevail.
Section1.10.-Severability.
Ifanyarticle,provision,word,sentence,paragraph,orsectionofthisRegulationisdisputed,foranyreason,beforeacourtanddeclaredunconstitutionalorvoid,suchruling shall not affect, damage, or invalidate the remaining provisions of thisRegulation,buttheireffectshallbelimitedtothearticle,provision,word,sentence,paragraph, or section that is declared unconstitutional or void. The nullity orinvalidityofanyarticle,word,sentence,paragraph,orsection inanyspecificcase,shallnotaffectorjeopardizeinanywayitsapplicationorvalidityinanyothercase,exceptifitspecificallyandexpresslyinvalidatesallcases.
Section1.11.-Forms.
The Commission shall establish the forms it deems necessary to conduct theproceedingspursuanttothisRegulation,andshallinformthepublicviaitswebsite.Notwithstanding,thefactthattheCommissionhasnotadoptedoneormoreforms,isintheprocessofreviewingthem,ortheInternetwebsiteisoutofservice,shallnotrelease any party of its obligation to comply with the provisions stated herein,providetheinformationrequiredbythisRegulationorotherwisecomplywithanyapplicableCommissionorder.
Deleted: “TransmissionInfrastructure”and“transmissionsystem”meanthephysicalequipmentusedtotransmitelectricpoweratvoltagesofatleast115,000volts,includingbutnotlimitedtopoles,lines,andtransformers.
Deleted: whenDeleted: for
Deleted: relieve
10
Section1.12.-ModeofSubmission.
Theforms,documents,andappearancesrequiredbyvirtueofthisRegulationoranyorder of the Commissionmust be submitted before the Commission in electronicformat according to the instructions which, from time to time, the Commissionestablishesthroughanorderinrelationtotheelectronicfilingsystem.
Iftheelectronicfilingsystemistemporarilynotoperatingorfunctioning,theforms,documents,andappearancesrequiredbyvirtueofthisRegulationorbyanyorderoftheCommissionshallbesubmittedbeforetheCommissioninaccordancewithanyinstructionsthattheCommissionshallprovideatthattimethroughanorder.
Section1.13.-EffectofSubmission.
InfilinganydocumentbeforetheCommission,thepartyundersigningsuchdocumentshallbedeemedtohavecertifiedthatthecontentofsaiddocumentistrueandthat,according to the signer’s best knowledge, information, and belief, formed afterreasonable inquiry, the document is based on reliable and trustworthy facts,arguments,judicialsources,andinformation.
Section1.14.-ConfidentialInformation.
If incompliancewiththeprovisionsof thisRegulationoranyof theCommission’sorders,apersonhasthedutytodiscloseinformationtotheCommissionconsideredto be privileged, pursuant to applicable evidentiary privileges, said person shallidentifytheallegedprivilegedinformationandrequestinwritingfortheCommissiontotreatsuchinformationasconfidential,pursuanttoArticle6.15ofAct57-2014.Inidentifying privileged information and requesting confidential treatment by theCommission,therequestingpartyshallfollowtherulesandproceduresestablishedby the Commission inResolution CEPR-MI-2016-0009, as such resolutionmay beamended from time to time, for the filing, handling and treatment of confidentialinformation.Except in the caseof informationprotectedunder theattorney-clientprivilege, the claim of confidential treatment shall, under no circumstances, begroundsfordenyingsuchinformationfrombeingfiledwiththeCommission.
Section1.15.-Validity.
PursuanttoSection2.8oftheLPAU,thisRegulationshallenterintoeffectthirty(30)daysafteritssubmissiontotheDepartmentofStateandtheLegislativeLibraryoftheOfficeofLegislativeServices.
Section1.16.-PenaltiesforNon-Compliance
Any Person who fails to comply with any of the requirements set forth in thisRegulationmaybesubjecttoaNoticeofNon-CompliancepursuanttoChapterIVofRegulation85432andmay, asa resultof suchnon-compliance, lose its statusasa 2RegulationonAdjudicative,NoticeofNoncompliance,RateReviewandInvestigationProcedures.
Deleted: ThepresentationofaDeleted: whosecontenthasbeenformulatedbyDeleted: undersignedDeleted: equivalentDeleted: certifyingDeleted: correct
11
registered Microgrid system or be subject to any other applicable administrativesanctionorpenaltydeemedappropriatebytheCommission.
Section1.17.-CompliancewithOtherApplicableLegalRequirements
IndevelopingaMicrogridSystempursuanttothisRegulation,theowner,operatorand/ordeveloperofsuchMicrogridsystemshallalsoensuretofullycomplywithanyand all applicable legal and regulatory requirements established and enforced byother relevant local, state and federal government entities. The granting of anauthorizationtooperateasaregisteredMicrogridsystemunderthisRegulationshallnotrelieveapartyfromfullycomplyingwithotherapplicablelegalandregulatoryrequirementsenforcedbyanyothergovernmententity.
CHAPTERII-MICROGRIDPROVISIONS
ARTICLE2.-MICROGRIDCATEGORIES
Section2.01.-MicrogridClassification.
A. Microgridsshallbeclassifiedasonofthefollowing:
1. PersonalMicrogrid.
2. CooperativeMicrogrid.
3. Third-PartyMicrogrid.
4. Any other ownership or operational arrangement not contemplatedherein may be submitted for Commission review, along with anysupportinginformationtheCommissionmaydeemrelevant.
B. Microgrids shall be subject to various requirements based on theirclassification,asfollows:
1. ExceptasotherwisestatedinSection2.02ofthisRegulation,therearenootherrequirementsforPersonalMicrogridsunderthisRegulation.
2. TherequirementsforCooperativeMicrogridsaredescribedinArticle4ofthisRegulation.
3. TherequirementsforThirdPartyMicrogridsaredescribedinArticle5ofthisRegulation.
4. The requirements forMicrogridsownedordevelopedbyPREPAareoutsidethescopeofthisRegulation.PREPAproposedmicrogridsshallbeaddressedthroughapplicableresourceplanningprocesses.
5. Therequirementsforsystemsoftypesnotlistedabovearethesameasthose for Third Party Microgrids, except as determined by the
Deleted: theimpositionofapenalty,asprovidedinArticle6.36ofAct57-2014or
Deleted: byownershipstructure,size,andwhetherornottheyengageinoff-systemsalesofenergyand/orothergridservicestoentitiesotherthanPREPA.
Deleted: <#>Microgridsmaybeownedbyanyofthefollowing:¶<#>Individuals;¶<#>Partnerships;¶<#>Customercooperativesofatleastthreeormoremembers;¶<#>Singlemunicipalities;¶<#>Groupsofmunicipalitiesorany
Deleted: administrativedivisionoftheCommonwealth;¶Singlenon-profitorfor-profitentitiesandgovernmententities,otherthanmunicipalities,andadministrativedivisions,excludingPREPA(hereafterreferredtoas“third-parties”);¶PREPA;¶Other
Deleted: arrangementsthatareDeleted: totheDeleted: forDeleted: .Uponreviewoftheproposedarrangement,
Deleted: willdeterminetheapplicableprovisionsofthisRegulation.¶Microgridsshallbeclassifiedbasedonsizeaccordingtothefollowing:¶Individualsystemsarethosewithoneortwocustomer-owners;¶Smallsystemsarethosewithatleastthree(3)andnomorethanten(10)customersorcustomer-ownersandtotalgeneratingcapacityofnomorethan250kW;or,¶Largesystemsarethosewithmorethan10customersorgeneratingcapacityover250kW.¶ ... [5]Deleted: notsellenergyand/orothergridservicesoutsideoftheirself-supplysystemtoentitiesother... [6]Deleted: ThereDeleted: individualself-supplysystemsDeleted: smallcooperativesystemsengagedinself-supply(hereafterreferredtoas“smallcooperative... [7]Deleted: largecooperativesystemsengagedinself-supply(hereafterreferredtoas“largecooperative... [8]Deleted: smallmunicipalsystems,largemunicipalsystemsandthird-partysystemsaredescribedin... [9]Deleted: bygroupsofmunicipalitiesDeleted: otheradministrativedivisions,arethesameasthoseforsystemsownedbysingle ... [10]Deleted: third-partysystems
12
CommissionundertheexemptionsprocessdescribedinArticle7ofthisRegulation.
Section2.02.-SaleofEnergyServicesandotherGridServices.
A. Except as otherwise provided in sub-section (C) of this Section, PersonalMicrogrids may provide Energy Services and/or other Grid Services to itsOwner(s)ortoPREPA.
B. Exceptasotherwiseprovidedinsub-section(C)ofthisSection,CooperativeMicrogrids may provide Energy Services and/or other Grid Services to itsMembersortoPREPA.
C. Personal Microgrids and Cooperative Microgrids may sale excess EnergyServices and/orotherGrid Services to Person(s) other than those listed inSubsections(A)and(B)ofthisSection,asapplicable,subjecttoCommissionauthorization.Insuchcases,theMicrogridmustsubmit,duringitsapplicationoratanymomentthereafterbutbeforeengaginginthesaleofsuchEnergyServices and/or otherGrid Services, a detailed request to the Commissiondescribing the proposed arrangement between the Microgrid and thePerson(s). Such Microgrids must provide any information relevant to theproposed arrangement or that may be required by the Commission. TheCommissionshallissueadeterminationontherequestwithinthirty(30)daysofreceipt.
ARTICLE3.-MICROGRIDTECHNICALREQUIREMENTS
Section3.01.-MicrogridComposition
AMicrogridshallconsist,ataminimum,ofgenerationassets,loadsandDistributionInfrastructure. Microgrids shall include sufficient generation, storage assets andadvanceddistributiontechnologies3toserveloadundernormaloperatingandusageconditions.IfaMicrogridincludesMeters,allmembersofeachcustomer-classmustbeequippedwithcomparablemeteringtechnology.
Section3.03.-EligibleGenerationResources
Microgrids may use either “renewable,” “combined heat-and-power,” or “hybrid,”generationresources,eachdescribedasfollows:
A. “Renewable” Microgrids – Renewable Microgrids have the followingqualifications:
3Advanceddistributiontechnologiesareequipmentsuchassensors,powerconditioningequipmentand other equipment suitable for regulation of voltage and/or frequency, control systems,communicationsystems,andautomationtechnologies.
Deleted: 8
Deleted: distributioninfrastructure
Deleted: meteringtechnologiesDeleted: infrastructure.Microgridsmustqualifyaseither“renewable,”“combinedheat-and-power,”or“hybrid”dependingonthecompositionofthegenerationassetsonthesystem.
Deleted: 02.-Renewable
Deleted: “
13
1. The primary energy source of the Microgrid must be one or moreRenewableResource(s)asdefinedinSection1.08ofthisRegulation.
2. ForRenewableResourcestobethe“Primaryenergysource”:
a. Seventy-fivepercent(75%)oftheenergyoutputofthesystemduring the 12-month period beginning with the date theMicrogrid first produces electric energy and each 12-monthperiodthereaftermustbefromaRenewableResource;4
b. The fuelusedbynon-renewablegenerationmustbenomorethan2,500Btupertotalenergyprovidedbythemicrogrid5;
c. Thenon-renweablegenerationmustoperateataheatrateofnomorethan13,000Btu/kWhatfulloutput;and
d. Thesumofinstalledrenewableenergygeneratingcapacityandelectricalenergystoragecapacity(inMW)oftheMicrogridshallexceedtheexpectedpeakdemandoftheMicrogrid.
3. Exceptasotherwiseprovideherein,useof fossil fuelbyaMicrogridmaynot,intheaggregate,exceedtwenty-fivepercent(25%)ofthetotalenergy output of the system during the 12-month period beginningwiththedatetheMicrogridfirstproduceselectricenergyandeach12-monthperiodthereafter.
4. UseoffossilfuelbyaMicrogridislimitedtothosepurposesidentifiedin18C.F.R.§292.204(b)(2)ortooperatetheMicrogridduringperiodswhentheRenewableResourcesareunavailable.7
5. ARenewableMicrogridOperatormayapplyforanexemption,underArticle7ofthisRegulation,ofthetwenty-fivepercent(25%)limiton
4Formicrogriddeliveringpowerasalternatingcurrentoutputwillbemeasuredatthealternatingcurrentterminalsofthegenerator,afteranyinverterconvertingdirectcurrentpowertoalternatingcurrent. Formicrogrids delivering power as direct current, outputwill bemeasured at the directcurrentterminalsofthegenerator,afteranyinverterconvertingalternatingcurrentpowertodirectcurrent.5Asanexample,thisstandardmaybemetbyageneratoroperatingat10,000Btu/kWh,providing25%oftheMicrogridelectricenergy.7Useofoil,naturalgasandcoalbyaMicrogrid,underSection3(17)(B)oftheFederalPowerAct,islimitedtotheminimumamountsoffuelrequiredforignition,startup,testing,flamestabilization,andcontrol uses, and the minimum amounts of fuel required to alleviate or prevent unanticipatedequipmentoutages,andemergencies,directlyaffecting thepublichealth, safety,orwelfare,whichwouldresultfromelectricpoweroutages.
Deleted: systemDeleted: arenewableenergyresource
Deleted: ”meansthat:
Deleted: totalenergyinputofthesystem(inMWh)onanannualbasis
Deleted: renewableenergyresource(s);and
Deleted: The
Deleted: systemexceedsDeleted: load
Deleted: anygradeofDeleted: oilornaturalgasDeleted: ).6Inparticular,suchuseshouldbelimitedtotheminimumamountsoffuelrequiredtoalleviateorpreventoutagesofelectricalservicetomicrogridcustomers.¶Useofanygradeoffueloil
Deleted: naturalgasbyamicrogridmaynot,intheaggregate,exceedtwenty-fivepercent(25%)ofthetotalenergyinputofthesystemduringthe12-monthperiodbeginningwiththedatethefacilityfirstproduceselectricenergyandanycalendaryearsubsequenttotheyearinwhichthefacilityfirstproduceselectricenergy.
Deleted: microgridsDeleted: notusesolidfossilfuels.¶Renewablemicrogridsmustdemonstratecompliancewiththequalificationsinpart(A)
Deleted: section,intheformandmannerdescribedintheforthcomingprovisions.¶Anymicrogridregisteredas“renewable”thatisfoundbytheCommissiontobenon-compliantwiththequalificationsinpart(A)ofthisSection,maybesubjecttoaNoticeofNon-CompliancepursuanttoChapterIVof
Deleted: 8543andmay,asaresultofsuchnon-compliance,loseitsstatusasalicensedmicrogridsystemorbesubjecttoanyotheradministrativesanctionorpenaltydeemedappropriatebytheCommission.
14
energy output from fossil fuels due to electrical equipment damagefromforcemajeureevents.
B. “Combined heat-and-power” (CHP) Microgrids – CHP Microgrids mustmeetthefollowingrequirementsduringthe12-monthperiodbeginningwiththe date the Microgrid first produces electric energy and each 12-monthperiodthereafter:8
1. The useful thermal energy outputof the system is no less than fiftypercent(50%)ofthetotalenergyoutput.
2. Thefuelinput,minustheusefulthermalenergyoutput,isnomorethan7,000BtuperkWhofgeneratoroutput.
C. Hybrid Microgrids–Inordertobeconsideredasa“Hybrid”,aMicrogridmustcomplywiththefollowing:
1. The renewable portion of its generation capacity must meet therequirementsofRenewableMicrogridsestablishedinSubsectionAofthisSection;and
2. Thecombinedheat-and-powerportionofitsgenerationcapacitymustmeettherequirementsofCHPMicrogridsestablishedinSubsectionBofthisSection.
3. Any application for a Hybrid Microgrid under this Regulation shallexplainhowtherenewable,CHPandanystorageandbackupcapacitywill operate and comply with the requirements described in thisSection.
Section3.04.-FormsofDemostratingCompliance
A. RenewableMicrogridsmustdemonstratecompliancewiththequalificationsin Section 3.03(A) of this Regulation. The following three alternatives fordemonstrating compliance are acceptable. Applicants shall select thepreferredalternativeandidenfitysuchintheapplicationforregistration.
1. OperationalPlan.
IncludeanoperationalplandescribingthetypeofgenerationassetsontheMicrogridandhowtheywillbeusedtomeetanticipateddemandsand, for each year thereafter, submit an annual operational reportdetailing fuel usage and demonstrating compliance with thequalificationinSection3.03(A)ofthisRegulation.
8AppendixBofthisRegulationcontainsseveralexamplesonhowtomeettheserequirements.
Deleted: Section3.03.-CombinedHeat-and-PowerMicrogrids¶
Deleted: microgridshaveDeleted: qualifications:
Deleted: mustbeDeleted: duringthe12-monthperiodbeginningwiththedatethefacilityfirstproduceselectricenergy,andanycalendaryearsubsequenttotheyearinwhichthefacilityfirstproduceselectricenergy
Deleted: shallbeDeleted: ,averagedoverthe12-monthperiodbeginningwiththedatethefacilityfirstproduceselectricenergy,andanycalendaryearsubsequenttotheyearinwhichthefacilityfirstproduceselectricenergy.
Deleted: <#>CHPmicrogridsmustdemonstratecompliancewiththequalificationsinpart(A)ofthissection.Theacceptableformsofdemonstrationvaryby... [11]Deleted: <#>¶ ... [12]Deleted: <#>showthat
Deleted: willcomplywithDeleted: 3.02Deleted: thattheDeleted: willcomplywithDeleted: Section3.03Deleted: RegulationDeleted: EachhybridmicrogridDeleted: mustDeleted: showthattheoperationcompliesDeleted: andthequalificationproceduresDeleted: Sections3.02and3.03ofDeleted: Regulation
Deleted: 05.-CodesandStandards¶ ... [13]Deleted: FeeforUseofPREPAInfrastructure
Deleted: IfthemicrogridwillusePREPAinfrastructure... [14]Deleted: 02Deleted: ThreeformsofdemonstrationDeleted: :
Deleted: MicrogridapplicationsmayincludeDeleted: systemDeleted: .MicrogridswillthenberequiredtoDeleted: reportsDeleted: 02
15
2. Oil-andgas-firedgenerators.
Renewable Microgrid with generating assets limited to solarphotovoltaicsandoil-ornaturalgas-firedgeneratorsshallbeassumedtocomplywiththeserequirementsifitconsumeslessthanamonthlyfossilfuellimit,ascalculatedusingthetemplateprovidedinAppendixA of this Regulation and submitted along with its application.Microgrids shallmaintainmonthly records of fuel consumption, andsubmitanannualfuelconsumptionreportforeachyeartheMicrogridisinoperation.
3. Diesel-firedgenerators.
Any Renewable Microgrid with generating assets limited to solarphotovoltaicsanddiesel-firedgeneratorsshallbeassumedtocomplywiththeserequirementsifitconsumeslessthan3.5gallonsofdieselfuelpermonthperkilowattofphotovoltaiccapacity.Microgridsshallmaintainmonthlyrecordsoffuelconsumption,andsubmitanannualfuelconsumptionreportforeachyeartheMicrogridisinoperation.
B. CHP Microgrids must demonstrate compliance with the qualifications inSection3.03(B)ofthisRegulation,asfollows.
1. Applications for CHP Microgrids shall include a description of thegenerationandheat-recoveryequipmenttobeinstalledandtheuseofthethermalenergy,aswellasaheatflowplanshowingthefuelinput,electricgenerationandusefulthermalenergyoutputandconsumptionfortypicaloperatingconditions.Wheremorethanonegeneratoristoserve theMicrogrid, theapplicationshalldescribeall thegenerationassetsandhowtheywillbedispatchedtomeetanticipatedelectricandthermaldemands.
2. Microgrids shall be required to submit annual operational reportsdetailing fuel usage, electric generation, and thermal energyconsumption, demonstrating compliance with the qualification inSection3.03(B)ofthisRegulation.
C. HybridMicrogrids shall submit separate demonstrations of compliance forboththerenewableportionandtheCHPportionoftheMicrogrid.
Section3.05.-CodesandStandards
Microgridsshall complywith theapplicable codesandstandards identifiedby theCommission through resolutionand/ororder.TheCommissionmay, from time totime,reviewand,whennecessary,modifyandupdate,thecodesandstandardsthatshallapplytoMicrogridsunderthisRegulation.
Deleted: Anyrenewablemicrogrid
Deleted: oilDeleted: B.TouseDeleted: provision,acooperativemuststatetheirintentiontodosointheirapplicationstotheCommission,submitcalculationsfollowingthetemplateprovidedinAppendixB,
Deleted: renewablemicrogrid
Deleted: 12Deleted: Tousethisprovision,acooperativemuststatetheirintentiontodosointheirapplicationstotheCommission,
Deleted: Microgridapplications
Deleted: onthesystem
Deleted: each,Deleted: system
Deleted: 5
16
Section3.06.-InterconnectionwithPREPA’sSystem
Microgrids may interconnect with the Electric Power Grid in accordance withapplicableregulationsorproceduresadoptedbyPREPA,itssuccessorortheoperatoroftheElectricPowerGrid.
ARTICLE4.-REQUIREMENTSFORCOOPERATIVEMICROGRIDS
Section4.01.-OwnershipRestriction
No singleMember of a CooperativeMicrogridmay possess or controlmore thanthirty-fivepercent(35%)ownershipstake.
Section4.02.-SizeofCooperativeMicrogrids
CooperativeMicrogridsshallbeclassifiedbasedonsizeaccordingtothefollowing:
1. SmallCooperativeMicrogridsarethosewithatotalgeneratingcapacityof250kWorless;and
2. Large Cooperative Microgrids are those with a generating capacityexceeding250kW.
Section4.03.-ApplicationandRegistration
Any Person interested in developing a Cooperative Microgrid must submit anapplication for registration as described in Article 6 of this Regulation. Thisapplicationshallcontainatleastthefollowinginformation:
A. Contactinformation:
1. Theapplicationmustprovidethefollowingcontactinformation:
a. NameoftheMicrogridOwner.
b. Name of the primary contact (Cooperative Microgrids mustdesignate at least one Coperative Member as the primarycontact).
c. Mailingaddres
d. E-mailaddress;and
e. Phonenumber.
2. Nameandcontact information(asdescribedabove)of theMicrogridOperator,ifsuchPersonisdifferentfromthePersonidentifiedastheMicrogridOwner.
B. Operationalstructure:TheapplicationshallidentifytheproposedMicrogridasaSmallorLargeCooperative,asapplicable.
17
C. Location:TheapplicationmustidentifytheMunicipality(orMunicipalities)inwhich the Microgrid is located, and a map showing the geographicalboundariesoftheproposedMicrogrid.
D. NumberofMembers:Theapplicationshall identify thenumberandtypeofCooperativeMembersthatwillbeservedbytheMicrogrid,suchas,butnotlimitedto:
1. Publichousingbuildingsandhouseholds,
2. Othermulti-familybuildingsandhouseholds,
3. Othersingle-familyhouseholds,
4. Critical facilities (e.g. hospitals, other medical facilities, water- andwaste-water-treatmentfacilities,policestationsandfirestations)
5. Irrigationcustomers,
6. Retailstores,and
7. Othercommercialandindustrialbuildings.
E. Type of Generation: The application must identify the type of generationproposedfortheMicrogrid,asprovidedinSection3.03ofthisRegulation,andtheformfordemonstratingcompliancetherewith,asprovidedinSection3.04ofthisRegulation.
F. System resources: The applicationmust list the planned sizes and types ofassets(including,asapplicable,generation,storage,inverters,andothermajorelectricalequipment)tobeaddedorconnectedtotheMicrogrid.
G. Equipment vendor: The application shall include the name and contactinformationfortheprimaryvendor(s)orinstaller(s)oftheMicrogrid.
H. CertificationofDesign:Prior toconstruction, theapplicationshall includeacertificationoftheMicrogriddesignsignedandstampedbylicensedengineer.
Section4.04.-RateforService
A. Thecost-per-shareshallbedeterminedbytheMembersof theCooperativeMicrogrid.
B. CooperativeMicrogridsmaycollectdepositsatthediscretionofitsMembers.Depositamountsshallbefair,just,andreasonable,andshallnotdiscriminateagainstanyindividualCooperativeMembers.
C. RatesforServicemaybebasedonconsumption,peakload,oranothermetricatthediscretionoftheMembersoftheCooperative,providedsuchratesare
Deleted: cooperative
Deleted: CooperativesDeleted: themembersofthecooperative.Deleted: membersofthecooperative
Deleted: CooperativesDeleted: chargeratesDeleted: cooperative.Ratesshallbe
18
fair, just, and reasonable, and not discriminatory against any individualMembersoftheCooperative.
Section4.05.-AdditionalRequirementsApplicabletoLargeCooperatives
Large Cooperatives shall also comply with the following reporting requirements.SmallCoopertivesarenotrequiredtoprovidetheinformationdescribedherein.
A. LargeCooperativesshallsubmitanannualreportonfuelusage,generation,andsalestotheCommission.Thisreportshallinclude:
1. Electricgenerationbyresourcetype;
2. ForCHPmicrogrids,usefulthermaloutputbyresourcetype;
3. Fuelusebyresourcetype;
4. Capacityfactorbymonthandyear;
5. Totalelectricityproduction(inkWh);
6. Any change in the number of Members, including additions anddeparturesofMembers;and
7. AnyotherinformationthattheCommissionmayrequire.
B. LargeCooperativesmustmaintainandsubmit to theCommissioncopiesofanyreportsrequiredbytheUSEPAandthePuertoRicoEnvironmentalQualityBoard.
ARTICLE5.-REQUIREMENTSFORTHIRD-PARTYMICROGRIDS
Section5.01.-OwnershipandSalesRestrictions
Third-Party Microgrids may sell Energy Services and/or other Grid Services toCustomerswhoaredirectlyconnectedtotheMicrogridsystemaswellastoPREPA,subjecttothenon-discriminationrequirementsinSection5.10ofthisRegulation.
Section5.02.-Certification
In addition to complying with the requirements set forth in this Regulation, anyMicrogridOperatorconsideredanElectricServiceCompany,assuchtermisdefinedinSection1.08(A)(5)ofRegulation8701,9shallcomplywithanyandallapplicablerequirementssetforthinRegulation8701.
ForthepurposesofthisRegulation,aMicrogridOperatoroverseeingtheoperationofa Third-PartyMicrogrid, or a group of Third-PartyMicrogrids, with an aggregategeneratingcapacityofonemegawatt(1MW)ormorewillbeconsideredanElectric
9AmendmenttoRegulationNo.8618onCertification,AnnualFees,andOperationalPlansforElectricServiceCompaniesinPuertoRico.
Deleted: shallDeleted: discriminateDeleted: cooperative
Deleted: 5Deleted: FeeforUseofPREPAInfrastructure¶Incaseswherethecooperativeintends
Deleted: usePREPAInfrastructure,suchcooperativeshallpayPREPAfortheuseofsuchinfrastructurelocatedwithintheboundaryofthemicrogrid,includingmetersanddistributionequipment.
Deleted: <#>ThecooperativeshallpayafeeascalculatedusingthetemplateprovidedinAppendixAofthisRegulation.¶<#>Thecooperativeshallincludethefollowingwiththeirapplications:¶<#>ThecalculatedmonthlyfeetobepaidtoPREPA;and¶<#>Supportingcalculations,followingthetemplateprovidedinAppendixA,asanattachmenttotheapplication.¶<#>Section5.06.-Reporting¶<#>Thecooperative
Deleted: ThermalgenerationDeleted: ,forCHPsystemsDeleted: sales;Deleted: customersDeleted: customers
Deleted: ,
Deleted: Section5.07.-InterconnectionwithPREPA’sSystem¶ ... [15]Deleted: 6Deleted: SMALLMUNICIPALSYSTEMS,LARGE ... [16]Deleted: SYSTEMSDeleted: 6
Deleted: InaccordancewiththegoalsofAct133-2016,... [17]Deleted: SystemsDeleted: energyDeleted: gridservicesDeleted: customersofthemicrogridortoPREPA,subject... [18]Deleted: 6Deleted: belowDeleted: 6
Deleted: AnymicrogridownerconsideredasDeleted: ,inadditiontocomplyingwiththerequirements... [19]Deleted: Section6.03.-Registration¶
19
Service Company. In such cases, the Microgrid Operator shall comply with therequirementsofSection3.07(A)(1)(a),3.07(A)(2)andArticleIVofRegulation8701.
Section5.03.-Registration
Any Person interested in owning and/or operating a Third-PartyMicrogridmustsubmitanapplicationforregistrationasdescribedinArticle6ofthisRegulation.Thisapplicationmustcontainatleastthefollowinginformation:
A. Contactinformation:
1. Theapplicationmustprovidethefollowingcontactinformation:
a. NameofMicrogridOwner;
b. Mailingaddress;
c. E-mailaddress;and
d. Phonenumber.
2. TheapplicationshallidentifythenameofthePersonthatwillserveasMicrogridOperatorandthecontactinformationdescribedinitems(b),(c)and(d)above,ifdifferentfromthatoftheMicrogridOwner.
B. Operationalstructure:TheapplicationshallidentifytheproposedMicrogridasaThird-PartyMicrogrid.
C. Location:TheapplicationmustidentifytheMunicipality(orMunicipalities)inwhich the Microgrid is located, and a map showing the geographicalboundariesoftheproposedMicrogrid.
D. Number of customers: The application must include the total expectednumberofCustomerstobeservedbytheMicrogrid.
E. Type of Generation: The application must identify the type of generationproposedfortheMicrogrid,asprovidedinSection3.03ofthisRegulation,andtheformfordemonstratingcompliancetherewith,asprovidedinSection3.04ofthisRegulation.
F. System resources: The applicationmust list the planned sizes and types ofassets(including,asapplicable,generation,storage,inverters,andothermajorelectricalequipment)tobeaddedorconnectedtotheMicrogrid.
G. Equipment vendor: The application shall include the name and contactinformationfortheprimaryvendor(s)orinstaller(s)oftheMicrogrid.
H. CertificationofDesign:Prior toconstruction, theapplicationshall includeacertificationoftheMicrogriddesignsignedandstampedbylicensedengineer.
Deleted: personDeleted: aSmallDeleted: LargeMunicipalSystemorDeleted: SystemDeleted: 7Deleted: form
Deleted: ,forregistrationoftheproposedmicrogrid,their
Deleted: ;specifically:Deleted: System
Deleted: personDeleted: AuthorizedRepresentativeDeleted: oftheAuthorizedRepresentativeDeleted: owner
Deleted: OwnershipDeleted: forregistrationDeleted: systemDeleted: SmallMunicipalSystem,LargeMunicipalSystemor
Deleted: SystemDeleted: forregistrationshallDeleted: geographicalboundsofthemicrogrid. ... [20]Deleted: systemDeleted: forregistrationDeleted: customersDeleted: microgridDeleted: MicrogridclassificationDeleted: forregistrationDeleted: systemsDeleted: renewable;CHP;orhybridsystemsDeleted: MicrogridresourceplanDeleted: forregistrationDeleted: systemDeleted: MicrogridequipmentDeleted: forregistrationDeleted: systemDeleted: inspection:TheDeleted: forregistrationDeleted: inspectionsignedbyaLicensedElectric... [21]Deleted: isincompliancewithallregulations ... [22]Deleted: localsitingregulationsandordinances.
20
I. Sampledocuments:Theapplicationshallincludethefollowing:
1. AmodelcontractforCommissionreviewandapproval,inaccordancewithSection5.09ofthisRegulation.
2. AsamplebillforCommissionreviewandapproval.
3. Any prospective changes to the model contract or the bill formatsubmitted along with the application must be approved by theCommissionpriortotheirimplementation.
J. Billingmodel:
1. Third-partyMicrogridsshallbilltheircustomersonaper-kWhbasis.
2. Microgrids unable to bill on a per-kWh basis may requestauthorization from the Commission for an alternative paymentstructure.Suchrequestshallexplainthereasonswhytheuseofaper-kWhbillingmethodispreferable,aswellasthepreferredalternativepaymentstructureandthecalculationssupportingthatstructure,asdescribedinSection5.04(D)ofthisRegulation.
K. Proposedratestructure,asdescribedinSection5.04ofthisRegulation
Section5.04.-RateStructure
A. MicrogridOperatorsmustchargeuniformratesacrossallCustomersof thesamecustomer-classof asingleMicrogrid system.Withina customer-class,chargesmaybestructuredinanynon-discriminatorymanner,includingbutnotlimitedtoenergyratesvaryingbyusageblock,timeofuse,season,systemloadandcondition.
B. Therateatwhichenergyandgridservicesaresoldshallbeprojectspecificcost-based rates, supported by substantial documentation. It shall becomputed as the expected annual costs divided by expected sales. Theexpectedannualcostsshallbecalculatedasfollows:
1. The projected investment in the microgrid system, net of taxcredits,grantsorsubsidies,timesacarryingcharge,whichshallbethelevelizedpaymentatacostofcapitaloverthelifeoftheproject(inyears).
2. Plus the annual operating costs of the system, including fuel,maintenanceofgeneration,fees,regulatorycharges,meterreadingandbilling.
C. For non-metered Microgrids, Microgrid Operators may charge for EnergyServicesandGridServicesonanalternativebasis(forexample,perkilowatt
Deleted: UseofPREPAinfrastructureDeleted: forregistrationshalllistthePREPAinfrastructureneededbythesystem,ifany,andanestimateofthetotalfeeforpurchaseormonthlyfeeforleaseofsuchinfrastructure,asprovidedinSection6.12ofthisRegulation.¶Modelcontract:Theapplicationforregistration
Deleted: 6
Deleted: itsDeleted: AlternativebillingDeleted: Systems
Deleted: mustsubmittheirproposedDeleted: aswellasDeleted: 6.05
Deleted: Section6.04.-DemonstrationofQualifyingComposition¶Renewablemicrogridsmustdemonstratecompliancewiththequalifications
Deleted: 3.02Deleted: .Threeformsofdemonstrationareacceptable:
Deleted: applicationsmayincludeadetailedoperationalplandescribingthetypeofgenerationassetsonthesystemandhowtheywillbeusedtomeetanticipateddemands.MicrogridswillthenberequiredtosubmitannualoperationalreportsdetailingfuelusageanddemonstratingcompliancewiththequalificationinSection3.02ofthisRegulation.¶Oil-andgas-firedgenerators.¶Anyrenewablemicrogridwithgeneratingassetslimitedtosolarphotovoltaicsandoil-ornaturalgas-firedgeneratorsshallbeassumedtocomplywiththeserequirementsifitconsumeslessthanamonthlyfueloillimitascalculatedusingthetemplateprovidedinAppendixB.Tousethisprovision,microgridownersmustasserttheirintentiontodoso... [23]Deleted: customersDeleted: microgridDeleted: ratestructuressuchasinclining-ordeclining-block,time-of-use,andseasonalpricing
Deleted: used.Deleted: averageDeleted: notexceedPREPA’saveragerateof20.22centsperkilowatt-hourasofJune2017.¶
Deleted: ratechargedbysystemownersforenergyandgridservicesmayescalateyearlyatarateno ... [24]Deleted: systems,systemownersDeleted: energyDeleted: gridservices
21
ofinstalledordiversifiedload,orpermonth).Inthiscase,MicrogridOperatorsmust provide, along with their applications, calculations supporting thisalternativecharge,demonstratingthatitdoesnotexceedthemaximumrateestablishedinparts(B)and(C)ofthissection.
D. MicrogridOperatorsshallsubmit,forCommissionapproval,aproposedratestructure,includingallsupportingdocumentation.
Section5.05.-Deposits
MicrogridOperatorsmayrequirepaymentofareasonabledeposit.SuchdepositshallbeuniformamongCustomer’softhesamecustomer-class.
Section5.06.-Billing
A. ElectricBillsshallberenderedinregularperiodicintervalsforallCustomerstaking service from theMicrogrid and in accordancewith the termsof thecontract.Paymentshallbeduewithinthirty(30)daysoftheissuanceoftheElectricBillwhichmaybeissuedelectronicallyorbymail.
B. AllElectricBillsmustbedraftedclearlyandplainlysothattheyareeasytounderstandwithoutrequiringthatreaderspossessanyspecializedknowledgefor their comprehension and must include the contact information of theCommissionandtheIndependentConsumerProtectionOffice.
Section5.07.-BillObjectionsandSuspensionofService
AllElectricBillobjectionsandsuspensionofserviceprocedureswillbeconductedinaccordancewithRegulation8863,RegulationontheProcedureforBillReviewandSuspensionofElectricService,oranyfutureregulationapprovedbytheCommissiontothateffect.
Section5.08.-ComplaintProcedure
Microgrid Operators shall develop and publish a procedure for addressing anycomplaints,otherthanbilldisputes,aCustomermayhavewithregardstotheEnergyServicesand/orotherGridServicesprovidedtotheCustomer.Theproceduresshallclearlydescribe theprocess throughwhichaCustomermay file any complaintorgrievancewiththeMicrogridOperatorandtheprocessthroughwhichtheMicrogridOperatorwilladdresssaidcomplaintorgrievance,includingthetimeperiodwithinwhichsuchcomplaintsorgrievanceswillbeaddressed.
AnyCustomerdissatisfiedwithadeterminationmadebytheMicrogridOperatorinrelation to a complaint or grievance made pursuant to this Section may file acomplaintwiththeCommissionforreviewofsuchdeterminationbytheMicrogridOperator.SuchcomplaintshallbefiledpursuanttoRegulation8543.
Deleted: microgridowners
Deleted: 6.06
Deleted: ownersDeleted: depositsnottoexceedthecustomer’sexpectedaveragemonthlybillpriortothecommencement
Deleted: servicedelivery.¶Depositrequirementsmust
Deleted: forallcustomersDeleted: ofasinglemicrogridsystem.
Deleted: 6.07Deleted: billDeleted: billsDeleted: .
Deleted: 6.08
Deleted: bill
Deleted: 6
22
Section5.09.-StandardContract
Microgrid Operators shall develop a standard form contract to be used for allCustomers with the exception that rates may vary for each customer-class. Thecontractshallbewritteninplainlanguageandshallinclude,butnotbelimitedto:
1. Theeffectivedateofthecontract;
2. Theterminationdateofthecontract;
3. All rates and charges for which the customer shall be charged,including,butnotlimitedto,latepaymentfeesandreconnectionfees,asapplicable;
4. Thebillingperiod;
5. ThetermsandconditionsforthesuspensionofservicetotheCustomer,includingtherequirementsforreconnection;
6. AnexistingCustomer’sshallbeauthorizedtotransfertheirrightsandresponsibilitiesunderaMicrogridcontracttoasubsequentCustomer.
7. Forcemajeureprovisions
8. TermsandconditionsbywhichtheMicrogridOperatormayhavetherighttoentertheCustomer’spremises;
9. Provisionsagainstthetheftofpower.
10. ThenameandcontactinformationtowhomCustomersshalladdressanyinquiriesandcomplaints;
11. Theprocedureforaddressingandresolvingcomplaintsorgrievances,otherthanbillobjections,asrequiredbySection5.08ofthisRegulation.
12. ProvisionsforterminationofthecontractbyeitherpartyinaccordancewithSection5.11ofthisRegulation;
13. Aprovisionthat if thecontract isassigned,cededor transferred, thesametermsandconditionsshallapply;and,
14. ThecontractshallbegovernedandconstruedinaccordancewiththelawsandunderthejurisdictionoftheCommonwealthofPuertoRico.
Section5.10.-Non-Discrimination
A. MicrogridOperatorscoveredunderArticle5ofthisRegulationareprohibitedfrom unduly discriminating against individual Person in the immediatevicinity of a Microgrid if such Persons wishes to receive service from theMicrogrid.
Deleted: ownersDeleted: customers
Deleted: ;
Deleted: fortheentityDeleted: all
Deleted: AmechanismDeleted: disputesDeleted: .Ifbindingarbitrationisused,bothpartiesmustagreetothearbitratorschosen.
Deleted: <#>ThecontactinformationforthePuertoRicoEnergyCommissionandtheIndependentConsumerProtectionOffice;¶
Deleted: <#>6Deleted: <#>below
Deleted: 6Deleted: ownersDeleted: 6Deleted: customersDeleted: themicrogridDeleted: thosecustomersdonothaveaccessDeleted: PREPAserviceandwouldliketotakeDeleted: microgrid
23
B. Inordertodemonstratenon-discrimination:
1. Microgrid Operatorsmust submit amap of the proposedMicrogridboundariesshowingtheloadstobeinterconnectedtotheMicrogrid.
2. TheCommissionatitsdiscretionmayreviewthemapsanddeterminewhether or not the proposed Microgrid boundaries constitutediscrimination.
C. Microgrid Operators may request reconsideration of a Commissiondeterminationofdiscrimination,inwhichcasetheyshalldemonstrateeitherofthefollowing:
1. Thatbasedoncost,itisnotfeasibletoconnectthePersonswhohavebeenexcluded.Inthiscase,theMicrogridOperatorsshallberequiredto submit a calculation showing that providing service to a specificPersonwould exceed the average cost of providing service to otherCustomers of the same customer-class such that the average ratecharged to the excluded Person would not permit the MicrogridOperatorstorecoveritscostsplusareasonablereturn,ifapplicable.
2. ThatitistechnicallynotfeasibletoconnectthePerson.Inthiscase,theMicrogridOperatorsshallberequiredtosubmitanaffidavitsignedbya licensed engineer describing the technical barriers that preventdeliveryofservicetoaspecificcustomer.
Section5.11.-ContractLengthandExitRequirements
A. ThelengthofthecontractshallbesufficienttoallowtheMicrogridOperatortorecoveritscostsplusareasonablereturn,butinnoevent,shallthecontractterm exceed twenty (20) years if a residential customer is one of thecontractingparties.
B. Microgrid Operators may terminate operation and/or remove equipmentuponreceivingpermissionfromtheCommission.
C. Terminationofservice:
1. All contracts shall contain language inwhicheach party agrees thateitherpartycanseekaterminationofservice.
2. TerminationofservicemaybetriggeredbyeitheraMicrogridOperatororaCustomer.
3. Anoticeperiodofnolessthanthirty(30)calendardaysshallbegivenby the terminating party to the other party before terminating acontract. The contract shall specify the circumstances under whicheither party may be entitled to terminate a contract. Notice of
Deleted: ownersDeleted: microgridDeleted: system
Deleted: system
Deleted: owners
Deleted: customersDeleted: microgridowners
Deleted: customerDeleted: theDeleted: customersDeleted: customerDeleted: microgridownerDeleted: customerDeleted: microgridownerDeleted: professional
Deleted: 6
Deleted: microgridDeleted: microgridowner
Deleted: owners
Deleted: microgridownerDeleted: microgridcustomer
Deleted: <#>Contractsmayrequireanoticeperiodforservicetermination,nottoexceedsixty(60)days.ThenoticeperiodwillbethesameforterminationinitiatedbythecustomerorbytheMicrogridowner.¶<#>Microgridowners
24
terminationshallbemadeinwritinganddeliveredbyemailorregularpostalservice.
4. MicrogridOperatorsmaychargeareasonableexitfeeforterminationofserviceonmeteredandnon-meteredMicrogridsduringthefirstfive(5)yearsof thecontractperiod,provided,however, that incases inwhichaCustomertransferacontractobligationtoanotherCustomer,whomshallhenceforthusetheserviceprovidedtotheproperty, thetransferringCustomershallnotberequiredtopayanexitfee.
5. IntheeventaMicrogridOperator,forwhateverreasons,isunabletocontinueprovidingservicetoitsCustomers,suchMicrogridOperatorshallexerciseduediligencetofindanewoperatorwhoshallassumeresponsibilitytoprovideservicetotheCustomersundersimilartermsofservice.ShouldtheMicrogridOperatorbeunabletosecureanewoperator, suchMicrogridOperator shallworkwithPREPA toensurethat the Microgrid’s Customers continue to receive uninterruptedelectrical service once the Microgrid ceases prividing service.Alternatively,aMicrogridOperatormayofferitsCustomertheoptionof assuming ownership of the Microgrid, in which case, should theCustomers accept, shall apply to the Commission to register andconverttheMicrogridintoaCooperativeMicrogrid.
6. In lieu of the above, a Microgrid Operator may provide additionalservice guarantees, such as, but not limited to, performance bonds,providedsuchguranateesensureCustomerswillcontinuetoreceiveuninterrupted electrical service in the event of a default by theMicrogridOperator.
Section5.12.-Reporting
A. Microgrid Operators shall be required to submit an annual report on fuelusage,generation,andsalestotheCommission.Thisreportshallinclude:
1. Electricgenerationbyresourcetype;
2. Thermalgenerationbyresourcetype,forCHPMicrogrids;
3. Fuelusebyresourcetype;
4. Capacityfactorbymonthandyear;
5. Totalsales;
6. Any change in the number of Customers, including additions anddeparturesofCustomers;and
7. AnyotherinformationthattheCommissionmayrequire.
Deleted: systemsDeleted: .¶Section6.12.-FeeforUseofPREPAInfrastructure¶IncaseswheretheownerofamicrogridintendstousePREPAInfrastructure,suchownershallpayPREPAfortheuseofsuchinfrastructurelocatedwithintheboundaryofthemicrogrid,includingmetersanddistributionequipment.¶ForSmallMunicipalSystems,theowner(s)ofthemicrogridshallpayPREPAtheamountof$25permonthpercustomer,fortheuseofPREPAInfrastructurelocatedwithintheboundaryofthemicrogrid,includingmetersanddistributionequipment,uptoamaximumof$250permonth.¶ForLargeMunicipalSystemsandThird-PartySystems,theowner(s)ofthemicrogridshallpayafeeascalculatedusingthetemplate
Deleted: inAppendixA.¶Theowner(s)ofthemicrogrid
Deleted: includethefollowingwiththeirapplications:¶ThecalculatedmonthlyratetobepaidtoPREPA;and¶Supportingcalculations,followingthetemplate
Deleted: inAppendixA,asDeleted: attachmenttotheapplication,asapplicable
Deleted: 6.13
Deleted: owners
Deleted: systems
Deleted: customersDeleted: customers
25
B. MicrogridOperatorsmustmaintainandsubmittotheCommissioncopiesofanyreportsrequiredbytheUSEPAandthePuertoRicoEnvironmentalQualityBoard.
Section5.13.-RateReview
A. Any Operator or Customer of a Third-party Microgrid may petition theCommissiontoconductaratereviewfortheserviceprovidedbytheThird-partyMicrogrid,subjecttothefollowingrestrictionsandrequirements:
1. MicrogridratesshallnotbesubjecttoreviewbytheCommissionforthe first three (3) years after the Commission approves theirapplicationforregistration.
2. Petitions for rate review may be brought by either Customers orMicrogridOperators.
a. Customersmaypetitionforratereviewonthebasisofunjustorunreasonable rates, on the basis of undue burden, or on thebasis of imprudence or inadequate service on the part of theMicrogridOperator.
b. MicrogridOperatorsmaypetitionforratereviewonthebasisofunjustorunreasonableratesoronthebasisofinsufficientcostrecovery.
CHAPTERIIIPROCEDURES
ARTICLE6.-REGISTRATIONPROCESS
Section6.01.-RegistrationForm
A. AnypersoninterestedindevelopingaMicrogridmustcompletearegistrationform,asapplicable,fortheclassificationoftheirMicrogrid.
B. Registration forms will be available at the Commission website, and willincludeataminimumtheinformationsetforthinSections4.03and5.03ofthis Regulation, as applicable. Applicants must submit this form to theCommissioninelectronicorpaperformat.
C. If the registration form is not available, applicants may provide theinformationrequiredfortherelevantMicrogridtypetotheCommissioninapaperorelectronicformatoftheirchoice.
Section6.02.-CommissionReview
A. The Commission shall review all applications for completeness andcompliancewiththisRegulation,pursuanttotheprovisionsofLPAU.
Deleted: owners
Deleted: 6.14
Deleted: ownerDeleted: customerDeleted: municipalorthirdDeleted: microgridsystemDeleted: ofDeleted: thatmicrogrid
Deleted: approvalofDeleted: applicationsDeleted: bytheCommissionDeleted: customersDeleted: systemowners
Deleted: systemowner.➝
Deleted: owners
Deleted: Section6.15.-InterconnectionwithPREPA’sSystem¶MicrogridscaninterconnectwithPREPA’ssysteminaccordancewithapplicableregulationsadoptedbyPREPA.¶
Deleted: 7Deleted: 7Deleted: Cooperative,MunicipalorThird-Partymicrogridsystem,
Deleted: systemDeleted: providedonDeleted: .Deleted: writtenDeleted: <#>TheCommissionwillprovideanoticewiththewebpageoftheregistrationformassoonastheformisreleasedonthewebsite.¶
Deleted: <#>systemDeleted: <#>written
Deleted: 7
26
B. TheCommissionshallissueadeterminationoneachapplicationwithinthirty(30)daysofreceipt:
1. Granting the Microgrid status as a Registered Microgrid, subject tocompliancewithSection6.03ofthisRegulation;
2. Requiringadditionalinformationand/orspecificrevisions;or
3. DenyingregistrationoftheMicrogrid.
C. TheCommissionmayissueadeterminationofdenialofanyapplicationonthebasisofMicrogridlocation,cost,composition,orotherconsiderations.
D. Ongoing duty to notify. If, at any point prior to or after a CommissiondeterminationhasbeenmadepursuanttothisSection,anyoftheinformationprovidedbyaMicrogridownerand/oroperatoraspartofanapplicationforregistration changes or is expected to change, theMicrogridowner and/oroperator shall have the responsibility of notifying the Commission of suchchange no later than ten (10) days from the date the change takes place.Failuretopromptlyupdateandnotify theCommissionofanysuchchangesmay result in aNoticeofNon-Compliance, pursuant to Section 1.16 of thisRegulation.
Section6.03.-ComplianceCertifications
A. AfteraMicrogridhasbeenfullyconstructed,butpriortobeginningoperation,the Microgrid owner and/or developer shall file with the Commission thefollowing:
1. AwrittencertificationsignedbyalicensedengineerindicatingthattheMicrogrid, as built, complies with all regulations including, but notlimited to, regulations of the U.S. EPA, all codes and standards asorderedbytheCommissionunderSection3.05ofthisRegulation,andlocalsitingregulationsandordinances.
2. AcertificationoftheMicrogrid‘asbuilt’designsignedandstampedbyalicensedengineer.
3. Acertificationofinspectionsignedbyalicensedengineerorlicensedelectrician,whenauthorizedbylawtodoso.
B. ThefilingofthedocumentsandinformationrequiredinSub-section(A)ofthisSectionshallconstituteauthorizationtotheMicrogridownerand/oroperatortobeginoperationoftheMicrogrid.
C. TheCommissionmayreviewtheinformationprovidedandmayrequiretheMicrogridownerand/oroperatoranyadditionalinformationtheCommissiondeterminesnecessaryorconvenient.Intheeventofnon-complianceorifthe
Deleted: whichshall
Deleted: <#>Grantpermissiontooperateasamicrogrid;¶<#>Require
Deleted: <#>Denypermissiontooperateasamicrogrid.¶
Deleted: permissiontoDeleted: tooperateasamicrogridDeleted: systemDeleted: Section 7.03
27
Commissiondetermines, from the informationprovided, that theMicrogridfailstocomplywithanyoftherequirementssetforthinthisRegulation,theCommissionmay,atitsdiscretion,takeanyappropriateactionnecessarytoensure the safety and reliability of the service provided to the microgridsMembersorCustomers.
Section6.04.-FilingFee
A. Except for Microgrids covered under Section 5.02 of this Regulation, anyapplicationforregistrationofaMicrogridsystemshallincludepaymentofafilingfeeasfollows:
1. SmallCooperativeMicrogrids:$50.00
2. LargeCooperativeMicrogridsandThird-PartyMicrogrids:$100.00
B. MicrogridscoveredunderSection5.02ofthisRegulationshallbeexemptfrompayment under this Section. Proof of payment of the applicable fees underRegulation 8701 shall be provided in order to claim the exemption frompaymentestablishedherein.
ARTICLE7.-EXEMPTIONS
AnyMicrogridOperatormayfilearequestforexemptionormodificationofanyoftherequirementsunder thisRegulation.Any request forexemptionshalldescribe theprovision from which the applicant seeks exemption or for which the applicantrequests a modification and shall include a clear justification of the applicant’srequest.ThisopportunitytofileforanexemptionmayoccuratthetimeofseekingapprovaloratalaterdatesuchaswhentheMicrogridisalreadyinoperationduetoachangeincircumstances.Inrulingonsuchmotions,theCommissionshallconsiderthereasonablenessoftherequest;thecostimpactontheprojectandtheMembersorCustomersoftheMicrogridprojectincludingtheprudenceofincurredoranticipatedcosts, if applicable; whether the exemption is supported by the Members orCustomers or potential Members or Customers of the Microgrid; whether theexemptionisinthepublicinterestandanyotherrelevantfactorspertainingtotherequestedwaiver.
ARTICLE8.-RECONSIDERATIONANDJUDICIALREVIEW
Section8.01.-RequestforReconsideration
AnypersonthatisnotsatisfiedwithadecisionmadebytheCommissionunderthisRegulationmayfile,withinthetermoftwenty(20)daysfromthedatecopyofthenotice of such decision is filed by the Commission’s Clerk, a request forreconsiderationbeforetheCommissionwhereinthepetitionersetsforthindetailthe
Deleted: microgridsystemsDeleted: 6Deleted: microgrid
Deleted: Systems
Deleted: ,Municipal(SmallandLarge)Deleted: Systems
Deleted: MicrogridsystemsDeleted: 6Deleted: paytheapplicablefilingfeesestablishedinRegulation8701.
Deleted: filingfeeDeleted: 8Deleted: microgridownerDeleted: appliedtotherelevantsystemtypeasdescribedinChapterIIof
Deleted: ofDeleted: of
Deleted: willtakeintoaccountfactorsincluding,butnotlimitedto:alternativestomicrogridserviceavailabletothecustomersinquestion;
Deleted: justnessandDeleted: costs;Deleted: ;andthesystemowner’sabilitytorecoverprudently-incurredcostsandearnafairrateofreturn,when
Deleted: .Deleted: 9Deleted: 9
28
grounds that support the request and the decisions that, in the opinion of thepetitioner,theCommissionshouldreconsider.
Section8.02.-JudicialReview
AnypersondissatisfiedwithafinaldecisionoftheCommissionunderthisRegulationmay,withinthirty(30)daysfromthedatecopyofnoticeofafinaldecisionaddressingarequestforreconsiderationisfiledbytheCommission’sClerk,orwithinthirty(30)daysfromthedatecopyofthenoticeofaCommissionfinaldecisionisfiledbytheCommission’sClerk,ifarequestforreconsiderationhasnotbeenfiled,appearbeforetheCourtofAppealsoftheCommonwealthofPuertoRicobywayofwritofjudicialreview, pursuant to Section 4.2 of LPAU and the applicable Rules of the Court ofAppeals.
AgreeduponbythePuertoRicoEnergyCommission,inSanJuan,PuertoRico,onMay ,2018.
____________________________________ÁngelR.RiveradelaCruzAssociateCommissioner
___________________________________JoséH.RománMoralesAssociateCommissioner
InterimChairman
Deleted: 9
Page 7: [1] Deleted CEPR 5/16/18 2:01:00 PM
“GreenEnergy” refers jointly toSustainableRenewable Energy, AlternativeRenewableEnergyandDistributedRenewableEnergy.
Page 7: [2] Deleted CEPR 5/16/18 2:01:00 PM
“Interconnection Charge”means the fair and reasonable amount ofmoneythatapersonshallpaytoPREPAfortherighttoconnecthis/herfacilitytotheElectricPowerGrid.
“Load”meansacustomer’suseofenergyand/orgridservices.
Page 7: [3] Deleted CEPR 5/16/18 2:01:00 PM
customerandadistributionnetwork.Metersmay,butarenotrequired,tobeequippedwithadvanced
1.
Page 7: [4] Deleted CEPR 5/16/18 2:01:00 PM
withrespecttoPREPA’sgrid.Thegoalofmicrogridsistoreduceenergyconsumptionbasedonfossilfuelsthroughlocalrenewableenergygenerationandstrategiestoreduceenergyconsumption.Amicrogrid
2.
Page 11: [5] Deleted CEPR 5/16/18 2:01:00 PM
willdeterminetheapplicableprovisionsofthisRegulation.
Microgridsshallbeclassifiedbasedonsizeaccordingtothefollowing:
Individualsystemsarethosewithoneortwocustomer-owners;
Small systems are thosewith at least three (3) and nomore than ten (10)customersorcustomer-ownersandtotalgeneratingcapacityofnomorethan250kW;or,
Largesystemsarethosewithmorethan10customersorgeneratingcapacityover250kW.
Microgridsthatproduceenergyprimarilyforconsumptionbytheowner(s)ofthesystemshallbereferredtoas“self-supply”systems.Self-supplymicrogrids
1.
Page 11: [6] Deleted CEPR 5/16/18 2:01:00 PM
notsellenergyand/orothergridservicesoutsideoftheirself-supplysystemtoentitiesotherthanPREPA.
2.
Page 11: [7] Deleted CEPR 5/16/18 2:01:00 PM
small cooperative systems engaged in self-supply (hereafter referred to as “smallcooperativemicrogrids”)
3.
Page 11: [8] Deleted CEPR 5/16/18 2:01:00 PM
largecooperativesystemsengagedinself-supply(hereafterreferredtoas“largecooperativemicrogrids”)
4.
Page 11: [9] Deleted CEPR 5/16/18 2:01:00 PM
smallmunicipalsystems,largemunicipalsystemsandthird-partysystemsaredescribedinArticle6ofthisRegulation.
Therequirementsforsystems5.
Page 11: [10] Deleted CEPR 5/16/18 2:01:00 PM
otheradministrativedivisions,arethesameas those forsystemsownedbysinglemunicipalities.
Therequirementsforsystemsowned6.
Page 14: [11] Deleted CEPR 5/16/18 2:01:00 PM
CHPmicrogridsmustdemonstratecompliancewiththequalificationsinpart(A)ofthissection.TheacceptableformsofdemonstrationvarybysystemclassificationandaredescribedintherelevantArticlesbelow.
Any microgrid registered as “CHP” that is found by the Commission to be non-compliantwiththequalificationsinpart(A)ofthisSection,maybesubjecttoaNoticeofNon-CompliancepursuanttoChapterIVofRegulation8543andmay,asaresultofsuchnon-compliance,loseitsstatusasalicensedmicrogridsystemorbesubjecttoanyotheradministrativesanctionorpenaltydeemedappropriatebytheCommission.
Section 3.04.- C.
Page 14: [12] Deleted CEPR 5/16/18 2:01:00 PM
EachhybridsystemC.
Page 14: [13] Deleted CEPR 5/16/18 2:01:00 PM
05.-CodesandStandards
Microgridsshallbecompliantwithexistingsafetystandards;namely,IEEEStandard1547fordesign;ULStandard1703,ULStandard1741,orIEEEStandard1547forequipment;andtheNationalElectricCode,oranysuccessorcodeorstandard,assuchcodeorstandardmayberevised,amendedorupdatedfromtimetotime.
ARTICLE4.-REQUIREMENTSFORSMALLCOOPERATIVESYSTEMS
Section4.01.-OwnershipandSalesRestrictions
InaccordancewiththegoalsofAct133-2016,SmallCooperativeSystemsmaysellenergyand/or other grid services to customers of the microgrid or to PREPA, subject to thefollowingrequirementsandrestrictions:
Nosinglememberofacooperativesystemmaypossessorcontrolmorethanthirty-fivepercent(35%)ownershipstake.
Cooperative-ownedmicrogridsmay distribute energy and grid services among itsmembersandmaysellexcessenergyorothergridservicestoPREPA.Suchmicrogridsmaynotsellenergyorgridservicestocustomers,otherthanPREPA,whohavenoownershipstakeinthesystem.
Section4.02.-Registration
Any person interested in developing a small cooperative microgrid must submit anapplicationforregistrationasdescribedinArticle7ofthisRegulation.Thisapplicationformshallcontainatleastthefollowinginformation:
Contactinformation:
Theapplicationmustprovide,forregistrationoftheproposedmicrogrid,thecontactinformation;specifically:
Cooperativename;
Mailingaddress;
E-mailaddress;and
Phonenumber.
Cooperative systems must designate at least one member as the primarycontactforthesystem.
Ownership structure: The application for registration shall identify the proposedsystemasasmallcooperative.
Location:Theapplicationforregistrationmustidentifythemunicipalityinwhichthemicrogridislocatedandtheaddressesofeachcustomertobeserved.
Numberofcustomers:Theapplicationforregistrationshallidentifythenumberofcustomers that will be served by the microgrid, by customer type, including thenumbersof:
Publichousingbuildingsandhouseholds,
Othermulti-familybuildingsandhouseholds,
Othersingle-familyhouseholds,
Critical facilities (e.g. hospitals, other medical facilities, water- and waste-water-treatmentfacilities,policestationsandfirestations)
Irrigationcustomers,
Retailstores,and
Othercommercialandindustrialbuildings.
Microgridclassification:Theapplicationforregistrationmustidentifytheproposedsystemsasrenewable;CHP;orhybridsystems.
Microgridresourceplan:Theapplicationforregistrationmustlisttheplannedsizesandtypesofassets(including,asapplicable,generation,storage,inverters,andothermajorelectricalequipment)tobeaddedorconnectedtothesystem.
Microgridequipmentvendor:Theapplicationforregistrationshallincludethenameandcontactinformationfortheprimaryvendor(s)orinstaller(s)ofthesystem.
Certification of inspection: The application for registration shall include acertificationofinspectionsignedbyaLicensedElectricEngineer. ThecertificationmustindicatethattheMicrogridisincompliancewithallregulationsincluding,butnotlimitedto,regulationsoftheUSEPA,allsafetystandardsaslistedinSection3.05ofthisRegulation,andlocalsitingregulationsandordinances.
Section4.03.-RateforService
Thecost-per-shareshallbedeterminedbythemembersofthecooperative.
Cooperatives may collect deposits at the discretion of the members of thecooperative. Deposit amounts shall be fair, just, and reasonable, and shall notdiscriminateagainstanyindividualmembersofthecooperative.
Cooperativesmaychargeratesbasedonconsumption,peakload,oranothermetricat the discretion of themembers of the cooperative. Rates shall be fair, just, andreasonable, and shall not discriminate against any individual members of thecooperative.
Section4.
Page 14: [14] Deleted CEPR 5/16/18 2:01:00 PM
IfthemicrogridwillusePREPAinfrastructurelocatedwithintheboundaryofthemicrogrid,thecooperativeshallpayPREPAtheamountof$25permonthpercustomertousesuchinfrastructure,includingmetersanddistributionequipment,uptoanaggregateof$250permonth.
Section4.05.-InterconnectionwithPREPA’sSystem
MicrogridscaninterconnectwithPREPA’ssysteminaccordancewithapplicableregulationsadoptedbyPREPA.
ARTICLE5.-REQUIREMENTSFORLARGECOOPERATIVESYSTEMS
Section5.01.-OwnershipandSalesRestrictions
InaccordancewiththegoalsofAct133-2016,LargeCooperativeSystemsmaysellenergyand/orothergridservicestomembersofthemicrogridortoPREPA,subjecttothefollowingrequirementsandrestrictions:
No single members of a cooperative system may possess more than thirty-fivepercent(35%)percentownershipstake.
Cooperative-ownedmicrogridsmay distribute energy and grid services among itsmembersandmaysellexcessenergyorothergridservicestoPREPA.Suchmicrogridsmaynotsellenergyorgridservicestocustomers,otherthanPREPA,whohavenoownershipstakeinthesystem.
Section5.02.-Registration
Any person interested in developing a large cooperative microgrids must submit anapplicationforregistrationasdescribedinArticle7ofthisRegulation.Thisapplicationformmustcontainatleastthefollowinginformation:
Contactinformation:
Theapplicationmustprovide,forregistrationoftheproposedmicrogrid,theircontactinformation;specifically:
Cooperativename;
Mailingaddress;
E-mailaddress;and
Phonenumber.
Cooperative systems must designate at least one member as the primarycontactforthesystem.
Ownership structure: The application for registration shall identify the proposedsystemasalargecooperative.
Location:Theapplicationforregistrationmustidentifythegeographicalboundsofthemicrogrid.Locationinformationmustincludethemunicipalityofthemicrogridandamapshowingthegeographicalboundariesoftheproposedsystem.
Numberofcustomers:Theapplicationforregistrationshallidentifythenumberofcustomers that will be served by the microgrid, by customer type, including thenumbersof:
Publichousingbuildingsandhouseholds,
Othermulti-familybuildingsandhouseholds,
Othersingle-familyhouseholds,
Critical facilities (e.g. hospitals, other medical facilities, water- and waste-water-treatmentfacilities,policestationsandfirestations)
Irrigationcustomers,
Retailstores,and
Othercommercialandindustrialbuildings.
Microgridclassification:Theapplicationforregistrationmustidentifytheproposedsystemsasrenewable;CHP;orhybridsystems.
Microgridresourceplan:Theapplicationforregistrationmustlisttheplannedsizesandtypesofassets(including,asapplicable,generation,storage,inverters,andothermajorelectricalequipment)tobeaddedorconnectedtothesystem.
Microgridequipmentvendor:Theapplicationforregistrationshallincludethenameandcontactinformationfortheprimaryvendor(s)orinstaller(s)ofthesystem.
Certification of inspection: The application for registration shall include acertificationofinspectionsignedbyaLicensedElectricEngineer. ThecertificationmustindicatethattheMicrogridisincompliancewithallregulationsincluding,butnotlimitedto,regulationsoftheUSEPA,allsafetystandardsaslistedinSection3.05ofthisRegulation,andlocalsitingregulationsandordinances.
UseofPREPAinfrastructure:TheapplicationforregistrationshallincludealistingofthePREPAinfrastructureneededbythesystem,ifany,andanestimateofthetotalfeeforpurchaseormonthlyfeeforleaseofsuchinfrastructure,asprovidedinSection5.05ofthisRegulation.
Section5.03.-DemonstrationofQualifyingComposition
Page 18: [15] Deleted CEPR 5/16/18 2:01:00 PM
Section5.07.-InterconnectionwithPREPA’sSystem
MicrogridscaninterconnectwithPREPA’ssysteminaccordancewithapplicableregulationsadoptedbyPREPA.
Page 18: [16] Deleted CEPR 5/16/18 2:01:00 PM
SMALLMUNICIPALSYSTEMS,LARGEMUNICIPALSYSTEMS,AND
Page 18: [17] Deleted CEPR 5/16/18 2:01:00 PM
Inaccordancewith thegoalsofAct133-2016, SmallMunicipal Systems,LargeMunicipalSystemsand
Page 18: [18] Deleted CEPR 5/16/18 2:01:00 PM
customers of the microgrid or to PREPA, subject to the following requirements andrestrictions:
SmallandLargeMunicipalsystemsmustbeownedbyasinglemunicipality,agroupofmunicipalities,oranotheradministrativedivisionoftheCommonwealth.
Third-party systems may be owned by any for-profit or non-profit entity, orgovernmentalagencyapartfrommunicipalities,otheradministrativedivisions,andPREPA.
SmallMunicipalSystems,LargeMunicipalSystemsandThird-PartySystemsmaysellenergyand/orothergridservicestoPREPAaswellastoothercustomers
Page 18: [19] Deleted CEPR 5/16/18 2:01:00 PM
,inadditiontocomplyingwiththerequirementssetforthinthisRegulation,
Page 19: [20] Deleted CEPR 5/16/18 2:01:00 PM
geographicalboundsofthemicrogrid.Locationinformationmustincludethemunicipalityofthemicrogrid
A.
Page 19: [21] Deleted CEPR 5/16/18 2:01:00 PM
inspectionsignedbyaLicensedElectricEngineer.ThecertificationmustindicatethattheB.
Page 19: [22] Deleted CEPR 5/16/18 2:01:00 PM
isincompliancewithallregulationsincluding,butnotlimitedto,regulationsoftheUSEPA,allsafetystandardsaslistedinSection3.05ofthisRegulation,
C.
Page 20: [23] Deleted CEPR 5/16/18 2:01:00 PM
applicationsmay includeadetailedoperationalplandescribing the typeofgenerationassetsonthesystemandhowtheywillbeusedtomeetanticipateddemands. Microgrids will then be required to submit annual operationalreports detailing fuel usage and demonstrating compliance with thequalificationinSection3.02ofthisRegulation.
Oil-andgas-firedgenerators.
Anyrenewablemicrogridwithgeneratingassetslimitedtosolarphotovoltaicsandoil-ornaturalgas-firedgeneratorsshallbeassumedtocomplywiththese
requirements if it consumes less thanamonthly fueloil limit as calculatedusingthetemplateprovidedinAppendixB.Tousethisprovision,microgridowners must assert their intention to do so in their applications to theCommission,submitcalculationsfollowingthetemplateprovidedinAppendixA,maintainmonthlyrecordsoffuelconsumption,andsubmitanannualfuelconsumptionreport.
Diesel-firedgenerators.
Anyrenewablemicrogridwithgeneratingassetslimitedtosolarphotovoltaicsand diesel-fired generators shall be assumed to comply with theserequirementsifitconsumeslessthan12.5gallonsofdieselfuelpermonthperkilowatt of photovoltaic capacity. To use this provision, microgrid ownersmustasserttheirintentiontodosointheirapplicationstotheCommission,maintain monthly records of fuel consumption, and submit an annual fuelconsumptionreport.
CHPmicrogridsmustdemonstratecompliancewiththequalificationsinSection3.03ofthisRegulation.
Microgridapplicationsshallincludeadescriptionofthegenerationandheat-recoveryequipmenttobeinstalledandtheuseofthethermalenergy,aswellas a heat flow plan showing the fuel input, electric generation and usefulthermal energy output and consumption for typical operating conditions.Wheremorethanonegeneratoristoservethemicrogrid,theapplicationshalldescribe all the generation assets on the system and how they will bedispatchedtomeetanticipatedelectricandthermaldemands.
Microgridsshallberequiredtosubmitannualoperationalreportsdetailingfuel usage, electric generation, and thermal energy consumption,demonstrating compliance with the qualification in Section 3.03 of thisRegulation.
Hybrid microgrids shall submit separate demonstrations of compliance for eachrenewableportionandCHPportionofthesystem.
Section6.05.-RateforService
SystemownersA.
Page 20: [24] Deleted CEPR 5/16/18 2:01:00 PM
ratechargedbysystemownersforenergyandgridservicesmayescalateyearlyataratenogreaterthanone-quarter(¼)ofthepercentagechangeinaveragefiscal-year“OtherGoodsandServicesConsumerPriceIndex”fromtheGovernmentDevelopmentBank1overtheFY2017averageof116.4.However, innoevent shall the rateexceed thegreaterof (1) the 1Availableathttp://www.gdb-pur.com/economy/documents/05-PRICE-2017-10-23.xls
maximumrateestablishedininpart(B)ofthissectionor(2)thewhole-systemaverageratecharged by PREPA, as measured over the most-recent twelve-month period for whichsufficientdataisavailable.
B.
