Relating to billing methods that may be utilized in connection with distributed generation facilities

The inclusion of this explanation does not constitute agreement with the explanation’s substance by the members of the general assembly.49, relating to electric utility rates and infrastructure support options for private generation customers. The bill defines “private generation customer” to mean an electric utility customer who utilizes a private generation facility.42 that is owned, leased, operated by, or operated on behalf of a private generation customer and whose production of electricity is used to offset a portion or all of the customer’s electricity bill or usage that would otherwise be purchased from an electric utility, but does not include certain facilities described in the bill. The bill provides that the general assembly recognizes the importance of electric utility infrastructure, including generation, transmission, and distribution systems, to provide electric service to all customers in Iowa. The general assembly also recognizes that tariffs are traditionally designed for the provision of full electric service to customers, not taking private generation into account. The bill specifies that it is the intent of the general assembly to require private generation customers to pay their share of costs of electric utility infrastructure, and to provide private generation customers with options to pay their share of costs. The bill allows rate-regulated electric utilities to file tariffs with the Iowa utilities board applicable to any private generation customer who utilizes a private generation facility installed on or after the date a tariff is approved pursuant to the bill. All tariff rates charged to a customer shall recover the electric utility’s actual cost of providing service to the applicable customer class. The bill provides that tariffs filed pursuant to the bill shall be designed to ensure that a private generation customer pays for electric utility infrastructure costs and shall require a private generation customer to choose from one of several rate structures described in the bill. The bill provides that the board shall review a tariff for compliance with the bill and shall approve the tariff as filed or docket the tariff for review in a formal proceeding, and thereafter either approve the tariff or modify the tariff to meet compliance within six months of the date of docketing. If the board fails to review the tariff within six months of the date of filing, the tariff is deemed approved. An approved tariff shall supersede any previously approved tariffs applicable to private generation customers, except as provided in the bill. The bill provides that a private generation customer who utilizes a private generation facility pursuant to a tariff approved by the board on or before the effective date of the bill may continue to receive electric service pursuant to the preexisting tariff for the remaining duration of the contract involving the facility, regardless of any subsequent change in ownership of such facility. If the private generation customer terminates electric service with the utility, the preexisting tariff shall no longer apply and the customer shall be required to receive electric service pursuant to a tariff approved in accordance with the bill, if such tariff was filed with the board. The bill provides that nothing in the bill shall preclude a customer from entering into a contract with an electric utility as an alternate energy production facility, cogeneration and small power production facility, or a standby and supplemental power service customer under the terms of the electric utility’s separate tariffs filed pursuant to specified federal law.