Distributed Generation Programs,
Incentives
and
Interconnections
Ian Loughran, P.Eng.
DSM Program Leader
Renewable Energy Programs
iloughran@saskpower.com
306-566-6108
1
SaskPower’s Challenge
• Unprecedented demand for power
• Strong provincial economy
• Industry is approximately 50 per cent of total load
• Last 10 years, demand has been 1.8 per cent per
year
• Next 10 years forecast at 2.4 per cent growth per
year.
• $5B asset value company; 80 years old
• Spending $15B in the next 10 years- aging
infrastructure
• Provincial environmental legislation has yet to be
released;
• Alignment with Federal government coal phase
out plans
2
SaskPower Distributed Generation Programs
Net Metering Program (up to 100 kW)
• Typically rural and urban residential customers
Small Power Producers Program (up to 100 kW)
• Small commercial Independent Power Producers (IPP)
Green Options Partners Program (>100 kW to 10 MW)
• Small commercial to large commercial IPP
Benefits of DG
• Capital offset
• Less line losses
• Environmental benefits
• Job creation
• Empowering customers
3
Preferred Environmental Technologies
• Technologies permitted for all programs:
• Micro-hydro
• Small wind turbines
• Solar photo voltaic (PV)
• Biomass fuels (gas, liquids and solids)
• Flare gas
• Waste heat/Heat recovery technologies
• SaskPower owns environmental credits associated with power generation
4
Net Metering Program
Up to 100 kW
– Started in 2007; 230 customers; 85 per cent small wind; 15 per cent solar PV
– Primary purpose is to offset your consumption
– Bank credits for your excess power delivered
• Credit at customer retail rate
• Credit will be taken off next month’s bill
• After 12 months the credits are forfeited
– Two-year contract
– Making some improvements to this program in 2011
5
Small Power Producers Program
Up to 100 kW:
– Started in 1994, currently five participants
• (one Combined Heat and Power, four Wind)
– Two options:
• Sell all power
• Sell excess power
– 2011 price SaskPower will pay is $0.09609/kWh escalating two per cent /year for a
20-year contract
6
Green Options Partners Program
>100 kW and 10 MW
• Program cap of 50 MW in 2011
– No more than 25 MW can be made of wind
– A lottery to select applications for the 2011 program closes June 1
• The 2011 program’s payment rate is $96.09/MWh for projects that
reach commercial operation in 2011
• Rate escalates at 2 per cent per annum for the duration of the 20-year
contract. 40 year contract for hydro projects.
• GO Partners Program reviewed annually
7
Net Metering Wind and Solar Applications
W
46
5k
W
80
4k
W
0k
42
45
W
33
6k
W
50
W 3
10
kW
32
0k
60
40
kW
15
kW
16
72
W
63
10
kW
20
kW
11
4k
30
9k
Increase in Applications
70
0
2007
2008
2009
Year
Solar
8
Wind
Total
2010
CanSIA PV Solar Grid Parity
0.45
0.40
Cost ($/kWh)
0.35
0.30
0.25
0.20
0.15
0.10
0.05
0.00
2008
2010
2012
2014
2016
2018
2020
2022
2024
Year
Solar Low Scenario
9
Solar High Scenario
Conventional
2026
Net Metering Rebate Program
• 35 per cent rebate to total installed cost (max of $35,000 rebate):
• 35 per cent total = 10 per cent SaskPower and 25 per cent Go Green
Fund
• Program led by Ministry of Environment’s Go Green Fund
• Rebate program ended March 31, 2011
• Go Green Fund is finalizing outstanding rebates to customers that
committed to projects by end date
• Public and industry pressure on Ministry to offer a bridge financing
program until a new program is in place
• Decisions will be made in the upcoming weeks (months?)
10
Renewable Energy Incentive Program
Development
New REI Program
• Saskatchewan Ministry of Environment issued an RFP (December
2010)
• Consultant to help develop and design a new REI program
• Awarded to Dunsky Energy Consulting (Montreal)-end of February
2011, and work began in March 2011
• Program design work should be completed by September 2011
• This is a new program, not policy change
• Implementation plans TBD
11
REI Program Funding
Value Propositions
• Funding agencies being solicited
12
•
Ministry of Environment- Go Green Fund- $/tGHG avoided
• Net Metering Rebate $200/tCO2; Clean Coal $80/tCO2
•
Enterprise Saskatchewan- Job creation; $/Jobs
•
Saskatchewan Innovation- Technology development
•
SaskPower- Supply value- $/MWh and/or $/MW
•
Ministry of Energy and Resources- Supply value-$/MWh and/or $/MW
Renewable Energy Incentive Program
Development
New REI Program Considerations:
• Quality- Industry standard (CanSIA, CanWEA,SWCC) and CSA
certification for product, product performance and installation
• Financing- Mechanisms for accessing capital
• Incentives- Production (by kWh); capital costs; combination of
both; possibly up to 500kW; possible variations by technology
type
• Implementation- Interconnection processes and contracts
13
Interconnection Process- 10 Entities; 30 Steps
Customer
Customer
Supply
Planning
Services
T&D
Northpoint
Engineering
DG Program
Electrical
DSM
Inspections
Billing
T&D
District
Metering
Services
14
Services
Interconnection Application Process
Small Power and Net Metering
• All application forms, templates and processes are on SaskPower web site
• Apply for Preliminary Interconnection Study $315 (includes GST)
• Items needed
• Electrical single line diagram
• Site diagram
• Generator and inverter detailed specifications (CSA approved)
• Interconnection costs involved
• Bi-directional meter (approx $500 incl GST)
• Electrical inspections permit ($200-300)
• Transformer upgrade costs split 50-50 with customer (up to $35/kW of generator)
• Customer pays for service upgrade costs
• Contracts
• Power Purchase Agreement and Interconnection Agreement
• Total cost is approximately $1,000; total time is approximately five months
• + Generator, installation, maintenance, etc.
15
Average Net Metering Application Process Time
12
Months
10
8
6
4
50%
Reduction
2
0
2007
2008
2009
Year
16
2010
Interconnection Application Process
GO Partners Program
• 500 kW Solar PV
• Apply for program- $1,725 (see SaskPower web site)
– Lottery selection
– Fee used for General Interconnection Feasibility Study (GIFS)
– Approximately four months
• Contracts
– Power Purchase Agreement; General Interconnection Agreement
• Interconnection costs involved
•
•
•
•
Bi-directional meter (approximately $8,000 including GST)
Electrical inspections permit ($1,000)
Transformer upgrade costs split 50-50 with customer (up to $35/kW of generator)
Customer pays for service upgrade costs
• Total cost is approximately $11,000; total time is approximately one year
17
Thank You.
Ian Loughran, P.Eng.
Renewable Energy Program Leader
iloughran@saskpower.com
306-566-6108
18
Net Metering Customers April 2011
WB
6%
Saskatoon
35%
NB
8%
Yorkton
8%
PA
8%
Swift Current
18%
19
Regina
17%
Net Metering Application Time
25
Months
20
15
24
20
10
11
5
10
8
5
0
1
NB
PA
2
Regina
1
S'toon
Region
Max
20
15
12
Min
1
Swift
3
3
Wey
York
Distributed Generation Programs – Why?
• Capital investment offset: Customers purchase, install, and operate
renewable power generation equipment
• Energy produced closer to where it is consumed: Less line losses equals
less energy produced at power plant
• Offsets some central power generation: Time of day; types of generation at
various times in the day
– Winter peaking utility; 7:00 pm November-February
• Clean, green and local: Develops green industry, creates local jobs
– Distribution, sales, installation (electrical contractors)
• Empowering our customers to choose the source of their electricity
21
Solar Resource
Yearly PV potential map for latitude tilt and the 13 "PV hotspots” in each
province and territory in Canada (NRCan, 2006)
22
Solar System Costs
$120,000
$100,000
Cost
$80,000
$60,000
$40,000
$20,000
$0
23
2
4
6
Capacity (kW)
2008 2009 2010
8
10