-----Original Message----- From: Joshua Barclay [mailto:joshuabarclay@earthlink.net] Sent: Monday, November 03, 2008 4:36 PM To: MPSCEDOCKETS Cc: Baldwin, Julie K (DLEG) Subject: Comments on U-15803 re: PA 295-net metering Please see attached word document containing my comments, following this email will be attached petitions in PDF file format. These are new petitions signed within the last few days, and have not yet been submitted to the MPSC. Signatories have been informed that their names and cities will be publicly posted on the internet. Please contact me if there is any problem reading the files. Thanks, Joshua Barclay

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Joshua S. Barclay 4445 Valentine Rd Whitmore Lake, MI 48189 November 2, 2008 Re: MPSC Case number U-15803 Dear Commissioners: Thank you for your attention to this important matter. I humbly request that you honor your first mission–growing Michigan's economy, by implementing rulemaking that will maximize innovation and competition, encourage non-polluting, safe, and cheaper renewable energy, and make Michigan a haven for new energy economy businesses, industries and consumers. We must recall the fundamental purpose of net metering laws in the first place. According to the US Department Of Energy "Net metering programs serve as an important incentive for consumer investment in renewable energy generation."1 (emphasis mine). Net metering has been described as “providing the most significant boost of any policy tool at any level of government…to decentralize and ‘green’ American energy sources."2 Net metering policies are the foundation of soil that allows the seeds of a new energy economy to flourish. With poisoned soil, nothing will grow as is evidenced by the paucity of current net metering participants in Michigan. Michigan benefits greatly when customer-generators tie to the grid, because these individuals and businesses invest their own money to serve the citizens, businesses and utilities of Michigan by

reducing electrical demand bolstering grid stability providing production during peak demand times reducing line loss eliminating electrical bottlenecks by distributing generation reducing carbon emissions reducing the poisoning of our air, water, and fish injecting money into the local economy instead of sending it out of state where

90% of our energy dollars currently go. creating much needed jobs in manufacturing, sales, system design and

installation all over the state, not just in a few centralized locations. According to the DOE, "Distributed energy offers solutions to many of the nation's most pressing energy and electric power problems3", including controlling costs. Net

1 http://apps3.eere.energy.gov/greenpower/markets/netmetering.shtml 2 Ferrey, Steven (2003). Nothing but net: Renewable energy and the environment, MidAmerican legal fictions, and supremacy doctrine, Duke Environmental Law& Policy Forum. 14:1-120. 3 http://www.eere.energy.gov/de/

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metering reduces our reliance on increasingly expensive coal, which will become even more of a cost burden on ratepayers with carbon caps under the next federal administration. These are some but not all of the reasons why we all want to encourage renewable energy to tie to the grid. In regard to systems over 20 kW and their "modified net metering" system as defined in Section 7(j) of Public Act 295 of 2008, my comments are brief. In its August 6, 2008 ruling in case U-15316, the MPSC agreed with staff that the PURPA standard is a "simple netting on a one-to-one kWh basis of electricity delivered by the utility to the customer and electricity delivered by the customer to the utility, at least to the point of zero net usage." In that ruling, the commission distinguished "net billing" from net metering, and indicated that net billing does not conform to PURPA standards adopted by the MPSC. I submit that "modified net metering" is equivalent to net-billing.4 The term itself testifies to its inadequacy with regard to PURPA-"modified net metering" is clearly not "net metering." With regard to systems under 20 kW, I would like to illustrate with a real life example, how depending on rulemaking, PA 295 will either greatly encourage or could certainly discourage renewable electric generation. My family has a 3.2 kW solar tracking photovoltaic array in our backyard which has been operating very successfully for two years. You may find more information at http://www.DreamFarm.org/. With a system of monthly billing, and "true net metering" as defined in Section 13(c) of Public Act 295 of 2008, we would lose retail credit for a full 55% of the energy we send to the grid. I must repeat for emphasis, with monthly billing, the majority of the energy our PV system sends to the grid would get only wholesale credit. This is no incentive for grid-tying whatsoever. As I will elucidate below, the Commission could ameliorate this fundamental disincentive for 20 kW and under customer-generators by simply requiring that net metering customers be allowed an annual billing period. The customer-generator could still pay installments toward the predicted total on a monthly basis, but with this system, the total will be eminently predictable, hence more likely to attract potential investors in grid-tied systems. With monthly billing, it is a sisyphean challenge to figure out the electricity bill even with all the data! An average utility customer considering purchase of a PV system might have to hire an accountant and an engineer to predict their payback time with monthly billing. (Businesses wishing to invest in systems over 20 kW would have to hire a team of accountants and engineers to figure out all the LMP possible scenarios.) I seriously challenge the commission or any member of the public who is not an accounting expert to try to calculate an approximate yearly bill with the following data. I have been unable to do it with certainty and I teach calculus based physics. This is not transparency of

4 Rose, Kenneth, and Karl Meeusen, Reference Manual and Procedures for Implementation of the “PURPA Standards” in the Energy Policy Act of 2005, March 22, 2006, p. 15, Washington DC: American Power Association, Edison Electric Institute, National Association of Regulatory Utility Commissioners, and National Rural Electric Cooperatives Association;

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billing methods as law requires. (For systems over 20 kW the billing system is absolutely opaque.) A fundamental advantage to an annual billing period is its simplicity and transparency The following table includes energy we drew from the grid and energy we sent to the grid for each month of our second year of operation. The bolded figures in the last column represent energy for which we lose retail credit with a monthly billing period. Under PA 295, with a monthly billing period, in any month you send more energy than you draw from the grid, only half the price per kWh will be credited to the next month.

Month

Energy Drawn from grid

(kWh)

Energy sent to grid (kWh)

Energy not receiving

retail credit (kWh)

September-07 119 385 266October-07 208 335 127

November-07 265 132 December-07 579 92

January-08 444 101 February-08 560 145

March-08 357 226 April-08 227 470 243May-08 104 457 353June-08 120 435 315July-08 119 515 396

August-08 124 560 436Yearly Totals 3226 3853 2136

As noted in the yearly totals, if we have a monthly billing period, 2136 kWh out of the 3853 kWh we send to the grid lose half their value. A full 55% of the energy we sent to the grid would not receive retail credit. Paradoxically, we send most of that energy on to the grid directly to our neighbors, during peak demand days and hours, when DTE most benefits, and we will buy that energy back at retail cost when the DTE needs it the least. Fortunately, I believe the MPSC has the ability, through rulemaking, to amend this disincentive by taking the following two steps. 1. Require that the billing period for net metering customer-generators be exactly one year. With this one step, MPSC can fulfill its mandate to create net metering per EPAct 2005, meet adopted PURPA standards and conform to Public Act 295 of 2008 as written. Under a one year billing period, our PV system would still lose retail credit on 627 kWh for the year (our annual excess generation), but that is much less of a loss than losing retail credit on 2136 kWh (our monthly total net excess generation). Annualized billing also solves the problem of system payback calculability- a major deterrent to investment in renewables is inability to calculate payback time. With annual billing, for properly sized systems, yearly savings = annual cost of electricity minus a predictable, reasonable, yearly access fee, which pays for distribution charges.

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From a scientific perspective, the only natural and sensible "billing period" should be exactly one year. Without annualized billing, PV systems installed in northern Michigan would be credited inequitably to those in the south of Michigan. Northern locales receive more solar energy in summer than southern locales. For example, on June 21, an array in Hancock, Michigan gets 40 more minutes (and higher intensity) solar radiation than an array in Ann Arbor. Thus, even though PV systems in northern Michigan actually produce more peak demand energy, they will lose more retail credit under a monthly billing system. Again, paradoxically more disincentive for better service to the public. Only if net metering customers are required by the MPSC to be billed on an annualized billing period will both Hancock and Ann Arbor be billed on an equitable scale. What Hancock loses in the winter, can be made up in the summer under such an annualized billing period. This is the only way net metering can best serve its intended purposes-promoting grid tied-peak demand renewable electric generation. 2. Determine a fair and equitable monthly charge to supplant per kWh delivery charges for net metering customers. If I read PA 295 correctly, renewable energy generators greater than 20 kW have to pay delivery charges for energy they deliver to themselves, which may never even touch the grid! Below 20 kW, customer-generators will have to pay for return delivery of energy they loaned to the utility when the utility most needed it. If I offered you a loan of $2000 with zero interest, when you were desperate for money, and market interest rates were highest, and simply asked that in return you pay me back when you have the cash on hand, any sane person would deem that more than equitable on my part. Why then, when I loan DTE 2000 kWh when they need it most, and I am even willing to wait six months for them to pay me back for it, do they pay me back with only 1000 kWh worth of delivered energy? And then they want a monthly standby fee in addition to that! It seems like usury to me. I agree that everyone should pay their fair share to get renewable energy deployed in Michigan. If our system lasts it's warrantee life time we will have paid 40 cents/kwh on average, and potentially even more because we would lose retail on so much of our energy under monthly billing. We are obviously not trying to profit from this endeavor, only to do what is right. I argue that the customers who install these systems have already paid their fair share. Even so, I personally am willing to pay a reasonable monthly fee for allowing us the privilege of grid connection. Why won't the utilities pay their fair share for the multiple benefits they receive from these systems. Why should I have to continue to donate hundreds and thousands of kWh to a utility who buys my peak energy at half price, and simultaneously sells it to my neighbors 600 feet away for full price. I am a teacher, not a profiteer, and I have invested in renewable energy at great expense to myself and my family. I cannot afford to make monthly donations to a utility. Since these systems serve multiple purposes advantageous to the utility, shouldn't the utility have to pay for the delivery of said services?

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The first goal of the MPSC is to Establish fair and reasonable rates for regulated services and adopt and administer fair terms and conditions of service for the State’s utility customers. If the MPSC does not defend those trying to stabilize the grid, distribute and diversify power production, who will? Must monopoly power and a detrimental focus on short term profits trump what is best for all of us? We have seen in the current economic crisis how greed on the part of a few economic powerhouses leads to everyone's economic ruin. I posit that greed, in the form of regressive net metering policies written by utilities, will also lead to economic ruin of our state's potentially redemptive new energy economy. In conclusion, net metering, when done right, has proven itself as an incentive. We Energies, serving Wisconsin and Michigan offers true net metering with indefinite rollover of retail credit. Including both Wisconsin and Michigan customers, they have 60 out of 1 million customers net metering and an additional 120 customers receiving 22.5 cents/kWh for solar PV generation! DTE, by contrast, with policies not coincidentally similar in construction and wording to PA 295, when I last checked had 21 customers out of 3 million net metering. This means We Energies has nine times greater participation in net metering than DTE, and that doesn't even count the 120 customers getting even better treatment-double retail credit. Without decisive action by the commission, Michigan can expect more of the same lack of participation in this program. Sincerely, Joshua S. Barclay