4.1. ERMUSR 01-09-2018 Elk River
Municipal Utilities UTILITIES COMMISSION MEETING
TO: FROM:
ERMU Commission Tom Sagstetter—Conservation and Key Accounts Manager
MEETING DATE: AGENDA ITEM NUMBER:
January 9, 2018 4.1
SUBJECT:
Integrity Testing Policy
ACTION REQUESTED:
Approve Revised Integrity Testing Policy
BACKGROUND:
The integrity testing policy was established to provide new or growing businesses in the Demand
Electric Service customer class the flexibility to test new or replacement equipment without
impacting the demand portion of their monthly bill. This policy currently applies to customers
that have a connected load greater 1,000 kW and have communicated with ERMU staff prior to
the testing date and desired off-peak time for the equipment testing. The policy allows ERMU to
waive the incremental demand charges that occurred during the agreed upon testing date and
times.
DISCUSSION:
The proposed changes will allow for all customers in the Demand Electric Service customer
class to utilize this policy.Prior to this update,the policy only applied to customers with demand
greater than 1,000 kW. Additional changes in the policy are proposed to better document the
request and provide a communication mechanism that the customer, field representatives, and
billing staff can use to ensure the integrity testing date and times are communicated to all
affected departments and meet policy criteria.
To ensure that the customer requesting the integrity testing does not negatively impact wholesale
costs to all ERMU customers, the customer performing the integrity test will have to provide
written notice prior to integrity testing. ERMU management will provide confirmation to the
customer and communicate the dates and times of integrity testing to ERMU staff. All testing
must occur during the off-peak hours from midnight to 6 a.m. Monday through Friday or
midnight to 10 a.m. on a weekend day.
If the customer adheres to the notification and off-peak hours, ERMU will waive the incremental
demand established during the agreed upon off-peak hours for the purposes of establishing the
customer's billing peak for that period. If the customer experiences the same or higher billing
demand during on-peak hours not associated with the integrity testing period there will be no
demand fees waived for that billing period.
ATTACHMENTS:
• Revised ERMU Policy—E.3—Integrity Testing Policy
Page 1 of 2
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• ERMU Policy—E.3 —Integrity Testing Policy—For Reference Only
Page 2 of 2
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Municipal Utilities
E.3—Integrity Testing Policy
1.0 Purpose
The purpose of this policy is to provide an opportunity for rate relief to qualified Demand
Electric Service customers from incremental demand charges resulting from approved
integrity testing which doesn't adversely affect ERMU.
2.0 Scope
For new or existing Demand Electric Service customers, installing new or replacement
equipment and conducting tests to determine the integrity of their equipment and/or electrical
system can have a significant financial impact on their electric demand and power bill. It can
also have a significant financial impact on ERMU's wholesale power costs if such testing
coincides with the hour the monthly billing peak is established. To encourage the practice of
performing integrity testing during off-peak hours, qualified customers may be eligible to
apply for incentive to conduct integrity testing during off-peak hours. That incentive will
come in the form of an agreement to waive the incremental demand charge associated with
the additional peak demand created by integrity testing providing the following conditions
are observed:
A. The applicant is an ERMU Demand Electric Service customer in good
standing.
B. Integrity testing would occur during off-peak hours as defined in the policy.
C. The term off-peak hours refers to the six hours from midnight to 6 AM any
weekday(Monday through Friday) or the ten hours from midnight to 10 AM
any weekend day or holiday.
D. Integrity testing refers to commissioning of new or replacement equipment
and/or facility testing that is typically performed to test the integrity of the
customers equipment and/or electrical system or ERMU electrical systems
serving the equipment or facility prior to the customer integrating the new or
replacement equipment into full operation.
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E. The customer must complete a written application at least two business days
prior to the proposed integrity testing date. ERMU will provide formal
confirmation of the application approval.Approval is required to receive the
integrity testing incentive. Such permission shall not unreasonably be
withheld.
Revised: January 9, 2018
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Elk River ---1
Municipal Utilities
E.3—Integrity Testing
1.0 Integrity Testing Policy
A. New large demand customers or existing large demand customers that have installed new
production equipment and conduct tests to determine the integrity of their production
equipment and/or electrical system or Elk River Municipal Utilities (ERMU) electric
distribution system can have a significant financial impact on their power bill especially
if all equipment is energized simultaneously. It can also have a significant financial
impact on ERMU's wholesale power bill if such testing coincides with the hour the
monthly billing peak is established. To discourage the practice of performing integrity
testing during on-peak hours, ERMU will offer new large demand customers or existing
large demand customers that have installed new production equipment an incentive to
conduct all integrity testing during off-peak hours. That incentive will come in the form
of an agreement to waive the demand charge associated with the additional peak created
by integrity testing providing the following are observed:
1. The term large demand customer applies to any business or facility that places
a demand of one megawatt(1000 kW) or more on Elk River Municipal
Utilities' distribution system. Multiple facilities under a common name or
ownership cannot aggregate to meet the minimum demand required to qualify
for this offer.
2. The term off-peak hours refers to the six hours from midnight to 6 AM any
weekday or the ten hours from midnight to 10 AM any weekend day.
3. 24 hour notice that integrity testing will be conducted will be forwarded to
ERMU by contacting 763.441.2020 to assure there are not extenuating
circumstances that such tests should not be performed on that day. Such
permission shall not unreasonably be withheld.
4. Initial startup refers to equipment and/or facility testing that is typically
performed to test the integrity of the electrical system serving the equipment
or facility prior to the business opening their doors for business to the general
public. It also refers to equipment and/or facility testing that may be
performed to test the integrity of the electrical system serving equipment that
has been added to an existing business.
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B. If all integrity testing is performed within the parameters described in items 1 through 4
above, ERMU will ignore all demand peaks established during those off-peak hours for
the purposes of establishing the customer's monthly billing demand. However, should
integrity testing occur during both on-peak and off-peak hours,no demand peaks and/or
resultant billing demand will be waived for that month.
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