2.4 ERMUSR 05-10-2022UTILITIES COMMISSION MEETING
TO: FROM:
ERMU Commission Tom Sagstetter – Conservation & Key Accounts Manager
MEETING DATE: AGENDA ITEM NUMBER:
May 10, 2022 2.4
SUBJECT:
2022 Distributed Energy Resources and Net Metering -Rulesand Tariff
ACTION REQUESTED:
Resolution 22-7 – Adopt by resolution the ERMURules Governing the Interconnection of
Cogeneration and Small Power Production Facilities
Resolution 22-8 – Adopt by resolution the ERMUCogeneration and Small Power Production
Tariff, which includes the Distributed Energy Resource Interconnection Process
BACKGROUND:
Every municipal electric utility in Minnesota must have rules for governing the interconnection
of cogeneration and small power production facilities to fulfill the requirements ofMinnesota
Statutes, Section 216B.1611 subd. 3. Included in the rules are requirementspertaining to the
required tariffs, and processes for the interconnection of cogeneration and small power
production facilities, also known as Distributed Energy Resources (DER). The rules established
will reflect the expectations and obligations forboth the municipal utility and customers who
seek to interconnect their own electric generation facilities with the distribution system.
To allow for consistency over all municipals in the state, ERMU is proposing to utilize the model
documents that were developedby Minnesota Public Utilities Commission (MN PUC) and
modified by the Minnesota Municipal Utilities Association (MMUA). The basis for these
documents and processes were established by the MN PUC order issued September 28, 2004
and updated by subsequent order on August 13, 2018.
DISCUSSION:
Since August 13, 2018, MMUA has been collaborating with stakeholders including the MN PUC,
MN Department of Commerce, utility work groups, and trade alliesto identify points of
clarification and process improvements. This collaborative effort resulted in a revised set of
documents, processes, and agreements referred to as the Minnesota Municipal
Interconnection Process (M-MIP) 2022.
On February 9, 2022,the MMUA Board of Directors recognized and agreed to host M-MIP 2022
booklets, forms, and agreement templateson its websiteso municipal electric utilities across
the state canadopt a distributed generation tariff that is compliant with MN PUC requirements,
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Page 1 of 2
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as required statute. In addition, the documentswill promote consistency and transparency for
all municipal utilitiesand retail customers interconnecting with the distribution system.The
changes reflect grammaticalcorrections, consistent naming of all responsible parties
throughoutthe documents,the inclusion of many revised technical requirements for more
complex DERs, and the removal of duplicative information.
It is important that the ERMU Commission adopt the Rules Governing the Interconnection of
Cogeneration and Small Power Production Facilities and the Tariff to retain local control over
these issues.
FINANCIAL IMPACT:
N/A
ATTACHMENTS:
Resolution No. 22-7 – ERMU Rules Governing the Interconnection of Cogeneration and
Small Power Production Facilities
Resolution No. 22-8 – ERMUCogeneration and Small Power Production Tariff which
includes the Distributed Energy Resource Interconnection Process
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Page 2 of 2
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RESOLUTION NO. 22-7
BOARD OF COMMISSIONERS
ELK RIVER MUNICIPAL UTILITIES
A RESOLUTION ADOPTING ELK RIVER MUNCIPAL UTILITIES RULES GOVERNING THE
INTERCONNECTION OF COGENERATION AND SMALL POWER PRODUCTION FACILITIES
WHEREAS the City of Elk River (“City”) isserved byElk River Municipal Utilities(“ERMU”), which
is committed to providing customers with reliable and affordable power; and
WHEREAS the purpose of the Rules Governing the Interconnection of Cogeneration and Small
Power Production Facilities (“Rules”) is for ERMU to implement certain provisions of Minnesota
Statutes Section 216B.164, the Public Utility Regulatory Policies Act of 1978, and Federal Energy
Regulatory Commission regulations related to customer-owned distributed energy resources;
and
WHEREAS ERMU Commission is now adopting these Rules to replace a previously adopted
similar version of these Rules and their accompanying, “Policy Regarding Distributed Energy
Resources and Net Metering;” and
WHEREAS the original adoption of these Rules established that, in accordance with Minnesota
Statutes Section 216B.164, subdivision 9, everywhere in that section, the term “commission”
appears, it refers to the ERMU Commission and, so, the ERMU Commission may resolve
disputes relating tothe provisions of §216B.164 as they apply to ERMU; and
WHEREAS these Rules shall be implemented to give the maximum possible encouragement to
cogeneration and small power production consistent with protection of the utility’s ratepayers
and thepublicin accordance with Minnesota Statutes Section 216B.164, subdivision 1; and
WHEREAS these Rules require ERMUto file withthe ERMU for its review and approval a
cogeneration and small power production tariffand annual updates of the rates described
therein; and
WHEREAS the cogeneration and small power production tariff includes a calculation of ERMU
average retail utility energy rates, and the rates at which ERMU purchases energy and capacity;
and
WHERAS all filings under these rules shall be maintained at the ERMUoffices and shall be made
available for public inspection during normal business hours.
NOW THEREFORE, BE IT RESOLVED that the Elk River Municipal Utilities Commission adopts the
Rules Governing the Interconnection of Cogeneration and Small Power Production Facilities
with ERMU attached as Exhibit A to this Resolution.
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th
This Resolution Passed and Adopted this 10day of May 2022.
John Dietz, Chair
Theresa Slominski, General Manager
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RESOLUTION NO. 22-8
BOARD OF COMMISSIONERS
ELK RIVER MUNICIPAL UTILITIES
A RESOLUTION APPROVING THE UPDATED COGENERATION AND SMALL POWER
PRODUCTION TARIFF FOR ELK RIVER MUNICIPAL UTILITIES
WHEREAS, the Rules Governing the Interconnection of Cogeneration and Small Power
Production Facilities (“Rules”) with Elk River Municipal Utilities(“ERMU”) and Minnesota
Statutes Section 216B.164 (“Statute”) require ERMU to file a Cogeneration and Small Power
Production Tariff with ERMU Commission annually; and
WHEREAS, the statute and the Rules require the information contained in schedules 1, 2 and 3
described in Exhibit A to this Resolution; and
WHERAS, these filings shall be maintained at ERMU offices and shall be made available for
public inspection during normal business hours.
THEREFORE, BE IT RESOLVED that the Elk River Municipal Utilities Commission approves the
Cogeneration and Small Power Production Tariff attached as Exhibit A to this Resolution for
transactions following the date of adoption stated below.
th
day of May 2022.
This Resolution Passed and Adopted this 10
John Dietz, Chair
Theresa Slominski, General Manager
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Exhibit A
COGENERATION AND SMALL POWER PRODUCTION TARIFF
TARIFF
Pursuant to its Rules Governing the Interconnection of Cogeneration and Small Power
Production Facilities,Elk River Municipal Utilities(“Utility”)establishes and/or updates its
Cogeneration and Small Power Production Tariff (“Tariff”) for billing and sales
transactions following the date of Tariff approval as follows.
The Tariff shall consist of the following three schedules.
SCHEDULE 1.
Calculation of average retail utility energy rates for each utility customer class.
SCHEDULE 2.
Rates at which Utility purchases energy and capacity from the wholesale supplier from
which purchases may first be avoided.
SCHEDULE 3.
Utility's adopted interconnection process, or “distributed generation tariff” adopted in
compliance with Minnesota Statutes Section 216B.1611, subd. 3(2), including standard
contract forms to be used with customers interconnecting qualifying facilities as well as
general technical interconnection and interoperability requirements.
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SCHEDULE 1 – AVERAGE RETAIL UTILITY ENERGY RATES
Average Retail Utility Energy Rates:Available to any Qualifying Facility of less than 40
kW capacity that does not select either Roll Over Credits, Simultaneous Purchase and
Sale Billing or Time of Day rates.
Utility shall bill Qualifying Facilities for any excess of energy supplied by Utility above
energy supplied by the Qualifying Facility during each billing period according to Utility’s
applicable rate schedule. Utility shall pay the customer for the energy generated by the
Qualifying Facility that exceeds that supplied by Utility during a billing period at the
“average retail utility energy rate.” "Average retail utility energy rate" means, for any
class of utility customer, the quotient of the total annual class revenue from sales of
electricity minus the annual revenue resulting from fixed charges, divided by the annual
class kilowatt-hour sales. Data from the most recent 12-month period available shall be
used in the computation.
“Average retail utility energy rates” are as follows:
Customer Class 2022 Average Retail
Utility Energy Rate
Residential$0.1206 /kWh
Commercial Non-Demand $0.1084 /kWh
Commercial Demand $0.0649 /kWh
Large Industrial Demand$0.0644 /kWh
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SCHEDULE 2 – WHOLESALE SUPPLY RATES
Wholesale Supply Rates: A “non-generating utility” must list the rates at which it
purchases energy and capacity. If the utility has more thanone wholesale supplier, the
rates listed are of that supplier from which purchases may first be avoided.
Utility purchases energy and capacity from Minnesota Municipal Power Agency. Last
year, the average energy rate paid by Utility was $0.02204per kilowatt-hour. The average
capacity rate paid by Utility was $0.05890 per kilowatt-hour.
These rates are used to calculate Utility’s “avoided costs” for purposes of calculating
compensation to customers whose Qualifying Facilities are not eligible for compensation
at Utility’s average retail utility energy rate or who elect compensation at another rate.
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SCHEDULE 2 – WHOLESALE SUPPLY RATES
Interconnection Process: In order to provide for coordinated interconnection of
customer-owned distributed energy resources and comply with Minnesota Statutes
Section 216B.1611, subd. 3(2), Utility has adopted the “Minnesota Municipal
Interconnection Process (M-MIP) 2022” as recognized by the Minnesota Municipal
Utilities Association Board of Directors at its February 9, 2022, meeting and made
publicly available at mmua.org.
General technical requirements may be found in the Minnesota Technical
Interconnection and Interoperability Requirements (TIIR) as adopted by the Minnesota
Public Utilities Commission on January 22, 2020as part of DOCKET NO. E-999/CI-16-
521.
For utility-specific safety standards, required operating procedures for interconnected
operations, and the functions to be performed by any control and protective apparatus,
please contact Utility for its Technical Specifications Manual (TSM).
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