Section 66-J. Net energy metering for residential solar, farm waste, non-residential solar electric generating systems, micro-combined heat and power generating equipment, or fuel cell electric generating equipment

1. Definitions. As used in this section, the following  terms
  shall have the following meanings:
    (a)  "Customer-generator"  means:  (i)  a  residential  customer of an
  electric corporation, who owns or  operates  solar  electric  generating
  equipment  located  and used at his or her residence; (ii) a customer of
  an electric corporation,  who  owns  or  operates  farm  waste  electric
  generating equipment located and used at his or her "farm operation," as
  such  term is defined in subdivision eleven of section three hundred one
  of the agriculture and markets law; (iii) a non-residential customer  of
  an electric corporation which owns or operates solar electric generating
  equipment  located and used at its premises; (iv) a residential customer
  of an electric corporation who owns, leases or  operates  micro-combined
  heat  and power generating equipment located on the customer's premises;
  and (v) a residential customer of  an  electric  corporation  who  owns,
  leases  or  operates  fuel  cell  generating  equipment  located  on the
  customer's premises.
    (b) "Net energy meter" means a meter that measures the reverse flow of
  electricity to register the difference between the electricity  supplied
  by an electric corporation to the customer-generator and the electricity
  provided to the corporation by that customer-generator.
    (c)  "Net  energy  metering"  means  the  use of a net energy meter to
  measure, during the billing period applicable to  a  customer-generator,
  the  net  amount  of electricity supplied by an electric corporation and
  provided to the corporation by a customer-generator.
    (d) "Solar electric generating equipment" means a photovoltaic  system
  (i)  (A) in the case of a residential customer, with a rated capacity of
  not  more  than  twenty-five  kilowatts;  and  (B)  in  the  case  of  a
  non-residential  customer,  with  a  rated capacity of not more than the
  lesser of two  thousand  kilowatts  or  such  customer's  peak  load  as
  measured  over  the  prior twelve month period, or in the case that such
  twelve month period of measurement is not available, then as  determined
  by  the  commission  based on its analysis of comparable facilities; and
  (ii) that is manufactured, installed, and operated  in  accordance  with
  applicable  government  and industry standards, that is connected to the
  electric  system  and  operated  in   conjunction   with   an   electric
  corporation's  transmission  and  distribution  facilities,  and that is
  operated in compliance with any standards and  requirements  established
  under this section.
    (e)  "Farm  waste  electric generating equipment" means equipment that
  generates  electric  energy  from  biogas  produced  by  the   anaerobic
  digestion  of  agricultural  waste,  such  as  livestock manure, farming
  wastes and food processing wastes with a rated capacity of not more than
  five hundred kilowatts, that is:
    (i)  manufactured,  installed,  and  operated   in   accordance   with
  applicable government and industry standards;
    (ii) connected to the electric system and operated in conjunction with
  an electric corporation's transmission and distribution facilities;
    (iii)  operated  in  compliance  with  any  standards and requirements
  established under this section;
    (iv) fueled at a minimum of ninety  percent  on  an  annual  basis  by
  biogas  produced from the anaerobic digestion of agricultural waste such
  as livestock manure materials, crop residues, and food processing waste;
  and

    (v) fueled by biogas generated by anaerobic digestion  with  at  least
  fifty  percent  by  weight  of  its  feedstock  being  livestock  manure
  materials on an annual basis.
    (f)  "Micro-combined  heat  and  power  generating equipment" means an
  integrated,  cogenerating  building   heating   and   electrical   power
  generation  system,  operating on any fuel and of any applicable engine,
  fuel cell, or other technology, with a rated capacity of  at  least  one
  kilowatt and not more than ten kilowatts electric and any thermal output
  that  at  full  load  has  a  design  total  fuel  use efficiency in the
  production of heat and electricity of not less than eighty percent,  and
  annually  produces at least two thousand kilowatt hours of useful energy
  in  the  form  of  electricity  that  may  work  in   combination   with
  supplemental   or   parallel   conventional  heating  systems,  that  is
  manufactured, installed  and  operated  in  accordance  with  applicable
  government  and  industry  standards,  that is connected to the electric
  system and  operated  in  conjunction  with  an  electric  corporation's
  transmission and distribution facilities.
    (g)  "Fuel  cell  electric  generating equipment" means a solid oxide,
  molten carbonate, proton exchange membrane or phosphoric acid fuel  cell
  with  a  combined  rated capacity of not more than ten kilowatts that is
  manufactured, installed  and  operated  in  accordance  with  applicable
  government  and  industry  standards,  that is connected to the electric
  system  and  operated  in  parallel  with  an   electric   corporation's
  transmission  and  distribution  facilities,  and  that  is  operated in
  compliance with any standards and requirements  established  under  this
  section.
    2.  Interconnection  and  net energy metering. An electric corporation
  shall provide for the interconnection of solar and farm  waste  electric
  generating equipment, micro-combined heat and power generating equipment
  and  fuel  cell  electric  generating  equipment  owned or operated by a
  customer-generator and  for  net  energy  metering,  provided  that  the
  customer-generator  enters  into a net energy metering contract with the
  corporation or complies  with  the  corporation's  net  energy  metering
  schedule  and complies with standards and requirements established under
  this section.
    3. Conditions of service. (a) (i) On or before three months after  the
  effective  date of this section, each electric corporation shall develop
  a model contract and file a schedule  that  establishes  consistent  and
  reasonable  rates,  terms  and  conditions  for  net  energy metering to
  customer-generators, according to the requirements of this section.  The
  commission  shall render a decision within three months from the date on
  which the schedule is filed.
    (ii) On or before three  months  after  the  effective  date  of  this
  subparagraph,  each  electric corporation shall develop a model contract
  and file a schedule that establishes consistent  and  reasonable  rates,
  terms and conditions for net energy metering to non-residential customer
  generators,   according   to  the  requirements  of  this  section.  The
  commission shall render a decision within three months of  the  date  on
  which the schedule is filed.
    (iii)  Each electric corporation shall make such contract and schedule
  available to customer-generators on a first come,  first  served  basis,
  until  the  total  rated  generating  capacity  for solar and farm waste
  electric generating equipment, micro-combined heat and power  generating
  equipment  and  fuel cell electric generating equipment owned, leased or
  operated by customer-generators in the  corporation's  service  area  is
  equivalent  to  one percent of the corporation's electric demand for the
  year two thousand five, as determined by the department.

    (b) Nothing in this subdivision  shall  prohibit  a  corporation  from
  providing  net  energy  metering  to additional customer-generators. The
  commission shall have the authority, after January first,  two  thousand
  twelve,  to increase the percent limits if it determines that additional
  net energy metering is in the public interest.
    (c)  In  the event that the electric corporation determines that it is
  necessary to install a dedicated transformer or transformers,  or  other
  equipment  to  protect  the  safety  and  adequacy  of  electric service
  provided to other customers, a customer-generator shall pay the electric
  corporation's  actual   costs   of   installing   the   transformer   or
  transformers, or other equipment:
    (i)  In  the  case  of a customer-generator who owns or operates solar
  electric generating equipment, micro-combined heat and power  generating
  equipment or fuel cell electric generating equipment located and used at
  his  or  her  residence,  up  to a maximum amount of three hundred fifty
  dollars;
    (ii) In the case of a customer-generator who  owns  or  operates  farm
  waste electric generating equipment located and used at his or her "farm
  operation,"  up  to  a  total  amount of five thousand dollars per "farm
  operation"; and
    (iii) In the case of a non-residential customer-generator who owns  or
  operates  solar  electric  generating  equipment located and used at its
  premises, such cost shall be as determined by the department pursuant to
  standards established thereby.
    (d) An electric corporation shall  impose  no  other  charge  or  fee,
  including back-up, stand by and demand charges, for the provision of net
  energy metering to a customer-generator, except as provided in paragraph
  (d) of subdivision four of this section.
    4.  Rates.  An  electric  corporation shall use net energy metering to
  measure and charge for the net electricity supplied by  the  corporation
  and  provided  to  the corporation by a customer-generator, according to
  these requirements:
    (a) In the event that  the  amount  of  electricity  supplied  by  the
  corporation  during the billing period exceeds the amount of electricity
  provided by a  customer-generator,  the  corporation  shall  charge  the
  customer-generator for the net electricity supplied at the same rate per
  kilowatt  hour  applicable to service provided to other customers in the
  same service class which do not generate electricity onsite.
    (b) In the  event  that  the  amount  of  electricity  produced  by  a
  customer-generator  during  the  billing  period  exceeds  the amount of
  electricity used by the customer-generator, the corporation shall  apply
  a  credit to the next bill for service to the customer-generator for the
  net electricity provided at the same rate per kilowatt  hour  applicable
  to  service  provided to other customers in the same service class which
  do not generate electricity onsite, except for micro-combined  heat  and
  power  or  fuel  cell  customer-generators,  who will be credited at the
  corporation's  avoided  costs.  The  avoided  cost  credit  provided  to
  micro-combined  heat and power or fuel cell customer-generators shall be
  treated for ratemaking purposes as a  purchase  of  electricity  in  the
  market that is includable in commodity costs.
    (c)  At the end of the year or annualized over the period that service
  is supplied by means of  net  energy  metering,  the  corporation  shall
  promptly issue payment at its avoided cost to the customer-generator, as
  defined  in subparagraph (i) or (ii) of paragraph (a) of subdivision one
  of this section, for the value of any remaining credit  for  the  excess
  electricity  produced  during  the year or over the annualized period by
  the customer-generator.

    (d) In the  event  that  the  corporation  imposes  charges  based  on
  kilowatt  demand  on  customers who are in the same service class as the
  customer-generator but which do not generate electricity  on  site,  the
  corporation  may  impose  the  same  charges  at  the  same rates to the
  customer-generator, provided, however, that the kilowatt demand for such
  demand  charges  is  determined  by the maximum measured kilowatt demand
  actually supplied by the corporation to  the  customer-generator  during
  the billing period.
    5. Safety standards. (a) On or before three months after the effective
  date   of  this  section,  each  electric  corporation  shall  establish
  standards  that  are  necessary  for  net  energy   metering   and   the
  interconnection  of  residential solar or farm waste electric generating
  equipment, micro-combined heat and power generating equipment  and  fuel
  cell electric generating equipment to its system and that the commission
  shall  determine are necessary for safe and adequate service and further
  the public policy set forth in this section. Such standards may  include
  but shall not be limited to:
    (i)  equipment  necessary  to  isolate  automatically  the residential
  solar, farm waste, micro-combined heat and power and fuel cell  electric
  generating  system  from  the  utility  system for voltage and frequency
  deviations; and
    (ii)  a  manual   lockable   disconnect   switch   provided   by   the
  customer-generator  which  shall  be  located  on  the  outside  of  the
  customer's  premises  and  externally  accessible  for  the  purpose  of
  isolating  the  residential  solar  and  farm  waste electric generating
  equipment.
    (b) Upon its own motion or upon a complaint, the  commission,  or  its
  designated  representative,  may investigate and make a determination as
  to the reasonableness and necessity of the standards  or  responsibility
  for compliance with the standards.
    (i)  In  the  case  of a customer-generator who owns or operates solar
  electric generating equipment located and used at his or her  residence;
  an  electric  corporation may not require a customer-generator to comply
  with additional safety or performance  standards,  perform  or  pay  for
  additional  tests,  or  purchase additional liability insurance provided
  that the residential solar or farm waste electric generating  equipment,
  micro-combined heat and power generating equipment or fuel cell electric
  generating  equipment meets the safety standards established pursuant to
  this paragraph.
    (ii) In the case of a customer-generator who  owns  or  operates  farm
  waste electric generating equipment located and used at his or her "farm
  operation," an electric corporation may not require a customer-generator
  to  comply  with  additional safety or performance standards, perform or
  pay for additional tests, or  purchase  additional  liability  insurance
  provided that:
    1.  the  electric  generating  equipment  meets  the  safety standards
  established pursuant to this paragraph; and
    2. the total rated generating capacity (measured in kW) of farm  waste
  electric  generating equipment that provides electricity to the electric
  corporation through the same local feeder line, does not  exceed  twenty
  percent of the rated capacity of that local feeder line.
    (iii)  In  the  event that the total rated generating capacity of farm
  waste electric generating equipment that  provides  electricity  to  the
  electric  corporation  through the same local feeder line exceeds twenty
  percent of the rated capacity of the local  feeder  line,  the  electric
  corporation may require the customer-generator to comply with reasonable
  measures to ensure safety of that local feeder line.

    5-a.  Safety  standards;  non-residential  solar  electric  generating
  equipment. (a) On or before three months after  the  effective  date  of
  this  subdivision,  each  electric corporation shall establish standards
  that are necessary for net energy metering and  the  interconnection  of
  non-residential  solar  electric  generating equipment to its system and
  that the commission shall determine are necessary for safe and  adequate
  service  and  further  the public policy set forth in this section. Such
  standards may include but shall not be limited to:
    (i) equipment necessary to isolate automatically the solar  generating
  system from the utility system for voltage and frequency deviations; and
    (ii)   a   manual   lockable   disconnect   switch   provided  by  the
  customer-generator  which  shall  be  located  on  the  outside  of  the
  customer-generator's  premises and externally accessible for the purpose
  of isolating the solar electric generating equipment.
    (b) In the event that the total rated  generating  capacity  of  solar
  electric  generating equipment that provides electricity to the electric
  corporation through the same local feeder line exceeds twenty percent of
  the rated capacity of the local feeder line,  the  electric  corporation
  may require the customer-generator to comply with reasonable measures to
  ensure safety of the local feeder line.
    (c)  Unless otherwise determined to be necessary by the commission, an
  electric corporation may not require a customer-generator to comply with
  additional  safety  or  performance  standards,  perform  or   pay   for
  additional  tests,  or  purchase additional liability insurance provided
  that the solar electric generating equipment meets the safety  standards
  established pursuant to this subdivision.
    (d)  Upon  its  own motion or upon a complaint, the commission, or its
  designated representative, may investigate and make a  determination  as
  to  the  reasonableness and necessity of the standards or responsibility
  for compliance with the standards.
    6. Electric restructuring.  Notwithstanding  the  provisions  of  this
  section,  including,  but  not  limited  to paragraph (b) of subdivision
  three of this  section,  a  customer-generator  shall  comply  with  any
  applicable determinations of the commission relating to restructuring of
  the electric industry.
    7. Severability of provisions. The provisions of this section shall be
  severable  and  if  the  application of any clause, sentence, paragraph,
  subdivision, section, or part thereof  to  any  person  or  circumstance
  shall  be adjudged by any court of competent jurisdiction to be invalid,
  such judgment shall not necessarily affect, impair,  or  invalidate  the
  application  of  any  such  clause,  sentence,  paragraph,  subdivision,
  section, part or remainder thereof, as the case may  be,  to  any  other
  person,  circumstance,  but  shall  be  confined in its operation to the
  clause,  sentence,  paragraph,  subdivision,  section  or  part  thereof
  directly  involved  in the controversy in which such judgment shall have
  been rendered.