AriSEIA Files Amendments to APS' Interconnection Manual

READ THE FILING HERE

Arizona Corporation Commission
1200 W. Washington Street
Phoenix, AZ 85007
 
Re: Exceptions to APS Interconnection Manual, Docket E-01345A-20-0152
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Madam Chair and Commissioners,

The Arizona Solar Energy Industries Association (AriSEIA) hereby files its Exceptions to Staff’s Memorandum and Proposed Order filed on September 29th, 2022. AriSEIA appreciates Staff’s efforts in reviewing Arizona Public Service’s (APS) Draft Interconnection Manual (the “Manual”). AriSEIA believes that the Order should be amended to incorporate several outstanding changes that are important to simplifying the interconnection process and are justified based on established technology performance across the globe and in other leading U.S. markets. The following Exceptions detail what changes must be made so that APS customers can further benefit from distributed generation, which will play a critical role in modernization of the grid.

As further background, AriSEIA participated in extensive review and discussion of the Manual with Staff and APS personnel throughout 2022, and we have filed comments in this docket and submitted written feedback to both APS and Staff on outstanding issues. During the deliberation on the Commission’s Interconnection Rulemaking, we expressed our concern that there are many utility requirements that unnecessarily inflate costs while adding unnecessary time and complexity to the process for interconnecting distributed generation systems in APS territory. The Exceptions detailed herein remain in the spirit of this prior notion.

I. Production Meters for Energy Storage Systems (Section 9.2(C) and (D) of the Manual)

Section 9.2.(C) of the Manual states that a customer must provide Production Metering for any Static Inverter based Energy Storage System (ESS) (i.e., battery backup system). In addition to requiring Production Metering, Section 9.2.(D) further requires that “[c]ustomer must provide a suitable visible open disconnecting means […] to electrically isolate any CT rated meter from all potential sources of power.”

AriSEIA strongly believes that Production Metering requirements and, by extension, additional disconnecting means, are unreasonable and unwarranted for any residential or commercial customer-owned ESS designed to provide value strictly “behind the meter.” A solar system Production Meter captures all of its production. When discharging, backup batteries do not create new energy production. Furthermore, Tucson Electric Power (TEP) already acknowledged these arguments and agreed to remove their requirement for ESS Production Metering in the latest version of their Interconnection Manual filed and approved earlier this year.

A proposed amendment making this modification is attached below as Attachment A, AriSEIA Proposed Amendment No. 1.

II. Production Meters for All Generating Facilities (Section 9 of the Manual)
 
In general, and as an extension of our comments above, AriSEIA contends that Production Meters for any customer-owned Generating Facility are unwarranted in the post-incentive era, which included Performance-Based Incentives (PBI) and Upfront Incentives in exchange for ownership of a customer’s Renewable Energy Credits (REC). The applicable requirements of Section 9 are costly and burdensome when considering that distributed generation industries are disproportionately impacted by supply chain and inflation conditions to the extent that project viability is seriously impacted. Meanwhile, it is entirely feasible for regulators and utility companies alike to estimate solar production based on the system details included in Interconnection Applications, and we contend that such estimates are sufficient in lieu of Production Metering.

A proposed amendment making this modification is attached below as Attachment B, AriSEIA Proposed Amendment No. 2.

III. Ground Fault Detection Requirements for Class III Systems (Section 10.2(B)(2)e. and (3)e. of the Manual)
 
Section 10.2(B)(2)e and (3)e. states that systems in the applicable size range may require the addition of ground fault detectors in cases where the Generating Facility parallels the utility through a transformer with ungrounded configurations (float wye or delta). Utility systems must already include ground fault detection and protection with or without the presence of customer-owned Generating Facilities. In addition, Screen B of Appendix B: Interconnection Application Screens validates whether a Generating Facility’s ground fault current contributions are low enough to be safe, and any system passing this Screen should, therefore, be accommodated through existing utility equipment. At a minimum, AriSEIA contends that a clear exemption from additional ground fault detection equipment must exist for any systems which pass Screen B, as well as Non-Exporting Systems and Inadvertent Export Systems of 20 kW or less.

A proposed amendment making this modification is attached below as Attachment C, AriSEIA Proposed Amendment No. 3.

IV. Study Feed (Appendix C of the Manual)
 
The Commission’s Rules for Interconnection established that fees are allowed for utility studies “if a tariff containing such a fee for the Utility has been approved by the Commission.” Both APS and TEP include written handbook provisions which require specific fee deposit payments and provide for refunds through subsequent adjustment to the actual study costs (though costs are not defined). AriSEIA members consistently experience disproportionately high utility study deposits relative to the actual charges that are attributable to the work involved. Refunds are issued after extended periods of time (often in excess of 12 months) and represent a consistent majority of the original deposits that were made. Considering the excessive study deposits that the industry continues to grapple with, AriSEIA contends that the deposit amounts, and philosophy on study deposits, be revised in accordance with the following comments, and should be submitted to the Commission for approval:

1. The work covered by Supplemental Study Deposits should not vary by system size as the effort to study a utility circuit’s minimum daytime load does not vary materially based on system size below the Class III threshold. The experience of our members shows that deposits of $500 consistently cover a utility’s cost to provide such studies.
2. The Commission should consider whether approving a charge and deposit for Feasibility Studies will discourage submissions at the feasibility stage and lead to wasted resources on more processing of later interconnection applications for projects with feasibility issues.
3. The System Impact Study and Facility Study deposits should not exceed $1,500 for systems at or under the Class III threshold based on observed study costs and refunds.
4. For systems between one and two MW, Table C.1 refers the reader to Schedule 6, which only provides guidance for Generating Facilities “for which the total generation output […] is sold directly to APS,” meanwhile there are many large commercial customers for which generation is sold directly to the customer through other means. We believe that the deposit amounts provided for the 500 – 999 kW systems should also be sufficient to cover the costs of the one to two MW Generating Facility studies.

A proposed amendment making this modification is attached below as Attachment D, AriSEIA Proposed Amendment No. 4.

V. Rate Schedules Applicable to Distributed Generation, System Size Limiting Factors (Appendix D of the Manual)    
 
Under System Size Limiting Factors in Appendix D of the Manual, item 1.b., the methodology for calculating the maximum system size for non-residential DG systems is presented as “125% of connected load for its meter, where connected load is defined as the maximum demand divided by 0.6.” Item 2.a. further defines that the “connected load is measured in AC.” Based on AriSEIA discussions with Staff and APS, and written redlines from APS, AriSEIA notes that the intent of the definition in 2.a. was to establish that the system size is measured in AC, rather than “connected load,” which would translate to the output of the methodology in 1.b. being a non-residential DG maximum system size measured in kW AC.

A proposed amendment making this modification is attached below as Attachment E, AriSEIA Proposed Amendment No. 5.

VI. Conclusion
 
Because these manuals are iterative, the utilities should establish a stakeholder process to discuss developing issues with the manuals and technological change.
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We respectfully request the Commission direct APS to file a revised Manual with the amendments attached below by November 15, 2022, to be effective immediately upon filing. Thank you for considering these comments meant to improve the compliance of the APS Manual with the spirit and letter of the Commission’s Interconnection Rules.