The Georgia Public Service Commission on Nov. 20 approved the Georgia Power Advanced Solar Initiative (GPASI), with some changes added by staff from the original Sept. 26 proposal from Georgia Power, a unit of Southern Co. (NYSE: SO).
The decision was made on Nov. 20, but the final written order was only posted to the commission website on Nov. 29.
“We are pleased the Commission has approved our Advanced Solar Initiative,” said Georgia Power President and CEO Paul Bowers in a Nov. 20 statement about the commission approval. “Developed in cooperation with the PSC, our solar plan will encourage new, cost competitive opportunities for solar development in our state while helping Georgia Power continue to build a diverse generation portfolio that provides our customers with the safest, most reliable and most cost effective electric system in the nation.”
In its Sept. 26 filing to begin this case, Georgia Power said goals of this program are to:
- provide Georgia Power’s customers more options to sell solar generation output;
- provide an additional process and structure for solar developers to generate solar electricity and sell it directly to Georgia Power; and
- offer pricing that encourages more renewable development.
Some of this solar capacity would be reallocated out of another program
The GPASI program proposed to reallocate a portion of the capacity from the 2015 Proxy Qualified Facilities (QF) Contract List for the development of solar projects. Currently, there is 250 MW of capacity on this list as well as 66 MW that is currently on the Proxy QF waiting list. The resources that are proposed to be procured by this program would be in addition to the solar resources that are currently being procured through commission-approved Green Energy contracts, Solar Purchase (SP) and Renewable and Nonrenewable Resources (RNR) tariffs, the Large Scale Solar program, and other QF purchases under the Public Utility Regulatory Policies Act (PURPA).
Under the GPASI program, Georgia Power proposed to purchase solar resources in two different ways: through requests for proposals (RFPs) from solar developers to meet an annual capacity target (60 MW per year, for three years); and smaller scale distributed generation (DG) solar purchase offerings (10 MW per year, for three years). The distributed generation offerings could be from smaller solar facilities, up to 100 kW in size (called Small-Scale), and mid-sized facilities which range from 100 kW up to 1 MW in size (Medium-Scale).
Georgia Power proposed to purchase 30 MW of solar DG from customers and developers that are located in its service territory. The company would enter into contracts to purchase 100% of the energy from the solar capacity over a three year period beginning in 2012. As proposed by the company, the Small and Medium Scale programs will procure 10 MW each year on a first-come, first-served basis until the 30 MW limit is met.
For the 10 MW portion, Georgia Power proposed that 2.5 MW would be procured under the Small Scale Program and 7.5 MW under the Medium Scale Program. No participant, customer or developer, as defined by Georgia Power, would be able to acquire more than 35% of the available annual capacity. Customers that are currently on the SP-1 Tariff waiting list as of Sept. 25 will be given first option to participate in the Small and Medium Scale programs.
Georgia Power proposed to purchase up to 60 MW of utility scale solar generation for a period of three years for a total procurement amount of 180 MW. This new solar generation would be procured through an RFP process, beginning in 2013, with an expected commercial operation date (COD) of Jan. 1, 2015. An RFP for an additional 60 MW would be issued in 2014 and then again in 2015. The expected COD for these two RFPs would be Jan. 1, 2016, and Jan. 1, 2017, respectively.
Since the capacity that will be available for this program is contingent on the Proxy QF Contract list and subsequent waiting list, the company will confirm the actual amount of capacity to be procured for the second and third years of the GPASI RFP by August 2013. This is because the deadline to provide the collateral for biomass projects is July 2013. The company proposes that the projects be less than or equal to 20 MW in size and the term of the Power Purchase Agreement (PPA) would be for 20 years.
Georgia Power would begin the GPASI RFP process by submitting a draft PPA and RFP for commission approval on Jan. 14, 2013. Although commission rules do not require the use of an Independent Monitor (IM) for this solicitation, the company requested to use an IM to assure bidders of transparency and fairness. PSC staff plans to issue a RFP for the IM function. Once the RFP process is complete and the selection of an IM is complete, staff will present its recommendation for commission approval.
For the utility scale offering, the basic terms and conditions of the pro forma PPA will be consistent with RFPs and PPAs that have been previously issued to secure solar generation for the recent Large Scale Solar Offering and the Green Energy Program. As proposed by the company, bidders will be required to pay a fee of $0.25 per kW to participate in the RFP. The fee will be used for program costs including the bid evaluation and to pay for the IM. The remaining costs will be covered by a fee assessed upon the winning bids. The winner’s fee will be dependent upon the administrative cost, which has not yet been determined.
Bidders will retain ownership of the renewable energy credits (RECs) from their projects, and will be required to adhere to the standard representation that the facility is a QF within the meaning of PURPA. All of the output from the solar facility will be purchased by the company in accordance with the commission’s administration of PURPA.
PSC staff offered some ideas that were accepted by the commission
During a Nov. 20 Administrative Session, commission staff made various recommendations.
- That the commission address the GPASI outside of an integrated resource plan (IRP) proceeding. It is staff’s position that the commission has already approved 250 MW of capacity for Biomass PPAs. Staff agreed with the Southern Alliance for Clean Energy that solar resource options, along with traditional resource options, should be considered in the upcoming 2013 IRP.
- That the word “Participant” as it applies to the GPASI program should be redefined. All parties would work together to agree on language to be included in the DG PPA no later than Dec. 12, 2012.
- The amount of DG capacity available for Year 1 should be increased from the proposed 10 MW to 30 MW. The amount of capacity for the Utility Scale would remain at 60 MW. For Year 2, the amount of DG capacity available should be increased to 30 MW and the amount of Utility Scale should be 60 MW plus the unsubscribed amount from year 1. For Year 3, the amount of DG capacity available should be 30 MW plus the unsubscribed amounts from Years 1 and Year 2.
- The application fee for the Medium-Scale Program should be increased from 25 cents per kW to $5 per kW. The application fee would be refunded unless a participant’s application is denied by Georgia Power.
- Georgia Power should notify participants of the Small and Medium Scale Program, the following information within 15 business days after receipt of application: that the application has been received, whether it has been deemed complete, whether it falls within the limits set for the program, and to expect someone to contact them to pursue execution of a PPA.
- The annual participant limit for the Small and Medium Scale Program should be revised from the proposed 35% of available annual capacity to 20%.
- Georgia Power should file a public disclosure document by January 31st of each year, beginning in 2014, that provides the amount of capacity that has been procured and remains available under the different GPASI programs.
An unnamed commissioner offered the following modification to one of the staff recommendations: The amount of DG capacity available for Year 1 should be increased from the company’s proposal of 10 MW to 45 MW. The amount of capacity for the Utility Scale would remain at 60 MW. For Year 2, the amount of DG capacity available should be increased to 45 MW plus any unsubscribed amounts from Year 1 and the amount of Utility Scale shall be 60 MW plus the unsubscribed amounts from Year 1. For Year 3, the amount of DG capacity should be all unsubscribed amounts from Year 1 and Year 2.
The commission in its Nov. 20 decision approved staff’s recommendations as modified by the commissioner’s motion.
Georgia Power says its ready to move fast under this program
Georgia Power noted in its Nov. 20 statement that this initiative creates the largest voluntarily developed solar portfolio from an investor-owned utility. Through GPASI, Georgia Power will acquire 210 MW of additional solar capacity through long-term contracts over a two-year period.
To meet the target of 210 MW, Georgia Power’s Utility Scale program will purchase 60 MW annually for two years through a competitive RFP program with projects ranging in size from 1-20 MW, the utility said in the Nov. 20 statement. By as early 2013, a Distributed Scale program will provide opportunities for up to 45 MW per year of smaller solar projects with specific reservations for Small Scale (less than 100 kW) and Medium Scale (100-1,000 kW) projects.
RFPs for the Utility Scale program will be conducted in 2013 and 2014 and require commercial operation dates in 2015 and 2016. Georgia Power said it could begin signing solar contracts under the Distributed Scale program as early first quarter of 2013.
The GPASI complements the company’s existing solar resources, which include leading-edge research and demonstration projects and a 50-MW Large Scale Solar program already in place.
Since the creation of the company’s Green Energy Program in 2003, which enables customers to support and foster the growth of renewable energy resources, Georgia Power said it has consistently pursued opportunities to grow solar in the state. Through various initiatives, including the Large Scale Solar Program approved in 2011, Georgia Power has worked closely with the PSC to add solar to its portfolio. There are currently 61.5 MW under contract.
Also, Georgia Power recently launched a new “solar energy expert” initiative and website that provides comprehensive information and personalized assistance for customers interested in learning more about solar energy.