                                 CODE OF VIRGINIA

PILOT PROGRAM FOR MUNICIPAL NET ENERGY METERING (§ 56-585.1:8)

A. As used in this section:
			&#8220;Host account&#8221; means the premises on which a municipal
customer-generator&#8217;s electrical generating facility is located.
			&#8220;Municipal customer-generator&#8221; means a municipality that owns or
operates, or that contracts with other persons to own or operate, an electrical
generating facility that (i) uses as its total source of fuel renewable energy
as defined in &#xA7; 56-576, (ii) has a generating capacity of not more than
three megawatts, (iii) is located on land owned or leased by the municipality
within the municipality and is connected to the municipality&#8217;s wiring on
the municipality&#8217;s side of its interconnection with the utility, (iv) is
interconnected and operated in parallel with the utility&#8217;s transmission
and distribution facilities, and (v) is intended primarily to offset all or part
of the municipal customer-generator&#8217;s own electricity requirements. The
capacity of any generating facility installed under this section, other than a
generating facility located on airports, landfills, parking lots and garages,
wastewater treatment sites, parks, post-mine land, or a reservoir that is owned,
operated, or leased by the municipality, shall not exceed the same limitation
established with respect to an eligible customer-generator as set forth in the
definition of such term in subsection B of &#xA7; 56-594.
			&#8220;Municipality&#8221; means any county, city, or town in the
Commonwealth, other than a municipality that owns and operates its own electric
utility, or any authority created pursuant to the Park Authorities Act (&#xA7;
15.2-5700 et seq.).
			&#8220;Net energy metering&#8221; means measuring the difference, over the
net metering period, between (i) electricity supplied to a municipal
customer-generator from the electric grid and (ii) the electricity generated and
fed back to the electric grid by the municipal customer-generator.
			&#8220;Net metering period&#8221; means the 12-month period following the
date of final interconnection of the municipal customer-generator&#8217;s system
with its utility and each 12-month period thereafter.
			&#8220;Phase I Utility&#8221; and &#8220;Phase II Utility&#8221; have the
same meaning as defined in &#xA7; 56-585.1:3.
			&#8220;Utility&#8221; means a Phase I Utility or Phase II Utility.

B. The Commission shall require each Phase I Utility to submit a proposal to the
Commission to conduct a pilot program for municipal net energy metering in
accordance with the following terms, conditions, and restrictions:

   1. A pilot program shall be conducted within the service territory of each
   Phase I Utility. The pilot program shall allow any municipal
   customer-generator that generates electricity from a renewable energy
   generation facility in amounts that exceed the amount of the utility&#8217;s
   electricity consumed by the host municipal customer-generator account to
   credit one or more of the municipality&#8217;s target metered accounts or
   metered accounts of the public school division of the municipality. In each
   Phase I Utility&#8217;s pilot program, the target accounts may be at one or
   more other separately utility-metered public buildings or facilities at
   contiguous or noncontiguous sites owned by the municipality and used for a
   public purpose. In each Phase I Utility&#8217;s pilot program, excess
   electricity beyond that used by the host account shall be credited to the
   metered account of the target municipal customer in the same municipality,
   such that the generation energy charges on the electric bills of such
   target&#8217;s metered accounts shall be reduced by the amount of the excess
   generation kilowatt-hours apportioned to the metered accounts multiplied by
   the applicable generation energy rate of the target&#8217;s accounts. The
   generation energy rate of the target&#8217;s accounts includes all applicable
   kilowatt-hour-based rate adjustment clauses with the exception of any
   non-fuel-related or non-generation-related kilowatt-hour-based rate adjustment
   clauses. The netting of the amount of electricity generated and the amount of
   electricity consumed, and the crediting for the amount of any excess
   generation determined as a result of such netting, shall occur in the twelfth
   month following the commencement of the host municipal
   customer-generator&#8217;s generation of electricity under a pilot program and
   annually thereafter, regardless of the municipal customer-generator&#8217;s
   regular billing period.

   2. The pilot program shall not limit the current authority of any municipality
   to participate in any other net energy metering program.

   3. The amount of generating capacity of the generating facilities that are the
   subject of a pilot program under this subsection shall not exceed five
   megawatts, although the Phase I Utility may, in its discretion, increase the
   generating capacity that is part of the program up to 10 megawatts.

   4. The aggregated capacity of all generation facilities that are the subject
   of each Phase I Utility&#8217;s pilot program under this subsection shall
   constitute a portion of the existing limit of the utility&#8217;s adjusted
   Virginia peak-load forecast of the previous year that is available to (i)
   municipal customer-generators under this section, (ii) eligible
   customer-generators and eligible agricultural customer-generators under &#xA7;
   56-594, and (iii) small agricultural generators under &#xA7; 56-594.2 in the
   utility&#8217;s service area. Municipal customer-generators shall be eligible
   to participate in a Phase I Utility&#8217;s pilot program implemented under
   this subsection on a first-come, first-served basis in each utility&#8217;s
   Virginia service area until the limits set forth in subdivision 3 are met.

C. The Commission shall require each Phase II Utility to submit a proposal to
the Commission to conduct a pilot program for municipal net energy metering in
accordance with the following terms, conditions, and restrictions:

   1. A pilot program shall be conducted within the service territory of each
   Phase II Utility. The pilot program shall allow any municipal
   customer-generator that generates electricity from a renewable energy
   generation facility in amounts that exceed the amount of the utility&#8217;s
   electricity consumed by the municipal customer-generator host account to
   credit one or more of the municipality&#8217;s target metered accounts (target
   accounts or beneficial accounts). In each Phase II Utility&#8217;s pilot
   program, the target accounts may be at one or more other separately
   utility-metered public buildings or facilities at contiguous or noncontiguous
   sites owned or leased by the municipality within the municipality. In each
   Phase II Utility&#8217;s pilot program, excess electricity beyond that used by
   the host account shall be credited to the beneficial accounts selected by the
   municipal customer in the same municipality. The generation energy charges on
   the electric bills of such beneficial accounts shall be reduced by the amount
   of the excess electricity kilowatt-hours apportioned to the net metered
   accounts multiplied by the applicable generation rate of the selected
   beneficial accounts. The generation energy rate of each selected beneficial
   account shall include all applicable rate adjustment clauses and riders,
   including fuel riders, with the exception of any non-fuel-related or
   non-generation-related riders. Non-bypassable charges shall be excluded from
   reductions on beneficial accounts. The netting of the amount of electricity
   generated and the amount of electricity consumed, and the crediting for the
   amount of any excess electricity determined as a result of such netting, shall
   occur in the twelfth month following the commencement of the host municipal
   customer-generator&#8217;s generation of electricity under a pilot program and
   annually thereafter, regardless of the municipal customer-generator&#8217;s
   regular billing period.

   2. The pilot program shall not limit the current authority of any municipality
   to participate in any other net energy metering program.

   3. The amount of generating capacity of the generating facilities that are the
   subject of a pilot program under this subsection shall not exceed 25
   megawatts.

   4. Municipal customer-generators shall be eligible to participate in a Phase
   II Utility&#8217;s pilot program implemented under this subsection on a
   first-come, first-served basis in each utility&#8217;s Virginia service area
   until the limits set forth in subdivision 3 are met.

D. Any pilot program conducted under this section shall require that:

   1. If conducted by a Phase I Utility or Phase II Utility, each participating
   municipality shall be responsible for all demonstrated administrative costs
   associated with implementing the pilot program, including demonstrated
   administrative costs associated with crediting excess electricity to target
   accounts; and

   2. If conducted by a Phase I Utility, the credit for excess electricity, to
   the extent possible, shall be prioritized to be directed to accounts at
   buildings or facilities of the public school division of the municipality
   before the credit is directed to any of the municipality&#8217;s target
   accounts.
   				Any pilot program conducted pursuant to this section shall not limit the
   current authority of any municipality to participate in any other net energy
   metering program.
   				Neither jurisdictional customers nor non-jurisdictional customers,
   including those that are members of a joint powers association representing
   member units of a political subdivision of the Commonwealth, that do not
   participate in a pilot program under this section shall bear any costs
   associated with participation in such pilot program by a participating host
   municipal customer-generator and participating target municipal customer.

E. The duration of any pilot program approved by the Commission pursuant to
subsection B shall be six years. The duration of any pilot program approved by
the Commission pursuant to subsection C shall be until July 1, 2028. If a pilot
program is not extended beyond such initial term, host and target accounts
participating at the end of the initial term shall be permitted to continue to
participate under the terms of the pilot program that existed during the initial
term. The terms of the pilot program shall be included in future contracts for
each municipality that elects to continue its program.

F. The Commission shall review the pilot program established pursuant to
subsection B in 2021 and every two years thereafter for the duration of the
pilot program. The Commission shall review the pilot program established
pursuant to subsection C in 2024 and every two years thereafter for the duration
of the pilot program.

G. Notwithstanding the provisions of &#xA7; 56-594.02, the aggregated capacity
of all generation facilities that are the subject of a utility&#8217;s pilot
program pursuant to this section shall not constitute any portion of the
existing aggregate net metering cap established in &#xA7; 56-594 and evaluated
by the Commission as part of a net energy metering proceeding.

H. The aggregated capacity of all generation facilities that are the subject of
each utility&#8217;s pilot program under this section and that are the subject
of a third-party power purchase agreement shall constitute a portion of the
existing limit of pilot programs pursuant to the provisions of &#xA7; 56-594.02.

HISTORY: 2019, cc. 746, 747; 2022, c. 388.