ISEA Blog

Welcome to the ISEA Blog. Catch up on the latest issues related to the adoption of solar and small wind energy in Illinois. We welcome your feedback and referral of newsworthy developments. 

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  • 26 Feb 2015 11:47 AM | Anonymous

    The Illinois Solar Energy Association’s webinar, held on 2/25/15, outlined the IPA’s Regular and Supplemental  Procurements processes for Renewable Energy Credits from distributed solar energy systems in Illinois. The presentation is available both as a PDF as well as a recorded version (below).



  • 24 Feb 2015 10:55 PM | Lesley McCain (Administrator)

    It was a busy week in Springfield last week with the introduction of a new Renewable Portfolio Standard (RPS) bill and the news of Governor Rauner’s proposed 2015-2016 budget.  


    The Clean Jobs Bill was unveiled Thursday (2/19/2015) with strong bi-partisan support in the House and Senate.  A growing coalition of business and special interest groups have joined forces to craft a unique and comprehensive clean energy bill to shape a better energy future. The goals are big, bold and urgent – increase statewide energy efficiency to 20% by 2025, ensure 35% of all power in Illinois comes from renewable sources by 2030 and set up a suggested framework for discussion to meet the new federal EPA carbon standards.  If passed, this could generate over 32,000 new jobs per year and attract more than $21B of investment in Illinois.  No other industry segment has that kind of potential in today’s economy! What is in store for solar energy specifically?

    •  Replace the current RPS procurement plan with a new, independent procurement process that is not tied to the traditional annual IPA power procurement process.  Note that the existing Regular Procurement (April/Sept 2015) and Supplemental Procurement (June/Nov 2015, March 2016) will not be impacted by the new Clean Energy Bill.
    • Identify stepping stones and targets for wind and solar (including DG, community and brownfield development), ensuring 25% RPS met by 2025 and 35% by 2030.  
    • Shift utility contributions from the supply side (IPA/ARES suppliers) to distribution (ComEd/Ameren) through a line or wires charge.  This will fix the broken funding cycle in the current RPS and create a steady, predictable stream of revenue allowing for long term planning. 
    • Develop a low-income family solar program through the targeted use of RERF dollars.  (Renewable Energy Resource Fund is the money from ARES suppliers for their compliance toward clean energy requirements and is the source of the $30M Supplemental Procurement.)  New contributions into this fund will cease in October 2016 and the outstanding balance will assist low income DG projects including community solar.  The first 15 years of RECs will be paid out once the system is energized and the utility will take ownership of the REC.  A 3rd party administrator will assure checks and balances against fraud. 
    • Publish a DG “declining block” pricing structure for 2016 through 2030.  This table will identify MW goals with established declining REC prices, enabling investors to calculate and compare incentives over time.  This proven model has worked well in other state to drive steady growth and eliminate the boom/bust cycle that crippled early REC programs.  The Illinois Power Agency (IPA) will review/revise every two years to ensure pricing matches market conditions.  Investors will likely be paid for the first 15 year REC value once the system is energized.
    • Require prevailing wage installation labor for new wind, and solar projects over 1000kW.
    ISEA will be actively working to support this legislation and need each and every one of you to roll up your sleeves and help.  We intend to hire a lobbyist to work in Springfield on a regular basis and will host a series of events including Solar Lobby Day on May 6th - watch your calendar for details!  2015 will be a pivotal year for solar growth in IL and is your opportunity to pave a clean energy future, catapulting us to the top 10 solar states in the nation!
     
    Governor Rauner’s proposed budget cuts for fiscal year 2015 – 2016 appear to eliminate the entire DCEO Energy Department as well as the rebate/grant funding.  Although scary at first, this could actually be a significant opportunity for solar investors and system installers. As discussed in our two recent webinars, the Supplemental Procurement plan will host at least 3 events – June 2015, November 2015 and March 2016.  Prospective system owners will work through solar companies or aggregators to bid into one of these events.  It is important to keep in mind that the intended purpose of a REC is to assist with the economics of a project and encourage completed IL installations in order to achieve legislated goal of 25% clean energy by 2025.  Therefore, the value of a REC will need to be high enough to stimulate the market to grow and build.  It could also create an urgency to participate NOW! The rebate program was riddled with problems including limited funding, an onerous application period, an unpredictable lottery or competitive review and stressful installation deadlines.  By transitioning to the Supplemental Procurement, all of these problems are eliminated or improved:


    • Immediate funding opportunities available in June & November & March.  No more “hurry up and wait” for the rebate/grant application deadlines to sign new customers.
    • Flexibility in funding amounts on a project by project need.  One REC price does not fit all projects, installers and developers can tailor pricing to meet customer needs. (Keep in mind there will be a confidential (unpublicized) ceiling for pricing so all projects must be below this threshold to be approved.)
    • Increased state budget from $2.5 million to $6 million ($30million/5 year REC contract).
    • Improved odds for funding - elimination of the lottery system and competitive grant cycle! 
    • Broader installation deadlines – no more November to May rush to install.  Approved projects have 6 months to be confirmed and a year to install. 
    The one possible downside to this format is that the REC payment will be made quarterly as opposed to a single lump sum.  It may be a good idea to factor those related costs into your REC price to make the project economically viable and compelling enough to act now.  Several ISEA members have expressed concerns that previous market indicators suggested low REC prices.  However, do not dismiss the elimination of the rebate changes the economics for project owners.  Therefore, we believe the IPA will need to adjust the benchmark accordingly.  Aggregators may also look at market conditions to provide input and experience in national REC pricing but the experts will be the installers and ultimately the investors.  This will, in all likelihood, be a negotiation with the aim of installing the greatest amount of solar for the most cost effective price.  
     
    Please note that ISEA will pursue opportunities to resurrect the rebate/grant program.  We are not ready to give up! However, indicators suggest it will be an uphill battle given the drastic cuts across the board to many human services and special interest groups.  We feel strongly that, if properly positioned, the Supplemental Procurement could be an excellent replacement to rebates and then transition smoothly to the declining block structure for the new RPS.  As stated previously we will need a great deal of support in Springfield from all members in order to secure a successfully incentive program that will drive growth through 2030! Please let us know we can count on you.
     

  • 27 Jan 2015 12:03 PM | Anonymous

    Written by Shannon Weigel


    The Illinois Commerce Commission has released its Final Orders for both the Supplemental and Regular 2015 Procurement. ISEA participated in the supplemental procurement planning process on behalf of its business and individual members and advocated in favor of several features that the ICC integrated into the final approved plan. Here are a couple of important details potential participants should know:


    Supplemental Procurement Plan
    In 2014, the state legislature passed a bill to authorize the Illinois Power Agency (“IPA”) to spend up to $30 million from the Renewable Energy Resource Fund (RERF) for a supplemental distributed generation (“DG”) solar procurement (the “IPA Act”). The RERF is funded through payments made by Alternative Retail Electric Suppliers (“ARES”) to satisfy statutory renewable energy resource procurement obligations.


    Eligible systems
    The IPA has chosen to procure RECs from “new” DG solar systems. PV systems that have been energized on or after the approval date of the plan (January 21, 2015) are considered “new”. ISEA anticipates the IPA will accept countersigned interconnection agreements from the utility as well as a letter from system owners verifying the system was not energized prior to the approval date.


    DG solar systems are defined as systems interconnected at the distribution system level of either an electric utility, ARES, municipal utility, or a rural electric cooperative; located on the customer’s electricity load; and limited in nameplate capacity to no more than 2,000 kW. This means all eligible systems will be located in Illinois.


    Systems that participate, or have participated, in grant, incentive, rebate or tax credit programs may participate so long as that participation does not include the sale or assignment of RECs. Participation in the Department of Commerce and Economic Opportunity (“DCEO”) programs does not prohibit you from participating in the supplemental procurement. ISEA recommends double checking with funding sources to confirm ownership of RECs as some, such as the Illinois Clean Energy Community Foundation, may have taken ownership per terms of the award.


    Procurement Process

    The IPA has chosen NERA Economic Consulting as the Procurement Administrator. NERA will set up the bidding event and explain the competitive bidding process. Bidders will offer a competitive bid for a 5-year REC contract. A standard capacity factor of 14.38% will be used in the bidding process to forecast the number of RECs. Bidders will use the formula below to convert bid system sizes into deliverable RECs.


    Nameplate Capacity in MW *14.38% *8760 hours/year * 5 years = contracted RECs


    The IPA originally proposed two categories of systems: systems less than 25kW and systems between 25kW to 2,000 kW. ISEA argued that the two categories should be broken into three to ensure diversity of participation at cost-effective prices for mid-sized commercial systems. In the final plan, the IPA did break the procurement into three distinct categories: systems < 25 kW, systems 25 kW – 500 kW and systems > 500 kW – 2 MW. The IPA will set three individual and confidential benchmarks that will be applied across all procurement events. Per language from the General Assembly the IPA will strive to buy half of RECs from systems < 25 kW. (Note: this does not mean ½ the $30 million budget.)


    Systems > 25 kW must be identified to prior to bidding. Bids may be speculative for systems < 25 kW. However, the systems must be identified within 6 months of the procurement event. The IPA states that evidence may include, but is not limited to, letters of intent, signed contracts, installation certification, site data and information, system ownership information, interconnection application and net metering application. 


    Bidders must meet deposit requirements of $16/REC for speculative projects and $8/REC for identified projects. Half of the deposit is due at the time of bid submission and the other half is due within 14 days after bid acceptance. The IPA will refund winning bidders as part of the first payment for RECs. If a winning bidder cancels the project or fails to development milestones, the bidder will forfeit the deposit. Unsuccessful bidders will have their deposits refunded. The refund will be prorated for a bidder who is successful for only a portion of their bid.


    Procurement Events

    There will be 3 procurement events with the possibility of one contingency event in early 2017. 


    June 2015

    • Budget of $5 million
    • <25kW Category: 5,000 REC maximum bid size
    • 25-500 kW Category: No identified goals beyond those for the >25kW Category
    • >25kW Category: 500 kW maximum system size
    November 2015

    • Budget of $10 million
    • <25kW Category: No maximum bid size (targeting 50% of RECs in this procurement event)
    • 5-500 kW Category: No maximum bid size (targeting 15% of RECs in this procurement event)
    • >500kW Category: 2 MW maximum system size (targeting 35% of RECs in this procurement event)
    March 2016

    • Budget of $15 million
    • <25kW Category: No maximum bid size for bids under 25 kW category
    • 25-500 kW Category: No identified goals beyond those for the >25kW Category
    • >25kW Category: 2 MW maximum system size for the 25 kW and above category
    Early 2017 (contingency event)

    • Balance of available funds
    • Possible limitation on categories of systems that may participate
    All bids must be at or below the appropriate confidential benchmark set by the IPA. Bids are then ranked in order of price per REC until all bids have been ranked or until the budget is exhausted. If that step ended because the budget was exhausted, in a next step, the lowest priced <25 kW systems that have not yet been ranked replace the highest priced >25 kW systems as needed to reach the objective of having 50% of the RECs for the procurement event from systems <25 kW. For the second procurement event, if needed, the same process is used to bring the >25 kW - 500 kW category up to 15% of the RECs.


    If your bid is selected

    Bidders might win contracts for only some of their projects. Installers must build systems within 12 months of the procurement, with a potential 6 month extension, granted at the IPA’s discretion. Systems must be installed by a “qualified person” and the bidder must certify that a qualified person was used for the system installation. Per legislative language as modified in the IPA Act, the definition of “qualified person” is slightly different than that required by the ICC for DG Certification. See reference below. 


    The winning bidder may request to substitute a system with one or more systems so long as the total size is of similar nameplate capacity. The IPA has the discretion to grant or deny substitution requests. 


    Systems > 25 kW will be required to have a revenue-quality meter as part of their installation. The Commission decided it is the IPA’s discretion as to what meters are required for < 25 kW systems. Both the IPA and Commission have stated they do not want to add unnecessary costs to < 25 kW systems and unintentionally create a barrier to participation. Additional details will be provided during the next few months.


    RECs must be delivered via GATs or M-RETs tracking system and transferred to the IPA’s account prior to invoicing. Bidders will invoice IPA quarterly and IPA will pay after RECs are delivered. 


    Next Steps

    The IPA will draft procurement documents for stakeholder comments and hold informational sessions. Per ISEA’s suggestion, the IPA will develop a webpage similar to “Plug in Illinois” to provide basic information to potential participants.


    2015 Regular Procurement Plan 

    The IPA will also procure, on behalf of the utilities, SRECs from new and existing systems through two energy procurement events in 2015. This is technically how the REC procurement event had been intended to work and was triggered by the need to purchase standard electricity for Ameren. Any year that the IPA purchases conventional power for the utilities they are also required to purchase renewable energy per the IPA Act. Given the small budget amounts and that the solar market is behind previously stated targets, the IPA has elected to focus the 2015 procurement solely on solar asset procurement and will not be purchasing wind RECs in the plan. 


    The first procurement event will occur in April 2015. The procurement will use about $13 million from the Renewable Resources Budget (RRB) for a one-year SREC contracts. Participants will likely be utility-scale existing systems with unsold RECs. 


    The second procurement event will be in September 2015 for RECs from DG resources. DG resources are defined as systems interconnected at the distribution system level of either an electric utility, ARES, municipal utility, or a rural electric cooperative; located on the customer’s electricity load; and limited in nameplate capacity to no more than 2,000 kW. By definition, all systems will therefore need to be installed in Illinois. Half of the RECs will come from systems < 25 kW.


    The utilities will purchase about $15 million from the Hourly ACP fund. Contracts will be for 5 years, paid annually beginning at the date of the first meter read registered in the appropriate tracking system. Successful bidders have until June 2016 to complete the system installation. 


    Bidders must aggregate projects to a minimum bid of 1 MW. Aggregators and system owners can combine projects < 25 kW and > 25 kW to meet the 1 MW threshold. A bidder can designate REC prices specific to individual systems. Within the 1 MW bid, the IPA may award all, none or some systems. No speculative bidding is allowed. Bidders must submit a non-refundable $500 bid fee and a $10/REC refundable deposit.


    Qualified Person– definition per Section 1‐56(i)(1) 

    For the purposes of this paragraph (1), "qualified person" means a person who performs installations of photovoltaics, including, but not limited to, distributed photovoltaic generation, and who: (A) has completed an apprenticeship as a journeyman electrician from a United States Department of Labor registered electrical apprenticeship and training program and received a certification of satisfactory completion; or (B) does not currently meet the criteria under clause (A) of this paragraph (1), but is enrolled in a United States Department of Labor registered electrical apprenticeship program, provided that the person is directly supervised by a person who meets the criteria under clause (A) of this paragraph (1); or (C) has obtained one of the following credentials in addition to attesting to satisfactory completion of at least 5 years or 8,000 hours of documented hands-on electrical experience: (i) a North American Board of Certified Energy Practitioners (NABCEP) Installer Certificate for Solar PV; (ii) an Underwriters Laboratories (UL) PV Systems Installer Certificate; (iii) an Electronics Technicians Association, International (ETAI) Level 3 PV Installer Certificate; or (iv) an Associate in Applied Science degree from an Illinois Community College Board approved community college program in renewable energy or a distributed generation technology.


    For the purposes of this paragraph (1), "directly supervised" means that there is a qualified person who meets the qualifications under clause (A) of this paragraph (1) and who is available for supervision and consultation regarding the work performed by persons under clause (B) of this paragraph (1), including a final inspection of the installation work that has been directly supervised to ensure safety and conformity with applicable codes.


    For the purposes of this paragraph (1), "install" means the major activities and actions required to connect, in accordance with applicable building and electrical codes, the conductors, connectors, and all associated fittings, devices, power outlets, or apparatuses mounted at the premises that are directly involved in delivering energy to the premises' electrical wiring from the photovoltaics, including, but not limited to, to distributed photovoltaic generation.

  • 19 Dec 2014 2:09 PM | Anonymous

     

     Learn about both the Illinois Regular and Special Renewable Energy Procurements. 

     

    Lisa Albrecht ISEA's Policy Committee Chair explains the difference between the procurements and how they will impact Illinois solar development in 2015. 

     

    2014-12-18 18.05 Illinois Solar Policy Update.wmv

     

    Regular Procurement Final Order:  http://www.icc.illinois.gov/docket/files.aspx?no=14-0588&docId=222864

     

     

    Supplemental Procurement Proposed Order : https://www.icc.illinois.gov/docket/files.aspx?no=14-0651&docId=222439

  • 12 Nov 2014 2:35 PM | Anonymous

    As you know, the state legislature passed a measure to authorize the IPA to spend $30M of the Renewable Energy Resource Fund (RERF) for a special DG Solar Procurement.  The IPA held several public workshops and published a draft procurement plan, soliciting comments at each stage.  On October 28th, the IPA submitted the final version for ICC consideration and final rulings by the ICC are due January 26, 2015.  ISEA was pleased to see many of our recommendations incorporated in this latest version.  (Click here to access draft plans and all comments filed to the IPA and ICC.)  Please note that this procurement is being developed at the same time as the Regular Procurement Plan, discussed in previous blogs.  This is a separate process with different targets and goals.


    The final version of the Special Procurement Plan has been filed for consideration with the ICC.  Overall provisions include:


    • The IPA will hold a competitive procurement among aggregators offering 5 year contracts only for “new” Distributed Generation (DG). DG includes all systems <2,000kW and are installed behind the meter and less than 2 MW. Due to the “behind the meter” requirement, only Illinois systems will be eligible.
    • “New” means the system is energized on or after the approval of the plan (likely January 26, 2015).  Systems must be built within 1 year of the procurement with a potential 6 month contingency if project experiences delays. 
    • A standard capacity factor of 14.38% will be used in the bidding process to forecast the number of RECs per KW of installed solar.  For example, for bidding purposes, RECs for a 10kW system would be calculated:  (0.010MW x 14.38% x 8760 hours/year x 5 years = about 63 RECs.  Bidders would use this formula to convert bid system sizes(nameplate KW) into deliverable RECs. As all contracts will be for 5 years, RECs should be bid for the duration of the contract.
    • The procurement events will feature two bid categories – systems under 25 kW and systems over 25 kW. The IPA will strive to buy half of the RECs from each group.  Only projects in the <25kW system can include speculative projects.  Projects >25kW must be identified but not energized.  The IPA will create the ability to gather this information during the bid process.  
    • There will be 3 different procurements (see below) with a minimum bid amount of 500 RECs.  Bids will be accepted by aggregators or system owners as long as the minimums are met. Therefore larger commercial systems will be able to self-procure if so desired.
    •  Aggregators cannot exceed the maximum bid of 5,000 RECs for <25kW systems in any procurement periodAs stated previously, bids can be speculative in this portion of the Special Procurement.  However, speculative projects must be identified within 6 months (3 month contingency) of the procurement event.
    • All projects in the >25 category must be identified (i.e. site control, etc) in order to bid.
    • Aggregators can bid in a different REC price for each project, but not different REC prices within the project, and for commercial systems you have to bid all the RECs from the system.
    • Eligible systems must be installed by a Qualified Person. This definition differs slightly from the current ICC definition of “Qualified Person”.  Aggregators and/or projects will need to verify that the system was installed accordingly.  If not, the project will not be eligible to sell RECs.  (see definition below)  As this was defined specifically by the General Assembly in Section 1-56(i) the ISEA was unable to alter these terms
    • Systems must be registered with PJM GATS or MISO M-RETS where all RECs will be tracked and transferred.  All systems will be required to have a utility-grade meter as part of their installation.
    • Aggregators will be required to meet deposit requirements of $16/REC for speculative projects and $8/REC for identified projects.  Deposit adjustments will be made as speculative projects are identified.
    • Commercial projects can substitute projects if they meet the same criteria of the project that won the award.
    • Bidders might only win contracts for some of their projects.  Deposits will be adjusted accordingly.
    • There will be 3 procurement events with a possible 4th contingent upon need.  

    June 2015 –

    •  Procurement Budget:  $5 M
    • Maximum bid of 5,000 RECs for residential.
    • Bids for commercial but systems can’t be over 500 kW

    November 2015-

    • Procurement Budget:  $10 M
    • Maximum bid of 5,000 RECs for residential.
    • No maximum bid for commercial and systems can be up to 2 MW now 

    March 2016

    • Procurement Budget:  $15 M
    • Maximum bid of 5,000 RECs for residential.
    • No maximum bid for commercial and systems can be up to 2 MW now 

    January 2017-  Contingency for any remaining money.

     

    ISEA objected to the following issues in the final 2015 Special Procurement Plan:

    1. Systems between 25kW – 2,000 kW should be broken into smaller sub-categories to ensure that the financial incentives to develop varying sizes work appropriately.  ISEA recommended 25kW – 399kW and 400kW – 2,000 kW.  This has not been supported to date but ISEA provided evidence that mature REC markets have been making these adjustments based on development results.  This is a vast economic opportunity for system owners, developers and installers. 
    2. Systems <25kW should utilize a 3rd party administrator as opposed to a multipleaggregators which could cause a great deal of confusion for system owners. The easier this process is for homeowners and small business owners, the more likely they are to participate.  We do not want complex competition to cause market confusion and potential delays.
    3. Aggregator Credit Requirements should be reduced to:  $10/REC for speculative bids, $5/REC for identified projects to open the field of potential bidders for REC procurement.
    4. ICC DG Certified Installers list needs to include additional details so that it is transparent if an installer qualifies for the Special Procurement.   NOTE:  This is an important distinction that all solar installers should investigate further and take the necessary steps to ensure they will qualify under the new guidelines.  This requirement is limited to just RECs from the Special Procurement and does not impact systems that do not seek to sell their RECs or for systems that intend to participate in the Regular Procurement.


     Qualified Person – definition per Section 156(i)(1)    

    For the purposes of this paragraph (1), "qualified


    person" means a person who performs installations of photovoltaics, including, but not limited to, distributed photovoltaic generation, and who: (A) has completed an apprenticeship as a journeyman electrician from a United States Department of Labor registered electrical apprenticeship and training program and received a certification of satisfactory completion; or (B) does not currently meet the criteria under clause (A) of this paragraph (1), but is enrolled in a United States Department of Labor registered electrical apprenticeship program, provided that the person is directly supervised by a person who meets the criteria under clause (A) of this paragraph (1); or (C) has obtained one of the following credentials in addition to attesting to satisfactory completion of at least 5 years or 8,000 hours of documented hands-on electrical experience: (i) a North American Board of Certified Energy Practitioners (NABCEP) Installer Certificate for Solar PV; (ii) an Underwriters Laboratories (UL) PV Systems Installer Certificate; (iii) an Electronics Technicians Association, International (ETAI) Level 3 PV Installer Certificate; or (iv) an Associate in Applied Science degree from an Illinois Community College Board approved community college program in renewable energy or a distributed generation technology.

    For the purposes of this paragraph (1), "directly


    supervised" means that there is a qualified person who meets the qualifications under clause (A) of this paragraph (1) and who is available for supervision and consultation regarding the work performed by persons under clause (B) of this paragraph (1), including a final inspection of the installation work that has been directly supervised to ensure safety and conformity with applicable codes.

    For the purposes of this paragraph (1), "install"


    means the major activities and actions required to connect, in accordance with applicable building and electrical codes, the conductors, connectors, and all associated fittings, devices, power outlets, or apparatuses mounted at the premises that are directly involved in delivering energy to the premises' electrical wiring from the photovoltaics, including, but not limited to, to distributed photovoltaic generation.

     

     

    Objections can be found on the ICC website. The ISEA intends to file Responses to the Objections (due 11/20) and likely Replies to the Responses (due 12/2)


  • 23 Oct 2014 4:15 PM | Anonymous

    by Lisa Albrecht, ISEA Policy Co-Chair


    A lot has been happening since the last Blog!


    Many may not realize but there are currently two separate procurement plans in the works to purchase Renewable Energy Credits in 2015; the Special Procurement which we’ve discussed in previous posts, and the Regular Procurement which is part of the standard annual energy procurement the IPA hosts on behalf of the utilities.   Both plans are still in draft form and we are working hard to try to negotiate a solution that will best serve all aspects of the solar industry.


    I’ve detailed both the Regular and Special Procurements below but also wanted to explain the process each procurement goes through legally.  The ISEA has participated in each of the following steps:

    1. The IPA holds public workshops when writing a new procurement plan.
    2. This input is used to create a Draft Plan which is published for public comment.
    3. The public has 14 days to submit informal comments on possible changes.
    4. Once received, the IPA then has 14 days to revise before submitting the final Plan to the ICC.
    5. Fortunately it doesn’t end there and interested parties have a chance to file legal “Objections” within 5 days.  These are filed by an attorney directly with the ICC and posted on the ICC website.
    6. Entities have the opportunity to submit “Responses to Objections” filed, either in agreement or opposition, and make a detailed case for their response. These are due within 10 days.
    7. There is one final opportunity to file “Responses to the Responses to the Objections” over the next 10 days.
    8. At that stage the comment period ends.  The ICC takes all of these comments under advisement and must either confirm or modify the plan 90 days after it was filed by the IPA.

    All of this is VERY CONFUSING so we will be hosting a webinar soon to go over the details. For perspective, it helps to understand there are 3 buckets of funding (remember when we were working on the RPS Fix?) 

    1. The Renewable Resource Budget (RRB) – the public utilities calculate their required %’s from fixed rate customers.
    2. The Hourly Alternate Compliance (ACP) Budget – the public utilities calculate their required $’s from hourly rate customers
    3. The Renewable Energy Resource Fund (RERF) – the Alternate Retail Energy Suppliers required offset. 

    The Regular Procurement will be spending funds from the RRB and the Hourly ACP budgets.  This is ComEd and Ameren’s portion of the Renewable Portfolio Standard.  The Special Procurement will be spending funds from the RERF budget.


    We encourage you to look at the proposed plans but here’s a quick snap shot of where we are at this point.  Please keep in mind that both Plan’s are still in draft mode and the ICC will make final determinations in about 90 days. 


    Regular Procurement – this is the furthest along in process above and on 10/31 ISEA will be submitting our “Response to the Responses to the Objections”.  From there we wait until 12/29 to see what the ICC finalizes.   The utilities will enter into contracts to purchase RECs from Aggregators.  There will be 2 procurements to purchase credits from existing and new systems under contract:

    1. April 2015:  The utilities will purchase about $13m from the RRB for single-year RECs.  These will likely be existing systems that have unsold RECs and will likely be utility scale or out of state RECs. ISEA has objected.
    2. September 2015: The utilities will purchase about $15m of the Hourly ACP) funding.
      1. The goal is to purchase half of the RECs from >25 kW systems and half from < 25 kW systems. This is half the REC’s not half the budget but until there is pricing we won’t know the quantity.
      2. No speculative bidding will be allowed and only specifically identified systems will be accepted in bids. Unbuilt systems have until June 2016 to be completed. 
      3. Contracts will be for 5 years.  They will not be prepaid in a lump sum.
      4. Aggregators are required to submit a Minimum bid of 1 MW of bundled capacity. Bidders can combine projects from >25 kW projects and <25 kW projects to meet the 1 MW threshold.
      5. Aggregators will be required to submit a non-refundable $500 bid fee.  They will also provide a $10/REC refundable credit deposit based on the # of RECs bid. 
      6. The contracts will be between utilities and aggregators.  System owners can self-aggregate if they meet the 1 MW minimum threshold. Otherwise an aggregator is just a third party – solar company, REC aggregator, municipality, non-profit – whoever has contractual rights to sell the RECs.

    Special Procurement – the IPA will be submitting their final Plan to the ICC on Monday 10/28.  I hesitate to list details as we are hoping for significant edits but do so because we’ve received several questions and concerns.  Again, I encourage folks to read the plan which is hot linked above.  The draft plan suggested:  


    General Provisions:

    • All bids must be for systems <2,000kW (Distributed Generation or DG systems). DG RECs as defined by Illinois statute mean they must be interconnected in Illinois, behind the meter, and used primarily to offset the customer’s usage.
    • All projects must be “new” as defined by the date of each of the procurements (see below). No existing systems will be able to participate.  ISEA has strongly objected to the definition of the term “new”, arguing that “new” should be systems installed on or after the date the Governor signed the bill into law.
    • No speculative bidding from large systems, ever. Bidders will need proof of viability of large systems, though the exact details aren’t spelled out.
    • All systems must be installed by a “qualified person” which is not part of the regular procurement.  The General Assembly included wording that restricts the state definition of “qualified person” and we cannot change it.  Systems built by installers who used “5 installed systems” as their qualification will be excluded from participating in the Special Procurement. 
    • Basically a bid will be for 1 REC/year/kW. So a 5 kW system will bid 25 RECs for the entire 5-year period and a 2 MW system = 10,000 RECs. 
    • The winning bidders will invoice the IPA quarterly and payment will be made after the RECs are delivered (i.e. no pre-payment).
    • Bidders will have to provide $25/REC deposits for speculative RECs and $10/REC deposits for identified systems. This translates into $125/kW for speculative bids or $50/kW for identified projects.
    • Aggregators are not necessary but allowed:
      • System owners can participate directly as long as they meet credit and minimum bid requirements (500kW).
      • Anyone can be an aggregator as long as they have the right to sell the RECs from projects, meet credit requirements, and meet minimum bid requirements. You will need to pre-qualify.
    • There will be 3 procurement events with a 4th if needed:

    June 2015$5 million

    • System is energized on or after June 2015 procurement date
    • Under 25 kW systems: minimum bid of 500 RECs (20 5 kW systems) and a maximum bid of 5,000 RECs (200 5 kW systems)
    • Over 25 kW systems: minimum bid of 500 RECs (4 25 kW systems) and a maximum systems size of 500 kW, meaning a maximum per-project bid of 2,500 RECs.

    November 2015$10 million

    • System is energized on or after June 2015 procurement date.
    • 500 REC minimum bid, no maximum system size.

    March 2016$15 million

    • System is energized on or after November 2015 procurement date.
    • 500 REC minimum bid, no maximum system size.

    Early 2017contingency

  • 12 Aug 2014 3:15 PM | Anonymous

    by Lisa Albrecht, ISEA Policy Co-Chair


    Thursday August 7th the Illinois Power Agency hosted a second public workshop to discuss the execution of HB 2427, the one-time procurement for $30million in Solar Renewable Energy Credits. The agenda and supporting documents can be found on the IPA web page. About 70 people participated in the discussions and seemed to represent a vast group of stakeholders including both local and national installers (primarily residential but also some commercial), home owners, Environmental Law and Policy Center, Elevate Energy, CUB, utilities (including ComEd, Ameren, a few ARES), the Metropolitan Mayor Caucus, Wind on the Wire and several wind developers, Wanxiang and many others.


    Kicking the meeting off, Anthony Star reviewed the legislative language which broadly discusses time frames, $30m cap, 50% of the procurement must be systems <25kW, contract durations for a minimum of 5 years, credit requirements for participants and finally the broad use of aggregators. The language of the bill was intentionally left relatively loose, allowing the IPA some latitude to create a program based on industry and public input. In many respects, Illinois is fortunate that we can have a “test run” of a REC program which can help when crafting a more permanent solution.


    Next NERA, the IPA regular procurement administrator, presented on trends and lessons learned in other state procurement focusing primarily on NJ, CT and DE. These states have many similarities to Illinois and the intent is to learn from their experiences while putting the IL program guidelines together. 


    The final presentation was a review of the consolidated responses to the survey the IPA put out in July soliciting public comment and feedback. All individual responses including those submitted by The Illinois Solar Energy Association can be found on the IPA website. 


    The remainder of the meeting was focused on discussing the broader issues to be tackled and defined. These comments will be taken under advisement by the IPA over the next 90 days as they develop a draft procurement plan. Much of this conversation was very similar to the June 12th workshop but additional points were discussed in detail. No decisions or preferences have been expressed officially at this time but it is clearly obvious that the IPA is eager to create something based strongly by market interest. 

    1) Product Categories, System Type, Ownership Structure, Date of Installation

    2) The Role and structure of Aggregators

    3) REC Pricing, Declining Blocks, Rate Caps

    4) Contract terms, Contract for differences, Flat Payments versus Annual


    The IPA will publish the draft procurement plan by September 29th, followed by a public comment period through October 14th. The ISEA would love your input so please feel free to comment here on the blog to continue the conversation.

    Thursday August 7th the Illinois Power Agency hosted a second public workshop to discuss the execution of HB 2427, the one-time procurement for $30million in Solar Renewable Energy Credits.  The agenda and supporting documents can be found on the IPA web page.  About 70 people participated in the discussions and seemed to represent a vast group of stakeholders including both local and national installers (primarily residential but also some commercial), home owners, Environmental Law and Policy Center, Elevate Energy, CUB, utilities (including ComEd, Ameren, a few ARES), the Metropolitan Mayor Caucus, Wind on the Wire and several wind developers, Wanxiang and many others.

    Kicking the meeting off, Anthony Star reviewed the legislative language which broadly discusses time frames, $30m cap, 50% of the procurement must be systems <25kW, contract durations for a minimum of 5 years, credit requirements for participants and finally the broad use of aggregators.   The language of the bill was intentionally left relatively loose, allowing the IPA some latitude to create a program based on industry and public input.  In many respects, Illinois is fortunate that we can have a “test run” of a REC program which can help when crafting a more permanent solution.

    Next NERA, the IPA regular procurement administrator, presented on trends and lessons learned in other state procurement focusing primarily on NJ, CT and DE.  These states have many similarities to Illinois and the intent is to learn from their experiences while putting the IL program guidelines together.

    The final presentation was a review of the consolidated responses to the survey the IPA put out in July soliciting public comment and feedback.  All individual responses including those submitted by The Illinois Solar Energy Association can be found on the IPA website.

    The remainder of the meeting was focused on discussing the broader issues to be tackled and defined.  These comments will be taken under advisement by the IPA over the next 90 days as they develop a draft procurement plan.  Much of this conversation was very similar to the June 12th workshop but additional points were discussed in detail.  No decisions or preferences have been expressed officially at this time but it is clearly obvious that the IPA is eager to create something based strongly by market interest. 

    • 1)     Product Categories, System Type, Ownership Structure, Date of Installation
    • 2)     The Role and structure of Aggregators
    • 3)     REC Pricing, Declining Blocks, Rate Caps
    • 4)     Contract terms, Contract for differences, Flat Payments versus Annual

    The IPA will publish the draft procurement plan by September 29th, followed by a public comment period through October 14th.  The ISEA would love your input so please feel free to comment here on the blog to continue the conversation.

    Thursday August 7th the Illinois Power Agency hosted a second public workshop to discuss the execution of HB 2427, the one-time procurement for $30million in Solar Renewable Energy Credits.  The agenda and supporting documents can be found on the IPA web page.  About 70 people participated in the discussions and seemed to represent a vast group of stakeholders including both local and national installers (primarily residential but also some commercial), home owners, Environmental Law and Policy Center, Elevate Energy, CUB, utilities (including ComEd, Ameren, a few ARES), the Metropolitan Mayor Caucus, Wind on the Wire and several wind developers, Wanxiang and many others.

    Kicking the meeting off, Anthony Star reviewed the legislative language which broadly discusses time frames, $30m cap, 50% of the procurement must be systems <25kW, contract durations for a minimum of 5 years, credit requirements for participants and finally the broad use of aggregators.   The language of the bill was intentionally left relatively loose, allowing the IPA some latitude to create a program based on industry and public input.  In many respects, Illinois is fortunate that we can have a “test run” of a REC program which can help when crafting a more permanent solution.

    Next NERA, the IPA regular procurement administrator, presented on trends and lessons learned in other state procurement focusing primarily on NJ, CT and DE.  These states have many similarities to Illinois and the intent is to learn from their experiences while putting the IL program guidelines together.

    The final presentation was a review of the consolidated responses to the survey the IPA put out in July soliciting public comment and feedback.  All individual responses including those submitted by The Illinois Solar Energy Association can be found on the IPA website.

    The remainder of the meeting was focused on discussing the broader issues to be tackled and defined.  These comments will be taken under advisement by the IPA over the next 90 days as they develop a draft procurement plan.  Much of this conversation was very similar to the June 12th workshop but additional points were discussed in detail.  No decisions or preferences have been expressed officially at this time but it is clearly obvious that the IPA is eager to create something based strongly by market interest. 

    • 1)     Product Categories, System Type, Ownership Structure, Date of Installation
    • 2)     The Role and structure of Aggregators
    • 3)     REC Pricing, Declining Blocks, Rate Caps
    • 4)     Contract terms, Contract for differences, Flat Payments versus Annual

    The IPA will publish the draft procurement plan by September 29th, followed by a public comment period through October 14th.  The ISEA would love your input so please feel free to comment here on the blog to continue the conversation.

  • 25 Jul 2014 1:02 PM | Anonymous

    By Shannon Weigel, ISEA Board Member


    Saturday, June 28th, Governor Quinn signed House Bill 2427 authorizing the Illinois Power Agency (IPA) to direct a one-time $30 million procurement of RECs.

    In anticipation of the Governor’s signature, the IPA held a preliminary stakeholder workshop on  June 12th, to discuss the program design for implementing the Supplemental PV Procurement Plan. Many questions were raised about the role of aggregators, treatment of new vs. existing systems, need for credit requirements, contract terms and overall procurement process. The IPA solicited written comments, which were due on Monday, July 21st. and can be found on the IPA website (http://www2.illinois.gov/ipa/Pages/Plans_Under_Development.aspx). The program design is officially underway at this stage and will evolve through a series of public workshops and program drafts from the IPA before being submitted to the Illinois Commerce Commission (ICC) later this year.

    ISEA submitted comments with the over-arching theme to keep the one-time procurement simple and transparent to ensure success and create consumer and legislative confidence with the aim of demonstrating a working, long-term solution for the RPS program.

    ISEA recommends creating 3 subcategories for the procurement. The first subcategory would be for large commercial projects between 400 kW – 2 MW. Although the ISEA comments did not officially comment on pricing techniques, it has been recommended by others that the  procurement process for this subcategory should be a competitive bid process for a 5 year contract for RECs. The payment would be a performance-based incentive (paid out for 5 years based on system production). 

    The second subcategory would be for commercial systems between 25 kW – 399 kW. ISEA recommends flexibility be allowed with regards to payment type (upfront payment or PBI) and that system owners could chose the payment terms.

    The third subcategory would be for systems < 25 kW, typically residential projects. The < 25 kW procurement would be set up like a Declining MW Block program. The declining block structure allocates specific capacities and provides incentives, which decline according the amount of PV deployed based on the capacity targets. The IPA would determine the money available for each block and the corresponding SREC price. The system owner would receive upfront payments when the system is energized. Half of the recs procured will from systems smaller than 25 kW.

    ISEA suggests that the IPA hire a Third Party Administrator to handle the procurement, contract execution and other administrative functions.

    ISEA also recommends that eligible systems be required to be completed no later than 12 months after the date of the SREC contract. Applicants can apply for a 6 month extension, which would be reviewed by the IPA or Third Party Administrator. Eligible projects that are not initially selected should be placed on a waiting list.

    With regards to new vs. existing systems, ISEA recommends that existing systems be defined as those that were energized between July 1, 2013- June 30, 2014. New systems should be defined as those that were energized after July 1, 2014. It is important that “new” be related to the passage of HB 2427 as opposed to the final definition of both process and terms by the IPA. Existing systems in the < 25 kW category would be priced below the lowest “declining block” as the value to the industry is the lowest having already been built.

    Next Steps:

    The IPA is hosting a public workshop on August 7th, 2014 from 10am-3pm. Please plan to participate as stakeholder input is important.

    The IPA will release the draft plan on September 29th and public comments will be due on October 14th. The IPA will revise the draft plan and submit the revised plan with the Illinois Commerce Commission by October 28th. The ICC has a deadline of January 26th, 2015 to approve the IPA’s plan.

  • 26 Jun 2014 6:25 PM | Lisa Albrecht (Administrator)

    Renewable Portfolio Standard (RPS):  It is official!!  The State of Illinois has authorized a one-time $30 million procurement of Solar Renewable Energy Credits.  Additional funds may also be released for separate wind/solar procurement if the IPA determines that it must procure conventional electricity on behalf of Ameren.  Although that will be a separate fund and process, these strategic steps could have an influence on the solar procurement as well.


    On June 12th the Illinois Power Agency held the first of a series of planning sessions, seeking public input to the structure and delivery of this program. The legislation included language allowing for various segments of the market (systems greater than 2MW and those under 2MW with subgroups under 25kW as well).  This approach will ensure a robust market place, driving the greatest amount of solar development as well as jobs and economic development in various solar segments.  It will be up to the IPA to determine the specifics of each of these aspects and future workshops will dive deeper into defining terms and guidelines including pricing/adders for utility/large/small systems, NEW versus OLD systems, eligibility dates for generated power, registration processes, deposit/credit requirements if any, the need/no need for aggregators, possible prepayment options, contract terms, performance guarantees as well as many other fine points.


    Procedurally there will be several more steps in defining this program.  Once the governor has signed the bill (expected in the next 25 days) the official 90 day workshop period will begin. Upon completion the IPA will then have 14 days to put official guidelines together which are then available for public comment.  At that point the Illinois Commerce Commission will have 90 days to review before proposing official language and sending to the Joint Commission for Administrative Rules for finalization.  All totaled it is likely the process could run through Feb/April 2015 and the procurement would be executed immediately after. The goal is to actually procure REC’s and enter into contracts before the end of the 2015 fiscal year but it could stretch beyond that date.


    Please watch for future workshops and plan to participate as input from all stakeholders will be important!


    Note that this one-time fix isn’t the end!  We will continue to work with many state and national organizations for a permanent fix to the RPS.  Strategic sessions will begin later this summer and work will begin immediately to ensure passage next spring. If you can, please let your legislators know this is important to you and keep telling them! More information will be available as these strategic sessions evolve but we will need everyone’s shoulder on the wheel in order to succeed in Springfield in 2015!


    Net Metering:  As you may know, most energy players in Illinois are not compliant with the Net Metering laws. The ICC has been accepting public comments to draft rule changes issued May 13th.  Brad Klein of The Environmental Law and Policy Center (ELPC) has been leading the charge on making the necessary legal corrections and ISEA has been working to assist them.  These official responses are available on the ICC website<http://www.icc.illinois.gov/electricity/NetMetering.aspx>.  


    Various entities formally introduced their comments to Commission Staff which was then discussed amongst other participants.  These discussions included the need for increased education among both the ARES organizations as well as end consumers, increased customer support for net metering applicants, a more streamlined process for customers switching between suppliers and the need for language clarification within the existing statute to ensure identical rates are applied to net metering customers among other things.

    There were few points of opposition until the end of the call when ComEd expressed very strong objections to net metering in general describing this policy an illegal subsidy.  The ELPC reminded ComEd that the point of this rule making was not to undue net metering but to firm up the existing regulatory process with the aim of improving customer processes and the fair execution across the state. Not exactly sure if this is a warning of contentious times ahead but we should be diligent and prepared to publicly address and defend the value of solar to the market place if necessary.  We may be gearing up for stronger battles ahead and will need a tremendous amount of support from all solar businesses, customers and supporters!


    Interconnection:  The final of 3 scheduled public workshops on interconnection was held on June 12th regarding the connection process with the utility.  IREC has been driving these negotiations along with the ELPC and revised drafts from the ICC staff should be publicly available soon.   These rules have been pretty good to date but are becoming dated as the energy sector changes.  ISEA has been participating in this legal process and as Illinois works to have one of the most up to date processes for interconnection with a utility in the country.  Once the ICC issues new guidelines they will have another 14 day public comment period. Please watch ISEA newsletters for that announcement.

  • 03 Jun 2014 2:08 PM | Lesley McCain (Administrator)

    US EPA releases draft proposal to cut carbon pollution from the nation’s power plants: On Monday June 2nd, President Obama announced bold new goals that will cut power plant emissions 30% by 2030. This is incredibly exciting and we will be digging in to better understand the implications for solar. Individual states will be given the responsibility for developing a compliance strategy, so it is imperative that we all stay engaged and participate in this process in order to ensure that we are positioned for the greatest deployment and impact on our clean energy future!

     

    Saturday May 31 marked the end of the legislative year and a lot happened the final week of legislation.  Here’s  the rundown. 

    SB103/HB2864 [RPS Fix]:  The Illinois Renewable Portfolio Standard (RPS) has not been working as originally intended and procurements for solar and wind projects have been on hold for the past two years.  A permanent RPS fix has been tabled until 2015 given the complex shifts occurring with Exelon and power in Illinois.

    ISEA and our partners will continue to work to get this vital legislation back on track in order to achieve the 25% clean energy goal by 2025. This conversation starts NOW, not next spring so please roll up your sleeves and let legislators know how vital this fix is to you and why.  ISEA will be sending out periodic reminders and specific requests over the next 9 months to keep this conversation alive and a top priority for the state! Please let us know if you need specific support at an event with your legislators.

     

    HB2472 [Renewable Energy Resource Fund]: in lieu of a permanent RPS fix, the legislature has authorized the Illinois Power Agency (IPA) to hold a one-time supplemental procurement of $30 million in solar energy beginning Spring 2015! This funds SRECs purchases. The details  will be worked out during public workshops which will begin on June 12th.  All are invited to participate to be ensure this program is well designed.  Please watch your inbox for details. If you tried to participate in RECAP but did not get in – this is your path toward a sustainable, sizeable solution!  

     

     ISEA ‘s goals for this short term solution are:
    • Be a combination of New/Existing projects, Utility Scale/DG, Residential/Commercial
    • Allocate 50% of the DG portion of the fund to systems <25Kw
    • Provide contracts for a minimum 5 year period, possibly longer
    • Authorized aggregators to broker between system owners and the state.  The thresholds for this first round may differ from the full RPS strategy as it is a special procurement.
    • Bring a solid REC price at public auction. If you were unable to get into to the RECAP program – Please participate in this process to ensure a strong clean energy future in Illinois.

    This special procurement is an exciting first step and, although not everything that we may have wanted, a HUGE win for solar in Illinois!  Thanks to all who supported the RPS fix as this would not have been possible without all of your hard work!


     

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