Interconnection Issues

Technical Requirements for Interconnection

In March 2005, the North Carolina Utilities Commission (NCUC) issued an order (E-100 Sub. 101) approving in part a proposed simplified interconnection standard for small, distributed generation. The standard applies to renewable-energy systems and other forms of distributed generation 20 kW or less for residential systems, and 100 kW or less for non-residential systems.  

Customer-generators must only carry a standard homeowner’s policy ($100,000 minimum coverage) or standard commercial policy ($300,000 minimum coverage), and a mutual indemnification provision applies. Significantly, generators are responsible only for upgrade and improvement costs associated directly with a system's interconnection. The state’s regulated utilities are prohibited from imposing indirect fees and charges.  

A redundant external disconnect switch is required, and the capacity of all interconnected generation is limited to a maximum of 2% of rated circuit capacity. However, applications for interconnected systems that exceed this saturation limit may be reviewed on a case-by-case basis. Utilities regulated by the NCUC have committed to reconsider the saturation limits, if necessary, after gaining more experience with small-generator interconnections. Utilities must file semiannual reports detailing the number of interconnection requests approved and denied, and the reasons for any denial.  

Non-Technical Interconnection Issues

The NCUC’s March 2005 order instructed the utilities to return to the bargaining table with the Commission’s public staff to discuss and resolve several outstanding issues, including application forms and review fees, standby-tariff rates, the need for a separate interconnection agreement for residential generators (in addition to an application), and the need to expand the rules to cover three-phase generators.  

The NCUC asked the parties to return to negotiations on several issues, including the need for and cost of application and engineering review fees, appropriate revisions to tariff agreements for renewable-energy systems, and the need to expand the standards and procedures to include three-phase generators. The NCUC also acknowledged the need to address ownership of renewable energy credits (RECs), indicating that they would soon be considered in a separate docket ( E-100 Sub. 100) on avoided cost.

After the NCUC has resolved the remaining issues pertaining to small-system interconnection, stakeholders will turn to the net metering and attempt to conclude the long-standing docket proceeding ( E-100 Sub. 83).

Contact:
Steve Kalland
North Carolina Solar Center
Campus Box 7401
North Carolina State University
Raleigh, NC 27695-7401
Phone: (919) 270-4649
Fax: (919) 515-5778
E-Mail: steve_kalland@ncsu.edu
Web site: http://www.ncsc.ncsu.edu

Renewable Energy Tax Credit – Personal and Corporate

The State offers a Renewable Energy Tax Credit, which provides a credit against corporate and personal income taxes in the amount of 35% of the cost of equipment and installation of a wind energy system. The credit may not exceed $10,500 for a residential installation or $250,000 for a commercial installation.

Renewable energy equipment costs eligible for the tax credit include the cost of the equipment and associated design, construction costs and installation costs less any discounts, rebates, advertising, installation assistance credits, name referral allowances or other similar reductions.

Under North Carolina's tax code, the allowable credit may not exceed 50% of a taxpayer's liability for the year, reduced by the sum of all other credits. Single-family homeowners who purchase and install a qualifying renewable energy system must take the maximum credit amount allowable for the tax year in which the system is installed. If the credit is not used entirely during the first year, the remaining amount may be carried over for the next five years.

For all other taxpayers, the credit is taken in five equal installments beginning with the year in which the property is placed in service. If the credit is not used entirely during these five years, the remaining amount may be carried over for the next five years. The credit can be taken against franchise tax, income tax or, if the taxpayer is an insurance company, against the gross premiums tax.  

For more information on programs, contact:

Contact:
Bob McGuffey
North Carolina Solar Center ( NCSC)
Phone: 919-515-3480
E-mail: bob_mcguffey@ncsu.edu
Web site: htpp://www.ncsc.ncsu.edu

Energy Improvement Loan Program

The Energy Improvement Loan Program (EILP) is available to North Carolina businesses, local governments, public schools and nonprofit organizations for projects that include energy-efficiency improvements and renewable-energy systems. Loans with an interest rate of 1% are available for certain renewable-energy projects and energy-recycling projects. Eligible renewable-energy projects generally include solar, wind, small hydro (less than 20 megawatts) and biomass. A rate of 3% is available for projects that demonstrate energy efficiency, energy cost-savings or reduced energy demand. As a special incentive, the North Carolina State Energy Office will pay the letter of credit fees associated with a loan – up to 1% of a loan's value – through December 31, 2005.

To qualify for an EILP low-interest loan, a project must (1) be located in North Carolina; (2) demonstrate energy efficiency, use of renewable-energy resources, energy cost savings or reduced energy demand; (3) use existing, reliable, commercially-available technologies; (4) meet federal and state air and water quality standards; and (5) be able to recover capital costs within the loan's maximum term of 10 years through energy-cost savings.

Contact:
Rondra McMillan
North Carolina Department of Administration
State Energy Office
1830 Tillery Place
Raleigh, NC 27604
Phone: (919) 733-1919
E-Mail: rondra.mcmillan@ncmail.net
Web site: http://www.energync.net

NC GreenPower Production Incentive

NC GreenPower, a statewide green-power program designed to encourage the use of renewable energy in North Carolina, offers production payments for grid-tied electricity generated by solar, wind, small hydro (10 MW or less) and biomass resources. Payment arrangements for electricity generated by most renewable-energy systems are available through a periodic RFP process. In April 2005, NC GreenPower issued an RFP for a combined annual total of 4,000,000 kWh of electricity generated by solar, wind and methane resources. The electricity generated by these systems is sold as green power under the NC GreenPower Program.  

Generators are required to enter into power-purchase agreements with their utility and with NC GreenPower. However, because premiums paid to NC GreenPower are funded exclusively by voluntary contributions from North Carolina electric customers, NC GreenPower is unable to provide guaranteed contracts to generators. Production payments are based on the amount (including payments from utility power-purchase agreements) expected to make installation of renewable-energy systems approach economic feasibility. Payments are made on a per-kWh basis and vary by technology.  

NC GreenPower is an independent, nonprofit organization created by state-government officials, electric utilities, nonprofit organizations, consumers, renewable-energy advocates and other stakeholders. It began operation in October 2003 and is the first statewide green-power program in the United States.  

Contact:
Carl Wilkins
NC GreenPower
909 Capability Drive, Suite 2100
Raleigh, NC 27606-3870
Phone: (919) 857-9000
Fax: (919) 832-2696
E-Mail: cwilkins@advancedenergy.org
Web site: http://www.ncgreenpower.org

TVA - Green Power Switch Generation Partners Program

Tennessee Valley Authority (TVA) and participating power distributors currently offer a dual-metering option to residential/small-commercial owners of wind generators through the Green Power Switch Generation Partners program. The output (green power) generated from this program will be counted as a TVA Green Power Switch resource.  
 
Under the residential/small-commercial contract, TVA will purchase the entire output of a qualifying system at $0.15 per kWh through a participating power distributor, and the consumer will receive a credit for the power generated. Qualifying sources include wind turbine systems between 500 Watts and 50 kW in AC output. In September 2004, larger commercial customers were included in the program, but for solar PV ownership only. Participation in this program is entirely up to the discretion of the power distributor. As of June 2004, about a dozen distributors have signed up for the program. Thus far, the program includes several residential solar participants and one 20-kW wind project.  
 
Qualifying systems must be used primarily to provide all or part of the energy needs at a particular site and must not have previously generated into the grid. Installations must also comply with local codes and adhere to specific interface guidelines established by the program. 
 
Until a total capacity of 150 kW has been reached, the owner of a qualifying residential system will receive a $500 payment when the site is connected to the grid. The goal for the entire program is 5 MW. The credit of $0.15/kWh is available for a minimum of 10 years from the signing of the contract, regardless of the amount produced. Payment is made in the form of a credit issued by the local power distributor on the monthly power bill for the home or business where the generation system is located. TVA retains sole rights to any renewable energy credits.

Contact:
Carmen Copeland
Tennessee Valley Authority
Green Power Switch Generation Partners
26 Century Blvd.
OCP 2-H, NST
Nashville, TN 37229
Phone: (615) 232-6724
Fax: (615) 232-6929
E-Mail: cacopeland@tva.gov
Web site: http://www.tva.com/greenpowerswitch/partners/

AWS Truewind has developed high-resolution wind energy resource maps for the North Carolina Department of Administration State Energy Office. Wind speed maps show the predicted mean wind speed in North Carolina at heights of 50 meters and 70 meters above the effective ground level.

The US Department of Energy has produced wind resource maps for each state. The map for North Carolina can be found here. You may also find the definitions of wind power classes for the maps helpful.

The US Department of Energy’s Energy Efficiency and Renewable Energy Network has also collected wind resource data for North Carolina.

There is additional information in the Wind Energy Atlas of the United States, where you can review maps for other locations in the US or get more information about how the maps were created.

Also useful is the National Renewable Energy Laboratory ( NREL) web site, which contains extensive information about wind resources in the United States.

The North Carolina Solar Center ( NCSC) maintains a searchable database directory of renewable energy and efficiency professionals.

An electronic copy of the U.S. Department of Energy's 23-page Consumer’s Guide to Small Wind Electric Systems is available at the Wind Powering America web site. A state-specific Consumer’s Guide is available for North Carolina.

NCGreenPower maintains a website with in-depth information on renewables including small wind. Their site includes consumer guides, installation guides, as well as general information for homeowners and farmers.

The Database of State Incentives for Renewable Energy (DSIRE) is a comprehensive source of information on state, local, utility, and selected federal incentives that promote renewable energy. Another item of interest is the Interstate Renewable Energy Council’s strong web site on wind energy projects and wind energy events/news occurring through out the country.

Contact your local utility to request information on their interconnection policies. In addition to Duke Power and Carolina Power and Light, there are over fifty municipal utilities and nearly thirty cooperative utilities in North Carolina.

The North Carolina Department of Administration’s Energy Office is responsible for energy planning and management, distribution of information on a variety of energy topics, and rendering technical assistance to government, business and families on energy issues.

The North Carolina Utilities Commission is responsible for regulations relating to the state’s electric utility industry. Within the Commission is the Public Staff, which represents consumer interests to the Commission.

The US Department of Energy’s Energy Efficiency and Renewable Energy Network maintains a list of state contacts.

The North Carolina Solar Center (NCSC) provides programs and resources that help people throughout North Carolina take advantage of solar and wind energy. Services available to the public include a toll-free hotline, a referral network of professionals, technical and design assistance, free publications, curriculum materials for teachers, training sessions, tours of a demonstration solar house, and a reference and media library. NCSC also maintains a list of information resources regarding conservation and renewable energy.

The North Carolina Sustainable Energy Association (NCSEA) works to create a sustainable energy future in North Carolina through the promotion of renewable energy technologies including solar, wind, micro-hydro, geothermal, biofuels and energy efficiency. They are active in legislative efforts, they publish a newsletter, and they organize tours of homes using renewable energy.

North Carolina Green Power is an independent, nonprofit organization created by state-government officials, electric utilities, nonprofit organizations, consumers, renewable-energy advocates and other stakeholders. It began operation in October 2003 and is the first statewide green-power program in the United States.  

The Small Wind Initiative at Appalachian University is a public service program, sponsored by ASU and the NC State Energy Office. The Initiative is comprised of 4 basic components: An R&D facility, a direct mailing campaign that identifies and contacts owners of windy property in Western North Carolina, an Anemometer Loan Program, and hands-on workshops, classes, tours, and community events.

The North Carolina Wind Working Group is an alliance among environmental groups, policy makers, industry members, educators, and citizen action groups who actively pursue wind power options by promoting supportive legislation and responsible siting criteria for development in North Carolina.

The NC COASTAL WIND INITIATIVE consists of two programs: the NC State Observation of Wind (NC SOW) and the NC Coastal Wind Working Group (CWWG).  The goals of the Coastal Wind Initiative programs are to educate eastern NC landowners and communities about the wind potential that exists in eastern North Carolina, provide quantitative data that can determine with certainty the economics of installing a wind turbine, and begin to address concerns specific to coastal wind resource development. Both of these programs have a particular interest in preserving rural communities and the family farm by exploring ways to reduce their financial burden.

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