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While small-scale, customer-owned power generation could prove to be a vital launching pad for the renewable-power revolution, the lack of uniform standards has delayed liftoff with cloudy skies. At least one state has recognized this dilemma and taken steps to rectify it.
Last month, the Iowa Utilities Board (IUB) adopted new rules designed to encourage further development of customer-owned electric generation, otherwise known as distributed generation. The new rules are designed to make it easier for customer-owned generation facilities to connect with their utilities by making the process transparent and less bureaucratic for smaller facilities.
The goal of the IUB’s new set of rules is to make it easier to add customer-owned electric generation at the local (i.e., distribution) level, such as solar and wind, while maintaining safety standards to protect customers and electric utility employees.
For example, general liability insurance, such as a homeowner’s policy, will now be sufficient for smaller generation facilities to interconnect. Also, the application fees adopted by the IUB impose only minimal filing fees on the smallest facilities.
To provide a more uniform and transparent process, the new rules require standardized application forms and interconnection agreements. The rules also provide four different levels of review, with the first three levels providing a streamlined process for the smallest generation facilities and those that do not export power to the grid.
The rules apply to Public Utilities Regulatory Policies Act of 1978 (PURPA) qualifying facilities, alternative-energy production (AEP) facilities, and rate-regulated electric utilities serving Iowa such as MidAmerican Energy Co. and Alliant Energy/Interstate Power and Light Co.
Not surprisingly, renewable-power advocates supported the change. They testified that the new rules were necessary to create uniform, timely and efficient interconnections that will encourage the development of small, on-site, customer-owned wind and solar power.