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 Opportunities and Incentives for CHP in Massachusetts Interconnection Procedures June 19, 2013 Tim Opportunities and Incentives for CHP in Massachusetts Interconnection Procedures June 19, 2013 Tim Roughan

Agenda • MA interconnection process • Federal Energy Regulatory Commission (FERC) interconnection process at Agenda • MA interconnection process • Federal Energy Regulatory Commission (FERC) interconnection process at ISO-NE • Appendix – Technical considerations • Appendix – Net metering in MA

Safety Moment • This morning’s session provides a great safety moment. – All the Safety Moment • This morning’s session provides a great safety moment. – All the benefits derived from Distributed Generation quickly lose their value if someone is injured as a result of an improper interconnection.

DG Activity Trends – National Grid • Received over 491 applications worth more than DG Activity Trends – National Grid • Received over 491 applications worth more than 77 MW of interconnection applications in Q 1 2013 (Last year estimated 1, 811 apps, actual was 2086) • Small (<100 k. W) Interconnection application are triggering large studies because of the aggregate generation on the circuit. • More projects are in construction phase • Some circuits have over 20 interconnected generators 4

Massachusetts Interconnection Standard • In late 2002, the MA DTE directed the investor owned Massachusetts Interconnection Standard • In late 2002, the MA DTE directed the investor owned utilities to commence a collaborative process to propose unified interconnection standards, policies, and procedures for distributed generation. • In 2009, DPU approved tariff that included net metering provisions. • In the summer of 2012, DPU convened a Distributed Generation Working Group (DGWG) to recommend improvements to the MA DG Tariff. The DGWG, comprised of utility, state and DG community stakeholders, reached consensus on all but one issue and the DPU approved the revised tariff on 3/20/13 and went into effect May 1, 2013. • This interconnection standard covers all forms of generation operating in parallel with the grid (it does not apply to emergency generation). 5

What is the Interconnection Process? • Process of getting an interconnection agreement from your What is the Interconnection Process? • Process of getting an interconnection agreement from your local utility (or distribution company) to connect a distributed generation system to their distribution system. • This process is used by the four investor owned utilities (IOU) in Massachusetts (NSTAR, National Grid, Unitil and Western Mass Electric) • Municipally-owned utilities are not required to follow this process, and may follow a different criteria. • The process is used to make sure interconnecting DG systems are integrated into the distribution system responsibly with respect to impacts on reliability, power quality and safety • Can not allow DG to affect neighbors on feeder 6

Importance of the Interconnection Process for CHP • Following the interconnection process is important Importance of the Interconnection Process for CHP • Following the interconnection process is important because a DG system changes the one-way power flow from the utility to customer, which can present dangers to utility workers if proper equipment is not installed • While robust and capable of handling minor disturbances, the quality of grid power is extremely important. The interconnection process ensures the DG meets safety, reliability, & power quality requirements with regard to: • Islanding • Transient Voltage Conditions • Noise and Harmonics • Frequency • Voltage Level • Machine Reactive Capability • It is essential that each interconnection get an interconnection agreement with the utility before installing any generation. You are proceeding at your own risk if you choose to install a system without utility approval. 7

Pre-Application Report Customer needs to provide: • • • Contact Person: Mailing Address: City: Pre-Application Report Customer needs to provide: • • • Contact Person: Mailing Address: City: Telephone ; E-Mail Address Alternative Contact Information (e. g. , system installation contractor or coordinating Facility Information: Proposed Facility Location (street address with cross streets, including town, and a Google Map still picture and GPS coordinates): Generation Type: Size (AC k. W): Single or Three Phase Generator Configuration: Stand-alone (no on-site load, not including parasitic load)? If there is existing service at the Proposed Facility site, provide: – Interconnecting Customer Account Number – site minimum and maximum (if available) current or proposed electric loads • Minimum k. W: • Maximum k. W: Is new service or service upgrade needed? Utility to provide: • • • Circuit voltage at the substation; Circuit name; Circuit voltage at proposed Facility; Whether Single or three phase is available near site; If single phase – distance from three phase service; Aggregate connected Facilities (k. W) on circuit; Submitted complete applications of Facilities (k. W) on circuit that have not yet been interconnected; Whether the Interconnecting Customer is served by an area network, a spot network, or radial system; Identification of feeders within ¼ mile of the proposed interconnection site through a snap-shot of GIS map or other means; and Other potential system constraints or critical items that may impact the proposed Facility.

Everything starts with the Application • A complete complex application package includes: – All Everything starts with the Application • A complete complex application package includes: – All appropriate sections of 4 -page application completely filled out. Customer will likely need assistance from vendor/engineer. – Copy of Pre-Application Report – Application fee $4. 50/KW ($300 minimum and $7, 500 maximum). This fee covers the initial review. (Proposed change in 2012 raises these costs) – Stamped electric one-line diagram, preferably showing relay controls (one copy) (Stamped by Massachusetts Electrical PE) – Site diagram (one copy) – One copy of any supplemental information (if electronic – single copy acceptable) – Identify electric customer and owner of proposed generation – Schedule Z if planning to Net Meter • Errors or problems with application will slow down the process and “stop the clock” • Send Electronic copy of all documents preferred if possible – Easier to distribute, saves paper, and is faster. However, submit first page of application with application fee. 9

Expedited Review Path • Applies to: • Single phase customers with listed single-phase inverter Expedited Review Path • Applies to: • Single phase customers with listed single-phase inverter based systems >15 k. W on a radial feed • Three phase customers with listed three-phase inverter based systems >25 k. W on a radial feed. • Maximum size is based on review of screens • Does not Apply to: • Non-listed inverters or other generators (induction / synchronous / asynchronous) • Aggregate generation capacity of listed inverters that exceed the above-mentioned limits 10

Expedited Review Path • Typically little or no (utility) system modifications required. If meter Expedited Review Path • Typically little or no (utility) system modifications required. If meter only – usually no charges passed to customer • Application fee plus any Supplemental Review charges up to 30 hours of engineering time @ $150/hr (if needed) • Relay control system must be well defined to make supplemental review easier. • Witness test fee of up to $300 plus travel is required. Table 1 of Section 3 in the Interconnection Tariff Expedited Eligible Facilities Listed DG Acknowledge Receipt of Application (Note 2) (3 days) Review Application for Completeness 10 days Complete Review of All Screens 25 days Complete Supplemental Review (if needed) (Note 3) 20 days or Standard Process Send Executable Agreement (Note 4) 10 days Construction Schedule By Mutual Agreement Total Maximum Days (Note 5) 40/60 days (Note 6) Notice/ Witness Test < 1 day with 10 day notice or by mutual agreement 11

Supplemental Review • • If one or more Screens are not passed, the Company Supplemental Review • • If one or more Screens are not passed, the Company will provide a Supplemental Review Agreement. Threshold is whether project is less than 67% of minimum load on the feeder – Then other screens review voltage quality , reliability and safety to reduce the potential need for impact studies. – DPU order allowed for the 67% screen, but requires utilities to document how the use of a 100% screen would change the screening process • Customer signs agreement and pays fee for additional engineering time (max fee is now $4, 500). • The Supplemental Review may be able to determine what impacts the generation system will have and what (if any) modifications are required. If so - an interconnection agreement will be sent to customer detailing: – System modification requirements, reasoning, and costs for these modifications – Specifics on protection requirements as necessary • If Supplemental Review cannot determine requirements, an Impact Study Agreement (or equal) will be sent to the customer. (You shift to the Standard Process. ) 12

Standard Review Path • Applies to: • Non-listed inverters or other generators: • Induction Standard Review Path • Applies to: • Non-listed inverters or other generators: • Induction • Synchronous • Asynchronous • Other large MW and Multi MW Projects • Renewable DG Customers / Developers 13

Standard Review Path • After initial review and/or supplemental review, customer may need to Standard Review Path • After initial review and/or supplemental review, customer may need to enter Standard Process • Customer can request Standard Process • Appropriate study agreement sent for signature and payment • Studies could include: – Impact Study: Determine the impact of the new generator on potentially affected systems, including EPS, other customers and other generators – Detailed Facility Study: Determine utility system modifications required and cost • ISO notification and possibly Transmission Study if over 1 MW • After studies – interconnection agreement sent for signature • Witness test fee is actual cost. Table 1 of Section 3 in the Interconnection Tariff Standard Eligible Facilities Any DG Acknowledge Receipt of Application (Note 2) (3 days) Review Application for Completeness 10 days Complete Standard Process Initial Review 20 days Send Follow-on Studies Cost/Agreement 5 days Complete Impact Study (if needed) 55 days Complete Detailed Study (if needed) 30 days Send Executable Agreement (Note 3) 15 days Construction Schedule By Mutual Agreement Total Maximum Days (Note 4) 125/150 days (Note 5) Notice/ Witness Test 10 days or by mutual agreement 14

MA – Revised Interconnection Tariff • 1 st payment of 25% of estimate is MA – Revised Interconnection Tariff • 1 st payment of 25% of estimate is only required within 120 business days of signing an ISA – Estimates are only good for 60 business days and we have the right to re-estimate if customer payment is not received before then – Company is not obligated to order equipment without receiving “adequate payment” as defined in customer’s ISA – Company not required to begin construction prior to receipt of full payment – If payment is not made within the applicable timeframe, the Company shall require the Customer to reapply for interconnection. • Increased study times for large projects – Those that require modification at substation • Instead of 55 business days for an Impact Study, now have 75 (2013 and 2014), then to 70 (2015), and then 60 (2016) – Projects > $200, 000 estimated costs (not including on-site work, metering, recloser, riser pole, etc. ) • Instead of 30 business day for a Detailed Study, now have 75 (2013 and 2014), then to 70 (2015), and then 60 (2016) – Projects > $1 million, all study timelines are by mutual agreement • Require more detailed reporting on project status – For both studies and construction timelines – ISA must include a mutually agreed upon timeline for construction – DPU has asked DG WG to investigate an incentive/penalty mechanism to ensure timeline compliance 15

Timeline Compliance • Regulatory obligation for both the distribution company and the customer – Timeline Compliance • Regulatory obligation for both the distribution company and the customer – Study times are suspended until such time as company receives the requested info from customer – if an applicant requests additional time at or near a milestone, the Company will get additional time to achieve that milestone – if an applicant requests a significant project change -- as determined by the distribution company -- the applicant will be required to submit a new interconnection application – at any time, an applicant may request a review of time-frame compliance by the distribution company, and the distribution company must respond within ten business days – There is a process to remove customers from the “queue” if they don’t abide by the timelines or extensions – Customer can request refund of application fee if the Company does not comply with timeline(s) 16

Responsibility of Costs • Interconnecting customer responsible for: • Application Fee • Expedited and Responsibility of Costs • Interconnecting customer responsible for: • Application Fee • Expedited and Standard: $4. 50/k. W ($300 min and $7, 500 max • Costs of impact and detailed studies if required • Grid modification requirements – can include ongoing charges • Witness Test Fee • Costs associated with design, construction and installation of the facility and all associated interconnection equipment on the customer’s side of the meter • Not all projects will require impact or detailed studies or EPS upgrades 17

Third Party Ownership • Application must include information for both generation owner (interconnecting Customer) Third Party Ownership • Application must include information for both generation owner (interconnecting Customer) and electric or retail customer (Customer) • Utility will correspond with owner, customer and installer – Listing email addresses for all parties on application makes communication easier and faster • Utility will enter into agreement with our electric customer (Attachment G of tariff) • *Note: Any Ownership change would require updated documentation submitted to the Utility Company 18

Common Application Mistakes • Number of inverters being used not indicated • Utility account Common Application Mistakes • Number of inverters being used not indicated • Utility account or meter number not included or incorrect • Address of facility not correct • Name on application differs from name on utility account • Application not signed • Ownership of property not identified • Not identifying third party ownership of generator 19

Common process delays • New construction or service upgrade • Host/Owner misidentification • Changing Common process delays • New construction or service upgrade • Host/Owner misidentification • Changing inverter or other equipment • Not supplying electrical permit • Certificate of Completion (Co. C) signed and dated before date given approval to install 20

Behind the scenes at utility… • Review and replacement of metering, modifications to billing Behind the scenes at utility… • Review and replacement of metering, modifications to billing • Modifications to protection systems as required (e. g. replace or install fusing, install switch, modify breaker/recloser setpoints, transfer trip, etc. ) • Larger generators require review by NEPOOL reliability committee and registration with ISO-NE • Adding generation asset to geographic information systems, maps, system one-lines, dispatch systems, etc. • Publish internal special operating guidelines for utility field personnel on larger generators. • Set up future testing for relay protection, meter calibration, insurance tracking, etc. 21

Many Stakeholders Involved Utility • • • • Application analyst – processes application and Many Stakeholders Involved Utility • • • • Application analyst – processes application and contracts Lead Engineer for reviews/studies Relay Engineering Distribution Planning Distribution Dispatch Distribution Design Engineering Meter Operations Meter Engineering Meter Data Services Relay Telecom Operations Inspection team Customer Service / Billing Legal… Interconnecting Customer • • Customer Equipment vendor Lead contractor Electrician Electrical Engineer (PE) Relay Engineer Relay testing firm Legal ISO-NE (If necessary) 22

Interconnection Summary and Recommendations • Submit your interconnection application with National Grid early, during Interconnection Summary and Recommendations • Submit your interconnection application with National Grid early, during conception phase before committing to buy no matter how simple or small the DG might be. • You can always request general utility information about a specific location from your utility • Large interconnection application take longer to study • Stand alone (no load behind the meter) interconnection application take longer to study • Interconnection timeframes do not apply to Electric Power System construction if required. 23

Summary and Recommendations continued • The Interconnection Standard is a wealth of information – Summary and Recommendations continued • The Interconnection Standard is a wealth of information – get to know it • Time frames are standard working days and do not include delays due to missing information or force majeure events • Interconnection expenses such as application fees, required studies, potential system modifications and witness tests should be budgeted into each project • Consider hiring an engineer to help with interconnection process • ISO-NE notification not included in time frame • Interconnection applications have increased significantly in the past few years – APPLY EARLY!!! 24

Compensation for excess CHP generation • If the customer will never export power – Compensation for excess CHP generation • If the customer will never export power – no concern • If under 60 k. Ws, customer can net usage over billing period – Paid average clearing price for load zone for excess • If customer will export power – they can sell their exported power to the market through a registered market participant. – Customer will need a Qualifying Facility (QF) certificate from FERC for the generator, to “sell” to local utility (Power Purchase Schedule) • Receive hourly clearing price for load zone for excess – Customer can work with any registered market participants to sell power – Customer must pay for all power they use. – Energy is netted for each hour, not over the billing period FERC QF page: http: //www. ferc. gov/industries/electric/gen-info/qual-fac. asp 25

State vs. ISO-NE Process • If project is large enough (>6 -10 MWs), will State vs. ISO-NE Process • If project is large enough (>6 -10 MWs), will need to interconnect to transmission system through Small Generator Interconnection Procedures (SGIP) • Need to apply to the New England Independent System Operator (ISO-NE) • If you will be selling your power to a third party, or bidding in capacity to the Forward Capacity Market (FCM) you may have to apply through ISO-NE • If circuit is already “FERC Jurisdictional” and project is selling to a third party, it will need to apply to ISO-NE. • If another generator is selling to the wholesale market, then the circuit is FERC jurisdictional http: //www. iso-ne. com/genrtion_resrcs/nwgen_inter/index. html 26

Interconnection Contacts & Tariff Links • National Grid • Email: Distributed. Generation@us. ngrid. com Interconnection Contacts & Tariff Links • National Grid • Email: Distributed. [email protected] ngrid. com • Phone: Alex Kuriakose | (781) 907 -1643, Bob Moran | (508) 897 -5656 W. ‘Adam’ Smith | (781) 907 -5528, Vishal Ahirrao | (781) 907 -3002 Sean Diamond | (781) 907 -2611, Chandra Bilsky | (401) 784 -7174 Kevin G. Kelly | (978) 725 -1325 • http: //www. nationalgridus. com/non_html/shared_interconnect. Stds. pdf • NSTAR • Joseph Feraci | (781) 441 -8196 (joseph. [email protected] com) • Paul Kelley | (781) 441 -8531 (paul. [email protected] com) • http: //www. nstar. com/business/rates_tariffs/interconnections • Unitil • Tim Noonis | 603 -773 -6533 ([email protected] com) • http: //www. unitil. com/energy-for-residents/electric-information/distributed-energyresources/renewable-energy-generation • WMECo • Phone: 413 -787 -1087 • Email: [email protected] com • http: //www. wmeco. com/distributedgeneration 27

Other Information Resources • MA DG and Interconnection Website: http: //sites. google. com/site/massdgic/ • Other Information Resources • MA DG and Interconnection Website: http: //sites. google. com/site/massdgic/ • Net Metering Basics: http: //sites. google. com/site/massdgic/ Home/net-metering-in-ma • Interconnection Guide for Distributed Generation (Mass-CEC): http: //www. masscec. com/masscec/file /Interconnection. Guideto. MA_Final%281 %29. pdf 28 28

Appendix Technical Aspects of Integrating DG with the Utility Distribution EPS 29 Appendix Technical Aspects of Integrating DG with the Utility Distribution EPS 29

Interconnection Standards: Local Rules – National Grid What are the local rules that apply Interconnection Standards: Local Rules – National Grid What are the local rules that apply to DG interconnections? Ø National Grid ESB 756 Parallel Generation Requirements Ø Originates from the ESB 750 Series and applicable Company tariffs in each state jurisdiction Ø ESB 756 main document Ø Appendices to ESB 756 for Jurisdictional Requirements Some key factors that influence the revision/update of Electric Service Requirements are: ¾ Government Ø DPU (Massachusetts), PSC (NY), and PUC (one each for NH & RI) Ø FERC Ø Federal, State, and Local Laws MA Court Rules: Solar PV Installations are Electrical. PHYSICAL INSTALLATION of PV Systems Must Be Done by LICENSED ELECTRICIANS. [July 2012 ruling by Suffolk Superior Court] Each utility has their requirements ¾ Company tariffs pursuant to the regulations that govern them as varying from state-to¾ Company policies & practices state based on the NESC. ¾ National codes 30 www. nationalgridus. com/electricalspecifications

Interconnection Standards: (cont’d) National Grid ESB 750 Series Key Points for Electric Service Requirements: Interconnection Standards: (cont’d) National Grid ESB 750 Series Key Points for Electric Service Requirements: Ø Require some means of disconnect and main overcurrent protection, i. e. , service equipment. Ø Billing meters secure. Ø Interface points clear to avoid potential operating and safety problems. Key Points for Parallel Generation Requirements: Ø Company determines the interconnect voltage and method of interconnection. Ø Prior notification to and approval by the Company is required for any generation to be installed or operated in parallel with the Company EPS. 31

Technical Issues: Ø Technical Process End-to-End (Study to Energization/Synchronization) with National Grid Ø Technical Technical Issues: Ø Technical Process End-to-End (Study to Energization/Synchronization) with National Grid Ø Technical Submittals for Utility Review Ø Potential Impacts of Parallel Generation on Distribution Electrical Power Systems (EPS) Ø Limits on National Grid Distribution EPS Ø Radial Systems Ø Network Systems Ø Service Connections of Small Net Metered DGs < 600 V Ø Typical Distribution EPS Upgrade Costs for Complex DG Installations 32

Technical Issues: Technical Submittals for Utility Review Recommended Guidelines for Residential and Commercial Single-line Technical Issues: Technical Submittals for Utility Review Recommended Guidelines for Residential and Commercial Single-line Diagram Submittals (for example, see Exhibit 5 & Figures 1 & 2 in ESB 756 Appendix C) ü 1. Identify the project, Company’s electric service order (ESO) number, location and submitter’s name and address. ü 2. Indicate standard any nonstandard system voltages, number of phases, and frequency of the incoming circuit. Indicate wye and delta systems; show whether grounded or ungrounded. ü 3. Identify cable, conductors and conduit, the type and number including Point of Common Coupling. (The Company is interested in how the power is getting from the service point to the protective equipment. ) 33

Technical Issues: (cont’d) Limits on Distribution EPS - Radial Ø Typical Planning Limits for Technical Issues: (cont’d) Limits on Distribution EPS - Radial Ø Typical Planning Limits for DG Connection to Radial Distribution Feeder DG installations are classified into two types - those interconnecting to the National Grid system on a dedicated radial feeder and those interconnecting on a non-dedicated radial feeder. 34

Technical Issues: Anti-Islanding on Distribution EPS - Radial Ø Anti-Islanding Protection The Company’s position Technical Issues: Anti-Islanding on Distribution EPS - Radial Ø Anti-Islanding Protection The Company’s position is that the interconnection of all parallel generators requires safeguards for synchronization and back-feed situations. A parallel generator is prohibited to energize a de-energized Company circuit. The Company uses three main “tests”; any determine if anti-islanding protection is required for exceeding minimum load issue or a protection issue or operating concern: 1. “Feeder Load versus Generation Test” 2. “Fault Sensitivity Test” 3. “Feeder Selectivity Test” Tips ü DG Customer’s protective device coordination study demonstrates generation voltage and/or frequency protection will trip within 2. 00 seconds for the loss of the utility source. ü Type-tested inverter-based parallel generation operated in regulated current mode, transient overvoltage protection is required upon detection of an island. ü When DTT is specified for a parallel generation project, the Company will determine the requirements and responsibilities for equipment, installation, and 35 communications media in the interconnection study.

Technical Issues: Limits on Distribution EPS - Network Ø Unlike radial distribution systems that Technical Issues: Limits on Distribution EPS - Network Ø Unlike radial distribution systems that deliver power to each customer in a single path from source to load, underground secondary area network systems deliver power to each customer through a complex and integrated system of multiple transformers and underground cables that are connected and operate in parallel. Ø Area Networks consist of one or more primary circuits from one or more substations or transmission supply points arranged such that they collectively feed secondary circuits serving one (a spot network) or more (an area network) electric customers. 36

Technical Issues: (cont’d) Limits on Distribution EPS - Network Area Networks consist of one Technical Issues: (cont’d) Limits on Distribution EPS - Network Area Networks consist of one or more primary circuits from one or more substations or transmission supply points arranged such that they collectively feed secondary circuits serving one (a spot network) or more (an area network) Interconnecting Customers. Portions of the following cities are served by area networks (customers in these areas should ask where the nearest radial system is located for possible tie-in): WMECo Greenfield Unitil Fitchburg National Grid NSTAR Brockton Boston Pittsfield Lynn New Bedford Springfield Worcester Cambridge West Springfield (For National Grid, see Exhibit 3 in ESB 756 Appendix B, or C, or D. ) 37

Technical Issues: (cont’d) Limits on Distribution EPS - Network Ø The connection of customer Technical Issues: (cont’d) Limits on Distribution EPS - Network Ø The connection of customer DG facilities on networks is an emerging topic, which ü (i) poses some issues for the Company to maintain adequate voltage and worker safety and ü (ii) has the potential to cause the power flow on network feeders to shift (i. e. , reverse) causing network protectors within the network grid to trip open. Ø To ensure network safety and reliability additional information will be required for the Company’s engineering analysis such as: ü Electric demand profile showing minimum load during peak generation time, ü Expected generation profile shown for a 24 -hour period and typical 7 -day duration, and ü Customer’s complete electric service single-line diagram up to the service point supplied by the Company’s secondary network EPS. 38

Technical Issues: Upgrades and System Modifications Some Upper End Typical Utility Interconnection Costs & Technical Issues: Upgrades and System Modifications Some Upper End Typical Utility Interconnection Costs & Duration Scheduling for Complex DG Installations Notes: 1) Distribution EPS relates to 15 k. V class system. 2) These are representative estimates only and are not inclusive of all costs [i. e. land rights, removal costs, taxes, etc. ] which will vary from job to job and that they are presented here for budgetary purposes only. 39

Post ISA Coordination Witness Testing (overview) 1. ) Relay Witness Testing • National Grid Post ISA Coordination Witness Testing (overview) 1. ) Relay Witness Testing • National Grid Witnesses relays trip based on settings approved by NG Protection Engineer 2. ) DTT Witness Testing • Communication (RFL) to the Local Substation • Typically Fiber or Lease line 3. ) RTU Witness Testing (≥ 1 MW) • Provide Real time monitoring of Large DG at National Grid’s Regional Control Center. • Ordering Correct (MPLS) communication circuit from Verizon • Verizon Regional Account Teams consults with Verizon’s “Service Delivery” Department 40

Appendix Net Metering 41 Appendix Net Metering 41

Net Metering in Massachusetts • • December 2009 Net Metering Tariff Three Net Metering Net Metering in Massachusetts • • December 2009 Net Metering Tariff Three Net Metering Classes – – – • Class 1: Any generator up to 60 KW is eligible Class 2: Agricultural, solar, or wind net metering facility over 60 KW but less than or equal to 1 MW (for municipal or government it’s “per unit) Class 3: Agricultural, solar, or wind net metering facility over 1 MW but less than or equal to 2 MW (for municipal or government it’s “per unit”) Recent changes – – limits projects to 2 MWs per parcel of land a single meter Must apply to the System of Assurance (Sof. A) at massaca. org for net metering services 42

Net Metering Tariff • Eligible customers can apply by submitting a Schedule Z. • Net Metering Tariff • Eligible customers can apply by submitting a Schedule Z. • Eligibility determined when approved within the So. A – Utility can not allow net metering without Sof. A approval • Class 2 and Class 3 will need a production meter on generation. • Net Metering is limited to 3% of each utility’s peak MW for private and 3% of peak for public projects – for NG-MA this total limit is 308 MWs. • Contribution towards total 6% limit is posted on each utility’s web site and updated monthly – As of 4/16, NG-MA is at 94 MWs for the private and of 52 MW toward the public cap 43

Net Metering changes • Three Factor Approach (order 11 -11 C) – Single parcel Net Metering changes • Three Factor Approach (order 11 -11 C) – Single parcel / single interconnection point / single meter • Enacted to limit gaming and limits one meter parcel of land with a limit of 2 MWs on the parcel for private entities – A governmental entity can have a total of 10 MWs of net-metered accounts throughout the state or on a parcel – No more 6 – 1 MW projects on a parcel – We can not provide more than one interconnection point (POI) • In addition, if there’s an existing meter(s) on a parcel, then customer can’t request a meter just for the net metering facility, it must be behind an existing meter – Otherwise separate metered project could earn higher credits than if it was behind an existing meter 44

Net Metering and Interconnection Order • Net Metering eligibility – The DPU ruled in Net Metering and Interconnection Order • Net Metering eligibility – The DPU ruled in the interconnection tariff order (10 -75 E) that “Early ISA’s” will NOT meet the executed ISA requirement for entrance into the System of Assurance, and will refer the matter to DPU 11 -11 for further investigation. – Until such time as the DPU reaches a resolution of the issue, Distribution Companies are directed to clearly mark Early ISAs on the title page and on the signature page with the words “Early ISA” for identification purposes.

Net Metering Credits • – – Energy use is “netted” over the billing month Net Metering Credits • – – Energy use is “netted” over the billing month If there is net energy use – utility will bill customer for net use If net energy export – export k. WH * the following • Renewable installations will be credited at near retail rate for excess k. WH (minus conservation and renewable energy charges). Non-Renewable credited at average monthly clearing price ISO-NE • • • Tariff allows credits to be allocated (with limitations) Customer still responsible for customer charges and demand charges, even if net export Tier 1 2 3 min 0 >60 KW >1 MW Credit the following charges max Type Default Service k. WH Dist- ribution k. WH Trans- mission k. WH Trans- ition k. WH 60 KW Agriculture Wind, PV X X 1 MW Agriculture Wind, PV X X 2 MW Agriculture Wind, PV X Gov’t only X X 46

47 47

48 48

49 49

Net Metering Production Reporting • Net Metering Tariff requires reporting of generator’s k. WH Net Metering Production Reporting • Net Metering Tariff requires reporting of generator’s k. WH output. • Class 1 Facilities to provide in writing by January 31 and September 30 • Class 2 and Class 3 Facilities may participate in production tracking system (PTS). – Mass CEC provided PTS data to the utilities, still working through implementation issues – Utility will request data from Class 2 and 3 Facilities 50

Net Metering Summary • If planning to Net Meter, submit Schedule Z with interconnection Net Metering Summary • If planning to Net Meter, submit Schedule Z with interconnection application • Correctly fill out Schedule Z – Name must match electric account of Host Customer – Must be signed by Host Customer • If allocating, verify name/address/account info of customer(s) – or will need to submit corrected form • Production reporting is required. • Over 60 k. Ws require registration as a settlement only generator (SOG) associated ISO OP 18 metering requirements 51