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HomeMy WebLinkAboutAgenda Report - July 19, 2017 G-02 PHTM CITY OF LODI COUNCIL COMMUNICATION AGENDA ITEM G-2 AGENDA TITLE: Continued Public Hearing to Consider Introducing Ordinance Amending Lodi Municipal Code Chapter 13.20 — Electrical Service — by Repealing and Reenacting Chapter 13.20.290, "Schedule EP — Energy Purchase" MEETING DATE: July 19, 2017 PREPARED BY: Electric Utility Director RECOMMENDED ACTION Continued public hearing to consider introducing ordinance amending Lodi Municipal Code Chapter 13.20 — Electrical Service — by repealing and reenacting Chapter 13.20.290, "Schedule EP — Energy Purchase". BACKGROUND INFORMATION: On April 19, 2017, a public hearing was conducted for City Council consideration of a two -percent electric rate increase and other minor changes related to Lodi Municipal Code Chapter 13.20. On May 3, 2017, the City Council adopted Ordinance 1941 approving the increase and changes which took effect July 1, 2017. On April 19, 2017, staff requested to continue the public hearing to July 19, 2017 to consider the portion of the electric rate changes pertaining to compensation for customer -owned generation. Customers who previously installed renewable generation of less than one megawatt to offset a portion or all of their energy usage are compensated under a net energy metering (NEM) rate structure. State law requires electric utilities to offer NEM to eligible customers up to a maximum cap. Lodi Electric Utility (LEU) has reached its cap and is proposing a new method of compensation. NEM is a billing mechanism which compensates customer -generators at the full retail rate for electricity they generate on-site; this shifts costs to the majority of customers who are non -generators. On-site generating customers still must access the distribution grid to maintain steady access to power when on- site generation is insufficient to meet power demands. With NEM on-site generators avoid charges on their electric bill for operating and maintaining the distribution system, and other fixed expenses, while still remaining interconnected to LEU's distribution grid. LEU currently has over 600 rooftop solar systems installed throughout its service territory with a combined capacity of over seven megawatts. It is estimated that on an annual basis, those systems generate approximately 11 gigawatt -hours of energy. That generation is approximately 2.5 percent of LEU's load. While the solar generation reduces the amount of power to be purchased by LEU, it does not reduce the fixed costs associated with serving NEM customers. The new proposed rate structure, or Schedule EP (Energy Purchase), will utilize one meter to register "delivered" energy that will be charged to a customer at regular retail rates and "received" energy that will be credited at the avoided cost of said energy for excess energy delivered to LEU's distribution grid from the customer -generator. LEU's avoided cost will be updated annually. The customer will not be billed or credited for energy consumed on-site. APPROVED: Manager Continued Public Hearing to Consider Introducing Ordinance Amending Lodi Municipal Code Chapter 13.20 — Electrical Service — by Repealing and Reenacting Chapter 13.20.290, "Schedule EP — Energy Purchase" July 19, 2017 Page 2 of 2 While this proposal will not eliminate the cost shift caused by solar under current rates, it will slow the rate at which cost shifting expands. From the perspective of solar customers and the solar industry, the three largest subsidies which reduce the cost of solar include utility rebates, the cost shift associated with NEM, and federal tax credits. With the extension of the federal tax credit, a push toward investment in renewable energy, and declining costs associated with solar installations, a change to how solar customers are compensated by reducing the current subsidy will not prevent customers from taking advantage of solar and the benefits it has to offer. Customer -generators taking service under the new Schedule EP will be responsible for all metering and interconnection charges as required to provide service under this schedule. These charges will be calculated and updated annually by LEU and be based on the cost(s) associated with providing service under this schedule. The new Schedule EP does not affect current customer -generators on LEU's existing NEM rate; these customers will continue to receive compensation under the current NEM rate schedule 20 years from the date of their system's interconnection. If approved, Schedule EP will be available to customers September 1, 2017. Solar applications have continued to be received and date/time stamped since LEU reached its cap. These applications will be processed in the order received under the new Schedule EP. FISCAL IMPACT: FUNDING AVAILABLE: The current cost shift associated with NEM is estimated at approximately $1 million annually; this cost shift will decrease as existing NEM customer -generators are moved to Schedule EP and reduce the costs that would have otherwise been avoided by customer -generators with the continuance of NEM by approximately 35 percent. Not applic tI zabeKirkley Electric Utility Director PREPARED BY: Melissa Price, Rates & Resources Manager EAK/MCP/Ist APPLICABILITY: CITY OF LODI ELECTRIC UTILITY DEPARTMENT SCHEDULE EP ENERGY PURCHASE This schedule is applicable to qualifying customer owned alternating current facilities operating in parallel with the City's electric system on a contract basis. APPLICABILITY: This schedule is applicable to qualifying customer -owned and pperated generating alternating current (AC) facilities operating in parallel with the City's electric distribution system. The customer -generator must currently be, or will be, served by the City of Lodi Electric Utility (LEU). Generating facilities must be rated 1 MWcEc-ac or less, located on the customer -generator's premises, and intended for the purpose of offsetting a part or all of the customer -generator's own electrical requirements. In no case shall the energy, capacity, and/or other attributes be available for resale by the customer. This schedule is available only to customers who do not otherwise qualify for compensation for customer -owned generation under another LEU rate schedule or contract. RATES: Energy Charges: Customer will be billed for all usage at the applicable service rate in effect when the electric service was rendered in accordance with the eligible customer -generator's otherwise applicable rate schedule based on metered usage for energy delivered and received after the customer -generator serves its own instantaneous load. Energy Purchase Credit: Credit will be provided to the customer for all metered customer -generated energy that exceeds the energy consumed, and is therefore exported to LEU's distribution system at a rate equal to the avoided cost to LEU; the specific value of which will be determined and updated annually by LEU based on the following components: avoided energy and transmission costs, environmental attribute value (if applicable, based on generation type), avoided system loss, and avoided capacity value. Energy Purchase Credit values will be published each year by June 1 on LEU's website and provided to customers receiving service under this schedule. The above charges and credits will be determined in accordance with LEU's metering specifications. LEU reserves the right to install additional metering equipment for statistical and/or billing purposes. BILLING: CITY OF LODI ELECTRIC UTILITY DEPARTMENT SCHEDULE EP ENERGY PURCHASE For each billing month, the customer shall receive a bill including all applicable Energy Charges, including, but not limited to, customer charges, energy charges, demand charges, and any surcharges, taxes, and/or discounts in accordance with their otherwise applicable rate schedule. The bill will also include all applicable Energy Purchase Credits which shall be used to offset the Energy Charges in a given billing month. Any credit(s) remaining at the end of each billing month shall carry forward and be applied to the customer's next monthly electric bill. Any outstanding charges will be due and payable at the end of each billing month. Monthly customer charges, public benefit charges, and all other surcharges shall be non -bypassable. SPECIAL CONDITIONS: Other conditions shall apply to this schedule as specified in the City of Lodi Electric Utility Department's Rules and Regulations, as updated from time to time, and Engineering Standards and Specifications (including metering requirements) which are available for review on LEU's website. Customers will be responsible for any and all metering and interconnection charges as required to provide service under this schedule. Said charges will be determined and updated annually by LEU and be based on the cost(s) associated with providing service under this schedule. A schedule of charges will be available on LEU's website. Any capacity or environmental attributes associated, now or in the future, with the credited excess energy produced by the customer -generator at sites subject to this schedule shall belong to the City. Capacity attributes include, but are not limited to, system, local, and/or flexible resource adequacy capacity, if any. Environmental attributes include, but are not limited to, Renewables Portfolio Standard eligible resources, renewable energy credits, greenhouse gas credits, and/or emission reduction credits, if any. LEU reserves the right to require a contract should it determine the customer -owned generator does not otherwise meet the specified applicability requirements to qualify under this schedule or another LEU rate schedule. Customers currently taking service under Schedule NEM shall continue to be billed in accordance with Schedule NEM for 20 years from the date of interconnection of their existing customer -owned generation facility, after which time they will be given the option to take service under this Schedule EP in order to continue to receive credit for their customer-ownedpeneration. ORDINANCE NO. AN ORDINANCE OF THE LODI CITY COUNCIL AMENDING LODI MUNICIPAL CODE CHAPTER 13.20 — ELECTRICAL SERVICE — BY REPEALING AND REENACTING SECTION 13.20.290 SCHEDULE EP — ENERGY PURCHASE IN ITS ENTIRETY BE IT ORDAINED BY THE LODI CITY COUNCIL AS FOLLOWS: SECTION 1. Lodi Municipal Code Chapter 13.20 — Electrical Service is hereby amended by repealing and reenacting Section 13.20.290 Schedule EP — Energy Purchase in its entirety, and shall read as follows: APPL ICABI1 ITV• This a;e is--apiiea.te—to quati y. ng custorne; -owned altemating--current faoties operating -in parallel with the City's electric system on a contract -basis-; APPLICABILITY: This schedule is applicable to qualifying customer -owned and operated generating alternating current (AC) facilities operating in parallel with the City's electric distribution system. The customer -generator must currently be, or will be, served by the City of Lodi Electric Utility (LEU). Generating facilities must be rated 1 MWeEc-ac or less, located on the customer -generator's premises. and intended for the purpose of offsetting a part or all of the customer - generator's own electrical requirements. In no case shall the energy. capacity. and/or other attributes be available for resale by the customer. This schedule is available only to customers who do not otherwise qualify for compensation for customer -owned generation under another LEU rate schedule or contract. RATES: Energy Charges: Customer will be billed for all usage at the applicable service rate in effect when the electric service was rendered in accordance with the eligible customer -generator's otherwise applicable rate schedule based on metered usage for energy delivered and received after the customer -generator serves its own instantaneous Toad. Energy Purchase Credit: Credit will be provided to the customer for all metered customer -generated energy that exceeds the energy consumed. and is therefore exported to LEU's distribution system. at a rate equal to the avoided cost to LEU; the specific value of which will be determined and updated annually by LEU based on the following components: avoided energy and transmission costs, environmental attribute value (if applicable, based on generation type). avoided system loss, and avoided capacity value. Energy Purchase Credit values will be published each year by June 1 an LED's website and provided to customers receiving service under this schedule. The above charges and credits will be determined in accordance with LEU's metering specifications. LEU reserves the right to install additional metering equipment for statistical and/or billing purposes. BILLING: For each billing month, the customer shall receive a bill including all applicable Energy Charges, including, but not limited to, customer charges, energy charges. demand charges,, and any surcharges, taxes. and/or discounts in accordance with their otherwise applicable rate schedule. The bill will also include all applicable Energy Purchase Credits which shall be used to offset the Energy Charges in a given billing month. Any credit(s) remaining at the end of each billing month shall carry forward and be applied to the customer's next monthly electric bill. Any outstandina charges will be due and payable at the end of each billing month. Monthly customer charges, public benefit charges, and all other surcharges shall be non -bypassable. SPECIAL CONDITIONS: Other conditions shall apply to this schedule as specified in the City of Lodi Electric Utility Department's Rules and Regulations, as updated from time to time, and Engineering Standards and Specifications (including metering requirements) which are available for review on LEU's website. Customers will be responsible for any and all metering and interconnection charges as required to provide service under this schedule. Said charges will be determined and updated annually by LEU and be based on the cost(s) associated with providing service under this schedule. A schedule of charges will be available on LEU's website. Any capacity or environmental attributes associated, now or in the future, with the credited excess energy produced by the customer -generator at sites subject to this schedule shall belong to the City. Capacity attributes include, but are not limited to, system. local, and/or flexible resource adequacy capacity. if any. Environmental attributes include, but are not limited to, Renewables Portfolio Standard eligible resources, renewable energy credits, greenhouse gas credits, and/or emission reduction credits, if any. LEU reserves the right to require a contract should it determine the customer -owned generator does not otherwise meet the specified applicability requirements to qualify under this schedule or another LEU rate schedule. Customers currently taking service under Schedule NEM shall continue to be billed in accordance with Schedule NEM for 20 years from the date of interconnection of their existing customer -owned generation facility, after which time they will be given the option to take service under this Schedule EP in order to continue to receive credit for their customer - owned generation. SECTION 2. No Mandatory Duty of Care. This ordinance is not intended to and shall not be construed or given effect in a manner which imposes upon the City, or any officer or employee thereof, a mandatory duty of care towards persons or property within the City or outside of the City so as to provide a basis of civil liability for damages, except as otherwise imposed by law. 2 SECTION 3. Severability. If any provision of this ordinance or the application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of the ordinance which can be given effect without the invalid provision or application. To this end, the provisions of this ordinance are severable. The City Council hereby declares that it would have adopted this ordinance irrespective of the invalidity of any particular portion thereof. SECTION 4. All ordinances and parts of ordinances in conflict herewith are repealed insofar as such conflict may exist. SECTION 5. Effective Date and Publication. This Ordinance shall take effect on September 1, 2017. In lieu of publication of the full text of the ordinance within fifteen (15) days after its passage, a summary of the ordinance may be published at least five (5) days prior to and fifteen (15) days after adoption by the City Council, and a certified copy shall be posted in the office of the City Clerk pursuant to Government Code section 36933(c)(1). Approved this day of , 2017 ATTEST DOUG KUEHNE Mayor JENNIFER M. FERRAIOLO City Clerk State of California County of San Joaquin, ss. I, Jennifer M. Ferraiolo, City Clerk of the City of Lodi, do hereby certify that Ordinance No. was introduced at a regular meeting of the City Council of the City of Lodi held July 19, 2017, and was thereafter passed, adopted, and ordered to print at a regular meeting of said Council held , 2017, by the following vote: AYES: COUNCIL MEMBERS - NOES: COUNCIL MEMBERS - ABSENT: COUNCIL MEMBERS - ABSTAIN: COUNCIL MEMBERS - 1 further certify that Ordinance No. was approved and signed by the Mayor on the date of its passage and the same has been published pursuant to law. Approved as to Form: JENNIFER M. FERRAIOLO City Clerk JANICE D. MAGDICH City Attorney 3 Public Hearing Energy Purchase (EP) Schedule Lodi City Council July 19, 2017 Lodi Electric Utility Energy Purchase (EP) Schedule Background ® Renewable Energy Requirements ® Utility Scale vs. Customer Generation ® Net Energy Metering (NEM) ® Post NEM Solution c Other Utilities ® Options & Bill Comparisons ® Recommendation Lodi Electric Utility Your Customer -owned Energy Partner Purchase & deliver energy ® Operate & maintain distribution system ® Customer programs Energy conservation incentives Bill payment assistance Low & fixed income Medical needs ® Support City services Police, fire, parks, library Lodi Electric Utility Supporting Green Energy ® Utility-scale projects benefit all customers c 50% eligible renewable energy by 2030 (SB 350) o Current portfolio 38% carbon-free energy Eligible renewable energy 24% Geothermal, small hydro, solar Additional 10 MW solar by 2022 Future renewable project with NCPA members o Pending renewable energy legislation (SB 100) 50% by 2026 60% by 2030 100% carbon-free energy by 2045 Eligible renewable 60% 4 Lodi Electric and Solar Utility Scale • IOMW- 2016 7 • 10 MW - 2022 Customer • 600+ systems Rooftop • 7+ MW installed Future , up to 20 Mw Community Over $6M in solar rebates to Lodi residents and businesses since 2007 Net Energy Metering (NEM) Rate structure compensates customers for solar generation at full retail rates ® State requires NEM until installed capacity reaches 5% of LEU's system peak LEU cap reached - 7.1 MW ® No requirement for POUs to continue NEM or adopt new program POUs recognize need to continue to fairly compensate customer generation 6 Challenges with NEM • Overvalues energy produced • Retail vs. wholesale pricing • NEM treats all energy equally • Regardless of time of day • Uses distribution system as a battery :ii+k.• Does not cover fixed costs of distribution system iliawIlL creating cross -subsidization • Non solar & low income customers Illir • NEM customers receive services without paying for them • System maintenance & upgrades • Rebates & energy efficiency services 7 Post NEM Solution Energy Purchase Schedule ® Advanced meter to record: Energy sold to grid Some energy and Energy delivered to customer consumed ted donsite on ste Charged standard rate Energy sent to home Energy exported to the grid Credited to customer at utility's avoided cost Demand (not billed at this time) Energy generated & consumed on-site No credit / no charge o Customer pays metering & interconnection costs Existing NEM customers Grandfathered in current NEM program until 20 years from date of interconnection Energy Purchase (EP) Schedule Energy delivered to customer (Customer pays retail rate) Customer peak demand 1 1 Of nsumptio Ailjer Solar generation drops off when customer usage reaches its peak 9 LEU -Avoided Cost Energy Purchase Componen Energy h $0.02978 Transmission $0.01944 Capacity $0.00719 Line Losses $0.00309 Renewable Total $0.00478 $0.06428 Updated annually each fiscal year o Published on LEU website by June 1 Post NEM —Other Utilities Alameda Palo Alto MID TID Roseville (proposed) IOU's (PG&E) Lodi (proposed) Avoided Cost ($ h) Delivered/Received $0.06447 Delivered/Received $0.07485 Delivered/Received $0.07600 Short Run TOU with Demand Marginal Cost Delivered/Received NEM with TOU Delivered/Received $0.05980 N/A $0.06428 Demand Charge Customer Charge N N N $15.75 Min Charge $20.00 Y $17.00 N N N $26.00 Min Charge $10.20 11 -11 How Does EP Compare? Monthly Bill Sample - 750 kWh User Charges Credits Total Bill: Non Solar Customer $115 N/A $115 $35 $115 Netted Above $36 $35 $79 $63 $13 $50 ® Buy All / Sell All originally considered All generation would be exported to grid Did not provide any benefit for new technology such as battery storage to offset peak demand 12 Conclusion -Schedule EP Still a Future for Solar Extended tax credits Declining solar prices Battery storage is Reduces Cross - Subsidization Additional work needed to address demand & fixed costs Credits Solar Customers for On -Site Generation Provides one-for-one credit when demand = generation Stops Purchase of Wholesale Power at Retail Prices Power exported to grid credited at avoided cost Continues to Support State's Green Energy Policies Reduces need to purchase market power 13 ( Implementation Schedule Public Hearing July 19th Consider Adopting Ordinance August 2nd Effective Date September 1st K ._ 14 Recommendation Introduce ordinance amending Lodi Municipal Code Chapter 13.20- Electrical Service - by Repealing and Reenacting Chapter 13.20.290, "Schedule EP - Energy Purchase" G -2 Jennifer Ferraiolo From: Sent: To: Cc: Subject: Attachments: Jennifer Ferraiolo Tuesday, July 18, 2017 5:26 PM snowboarder4_15@hotmail.com City Council; Steve Schwabauer; Janice Magdich; Elizabeth Kirkley FW: Council meeting 7/19 comments council.doc Thank you for your email. It was received by the City Council and forwarded to the City Manager's office and Electric Utility Department for information, response, and/or handling. In addition, your correspondence will be provided as a Blue Sheet item at tomorrow night's Council meeting. Jennifer M. Ferraiolo, MMC City Clerk P.O. Box 3006 Lodi, CA 95241-1910 (209) 333-6702 (209) 333-6807 FAX From: Ryan Wentz [mailto:snowboarder4 15@hotmail.com] Sent: Tuesday, July 18, 2017 5:22 PM To: JoAnne Mounce Cc: Alan Nakanishi; Doug Kuehne; Mark Chandler; Bob Johnson; Jennifer Ferraiolo Subject: Council meeting 7/19 comments Hello council members. Attached is a letter regarding agenda item G-02 for the 7/19 council meeting. Thank you for taking the time to read it. Ryan 1 Ryan Wentz 121 Boxwood ct. Lodi, Ca 95242 07/19/2017 Lodi City Council 221 W. Pine Lodi, Ca 95240 Dear City Council: I am writing you to submit my concerns for agenda item G-2 (imposing a new solar energy purchase policy). I am struggling to find reasons that are cost effective to the residential consumer with the implementation of the proposed new plan. However, I fully understand that there is a "cost shift" on the old NEM program and it needs to change. A few concerns I have with the proposed program is first, it would cause residents to spread the solar panels out on multiple aspects of their roof in order to produce power while they are home and using it instead of putting all the panels on the south facing aspect that is the most efficient in generating renewable energy. This would result ultimately in less renewable energy for both the customer and the city and a less efficient system. As the state leader in the country for renewable energy shouldn't we be encouraging the most renewable energy generation possible? Secondly, most people are not home during the day to use appliances which use a lot of power. I sure don't want to run my dryer in the heat of the day however this new plan would cause me to do just that. Furthermore, adding even more of a load to the system when I could be feeding that energy back into the grid to offset the overall peak demand on the city. It would also cause me to set my thermostat lower than normal at 5pm in the hopes of then shutting it off until it cools off to prevent my air conditioner from running while I'm not generating. Also, having a cap on the system size will prevent people from being able to offset their energy usage costs. I would need to generate roughly 3 times the power during the day to offset my usage at night which is not possible with the cap. If you decide to go forward with the proposed plan I would suggest lifting the cap and letting [Recipient Name] [Date] Page 2 people generate as much as they want. This would benefit both the city and the customer generator. Under the new plan, people who install solar are effectively buying a tiny power plant where they are responsible for not only the cost of the equipment but also the maintenance and the city will get the major benefit by being able to buy their power for 6 cents (the avoided cost rate) and then turning around to sell that same power back to them at much higher prices. It just doesn't make sense. Possible solutions could be raising the fixed monthly charge, switching to time of use rates and keeping net metering like PG&E has done, or uncoupling the charges to assess exactly how much "grid maintenance" should cost per customer. There was an article in the Lodi News Sentinel from September 30th, 2015 addressing this issue, and at the time you decided to implement two of the suggestions which were collapsing the 5 tiers to 3 and switching to a fixed monthly charge instead of just a minimum bill as in years past. Here is a quote from the article "Fixed monthly charge: It could ensure collection of enough funds to cover the costs of distributing power and maintaining the grid. Rates could be lowered in response. However, this could increase costs to low- energy users and discourage solar customers." It seems that was miscalculated and in fact is not covering the costs it set out to? Lastly, this delay in moving forward with the process is really a shame. Why wasn't a new plan already researched and approved before we hit the five percent net metering minimum? There are some described charges in agenda item G-02 but it does not give any costs. It says "Customer -generators taking service under the new Schedule EP will be responsible for all metering and interconnection charges as required to provide service under this schedule. These charges will be calculated and updated annually by LEU and be based on the cost(s) associated with providing service under this schedule." What will these costs be currently? Thank you for your time. Sincerely, Ryan Wentz Please immediately confirm receipt of this fax by calling 333-6702 CITY OF LODI P. O. BOX 3006 LODI, CALIFORNIA 95241-1910 ADVERTISING INSTRUCTIONS SUBJECT: SUMMARY OF ORDINANCE NO. 1944 PUBLISH DATE: SATURDAY, JULY 22, 2017 LEGAL AD TEAR SHEETS WANTED: One (1) please SEND AFFIDAVIT AND BILL TO: LNS ACCT. #0510052 JENNIFER M. FERRAIOLO, CITY CLERK City of Lodi P.O. Box 3006 Lodi, CA 95241-1910 DATED: THURSDAY, JULY 20, 2017 ORDERED BY: JENNIFER M. FERRAIOLO CITY CLERK PAMELA M. FARRIS DEPUTY CITY CLERK ELIZABETH BURGOS ADMINISTRATIVE CLERK Verify Appearance of this Legal in the Newspaper - Copy to File SEND PROOF OF ADVERTISEMENT THANK YOU!! Emailed to the Sentinel at dianer@lodinews.com at CV.V5 (time) on Ifr O l'1 (date) (pages) LNS Phoned to confirm receipt of all pages at (time) PMF ES (initials) N:\Administration\CLERK\OrdSummaries\Advins. doc CITY OF LODI ORDINANCE NO. 1944 AN ORDINANCE OF THE LODI CITY COUNCIL AMENDING LODI MUNICIPAL CODE CHAPTER 13.20 — ELECTRICAL SERVICE — BY REPEALING AND RE-ENACTING SECTION 13.20.290, "SCHEDULE EP — ENERGY PURCHASE," IN ITS ENTIRETY. The purpose of this ordinance is to establish a method and rate to compensate customer -owned generation for generating facilities located on the customer -generator's premises operating in parallel with Lodi's electric distribution system. Introduced July 19, 2017. Adoption to be considered August 2, 2017. AYES: Chandler, Johnson, Nakanishi, and Mayor Kuehne; NOES: Mounce; ABSENT: None. Jennifer M. Ferraiolo, City Clerk City of Lodi July 19, 2017 Certified copy of the full text of this ordinance is available in the office of the Lodi City Clerk, DECLARATION OF POSTING ORDINANCE NO. 1944 AN ORDINANCE OF THE LODI CITY COUNCIL AMENDING LODI MUNICIPAL CODE CHAPTER 13.20 — ELECTRICAL SERVICE — BY REPEALING AND RE-ENACTING SECTION 13.20.290, "SCHEDULE EP — ENERGY PURCHASE," IN ITS ENTIRETY. On Thursday, July 20, 2017, in the City of Lodi, San Joaquin County, California, a certified copy of Ordinance No. 1944 (attached hereto, marked Exhibit "A") was posted in the Lodi City Clerk's Office. I declare under penalty of perjury that the foregoing is true and correct. Executed on July 20, 2017, at Lodi, California. Pamela M. Farris Deputy City Clerk ords ummaries\aaDecPost. doc ORDERED BY: JENNIFER M. FERRAIOLO CITY CLERK Elizabeth Burgos Administrative Clerk ORDINANCE NO. 1944 AN ORDINANCE OF THE LODI CITY COUNCIL AMENDING LODI MUNICIPAL CODE CHAPTER 13.20 — ELECTRICAL SERVICE — BY REPEALING AND REENACTING SECTION 13.20.290, "SCHEDULE EP — ENERGY PURCHASE," IN ITS ENTIRETY BE IT ORDAINED BY THE LODI CITY COUNCIL AS FOLLOWS: SECTION 1. Lodi Municipal Code Chapter 13.20 — Electrical Service is hereby amended by repealing and reenacting Section 13.20.290, "Schedule EP — Energy Purchase," in its entirety, and shall read as follows: APPLICABILITY: This schedule is applicable to qualifying customer -owned and operated generating alternating current (AC) facilities operating in parallel with the City's electric distribution system. The customer -generator must currently be, or will be, served by the City of Lodi Electric Utility (LEU). Generating facilities must be rated 1 MWcec-ac or Tess, located on the customer -generator's premises, and intended for the purpose of offsetting a part or all of the customer - generator's own electrical requirements. In no case shall the energy, capacity, and/or other attributes be available for resale by the customer. This schedule is available only to customers who do not otherwise qualify for compensation for customer -owned generation under another LEU rate schedule or contract. RATES: Energy Charges: Customer will be billed for all usage at the applicable service rate in effect when the electric service was rendered in accordance with the eligible customer -generator's otherwise applicable rate schedule based on metered usage for energy delivered and received after the customer -generator serves its own instantaneous load. Enemy Purchase Credit: Credit will be provided to the customer for all metered customer -generated energy that exceeds the energy consumed, and is therefore exported to LEU's distribution system, at a rate equal to the avoided cost to LEU; the specific value of which will be determined and updated annually by LEU based on the following components: avoided energy and transmission costs, environmental attribute value (if applicable, based on generation type), avoided system loss, and avoided capacity value. Energy Purchase Credit values will be published each year by June 1 on LEU's website and provided to customers receiving service under this schedule. The above charges and credits will be determined in accordance with LEU's metering specifications. LEU reserves the right to install additional metering equipment for statistical and/or billing purposes. BILLING: For each billing month, the customer shall receive a bill including all applicable Energy Charges, including, but not limited to, customer charges, energy charges, demand charges, and any surcharges, taxes, and/or discounts in accordance with their otherwise applicable rate schedule. The bill will also include all applicable Energy Purchase Credits which shall be used to offset the Energy Charges in a given billing month. Any credit(s) remaining at the end of each billing month shall carry forward and be applied to the customer's next monthly electric bill. Any outstanding charges will be due and payable at the end of each billing month. Monthly customer charges, public benefit charges, and all other surcharges shall be non -bypassable. SPECIAL CONDITIONS: Other conditions shall apply to this schedule as specified in the City of Lodi Electric Utility Department's Rules and Regulations, as updated from time to time, and Engineering Standards and Specifications (including metering requirements) which are available for review on LEU's website. Customers will be responsible for any and all metering and interconnection charges as required to provide service under this schedule. Said charges will be determined and updated annually by LEU and be based on the cost(s) associated with providing service under this schedule. A schedule of charges will be available on LEU's website. Any capacity or environmental attributes associated, now or in the future, with the credited excess energy produced by the customer -generator at sites subject to this schedule shall belong to the City. Capacity attributes include, but are not limited to, system, local, and/or flexible resource adequacy capacity, if any. Environmental attributes include, but are not limited to, Renewables Portfolio Standard eligible resources, renewable energy credits, greenhouse gas credits, and/or emission reduction credits, if any. LEU reserves the right to require a contract should it determine the customer -owned generator does not otherwise meet the specified applicability requirements to qualify under this schedule or another LEU rate schedule. Customers currently taking service under Schedule NEM shall continue to be billed in accordance with Schedule NEM for 20 years from the date of interconnection of their existing customer -owned generation facility, after which time they will be given the option to take service under this Schedule EP in order to continue to receive credit for their customer - owned generation. SECTION 2. No Mandatory Duty of Care. This ordinance is not intended to and shall not be construed or given effect in a manner which imposes upon the City, or any officer or employee thereof, a mandatory duty of care towards persons or property within the City or outside of the City so as to provide a basis of civil liability for damages, except as otherwise imposed by law. SECTION 3. Severability. If any provision of this ordinance or the application thereof to any person or circumstances is held invalid, such invalidity shall not affect other provisions or applications of the ordinance which can be given effect without the invalid provision or application. To this end, the provisions of this ordinance are severable. The City Council hereby declares that it would have adopted this ordinance irrespective of the invalidity of any particular portion thereof. 2 SECTION 4. All ordinances and parts of ordinances in conflict herewith are repealed insofar as such conflict may exist. SECTION 5. Effective Date and Publication. This Ordinance shall take effect on September 1, 2017. In lieu of publication of the full text of the ordinance within fifteen (15) days after its passage, a summary of the ordinance may be published at least five (5) days prior to and fifteen (15) days after adoption by the City Council, and a certified copy shall be posted in the office of the City Clerk pursuant to Government Code section 36933(c)(1). ATTEST: JENNIFER M. FERRAIOLO City Clerk Approved this day of , 2017 DOUG KUEHNE Mayor State of California County of San Joaquin, ss. I, Jennifer M. Ferraiolo, City Clerk of the City of Lodi, do hereby certify that Ordinance No. 1944 was introduced at a regular meeting of the City Council of the City of Lodi held July 19, 2017, and was thereafter passed, adopted, and ordered to print at a regular meeting of said Council held 2017, by the following vote: AYES: COUNCIL MEMBERS — NOES: COUNCIL MEMBERS — ABSENT: COUNCIL MEMBERS — ABSTAIN: COUNCIL MEMBERS — 1 further certify that Ordinance No. 1944 was approved and signed by the Mayor on the date of its passage and the same has been published pursuant to law. Approved as to Form: JENNIFER M. FERRAIOLO City Clerk JANICE D. MAGDICH City Attorney 3 SUBJECT: Please immediately confirm receipt of this fax by calling 333-6702 CITY OF LODI P. O. BOX 3006 LODI, CALIFORNIA 95241-1910 ADVERTISING INSTRUCTIONS CONTINUED PUBLIC HEARING TO CONSIDER AMENDING LODI MUNICIPAL CODE CHAPTER 13.20.290, SCHEDULE EP — ENERGY PURCHASE, AS IT RELATES TO CUSTOMER -OWNED GENERATION PUBLISH DATE: SATURDAY, JULY 8, 2017 LEGAL AD TEAR SHEETS WANTED: One (1) please SEND AFFIDAVIT AND BILL TO: LNS ACCT. #0510052 DATED: THURSDAY, JULY 6, 2017 ORDERED BY: t ELA M. ARRIS PUTY CI CLERK JENNIFER M. FERRAIOLO, CITY CLERK City of Lodi P.O. Box 3006 Lodi, CA 95241-1910 JENNIFER M. FERRAIOLO CITY CLERK ELIZABETH BURGOS ADMINISTRATIVE CLERK Verify Appearance of this Legal in the Newspaper - Copy to File Faxed to the Sentinel at 369-1084 at (time) on (date) (pages) LNS Phoned to confirm receipt of all pages at (time) JMF _EB (initials) forms\advins.doc DECLARATION OF POSTING CONTINUED PUBLIC HEARING TO CONSIDER AMENDING LODI MUNICIPAL CODE CHAPTER 13.20.290, SCHEDULE EP — ENERGY PURCHASE, AS IT RELATES TO CUSTOMER -OWNED GENERATION On Thursday, July 6, 2017, in the City of Lodi, San Joaquin County, California, a Notice of Continued Public Hearing to consider amending Lodi Municipal Code Chapter 13.20.290, Schedule EP — Energy Purchase, as it relates to customer -owned generation (attached and marked as Exhibit A) was posted at the following locations: Lodi City Clerk's Office Lodi City Hall Lobby Lodi Carnegie Forum WorkNet Office I declare under penalty of perjury that the foregoing is true and correct. Executed on July 6, 2017, at Lodi, California. 116.1,4 .A1_&214lif1� AMELA ; . FARRIS DEPUTY ' ITY CLERK ORDERED BY: NIFER . F' �OLO TY CLE ELIZABETH BURGOS ADMINISTRATIVE CLERK N:\Administration\CLERK\Public Hearings\AFFADAVITS\DECPOSTEUD.DOC CITY OF LORI Carnegie Forum 305 West Pine Street, Lodi NOTICE OF CONTINUED PUBLIC HEARING Date: July 19, 2017 Time: 7:00 p.m. r For information regarding this notice please contact: Jennifer M. Ferraiolo City Clerk Telephone: (209) 333-6702 L NOTICE OF CONTINUED PUBLIC HEARING NOTICE IS HEREBY GIVEN that on Wednesday, July 19, 2017, at the hour of 7:00 p.m., or as soon thereafter as the matter may be heard, the City Council will conduct a public hearing at the Carnegie Forum, 305 West Pine Street, Lodi, to consider the following matter: a) Consider Lodi Municipal Code Chapter 13.20.290, Schedule EP — Energy Purchase, as it relates to customer -owned generation (as identified on the attached Exhibit A). Information regarding this item may be obtained in the Electric Utility Department, 1331 South Ham Lane, Lodi, (209) 333-6762. All interested persons are invited to present their views and comments on this matter. Written statements may. be filed with the City Clerk, City Hall, 221 West Pine Street, 2nd Floor, Lodi, 95240, at any time prior to the hearing scheduled herein, and oral statements may be made at said hearing. If you challenge the subject matter in court, you may be limited to raising only those issues you or someone else raised at the public hearing described in this notice or in written correspondence delivered to the City Clerk, 221 West Pine Street, at or prior to the close of the public hearing. By Order of the Lodi City Council: — -Cnnifer . Ferraiolo ity Clerk Dated: July 5, 2017 Approved as to form: ,—Janice D. Magdich City Attorney AVISO: Para obtener ayuda interpretativa con esta noticia, por favor Ilame a la oficina de la Secretaria Municipal, a las (209) 333-6702. CLERK\PUBHEAR\NOTICES\Noteud doc 7/5/17 CITY OF LODI ELECTRIC UTILITY DEPARTMENT SCHEDULE EP ENERGY PURCHASE Lodi Electric Utility (LEU) has reached the cap at which it is required to offer Net Energy Metering (NEM) to customers under current State law. Lodi Municipal Code, Section 13.20.290 Schedule EP (Energy Purchase) is being proposed to provide a method to compensate customer -owned generation for generating facilities located on the customer - generator's premises that are rated 1 MW cEc-ac or Tess and operating in parallel with LEU's electric distribution system. The proposed Schedule EP will utilize one meter to register energy LEU delivers to the customer that will be charged at regular retail rates and energy the customer delivers to LEU that will be credited at the avoided cost of said energy for excess energy sent to LEU's distribution grid from the customer - generator. LEU's avoided cost will be determined and updated annually by LEU. Customer -generators taking service under the proposed Schedule EP will be responsible for all metering and interconnection charges, as required, to provide service under this schedule. The proposed Schedule EP will not affect current customer -generators on LEU's existing NEM rate; these customers will continue to receive compensation under the current NEM rate schedule until 20 years from the date of their system's interconnection, at which time the customer -generator will be charged and credited in accordance with Schedule EP. If approved, Schedule EP will be available to customers September 1, 2017. Solar applications have continued to be received and date/time stamped since LEU reached its cap. These applications will be processed in the order received under the new Schedule EP.