23-18-604. Commission authority — Definition.

23-18-604. Commission authority — Definition. (a) An electric utility shall allow net-metering facilities to be interconnected using a standard meter capable of registering the flow of electricity in two (2) directions. (b) Following notice and opportunity for public comment, a commission: (1) Shall establish appropriate rates, terms, and conditions for net metering; (2) For net-metering customers who receive service under a rate that does not include a demand component, may: (A) Require an electric utility to credit the net-metering customer with any accumulated net excess generation as measured in kilowatt hours or kilowatt hours multiplied by the applicable rate in the next applicable billing period and base the bill of the net-metering customer on the net amount of electricity as measured in kilowatt hours or kilowatt hours multiplied by the applicable rate that the net-metering customer has received from or fed back to the electric utility during the billing period; (B) Take the following actions if those actions are in the public interest and doing so will not result in an unreasonable allocation of or increase in costs to other utility customers: (i) Separately meter the electric energy, measured in kilowatt hours, supplied by the electric utility to the net-metering customer and the electric energy, measured in kilowatt hours, that is generated by the net-metering customer's net-metering facility that is fed back to the electric utility at any time during the applicable billing period; (ii) Apply the commission-approved retail rate to all kilowatt hours that are supplied by the electric utility to a net-metering customer by the electric utility during the applicable period determined by a commission; (iii) Apply the avoided cost of the electric utility plus any additional sum determined under subdivision (b)(2)(B)(iv) of this section to all kilowatt hours supplied to the electric utility by a net-metering customer, during the period determined by a commission, which shall be credited to the total bill of the net-metering customer in a dollar value; and (iv) The additional sum added to the avoided cost of the electric utility may be applied after the demonstration of quantifiable benefits by the net-metering customer and shall not exceed forty percent (40%) of the avoided cost of the electric utility; (C) Authorize an electric utility to assess a net-metering customer that is being charged a rate that does not include a demand component a per-kilowatt-hour fee or charge to recover the quantifiable direct demand-related distribution cost of the electric utility for providing electricity to the net-metering customer that is not: (i) Avoided as a result of the generation of electricity by the net-metering facility; and (ii) Offset by quantifiable benefits; or (D) Take other actions that are in the public interest and do not result in an unreasonable allocation of costs to other utility customers; (3) Shall require that net-metering equipment be installed to accurately measure the electricity: (A) Supplied by the electric utility to each net-metering customer; and (B) Generated by each net-metering customer that is fed back to the electric utility over the applicable billing period; (4) May authorize an electric utility to assess a net-metering customer a greater fee or charge of any type, if the electric utility's direct costs of interconnection and administration of net metering outweigh the distribution system, environmental, and public policy benefits of allocating the costs among the electric utility's entire customer base; (5) For net-metering customers who receive service under a rate that does not include a demand component, shall require an electric utility to credit a net-metering customer with the amount of any accumulated net excess generation as measured in kilowatt hours or kilowatt hours multiplied by the applicable rate in the next applicable billing period; (6) Except as provided in subdivision (b)(9) of this section, for net-metering customers who receive service under a rate that includes a demand component, shall require an electric utility to credit the net-metering customer with any accumulated net excess generation in the next applicable billing period and base the bill of the net-metering customer on the net amount of electricity that the net-metering customer has received from or fed back to the electric utility during the billing period; (7) May expand the scope of net metering to include additional facilities that do not use a renewable energy resource for a fuel if so doing results in distribution system, environmental, or public policy benefits; (8) Shall provide that: (A)(i) The amount of the net excess generation credit as measured in kilowatt hours or kilowatt hours multiplied by the applicable rate remaining in a net-metering customer's account at the close of a billing cycle shall not expire and shall be carried forward to subsequent billing cycles indefinitely. (ii) However, for net excess generation credits older than twenty-four (24) months, a net-metering customer may elect to have the electric utility purchase the net excess generation credits in the net-metering customer's account at the electric utility's avoided cost, plus any additional sum determined under this section, if the sum to be paid to the net-metering customer is at least one hundred dollars ($100). (iii) An electric utility shall purchase at the electric utility's avoided cost, plus any additional sum determined under this section, any net excess generation credit remaining in a net-metering customer's account when the net-metering customer: (a) Ceases to be a customer of the electric utility; (b) Ceases to operate the net-metering facility; or (c) Transfers the net-metering facility to another person; and (B) A renewable energy credit created as the result of electricity supplied by a net-metering customer is the property of the net-metering customer that generated the renewable energy credit; and (9) May allow a net-metering facility with a generating capacity that exceeds the limits provided under § 23-18-603(8)(B)(ii) or § 23-18-603(8)(B)(iii) of up to twenty thousand kilowatts (20,000 kW) if: (A) For any net-metering facility with a generating capacity of less than five thousand kilowatts (5,000 kW): (i) The net-metering facility is not for residential use; (ii) Increasing the generating capacity limits for individual net-metering facilities results in distribution system, environmental, or public policy benefits or allowing an increased generating capacity for the net-metering facility would increase the state's ability to attract businesses to Arkansas; and (iii) Allowing an increased generating capacity for the net-metering facility is in the public interest; or (B) For any net-metering facility with a generating capacity of greater than five thousand kilowatts (5,000 kW): (i) The net-metering facility is not for residential use; (ii) Increasing the generating capacity limits for individual net-metering facilities results in distribution system, environmental, or public policy benefits or allowing an increased generating capacity for the net-metering facility would increase the ability of the state to attract business to Arkansas; (iii) Allowing an increased generating capacity for the net-metering facility does not result in an unreasonable allocation of costs to other utility customers; and (iv) Allowing an increased generating capacity for the net-metering facility is in the public interest; and (10)(A) Shall allow the net-metering facility of a net-metering customer who has submitted a standard interconnection agreement, as referred to in the rules of the Arkansas Public Service Commission, to the electric utility after July 24, 2019, but before December 31, 2022, to remain under the rate structure in effect when the net-metering contract was signed, for a period not to exceed twenty (20) years, subject to approval by a commission. (B) A net-metering facility under subdivision (b)(10)(A) of this section remains subject to any other change or modification in rates, terms, and conditions. (c)(1) Except as provided in subdivision (c)(2) of this section, an electric utility shall separately meter, bill, and credit each net-metering facility even if one (1) or more net-metering facilities are under common ownership. (2)(A)(i) At the net-metering customer's discretion, an electric utility may apply net-metering credits from a net-metering facility to the bill for another meter location if the net-metering facility and the separate meter location are under common ownership within a single electric utility's service area. (ii) Subdivision (c)(2)(A)(i) of this section does not apply if more than two (2) customers that are governmental entities or other entities that are exempt from state and federal income tax defined under § 23-18-603(7)(C) co-locate at a site hosting the net-metering facility. (B) Net excess generation shall be credited first to the net-metering customer's meter to which the net-metering facility is physically attached. (C) After applying net excess generation under subdivision (c)(2)(B) of this section and upon request of the net-metering customer under subdivision (c)(2)(A) of this section, any remaining net excess generation shall be credited to one (1) or more of the net-metering customer's meters in the rank order provided by the net-metering customer. (d) A person who acts as a lessor or service provider as described in § 23-18-603(7)(B) or § 23-18-603(7)(C) shall not be considered a public utility as defined in § 23-1-101.