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Senate Public Utilities Committee Briefing March 12, 2013 Presented by Todd A. Snitchler, Chairman

Senate Public Utilities Committee Briefing March 12, 2013 Presented by Todd A. Snitchler, Chairman. Ohio Alternative Energy Portfolio Standard. 25% by 2025 25% of retail electricity sold by:

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Senate Public Utilities Committee Briefing March 12, 2013 Presented by Todd A. Snitchler, Chairman

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  1. Senate Public Utilities Committee Briefing March 12, 2013 Presented by Todd A. Snitchler, Chairman

  2. Ohio Alternative Energy Portfolio Standard 25% by 2025 25% of retail electricity sold by: Ohio’s electric distribution utilities – American Electric Power, Dayton Power & Light, Duke Energy, and First Energy, or; Competitive electric service companies Must be generated from alternative sources: Renewable energy sources Advanced energy technology

  3. SB 221 25% (of total kWh) by 2025 • Half may be from advanced energy resources • At least half from renewable, .5% solar • At least half of renewable through facilities located in the state, remainder deliverable • Compliance payments/forfeitures • Cost of compliance not to exceed three percent of otherwise acquired

  4. Renewable Portfolio Standard Policies.. www.dsireusa.org / February 2013. 29 states,+ Washington DC and 2 territories,have Renewable Portfolio Standards (8 states and 2 territories have renewable portfolio goals).

  5. Renewable Portfolio Standard Policies with Solar / Distributed Generation Provisions. www.dsireusa.org / February 2013. 16 states,+ Washington DC have Renewable Portfolio Standards with Solar and/or Distributed Generation provisions

  6. Benchmarks

  7. Alternative Energy Benchmarks (including advanced)

  8. Renewable Energy Credits New Ohio Renewable Energy Credit (REC) trading market created by new law in 2009 1 REC = 1 mWh of electricity generated Utilities may own renewable facilities or purchase RECs to meet the renewable portion of the standard PUCO certifies resources; established tracking systems will issue and track RECs RECs have a 5-year lifetime following their acquisition Energy and RECs may be sold as separate commodities

  9. Compliance Payments Utilities and electric service companies subject to compliance payments if annual renewable and solar benchmarks are not met. Non Solar: Started at $45/mWh in 2009 2012 compliance payment was $47.56/MWh Solar: $450/mWh in 2009 and declines over time 2012 compliance payment was $350/MWh for solar Exceptions: force majeure; 3% cost cap

  10. Certification Application REN certification is not mandatory for any renewable project, but necessary to create RECs eligible for Ohio utility compliance No fee to apply May certify facilities prior to commercial operation Application will focus on: Resource/technology utilized Placed in-service date Deliverability to the state One-time review (unless significant change to facility in future) Interested person may seek intervention and request hearing on certification Certification status will be conveyed to applicable attribute tracking system

  11. Facilities Certified Since June 2009

  12. Wind Momentum • Federal PTC (Production Tax Credit) • State Renewable Portfolio Standards (RPS) • Technological Improvements • Price Volatility for Other Fuels (i.e., Natural Gas) • Interest in Green Power / Clean Energy Sources • Climate Change / Energy Independence

  13. Wind farms in Ohio can help provide renewable resources to meet Ohio’s Alternative Energy Portfolio Standards But Also: A small wind generator owned by a retail customermay enable the customer to use a renewable resource to offset his electrical demand and potentially earn a credit for net metering on his electric bill.

  14. Qualified Biomass Resources Biogas: landfill methane gas or anaerobic digestion of organic materials such as animal waste, bio-solids, food waste, agricultural crops and residues, solid waste Agricultural crops, tree crops, crop by-products and residues Wood and paper manufacturing waste Forestry or vegetation waste Algae

  15. Advanced Energy Resources Clean coal Advanced Nuclear Fuel cells Customer co-generation Advanced solid waste conversion Utility generation plant or demand-side management efficiency measures Uprated capacity of an existing electric generating facility resulting from the deployment of advanced technology Any new, retrofitted, refueled or repowered generating facility in Ohio Note: RECs are not created from advanced resources

  16. Energy Efficiency and Demand Reduction Benchmarks - SB 221 (OAC 4901:1-39) • Establishes requirements and processes to determine specific benchmarks for energy efficiency and peak reduction programs • Establishes energy usage and demand baselines for measuring annual energy savings and demand reductions • Provides mechanisms by which investments achieve energy savings and demand reductions by mercantile customers in their own facilities and can be recognized in electric utility programs as contributing to specific levels of energy savings and demand reductions.

  17. Senate Bill 315 and EE Gov. Kasich signed June 2012: • CHP and waste energy recovery can be counted toward the state’s Energy Efficiency requirements. • Waste energy recovery facilities qualify as renewable energy sources under Ohio’s Alternative Energy Portfolio standard.

  18. Electricity Consumption in Investor-Owned Electric Utility Service Areas in Ohio October 2008 – December 2009

  19. Energy Efficiency Requirement • 22% + Reduction by 2025 • Could result in annual usage at 13.8 million mWh below 2007 Peak Demand Reduction Standard • 7.75% by 2018 • Tariffs and special contracts available to commit the demand reduction • Customers enrolled in RTO demand response programs are counted if customer commits the peak demand reduction

  20. Peak Demand Reduction and Energy Efficiency Benchmarks

  21. Peak Demand Reduction and Energy Efficiency Benchmarks • Each Electric Distribution Utility filed a report identifying the 2009 baselines and benchmarks. • Each Electric Distribution Utility filed a program portfolio plan for energy efficiency and peak reduction programs. • Upon approval of the program portfolio plan, an Electric distribution utility may seek cost recovery. • Each year, on April 15, the Electric Distribution Utility must file a portfolio status report that demonstrates its compliance status with its benchmarks and provides an assessment of its performance.

  22. Mercantile Customer Applicationsto commit Energy Efficiency and Peak Demand Reduction Ohio Administrative Code 4901:1-39-05(F) • Permits a mercantile customer to file individually or jointly with an electric utility, an application to commit the customer’s existing demand reduction, demand response, and energy efficiency programs for integration with the utility’s program • Expectation the mercantile customers were to be exempt from the EE/PDR Rider of the tariff they are taking service • Pilot Program adopted by the Commission for ease of application and administration

  23. To support sound energy policies that provide for the installation of energy capacity and transmission infrastructure for the benefit of the Ohio citizens, promoting the state’s economic interests, and protecting the environment and land use. Ohio Power Siting BoardMission Statement

  24. Ohio Power Siting BoardMember Agencies

  25. OPSB Jurisdiction Definition of “Major Utility Facility:” • A generating plant of 50 megawatts or more • An electric transmission line of 125 kilovolts or greater • Intrastate gas or natural gas transmission line capable of transporting gas at or greater than 125 pounds per square inch of pressure (does not includeproduction, gathering or liquids lines)

  26. HB 562 (2008) • Gave the Board additional oversight regarding commercial wind farms • Wind facilities greater than 5 MW • This bill also directed the Board to adopt certification rules for the construction, operation and maintenance of wind-powered electric generation facilities • The rules outline requirements for aesthetics, setback, noise levels, ice throw, blade sheer and shadow flicker   

  27. OPSB Benefits • One-Stop Siting Process • Timely action: Approximately 6 to 12 months for applications, with statutory time mandates; accelerated schedules an option under certain circumstances • Regulatory certainty: process is known and practiced • Sole jurisdiction: local and public participation welcome in the process, but sole decision rests with the state (OPSB) • Our siting process is fair and efficient and has been put forth as an example for others to follow • Having seen our success, several states and countries have adopted new siting legislation modeled after Ohio’s statute

  28. OPSB Electric Generation Applications(1998-2013) * Includes Amendment Applications

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