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SPONSOR: |
Beam |
DATE TYPED: |
2/19/03 |
HB |
HJM 21/a HGUAC |
||
SHORT TITLE: |
Request PRC to Adopt Net Metering Rules |
SB |
|
||||
|
ANALYST: |
Maloy |
|||||
REVENUE
Estimated Revenue |
Subsequent Years Impact |
Recurring or
Non-Rec |
Fund Affected |
|
FY03 |
FY04 |
|
|
|
|
|
(Indeterminate) |
Recurring |
General
Fund |
Responses
Received From
Public
Regulatory Commission (PRC)
SUMMARY
The House Government and Urban Affairs Committee
has amended HJM 21 to change the amount of increase from a specific amount to a general amount. The specific amount of increase is struck (“ten
kilowatts to 100 kilowatts”), and
replaced by wording making the increase simply “significant”.
Synopsis of Original
Bill
HJM 21 requests the Public Regulatory Commission amend the existing net-metering rule to increase the amount of energy that will be repurchased by a utility provider from a utility customer from ten kilowatts to one hundred kilowatts.
1. The existing
net-metering rule applies to only Qualifying Facilities (QF) of 10 kW or
smaller. Is HJM21 intended to cover only QF s?
2. Typically, loads above
50kW are billed for both demand and energy by the utilities. All facilities 10 kW or smaller are billed
only on energy basis. Therefore, increasing the size limit to 100kW increases
the complexity and may require installation of additional metering equipment.
That may increase cost to the producer.
3. Because of the increase
in the size limit, the energy sold by the utility will be decreased. That will
decrease both NM Gross Receipts Tax revenue and the PRC’ s Inspection and
Supervision fee revenue.
4. If the customer
displaces all of their consumption with their own generation, the implicit
payment for that generation is the utility’s retail rate, which contains recovery
of and recovery on investment, operation and maintenance costs, administrative
and general expenses, property taxes and other related costs. Other than fuel
and variable O&M costs, none of the above costs are avoided by the utility
when it purchases the output of the net-metered generating facility. Therefore,
payment of retail rate for the output of the net-metered generation results in
other ratepayers subsidizing the net-metered generation. When the size is
increased, the subsidy increases and so does the burden on the other
ratepayers.
FISCAL IMPLICATIONS
HJM 21 would result in a reduction in revenue to the general fund due to a reduction in Gross Receipts Tax revenue and in the PRC’s Inspection and Supervision fee revenue. The PRC was not able to estimate the impact.
ALTERNATIVES
Reduction of the size limit to
less than 50 kW.
SJM/njw:sb