Rhode Island allows net metering for systems up to five megawatts (MW) in capacity that are designed to generate up to 100% of the electricity that a home or other facility uses. Systems that generate electricity using solar energy, wind energy, ocean-thermal energy, geothermal energy, small hydropower, biogas from anaerobic digestion, or fuel cells using any of these energy sources are eligible. All customers of electric distribution companies including public entities of the state are eligible. The aggregate amount of net-metered systems in Block Island Power Company and Pascoag Utility District is capped at 3% of the peak load for each utility district. In 2014, the aggregate cap for net metering for National Grid was eliminated.
Net Excess Generation:
The rate credited for kilowatt-hours (kWh) generated that do not exceed the customer's kWh consumption for that billing period is equal to the utility's retail rate (minus a very small conservation charge per kWh). Any excess kWh generation that exceed 100% but limited up to 125% of the net-metering customers usage during the billing period will be paid excess renewable net-metering credits which is equal to the utilities avoided cost rate, unless the utility and the consumer have agreed to a different plan. Excess credit may be carried forward to the next bill or purchased by the utility (at its discretion). To facilitate the administration of billing, utilities may estimate a net-metered customer's generation and consumption over a 12-month period. Otherwise, the rates (including customer charges and demand charges) that apply to a net-metered customer must be the same rates that would apply if the same customer were not net metering. Utilities may not impose any other charges on net-metered customers. Net-metered customers are exempt from back-up or standby rates commensurate with the size of the net-metered system. Utilities my recover through rates any revenue shortfall caused by this exemption.
A system generally must be owned by the customer of record and sited on the customer's premises (in the same geographic location). However, facilities (1) owned by public entity* or multi-municipal collaborative or (2) owned and operated by a developer on behalf of public entity or multi-municipal collaborative through “public entity net metering financing arrangement”** are also eligible. Meter aggregation is generally allowed, and special provisions exist to accommodate meter aggregation for farm-based systems that serve facilities in close proximity to each other.
Rate Design and Cost Allocation study
S.B.0081 enacted on June 2015 requires the Public Utilities Commission (PUC) to open a docket by July 2015 to consider rate design and distribution cost allocation among rate classes taking into account the effects of net metering and increasing distributed energy resources. Electric utilities are required to file revenue-neutral allocated cost of service study of all rate classes and propose new rates for all customers in each rate class. The PUC will determine new rates taking into account various factors, including the benefits of distributed-energy resources, services provided by net-metered customers, equitable ratemaking principles, and others. The PUC can choose to consider any reasonable rate design options include fixed charges, minimum-monthly charges, demand charges, volumetric charges, or any combination. The PUC shall issue an order before March 2016, and the new rates would take effect after April 2016.
*A "public entity" is defined as the municipalities, wastewater treatment facilities, public transit agencies or any water distributing plant or system.
**A "public entity net metering financing arrangement" is defined as an arrangement between a public entity or multi-municipal collaborative and a private entity to facilitate the financing and operation of a net-metered system. Such systems are owned and operated by the private entity and must be located on property owned or controlled by the public entity or one of the municipalities.