Net Metering

NET METERING

Eligibility and Availability

In December 2005 the Colorado Public Utilities Commission (PUC) adopted standards for net metering and interconnection, as required by Amendment 37, a renewable energy ballot initiative approved by Colorado voters in November 2004.

Customer-generators are eligible for net metering in Colorado for retail renewable distributed generation. The following sections describe the rules that apply to investor-owned utilities (IOUs), with last section detailing net metering for municipal utilities and electric cooperatives. All utilities subject to the below net metering rules are required to provide net metering service at non-discriminatory rates to customer-generators.

Systems sized up to 120% of the customer's annual average consumption that generate electricity using qualifying renewable energy resources are eligible for net metering in IOU service territories.

If a customer-generator does not own a single bi-directional meter, then the utility must provide one free of charge. Systems over 10 kilowatts (kW) in capacity require a second meter to measure the output for the counting of renewable energy credits (RECs).

S.B. 18-009, passed in March 2018, establishes that solar-plus-storage systems are eligible for net metering.

Net Excess Generation

Any customer's net excess generation (NEG) in a given month is applied as a kilowatt-hour (kWh) credit to the customer's next bill, with each kWh credit of NEG off-setting 1 kWh of electricity consumption in a future month. If in a calendar year a customer's generation exceeds consumption, or if the customer-generator terminates its retail service, the utility must reimburse the customer for the NEG at the utility's average hourly incremental cost over the most recent calendar year.

Net metering customers may make a one-time election in writing on or before the end of the calendar year to have their NEG carried forward from month-to-month indefinitely. If the customer chooses this option, they will surrender all their kWh credits when they terminate service with their utility. 

Renewable Energy Credits

The customer-generator retains ownership of any RECs associated with the energy generated by the customer-generator’s system. A utility may acquire the RECs by purchasing them from the customer-generator through a standard offer. All contracts for RECs for solar electric technologies located on site at customer facilities are required to have a minimum term of 20 years if the system is under 100 kW.

Meter Aggregation

A single customer with multiple meters located on contiguous property may elect to have their generator offset the load measured at more than one meter, a policy commonly referred to as “meter aggregation.” A customer who wants to aggregate their meters under net metering must give the utility a 30-day notice and specify the order in which they want their kWh credits applied to the multiple meters. All affected meters must be on the same rate schedule.

Municipal Utilities and Electric Cooperatives

Colorado enacted legislation in March 2008 requiring municipal utilities with more than 5,000 customers and all electric cooperatives to offer net metering for residential systems up to 10 kW and commercial and industrial systems up to 25 kW (see H.B. 1160). Electric cooperatives and municipal utilities are authorized to exceed these minimum size standards.

Any customer's NEG in a given month is applied as a kWh credit to the customer's next bill, with each kWh credit of NEG off-setting 1 kWh of electricity consumption in a future month. Electric cooperatives and municipal utilities are required to pay for any remaining NEG at the end of an annual period based on a "rate deemed appropriate” by the electric cooperative or municipal utility.

COMMUNITY SOLAR GARDENS

Eligibility and Availability

In 2010 Colorado enacted the Community Solar Gardens Act, allowing for the creation of "community solar gardens" (CSGs) with a nameplate capacity of up to 2 megawatts in the service territory of an IOU (see H.B. 1342). In 2015, Colorado enacted H.B. 15-1377, which specified that CSGs could be located in the service territory of an electric cooperative and used to comply with the retail distributed generation requirements of Colorado's Renewable Energy Standard.

A CSG may be owned by the utility itself or any other for-profit or nonprofit entity or organization and must have at least 10 subscribers (or 4 subscribers if in the territory of an electric cooperative and the system size is less than 50 kW). The subscribers may purchase a portion (up to 40%) of the power produced by the array and receive kWh credits on their utility bills in proportion to the size of their subscription. CSG subscriptions must be for at least 1 kW (unless owned by a low-income CSG subscriber) and a supply no more than 120% of the subscriber’s annual electricity consumption.

Pursuant to H.B. 15-1284 enacted May 2015, subscribers must be located in the service territory of the same qualifying retail utility and also in the same county as, or a county adjacent to, that of the community solar garden. 

Net Excess Generation

If, in a monthly billing period, the CSG subscriber’s billing credit associated with a CSG subscription exceeds the customer’s bill from the IOU, the excess billing credit will be rolled over as a credit from month-to-month indefinitely until the customer terminates service with the IOU, at which time any remaining billing credits expire.

Aggregate Cap

For compliance years 2011-2013, IOUs were only required to purchase up to 6 MW of new CSGs. For compliance years 2014 and thereafter, the PUC will set minimum and maximum purchases of renewable energy and RECs from new CSGs of different segments based on the capacity of the CSGs. Beginning in the 2015 compliance year, IOUs plan for acquisition of renewable energy from CSGs will be part of its renewable portfolio standard compliance plan. At least 5% of an IOU’s purchases from CSGs must be reserved for low-income CSG subscribers.