DE 98-023 PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE Interconnection Requirements for Residential Cogeneration Qualifying Facilities Order Approving Settlement Stipulation O R D E R N O. 23,031 October 5, 1998 APPEARANCES: Catherine E. Shively, Esq. on behalf of Public Service Company of New Hampshire; Pentti J. Aalto on behalf of PJA Energy Systems Design; and Eugene F. Sullivan, Esq. on behalf of the Staff of the New Hampshire Public Utilities Commission. In this order, the New Hampshire Public Utilities Commission (Commission) approves a settlement which modifies the interconnection requirements applicable to Public Service Company of New Hampshire (PSNH) for Qualifying Facilities (QFs) up to 25 kilowatts. The approved Stipulation also resolves a dispute between PSNH and Intelligen Systems Inc. (Intelligen) relative to the interconnection of Intelligen's residential cogeneration units to PSNH's distribution system. I. PROCEDURAL HISTORY The Commission initiated this proceeding on March 13, 1998 to investigate the policies governing the interconnection of residential cogeneration units to PSNH's electric grid. The investigation was also precipitated by a disagreement between PSNH and Intelligen over the interconnection of Intelligen's residential cogeneration units. A duly noticed prehearing conference was held on April 16, 1998 during which the Commission granted intervention requests by the following individuals or entities: Intelligen, Chuck Stata and John Bachhuber. See Order No. 22,906 (April 28, 1998). On April 21, 1998, a late intervention request was filed by PJA Systems Design (PJ Systems). PSNH filed direct testimony on April 30, 1998. On August 13, 1998, PSNH filed a Settlement Stipulation (Stipulation) supported by all parties of record. PJ Systems is not a party to the Stipulation, although it did not object to the policies articulated therein as an interim approach until the Commission reconsiders the interconnection guidelines applicable to all electric utilities. The Commission held a hearing to address the Stipulation on August 18, 1998. During that hearing, PSNH presented the testimony of Stephen Hall, S.B. Wicker, Jr. and Russell Johnson. II. THE STIPULATION The Stipulation purports to resolve all outstanding issues in this docket. Specifically, PSNH and the stipulating parties propose to maintain the QF interconnection guidelines established by the Commission in prior dockets except as noted in the Stipulation. Below, we briefly summarize those proposed exceptions, i.e., those provisions which would modify or amend prior interconnection polices. Insurance Coverage Under the Stipulation, residential customers who install generation up to 25 kw will be required to have $250,000 in liability insurance coverage. PSNH will not need to be named as an insured under any such policy. Commercial customers must carry coverage in the same amount, but must also name PSNH as an insured. Design Standard The Stipulation provides that PSNH will continue to use the "GE Flicker Curve" as a design standard for its distribution system. Since merging with NU, PSNH has incorporated the standard by applying the NU Distribution Design Standards; these Standards generally prevent voltage fluctuations from exceeding the GE Flicker Curve. Determination of Local Effects The Stipulation provides a series of procedures for determining the "local effects" of QF installations. These procedures require PSNH to utilize the GE Flicker Curve based on an assumed frequency of motor starts per hour; however, customers will be allowed to challenge this assumed frequency level. In the event that PSNH and a customer are unable to agree on this issue, the Stipulation provides that the matter will be referred to the Commission Staff for resolution. Effects on PSNH's Primary System Under the Stipulation, if PSNH determines that a QF unit will affect PSNH's primary system in a manner which violates the GE Flicker Curve's Borderline of Visibility, the customer will be responsible for all costs associated with eliminating those effects unless the primary system does not meet the Commission's rules pertaining to quality of electric service (Puc 304). Customers Served By Dedicated Transformers Customers who take dedicated service will be required to pay all costs associated with upgrading facilities to meet the above-described voltage flicker standards. Multiple Customers Served By a Single Transformer In cases where a customer seeks to interconnect a QF to a transformer served by more than one customer, the Stipulation provides that PSNH will determine whether an installation violates the Flicker Curve's Borderline of Irritation at the meter(s) of any other customer(s); if it violates that standard, the customer installing the QF will be responsible for all costs associated with reducing the impact to others to below the "Borderline of Visibility." If PSNH determines that the installation affects any other customer(s) served by the same transformer in a manner that violates Borderline of Visibility (at the meter), the customer installing the QF will be responsible for 50% of the costs associated with reducing the impact to such other customer(s) to a level below the Borderline of Visibility. Underground Distribution Service Under the Stipulation, PSNH will evaluate QF installations to underground distribution facilities in the same manner as described above; cost-sharing will apply only to changes to underground system transformers; and, customers will be responsible for all costs associated with replacing and upgrading underground facilities. Customers Adding Load According to the Stipulation, PSNH will utilize the GE Flicker curve to determine whether to upgrade its facilities to provide service to customers who add load. Any payment obligation on the part of customers will be determined in accordance with PSNH's Tariff. III. COMMISSION ANALYSIS The Stipulation sets forth reasonable standards and guidelines for interconnecting residential QF units to PSNH's system and, accordingly, we approve the Stipulation without modification. We note, however, that it may be appropriate to revisit the issues raised in this proceeding on a generic basis as the State implements the restructuring policies articulated in RSA 374-F. In that sense, we agree with PJA Systems that the Stipulation offers an interim solution rather than a final Commission policy. As such, we will continue to reevaluate the interconnection policies applicable to PSNH or to the State's other electric utilities as circumstances warrant. Based upon the foregoing, it is hereby ORDERED, that the Stipulation described in the body of this order is APPROVED. By order of the Public Utilities Commission of New Hampshire this fifth day of October, 1998. Douglas L. Patch Bruce B. Ellsworth Susan S. Geiger Chairman Commissioner Commissioner Attested by: Thomas B. Getz Executive Director and Secretary