Illinois Power Agency Long-Term Renewable Resources Procurement Plan What s Next? Anthony Star Director Illinois Power Agency Institute for Regulatory Policy Studies Spring 2018 Conference
Long-Term Renewable Resources Procurement Plan Development Timeline Public Act 99-0906 enacted in December 2016, took effect June 1, 2017 IPA held stakeholder workshops in May 2017 and issued Request for Comments in June 2017 IPA released draft Plan for public comment on September 29, 2017 IPA filed Plan for ICC Approval on December 4, 2017 (Docket 17-0838) and Parties offered Objections to the Plan, then there were Responses and Replies to refine positions Administrative Law Judge issued Proposed Order on February 26, 2018 followed by parties filing Briefs on Exceptions and Reply Briefs on Exceptions ICC issued Final Order on April 3, 2018 Parties have 30 days to request a rehearing [IPA filed Request for Clarification on April 16] ICC has 20 days to determine whether or not to grant a rehearing
Overview of RPS Responsibilities Illinois Power Agency Development of Long-Term Renewable Resources Procurement Plan Competitive Procurements Utility-scale Brownfield Solar Programs Adjustable Block Program Illinois Solar for All Program Utilities Contractual counterparties Job training funding Net metering Smart Inverter Rebates Illinois Commerce Commission Approval of Long-Term Plan Approval of contracts Installer certification ARES compliance 3
Competitive Procurement Structure A Forward Procurement is a competitive procurement for RECs where the beginning delivery date is in a future delivery year and the delivery term is multiple years. Forward Procurements are for unit-specific RECs Site control and other proof of development milestones required Procurements to largely follow past competitive procurement processes Pay-as-bid, Request for Proposal process 15-year fixed price REC-only contracts 4
Competitive REC Procurements: Proposed vs. Approved Forward Procurements New Wind, Summer 2018 ICC Order increased volume from 1 million to 2 million RECs Brownfield Solar, Summer 2018 (80,000 RECs) Utility Scale Solar, Spring 2019 ICC Order increased volume from 1 million to 2 million RECs, will be held in 2018 New Wind, Fall 2019 (1 million RECs) Other New Renewables, Fall 2019 ICC Order postponed; to be considered in Plan update developed in 2019 Non-solar Community Renewables, Fall 2019 Low-Income Community Solar Pilot Projects, TBD Spot Procurements proposed by IPA to meet annual RPS Percentage Targets ICC Order cancelled Spot Procurements RECs from Adjacent State Resources eligible if the facility earn 60 or more points in a five-part test developed by the IPA 5
Adjustable Block Program Three sub-programs Distributed Generation below 10 kw, upfront payment Distributed Generation between 10 kw and 2 MW, 20% payment when energized, remainder over four years Community Solar, 20% payment when energized, remainder over four years Goal of 1 million RECs by 2020/21 (approximately 666 MW) Contracts to purchase 15 years of RECs Long-term Plan included proposed approach for the determination of prices, block size/schedule, application process/criteria, etc. Ongoing collateral requirements to ensure REC delivery Detailed program guidelines to be developed in conjunction with Program Administrator subject to the provisions in approved Plan
Illinois Solar for All Program Funded primarily by the Renewable Energy Resources Fund (funds collected from Alternative Retail Electric Suppliers) Four specific programs Low-income Distributed Generation Incentive Low-income Community Solar Project Initiative Initiatives for Non-profits and Public Facilities Low-Income Community Solar Pilot Projects (competitively bid) Each contract that provides for the installation of solar facilities shall provide that the solar facilities will produce energy and economic benefits, at a level determined by the Agency to be reasonable, for the participating low income customers.
What s in the ICC Order Related to the Adjustable Block Program? Upheld IPA s broad authority to develop consumer protections Changed allocation of Adjustable Block Program to hold 25% of capacity in reserve Approved lottery for managing initial demand for the Adjustable Block Program (including community solar provision to prioritize projects including a commitment to include small subscribers) Approved various adjustments to the REC Pricing Model Clarified what permits are required at time of project application Preserved participation of projects in service territories of municipal electric utilities and rural electric cooperatives Allowed co-location of community solar projects (up to 4 MW colocated, rather than 2 MW)
What s in the ICC Order Related to the Illinois Solar for All Program? Clarified economic benefits for Illinois Solar for All DG and Community Solar to ensure that 50% of the value of energy savings flow to the customer/subscriber Clarified that small subscriber adders apply to Illinois Solar for All Community Solar Projects Added additional guidelines and criteria for project eligibility to participate in the Low-income Community Solar Pilot Project procurement
Next Steps: Adjustable Bock and Illinois Solar for All Programs IPA in the process of hiring Program Administrators Responses to RFP for Adjustable Block Program Administrator received on April 13; for Illinois Solar for All Program Administrator due May 6 Program Administrator selections subject to ICC approval (likely late May or June) IPA reviewing REC Pricing Model with goal of finalizing prices by June 2 (Note, IPA has requested a clarification from the ICC to allow the consideration of a new pricing tier for colocated community solar projects) Once Program Administrators in place additional information on the schedule for program development will be released IPA expects opportunities for stakeholder input on program materials over the summer Approved Vendor registration not expected to begin before the Fall
Challenges Ahead Community Solar Rush Estimated 100 MW of solar currently installed in Illinois, nearly 1,000 MW of community solar interconnection requests. Lottery likely. Funding Bottleneck Utilities collect funds from ratepayers to support RPS up to 2.015% rate cap. Funds can rollover each year through 2020/21. IPA will have to manage funding to prepare for the amount of funds collected by utilities in 2021/22. How do we meet RPS annual percentage goals? 1.8 million RECs from 2010 Long-term contracts 2 million RECS from Initial Forward Procurements (1 million each, wind and solar) 4 million RECs from 2018 Wind and Solar Forward Procurements (2 million each, wind and solar) 1 million RECs from 2019 Wind Forward Procurement 1 million RECs from Adjustable Block Program 9.8 million RECs: total projected by 2020/21 22 million RECs: 2020/21 RPS 17.5% goal 31 million Recs: 2025/26 RPS 25% goal Opportunity to adapt IPA will update Plan in Summer 2019 for changes to take effect in 2020 Future legislation?
Anthony Star Director Illinois Power Agency Anthony.Star@Illinois.gov 312/814-8106 www.illinois.gov/ipa 12