Direct purchase of renewable energy
Utah businesses are increasingly turning to renewable energy to power their operations, but if you’re a big energy user that wants to get most or all of your power from clean energy, you likely don’t have enough space at your facility for the solar, wind or geothermal needed. The solution is to allow businesses to purchase renewable energy from off-site projects. Just think about how much pollution we prevent if massive energy users, like data centers, are powered by clean 100% renewable energy! This is a game changer, and at long last it looks like these types of projects are finally able to move forward thanks to a recent clean energy victory. Here's the story:
Utah Clean Energy has been plugging away through a variety of legislative and utility avenues to make it possible for businesses to get their power from off-site renewable energy. We cleared a big hurdle when we helped pass legislation allowing renewable energy developers to sell electricity directly to large energy users and deliver it using Rocky Mountain Power’s transmission and distribution systems. Unfortunately, no businesses were able to overcome the complexity (and resulting expense) of Rocky Mountain Power’s rate structure for these types of contracts.
Utah Clean Energy and other stakeholders worked for months to iron out these issues through a utility proceeding before the Utah Public Service Commission. Our testimony in this docket made the case for fair, simple, and reasonable costs for renewable energy purchases. In a huge clean energy win, the Utah Public Service Commission's final ruling addressed all of the concerns raised in our and other parties' testimony - making renewable energy contracts more cost-effective for large energy users, and renewable energy developers. Long story short - more renewable energy choices in Utah. In fact, we anticipate large energy users will be able to leverage this win to get 100% of their electricity from clean, renewable energy.
The result is a new tariff, Schedule 34, which allows large energy customers to pay a surcharge to purchase off-site renewable energy through a contract with the utility. The customer purchasing energy must have an annual electric peak load of at least 5 MW (although the customer may aggregate multiple meters to reach this minimum load), and may purchase enough renewable energy to equal their projected annual load. Any energy output that exceeds the customer’s actual annual usage will be compensated at avoided cost pricing.
The price for energy purchased through this tariff is defined in in Utah Code Annotated § 54-17-806. Briefly, here’s how it works:
- The customer continues to purchase energy from the utility at prices specified by their regular utility tariff.
- The customer also pays an incremental charge to the utility which equals the difference between the price of the renewable energy facility and the utility’s avoided costs. Customers may also negotiate a different amount for this payment in their contract with the utility.
The customer pays monthly administrative fee of $110 per generation source, $150 for the first delivery point, and $50 for each additional delivery point.