5. Discussion
Petitioners raise a valid argument that the independence requirement in D.06-08-028 is unnecessarily restrictive and has the potential to limit competition among PMRS providers. The Commission has previously stated that one of its key goals in the CSI program is market transformation to make solar products cost-effective. (D.06-01-024, p. 4.) We agree with Petitioners that the independence requirement could restrict innovation in solar metering and monitoring services and potentially raise solar costs. If we remove the independence requirement and open the PMRS market to a larger pool of providers, while ensuring accurate data, this supports our goal of lowering solar costs. We are also persuaded that the definition of "affiliated entities" in D.06-08-028 could have been more specific. Even if we had clearly defined what type of affiliation would render an entity ineligible to perform the PMRS function, we did not specify how this would be enforced. The decision did not specifically state whether the independence requirement applied only to data supplied to Program Administrators for PBI payment purposes, or also to data to system owners to monitor system performance.
Upon further review and after obtaining comments on the PDP proposal, we now find that accuracy and data integrity can be ensured through alternative means, namely a PDP qualification process similar to the one on which parties commented, as well as through verification and auditing of a sampling of metered data through the CSI measurement and evaluation process.3 While we agree with several commenting parties that accurate data regarding solar system performance is critical to correct calculation and payment of PBI and meaningful program evaluation, we do not agree with FST/Energy Recommerce that independence is the only way to ensure accurate data. As Enphase points out, we do not require independent water, electricity, or gas meters, but instead rely on equipment certification to ensure accurate, verifiable, and trustworthy meter data. Rigorous standards for metering and monitoring, such as a PDP qualification process, are required for accurate data, not independence. Moreover, FST/Energy Recommerce argue that independence is required for REC trading purposes, but our Energy Division staff advises us that the Western Renewable Energy Generation Information System (WREGIS), the system developed to track RECs for purposes of assessing compliance with California's Renewables Portfolio Standard (RPS), has a meter accuracy requirement, but not an independence requirement.
We agree with the Joint Solar Parties II that PDP standards and protocols can ensure certification, data verification, enforcement, and data quality. As the Joint Solar Parties II point out, many solar companies are publicly listed companies that operate under the United States Securities and Exchange Commission and Sarbanes-Oxley reporting rules. As such, they have an incentive to provide accurate reporting of production data so as not to jeopardize their brand image by biased reporting.
Further, we reject SCE's proposal that the Commission delegate responsibility for PMRS for PBI payment purposes to the CSI Program Administrators. We will not delegate PMRS for PBI payment purposes to the Program Administrators because we prefer to let individual solar customers determine the PMRS approach they prefer, choosing from competitive PMRS providers who meet the PDP guidelines and protocols.
Although we are willing to relax the independence requirement in favor of a PDP qualification process, we are concerned that the PDP proposal circulated for comment needs further refinement before it can be applied to the CSI program. In particular, we agree with FST/Energy Recommerce that the PDP proposal needs further development on specific issue areas and input from affected companies. Given that the PDP proposal covers a wide variety of data requirements, such as data format, security and confidentiality, validation, and retention, we have concerns that without adequate input from the companies that might potentially become PDPs, the data requirements may be unduly burdensome. We also have concerns with aspects of the PDP proposal relating to technical and customer support, performance exemptions, and the appeal process. Therefore, we direct Energy Division staff to convene a workshop within 45 days of this order to discuss improvements and refinements to the PDP qualification process. Specifically, the workshop should address the following aspects of PDP qualifications, standards, and protocols
· Data format, reporting and retention
· Data security and confidentiality
· Data and payment validation
· Measurement and evaluation
· Technical and customer support
· PDP performance exemptions
· PDP non-performance and appeal process
Following the workshop, Energy Division shall file a workshop report with recommendations for changes to the PDP proposal, and serve the report on the service list of this proceeding. The workshop report will direct one of the utilities to file an advice letter, on behalf of the CSI Program Administrators, which addresses Energy Division's recommendations and contains a revised PDP qualification process, and PDP standards and protocols. This advice letter should be filed within 30 days of the workshop report, unless modified by ALJ ruling. The PDP qualification process, standards, and protocols shall be effective upon Energy Division's approval of the advice letter.
Next, we find it necessary to clear up any confusion created from the general discussion of PMRS in D.06-08-028. In considering the petition, we realize that we may have been too general in D.06-08-028 in our discussion of the need for independent PMRS. We now find it appropriate to establish differing requirements for the provision of PMRS based on the recipient and use of the PMRS information. The recipient and use of the PMRS information differ based on whether the system owner is receiving PBI or EPBB incentives. Thus, we will delineate the PMRS requirements based on whether the PMRS provider is providing information to the Program Administrator to calculate incentive payments under PBI, or to the EPBB customer solely to monitor system output for the customer's information.
For systems participating under the PBI, we will replace the independence requirement in D.06-08-028 with a protocol-based approach consistent with the PDP qualification process and guidelines, once finalized through the advice letter process described above. Given that ratepayer monies are involved and the incentive payout is tied directly to system output, data integrity is absolutely essential. Thus, all systems that receive CSI incentives through PBI payments will be required to take service from a PMRS provider that meets the requirements under the PDP qualification process. The Program Administrators will determine the incentives to be awarded to systems receiving PBI on the basis of this information.4 If PBI customers meet these PDP requirements, and all other program rules as set forth in the CSI Handbook, they should receive their PBI payments without delay.
In the interim, until the Commission takes action on the advice letter to be filed on behalf of the Program Administrators as described above, systems owners seeking incentives under the PBI are required to take PMRS from providers that, at a minimum, adhere to the interim protocols identified in the PDP proposal on which parties commented. These interim protocols are attached to this order as Appendix A. Once the PDP qualification process, standards, and protocols have been finalized and approved by Energy Division, all PMRS providers serving systems receiving incentives under the PBI will be required to meet these finalized protocols.
For systems participating under the EPBB, while we retain our requirement that systems take service from PMRS provider, subject to the cost caps identified in D.06-08-028 and as modified in D.07-07-028, we will no longer require that PMRS providers meet the independence requirements set forth in D.06-08-028, nor will we require these providers to meet the PDP requirements identified in this order. While we continue to believe that system owners should have access to accurate data in order to monitor their system's performance, we do not believe the same level of stringency is required. We take this position because, under the EPBB, the amount of ratepayer incentives provided does not depend on metered system performance, but is estimated and paid in advance. The Commission will likely conduct its own audit and program evaluation of EPBB incentives after it considers CSI program evaluation requirements in a later portion of this proceeding. System owners who receive EPBB incentives can decide for themselves if they want to retain the services of a PMRS provider that adheres to more exacting standards (e.g., is "independent," or that meets the PDP requirements adopted herein for PBI systems).5 Performance monitoring remains an important tool for the consumer to monitor actual system output and, by extension, the impact that the system is having in reducing electricity bills.
Furthermore, D.06-08-028, as modified by D.07-07-028, requires that systems receiving incentives under the EPBB subscribe to PMRS provided the costs of these services do not exceed 1% of system costs for systems up to 30 kW, and .5% of system costs for systems greater than 30 kW. To the extent that stringent data handling requirements result in higher PMRS costs, we see little practical value in imposing these requirements on EPBB systems if, as seems likely, such a requirement results in the cost cap being reached and exemption from the PMRS requirement.
The changes articulated in this decision will apply to all systems participating in the CSI program. As of the effective date of this order, all EPBB systems, existing and new, will be allowed to receive PMRS from a provider of their choosing, irrespective of that entity's affiliation with the incentive recipient, solar manufacturers, or solar installers, so long as the provider is listed on the CEC eligible PMRS provider list.6 As of the effective date of this order, all systems receiving or seeking incentives under the PBI will be required to take PMRS from a provider that meets the interim protocols identified in Appendix A of this order for the data stream to the Program Administrator for purposes of PBI payments, until finalized protocols are adopted by Energy Division through the advice letter process.
Finally, we find it necessary to clear up any confusion that may exist on the role of the Metering Subcommittee. In FST/Energy Recommerce's comments on the PDP proposal, they expressed concern regarding the governance of the CSI Metering Subcommittee. FST/Energy Recommerce contend that in D.06-08-028, "the Commission had given the Metering Subcommittee the tasks of developing standards and specifications for meter performance and communication." They express surprise in learning that the Metering Subcommittee "is an advisory body only and has no official responsibilities for CSI program implementation."
In response to this comment, we clarify that in D.06-08-028, the Commission stated that parties were free to organize a metering and data communication committee to propose metering standards, protocols, and data reporting requirements as part of the CSI Program Handbook development process. (D.06-08-028, p. 81.) The Commission did not create the Metering Subcommittee or give it any official role in CSI implementation, although it did suggest metering topics that such a subcommittee might want to provide input on as the Commission finalized the CSI handbook. A Metering Subcommittee was formed as part of the Handbook process, and it has contributed input to the Commission in developing the CSI Handbook.
While we welcome the input of parties and outside metering experts in development of standards for metering performance and communication, the Metering Subcommittee has no official role in CSI program implementation. All CSI metering requirements will be established either through Commission orders such as this one, or through the CSI Handbook, as appropriate. According to the process established in D.06-08-028, the initial CSI Handbook was approved by an Assigned Commissioner's Ruling in December 2006, and changes to it are now considered through an advice letter process. Through the advice letter process, all interested parties have an opportunity to comment on potential changes to the CSI Handbook. Similarly, any metering requirements set forth in a Commission order may only be changed by a subsequent Commission order, following an opportunity for comment by all interested parties.
3 The Commission intends to address CSI measurement and evaluation in a subsequent phase of this proceeding.
4 This is a minimum requirement. Nothing in this order precludes recipients of PBI from taking additional PMRS from a provider that does not meet these requirements.
5 System owners may wish to take service from a PMRS provider that adheres to more stringent requirements for a variety of reasons, including the issue of RECs. To the extent that the performance monitoring and reporting requirements are more stringent under WREGIS than what is adopted here, system owners may wish to opt for a PMRS provider that adheres to a more exacting standard in order to preserve the option to sell RECs if and when California authorizes unbundled RECs to be used for compliance purposes under the RPS program.
6 EPBB systems are still required to choose a PMRS provider subject to the cost caps adopted in D.06-08-028, as modified in D.07-07-028.
