Case Background
On August 31,
2018, Florida Power & Light Company (FPL) filed a petition for a one-year
extension of its Voluntary Solar Partnership (VSP) program and associated
tariff. The VSP program was first approved in Order No. PSC-14-0468-TRF-EI (initial
VSP order) as a pilot program that would terminate on December 31, 2017. Due to the time needed for FPL to complete
billing system modifications, the billing of VSP program participants for the
monthly $9 charge did not start until May 2015. In Order No.
PSC-2017-0499-TRF-EI, the Commission approved a one-year extension (from
December 31, 2017 to December 31, 2018) to allow FPL to gather additional data
regarding the durability of customer interest over a more substantial period of
time.[2]
The VSP program offers
all FPL customers an opportunity, for $9 per month, to participate voluntarily
in a program designed to contribute to the construction and operation of solar
photovoltaic generation facilities located in communities throughout FPL’s
service territory. FPL markets the VSP program to its customers as FPL
SolarNow. Customers may enroll or cancel their enrollment at any time. FPL’s
proposed tariff revision, as shown in Attachment A to the recommendation,
changes the termination date for service under the VSP program from December
31, 2018 to December 31, 2019. The Commission has approved similar community
solar tariffs for Gulf Power Company and Duke Energy Florida.
FPL waived the
60-day file and suspend provision of Section 366.06(3), Florida Statutes (F.S.),
until the December 11, 2018 Agenda Conference. During the evaluation of the
petition, staff issued two data requests to FPL for which responses were
received on October 15, 2018 and November 14, 2018. The Commission has
jurisdiction in the matter pursuant to Sections 366.05, 366.06, and 366.075,
F.S.
Discussion
of Issues
Issue 1:
Should the Commission approve the one-year extension
of the VSP program?
Recommendation:
Yes. The Commission should approve the one-year
extension of the VSP program to allow FPL to complete and evaluate its research
regarding how the VSP program and the planned new shared solar program would
impact one another. The revised tariff, as shown in Attachment A, should be
effective January 1 to December 31, 2019. Prior to the expiration of the VSP
program (December 31, 2019), FPL should petition the Commission regarding the
future of the VSP program. (Doherty)
Staff Analysis:
The VSP program was designed for FPL to use the
voluntary customer contributions to support the revenue requirement associated
with constructing and operating the solar facilities supported under the
program so that non-participants are not required to subsidize these solar
facilities. The revenue requirement includes a return, depreciation, operations
and maintenance (O&M) expenses, and other costs such as property taxes and
insurance. As required by the initial VSP order, marketing and administrative
expenses are capped at 20 percent of participant contributions.
The voluntary contributions did not cover the revenue
requirement in 2015; however, for 2016 through 2018, FPL showed that the
revenues received under the VSP program are greater than the revenue requirement
of the solar facilities. Thus, the net impact to all customers has been
positive since 2016. FPL projects that the voluntary customer contributions
will total $6,717,000 by December 2018, while the total revenue requirement for
the VSP program will total $5,100,000. The
electricity generated by the solar facilities displaces fuel that otherwise
would have been used for generation, resulting in avoided fuel costs. FPL
calculated the fuel savings to be $43,000, resulting in a positive net impact
to all customers of $1,660,000,
which will be used to support additional solar facilities under the program.
As discussed in the initial VSP order, FPL is sizing the
solar projects supported by the program based on the level of participation.
FPL currently has 84 solar structures at 39 locations completed for a total of
1,395 direct current kilowatts (kW) of solar capacity. An additional 53 solar
structures are under construction at 22 locations. FPL stated that the completed and planned
solar projects comprise a diverse set of assets, including ground-mount
structures, rooftop installations, covered walkways, parking canopies, and
tree-like structures. The installation size of the projects ranges from three
kW to 200 kW.
The O&M expenses for the VSP program include the land
lease payments made to host locations. In response to staff’s data request, FPL
explained that the solar facilities incurred minimal damage as a result of
storms or hurricanes. FPL stated that the solar facilities are being built to
comply with the local building and wind codes and there are no specific
pre-storm preparations required. FPL ensures the facilities are operational and
safe through regular maintenance and inspections.
Table 1-1 below shows the total number of customers participating
in the VSP program for the period May 2015 through December 2018. As of August
2018, there are 36,024 participants and FPL projects 40,550 participants by
year end. FPL stated that, on average, the monthly new enrollments have more
than offset the number of participants who have elected to unsubscribe.
Table 1-1
VSP Participants
|
|
Total Participants
(Residential and
Commercial)
|
|
May 2015
|
156
|
|
May 2016
|
3,070
|
|
May 2017
|
19,309
|
|
May 2018
|
34,646
|
|
August 2018
|
36,024
|
|
December 2018*
|
40,550
|
Source:
FPL response to staff’s first and second data requests
*forecasted number
Marketing and Participant Preference
FPL stated that it markets the VSP program through monthly
email campaigns, eNewsletters, bill inserts, social media, and flyers. Monthly
blogs are used to keep an ongoing dialogue with program participants and the
eNewsletters provide project updates to the participants. FPL explained that it
has learned the importance of creating ties with the communities and host
locations to keep participants’ interested and aware of ongoing projects in the
area.
Based on feedback from participants, FPL stated that the
solar canopies and trees are the participants’ preferred solar projects. The
solar canopy generates more power and offers the additional function of
providing shaded seating and shaded parking lots. The solar trees were well
received for their artistic appearance and provision of shade, as well as
seating, and serving as a convenient charging station.
FPL’s Planned New Shared Solar Program
In last year’s petition for a one-year extension of the
VSP program (Docket No. 20170212-EI), FPL stated that it is developing, for
Commission approval within the next year (2018), a new large scale solar
program (shared solar program). The shared solar program would provide
participants with direct credits on their electric bill associated with energy
generated by the blocks of solar capacity. FPL stated in the instant petition
that the reason for the delayed filing for its shared solar program is that FPL
needs more time to better assess market support for the new program. In
addition, FPL expects to collect additional data on how the new program would impact
the existing VSP program and to finalize the design and implementation plans
for the shared solar program in 2019.
Specifically, FPL stated that it will be examining three
areas: (1) the market potential for each program, (2) which aspects of each program
appeal to various customer groups, and (3) whether introducing the shared solar
program could cause customers to migrate out of the VSP program and, if so, at
what rates. This research will assist FPL in making an informed recommendation
regarding the future of the VSP program.
Conclusion
Staff agrees with FPL that a one-year extension of the
tariff will allow FPL to complete and evaluate its research regarding how the
VSP program and the planned shared solar program would impact one another.
Staff, therefore recommends approval of the one-year extension of the VSP
program and tariff. The revised tariff, as shown in Attachment A, should be
effective January 1 to December 31, 2019. Prior to the expiration of the VSP
program (December 31, 2019), FPL should petition the Commission regarding the
future of the VSP program.
Issue 2: Should this docket
be closed?
Recommendation:
If Issue 1 is approved and a protest is filed within
21 days of the issuance or the order, the tariff should remain in effect, with
any revenues held subject to refund, pending resolution of the protest. If no
timely protest is filed, this docket should be closed upon the issuance of a
consummating order. (Nieves)
Staff Analysis:
If Issue 1 is approved and a protest is filed within
21 days of the issuance or the order, the tariff should remain in effect, with
any revenues held subject to refund, pending resolution of the protest. If no
timely protest is filed, this docket should be closed upon the issuance of a
consummating order.
