BIPCo vetting multiple projects

Thu, 03/05/2020 - 6:30pm
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There’s so much going on at the Block Island Power Company that some of the projects are experiencing bottlenecks. The governing arm of the power company, the Block Island Utility District Board of Commissioners, met for a full three hours on Friday, Feb. 28 to vet them all.

Utility District Treasurer Bill Penn expressed frustration with the slow pace of the financial audit, which must be complete by April 1 to satisfy the requirements of Cooperative Finance Corporation, BIPCo’s lender. “This is not moving smoothly,” said Penn, who predicted that draft financial statements would not be available until mid-March.

“We are not missing that CFC deadline,” said BIPCo President Jeffery Wright. He explained that not only were there several “data requests” from the R.I. Division of Public Utilities and Carriers regarding the rate case that needed responding to, but that the company was dealing with new auditors, as well as new technology. “It’s pretty overwhelming,” he said. “It’s starting from scratch.”

The rate case itself is going well, Wright reported. Although the Division had a couple recommended changes, they were minor and the company would not be filing a rebuttal to the suggested changes. The procedural schedule set by the Division is still on track with evidentiary hearings set for three days in early May, but Wright thought the hearing might not take more than half a day, paving the way for the new rates to go into effect June first. “That’s ‘wow’’’ said Wright.

The commissioners are also setting an aggressive schedule for the construction of a home for Wright to rent from BIPCo on the vacant lot at the corner of Beach and Ocean Avenues. Penn reported that an architect has been retained and some preliminary designs and site plans have been done. He said the house would be a “traditional two-story,” 2200 square-foot home with three bedrooms.

Penn said the plans would need approval from the R.I. Coastal Resources Management Council and the Block Island Historical District Commission. Penn is the chairman of the HDC and will therefore not participate in the discussions on the matter, but he hoped that the massing and siting of the project would be discussed at the HDC’s April meeting. “My goal is to get this built by fall,” he said.

There were extensive discussions on whether the home would be modular or stick-built and how that choice would affect the timing of such things as the pouring of a foundation. One thing they do know is: “It’s going to be a completely electric house, obviously,” said Penn, although they do plan on having a solar installation.

Solar is also planned for the rooftops of some of the power company’s buildings. Wright said the 90 kilowatt solar system was being paid for by the Block Island Solar Initiative, which is being funded by an anonymous donor. The program is being administered through the Rhode Island Foundation.

Wright said the investment, predicted to cost $300,000 to $340,000, would result in a savings of about $35,000 per year, and those savings would be applied to capital upgrades, the cost of decommissioning the system at the end of its life, and to the panel maintenance.

“I want to express my appreciation to the donor,” said Commissioner Everett Shorey.

Currently state law restricts net metering for private solar and wind installations at three percent of a utility’s peak output – a limit that has been met for BIPCo. Despite that, the commissioners have been forging ahead crafting a new policy for additional installations.

In order for a new policy to be implemented, two things must happen. First, legislation lifting the cap must be passed by the R.I. General Legislature, and secondly the R.I. Public Utilities Commission must approve the new tariff.

Wright said that the legislation, which would only apply to BIPCo and the Pascoag Utilitiy District, has been filed but no hearings on the matter had been scheduled. With the commissioners giving their go-ahead on final language for the tariff, it will be submitted to the PUC in tandem with the legislation in hopes that “they come out at the same time.”

There was some pushback from Chris Warfel, owner of Entech Engineering, which installs solar systems on the island. Warfel called for outside help to evaluate the new tariff, questioning the veracity of the numbers Wright had submitted as the “cost” of net metering to other BIPCo customers.

That cost has been calculated at $20,000 per each one percent of the peak, or at $60,000 for that three percent peak, and Wright said the calculations came about as the result of the cost of service study performed by Richard LaCapra as part of the rate case.

The new tariff would increase the maximum from three percent to 15 percent of the peak, and can be revisited each year. The rate that customers will be credited for their production will be less than under the old policy, and will not have an impact on other ratepayers.

While the commissioners agreed with Warfel’s comment that “the public needs to know more about this,” they didn’t feel that was cause to hold up the filing with the PUC.

As resident Tony Pappas said: “You can also do it for a year and see what the experience is.”

Wright said that public hearings would be held, and the commissioners will be publicizing the policy through The Block Island Times.

Another wrinkle in the policy appeared. The current policy is meant for residential installations only, but somehow there are non-residential customers participating. According to a schedule of participants, one third of the three percent peak is taken up by non-residential customers. Those customers include governmental units (Town Hall, Block Island School, and the Post Office) and not-for profits.

Utility District Chair Barbara MacMullan said the program had been administered improperly by the previous owners of BIPCo, and that “it was not the residential participants’ fault.”

“I’ve always asked, how did the Town Hall, and the school, and the church get net metering,” said Wright.

While that question wasn’t answered, MacMullan said non-residential customers wouldn’t be “kicked off” but she hoped that the portion of the three percent they were taking up could be freed up for additional residential customers.

Wright said he would check with the PUC if it was okay to exclude commercial customers from the cap and open up 50 kilowatts to additional installations by residential customers. Regardless of what happens, all current net metering customers will be grandfathered under the old policy.

In his president’s report, Wright said that he had not yet met with the Department of Environmental Management to discuss the removal of contaminated soil from the property. The volume of contaminated soil is “increasing” said Wright, with an estimated cost of up to $2 million, which will be paid for by the DEM. Wright hopes the work can be started in the fall.

He also reported that AT&T was installing three additional pole-mounted antennas for cell phone service, and negotiations with National Grid regarding “compensation for fuel” when the cable to the mainland is out of commission due to reburying, are ongoing.