Nonresidential NEM changes
The NC Utilities Commission also approved changes to nonresidential NEM rates for each Duke Energy utility, with Duke Energy Progress (DEP) implementing these changes on October 1, 2023, and Duke Energy Carolinas (DEC) implementing these changes on January 1, 2024.
Unfortunately, the Commission did not provide as much discussion about these changes as they did with the residential NEM changes. However, for those wishing to dig deeper, the Commission’s Order accepting these changes can be found here for DEP (see pp. 138-42 for NEM discussion, Docket No. E-2 Sub 1300) and here for DEC (pp. 176-79, Docket No. E-7 Sub 1276). The Commission ultimately accepted Duke Energy’s rationale for these changes, as provided by their witness Jonathan Byrd. Witness Byrd’s discussion of the new nonresidential NEM rates, as well as new time-of-use and demand charge changes, can be found in his initial testimony for DEP (pp. 20-22 and Exhibit 7 for NEM specifically). For DEC, Witness Byrd provided a substantially similar discussion in his initial testimony (pp. pp. 20-22 and Exhibit 7 for NEM specifically), and provided further explanation in his rebuttal testimony (pp. 33-40).
Similar to the changes to residential NEM, customers who submitted interconnection requests prior to these implementation dates will be allowed to stay on the Legacy Net Metering rate for 10 years (October 1, 2033, for DEP, and January 1, 2034, for DEC). After that period, those customers will be transitioned to the Nonresidential Solar Choice (NSC) rate.
Similar to the RSC rate, the NSC rate requires customers to take service under a time-of-use rate schedule. Customers retain the RECs generated from their system if they take service under a time-of-use schedule with demand rates, otherwise the RECs must be provided to Duke Energy. The NSC rate does not feature a minimum monthly bill requirement as is found in the RSC rate. Unfortunately, Duke Energy does not plan to provide a bill savings estimator like the one available for residential customers.
The new NSC rate allows for systems to be built up to the lesser of 5,000 kWAC or 100% of the Customer’s contract demand, which is up from 1,000 kWAC under the Legacy Net Metering rate (though leased systems still have a maximum system size of 1,000 kWAC). This size limitation is applied by contract as opposed to individual meter, such that a customer with a contract for 6 MW of demand divided between two delivery points of 3 MW each would still be limited to a maximum system size of 5 MW. Projects sized over 1,000 kWAC must go through the Definitive Interconnection System Impact Study processes.
While the NSC rate utilizes the same time-of-use periods as described above, unlike the RSC rate, NSC allows excess energy generated during a higher-value period to “waterfall” to a lesser value one. Meaning that excess energy generated during the on-peak time period will be applied to the off-peak time period, then to the discount time period, and if any is left it will then be compensated at the net excess energy credit rate (as determined in annual avoided cost proceedings).
Though the NSC rate does include the potential for standby charges in each Duke Energy service territory for generation with capacities above 100 kWAC (the wording of rate schedules and riders differs slightly between DEP and DEC), there is a further limitation that standby charges shall only apply to systems with planning capacity factors of 60% and above. This means that these standby charges should not apply to rooftop solar facilities, which usually have capacity factors of between 20-25%.
For more information on net metering and rooftop solar in North Carolina, visit NCSEA’s website here: https://www.energync.org/net-energy-metering/