Annual Meeting Chat Questions/Comments Response
Please see below each question/comment and the Cooperative's response.
Bayfield Electric Cooperative’s revised net metering policy is fair to all members and meets or exceeds state and federal requirements. The Wisconsin Public Service Commission (PSC) requires all regulated utilities to allow net metering to customers that generate electricity up to 20 kilowatts (kW). Bayfield Electric, as a cooperative, is exempt from this requirement but voluntarily participates. Regarding purchase of excess generation, the PSC has not adopted rules for net metering. Utility policies vary but Bayfield Electric’s new policy is consistent with that of the majority of Wisconsin’s other 23 electric cooperatives.
Federal law – the Public Utilities Regulatory Policy Act (PURPA) - supports the utility’s purchase of net excess generation at its avoided cost, the cost it would incur if the utility chose to generate it or purchase it from another source. Dairyland Power Cooperative is Bayfield Electric’s wholesale power supplier. Market price defines Dairyland Power’s avoided cost. Dairyland Power sells all of its generation into the market and then buys it all back. The Federal Energy Regulatory Commission (FERC), overseer for PURPA, has approved the use of avoided cost for the purchase of excess power from distributed generation (i.e. customer-owned renewable generation). And, FERC has ruled that the wholesale power supplier’s avoided cost is the avoided cost for its member distribution member-cooperatives including Bayfield Electric. Furthermore, FERC has determined that avoided cost (market price) is fair.
The purpose of net metering is to allow cooperative members to offset their individual power needs, not to become independent power producers - selling power back to the cooperative. Bayfield’s purchase of excess generation from members’ distributed generation does not eliminate Bayfield Electric’s fixed costs – all of the other costs that the cooperative has in bringing electricity to its members. Therefore, a member’s own renewable generation should be properly sized to their home/farm/business. The difference between avoided cost and Bayfield Electric’s retail rate is that avoided cost is market price for energy only, whereas, Bayfield Electric’s retail rate includes its fixed costs. Paying or crediting the retail rate for excess energy from distributed generation increases the cost of power for all of Bayfield Electric’s other members.
