Chapter 14 - Electric Utility

ARTICLE 14-1
ARTICLE 14-2
ARTICLE 14-3
ARTICLE 14-4
ARTICLE 14-5

ARTICLE 14-1        RATES AND CHARGES

14-1-1           Rates

14-1-2           Load Restrictions

14-1-3           Minimum Charges

14-1-4           Security Lights

14-1-5           Special Transformers

14-1-6           Late Charges

14-1-7           Disconnect/Reconnect Charges

Section 14-1-1      Rates

1. Service Rates.  Applicable to all single and three phase residential service for individual private premises and individually metered apartments when all service is supplied at one point of delivery and energy is measured through one meter.  This schedule is not applicable to resale, breakdown or standby service for customers operating their own generating facilities.
   
   Rate:             $ .08 per K.W.H. per month
   
   Minimum monthly charge  $4.00 per month
   

2. General Service Rates.  This schedule of rates is applicable to all general power and lighting service for which no specific schedule of rates is provided and when all energy is supplied at one point of delivery and measured by one meter.
   
   Rate:             $ .08 per K.W.H. per month
   
   Minimum monthly charge  $2.00 per kilowatt on connected load
   

3. Temporary Service Rates.  This rate schedule is applicable to all types of light and power service for temporary service which shall be in service for less than one month.  Applicant shall pay all costs incurred for such installation.
   
   Rate:             $ .15 per K.W.H. per month
   
   Minimum monthly charge  $10.00 per month
   

4. Irrigation Service Rates.  This rate schedule is for irrigation pumping applicable to three phase service of ten horsepower or more.
   
   Rate:             $ .08 per K.W.H. per month
   
   Minimum monthly charge  $10.00 per month on pumps 10 horsepower and above
   
   $ 4.00 per month on pumps less than 10 horsepower
   

5. Contract and Emergency Service Rates.  Rates and conditions for such service shall be determined by the town council.
   

6. State and Local Sales Taxes.  The rate schedules for purchasing electricity shall add all applicable state and local sales taxes to each customer’s bill.  The sales tax shall be shown as a separate item on the bill.

Section 14-1-2      Load Restrictions

Motors or other services requiring more than three horsepower, or equivalent, of operating current for single phase or more than ten horsepower, or equivalent, of operating current for three phase, shall have proper starting windings on equipment as approved by authorized personnel of the town.

Section 14-1-3      Minimum Charges

The minimum monthly charge as set forth in Section 14-1-1, subsection A and B are based on 3 K.V.A. or less of installed transformer capacity.  When more than 3 K.V.A. of transformer is required, the minimum monthly charge shall be increased at the rate of seventy-five cents ($0.75) for each additional K.V.A. or fractional part thereof required.

Section 14-1-4      Security Lights

This section is applicable to all security lights.  The customer shall pay for the actual cost of installing the light - to include the pole, light fixture and labor.  Thereafter the town will maintain the security light.

Rate:          $7.00 per month

Section 14-1-5      Special Transformers

This section is for all special order transformers, transformers that are installed for exclusive use of a customer or at the specific request of a customer.  The customer shall pay for the first transformer and the town will stock a replacement transformer thereafter.

Section 14-1-6      Late Charges[1]

1. A late fee of one and a half percent of the total bill with a $5.00 minimum will be added to all electric bills not paid by the last day of each month, unless the last day falls on a Saturday, Sunday or a legal holiday, which would then put the last day to make a utility payment on the next regular working day.  This penalty applies to all commercial, irrigation and residential customers when they are past due, regardless if they enter into a payment extension agreement with the utility office and will continue to accrue to an account for each month that late payments are made.
   

2. A person is only eligible to enter into a payment extension agreement when they are able to show how they will make the delinquent payments to the utility supervisor or town manager, and it will be at their discretion and judgement whether to allow an account to enter into a payment extension agreement.  It shall be understood that an essential element of a payment extension agreement is that all future electricity payments must be made by their due date in conjunction with any delinquent payments.  Should a customer not comply with the terms of the  payment extension agreement, including becoming delinquent on future utility bills, then the payment extension agreement shall  become null and void and this electric service subject for shut off.  Payment extension agreements are not to continue beyond three months in any calendar year for any customer or single account.

Section 14-1-7      Disconnect/Reconnect Charges[2]

A disconnect/reconnect charge will be assessed for all disconnects/reconnects.  The council from time to time will review and adopt by resolution the amount of these disconnect/reconnect charges for electric service after it has been terminated due to nonpayment of a utility bill or for any other valid reason caused by the customer.

ARTICLE 14-2        GENERAL PROVISIONS

14-2-1           Purpose

14-2-2           Introduction

14-2-3           Definitions

Section 14-2-1      Purpose

The town hereby undertakes to comply with all lawful regulations of the Federal Energy Regulatory Commission (FERC) codified in subpart c of 18 CFR Part 292 dealing with arrangements with qualifying cogeneration and small power production facilities under Section 210 of Public Utility Regulatory Policies Act of 1978 (PURPA).

Section 14-2-2      Introduction

1. The Public Utility Regulatory Policies Act of 1978 (PURPA), under Section 210, requires the Federal Energy Regulatory Commission (FERC) to develop rules which encourage cogeneration and small power production.  Pursuant to Section 210, regulations have been prepared by FERC and published in the Federal Register (45 FR 12214, February 24, 1980).  The Town of Thatcher Electric Utility ("Utility") which is a nonregulated electric utility will implement, to the extent possible, the procedures and requirements of FERC Order No. 69, pursuant to these rules.
   

2. These rules apply to all entities willing and able to enter into an agreement with the utility.  Provisions of these rules shall not supersede existing contracts.  Entities who have the status of "qualifying small power production facility" and/or "qualifying cogeneration facility" (hereinafter referred to collectively as qualifying facility) pursuant to FERC Order No. 70 (45 FT 17959, March 20, 1980) are eligible to apply for service under these rules.
   

3. These rules represent general guidelines since the nature, size and character of qualifying facilities can vary widely.  The utility reserves the right to evaluate qualifying facilities on a case by case basis.

Section 14-2-3      Definitions

1. Terms as defined in order No. 69 (18 CFR Part 292) shall have the same meaning for these rules unless further defined.
   

2. In this chapter, unless the context otherwise requires:

   1.      "Accredited capacity" means the electrical rating given to generating equipment that meets the utility's criteria for uniform rating of equipment.  This criteria includes but is not limited to reliability, availability, type of equipment and the degree of coordination between the qualifying facility and the utility.

   2.      "Capacity costs" means the costs associated with providing the capability to deliver energy.  They consist of the capital costs of facilities used to generate and transmit electricity or the cost to purchase such capacity from other utilities.

   3.      "Demand" means the average rate in kilowatts at which electric capacity is made available as determined at the point of measurement during any thirty minute period or any other period to be determined by the utility.

   4.      "Energy" means electric energy as measured in kilowatt hours at the point of measurement.

   5.      "Energy costs" means the variable costs associated with the production of electric energy.  They represent energy related cost only or the average cost of purchased energy.  Identifiable capacity charges included in purchased power agreements shall not be included in the calculation of the cost of purchased energy.

   6.      "Point of interconnection" means the point or points at which the qualifying facility is to receive and/or deliver energy or capacity and energy under normal operating conditions.

   7.      "Point of measurement" means the point or points where energy and/or demand are metered.

   8.      "Present utility practice" means any of the practices, methods and acts engaged in or approved by a significant portion of the electrical utility industry consistent with reliability, safety and expedition.

ARTICLE 14-3        CONDITIONS OF SERVICE

The conditions listed in this article shall apply to all qualifying facilities served under these rules.

1. The utility shall purchase energy or capacity and energy from any qualifying facility which offers to sell energy or capacity and energy.
   

2. The utility shall sell any capacity and energy that is required by the qualifying facility to the qualifying facility.  The qualifying facility shall be billed under the applicable residential, general, industrial or contractual service schedule.
   

3. The utility shall offer to provide maintenance, interruptible, supplementary and back-up power to the qualifying facility if requested by the qualifying facility.
   

4. The qualifying facility shall execute a written agreement with the utility.  The utility reserves the right to waive this requirement.  The waiving of this requirement by the utility does not relinquish the utility's right to require the execution of a written agreement in the future.
   

5. The qualifying facility shall comply with all requirements of the National Electrical Safety Code, American National Standards Institute, Institute of Electrical and Electronic Engineers, American Society of Mechanical Engineers, and any other applicable local, state or national code and operate its equipment according to prudent utility practice.  In case of any conflict in the foregoing codes or standards, the utility shall decide which shall govern.
   

6. The utility shall interconnect and operate in parallel with the qualifying facility.  The qualifying facility shall, to the point of interconnection, furnish, install, operate and maintain in good order and repair and without cost to the utility such relays, locks and seals, breakers, automatic synchronizers and other control and protective equipment as shall be designated by the utility as being required as suitable for the operation of the qualifying facility in parallel with the utility's system.  The qualifying facility shall take appropriate steps to insure that operating in parallel will not degrade in any fashion the quality of service that is normally maintained on the utility's system.
   

7. Switching equipment capable of isolating the qualifying facility from the utility's system shall be accessible to the utility or its agent at all times.
   

8. At its option, the utility or its agent may choose to operate, without notice or liability, the switching equipment described in subsection F of this article if, in the opinion of the utility or its agent, continued operation of the qualifying facility in connection with the utility's system may create or contribute to a system emergency or safety hazard.  The utility's obligation to purchase from the qualifying facility ceases when the utility or its agent operates the switching equipment described in subsection F of this article.  The utility shall endeavor to minimize any adverse effects of such operation on the qualifying facility.
   

9. The qualifying facility shall indemnify and hold harmless the utility from any and all liability arising from the operation and interconnection of the customer's facilities.  The qualifying facility shall bear full responsibility for the installation and safe operation of the equipment required to generate and deliver energy or capacity and energy to the point of interconnection.
   

10. The utility shall provide upon request sufficient data to allow the customer to determine the cost effectiveness of the qualifying facility if it goes into operation pursuant to these rules.  The data given will conform to the outline given in 292.303 (Order No. 69 - 18 CFR Part 292).
    

11. Any costs of interconnection which are over and above the interconnection costs that would be incurred due to the connection of a comparable non-generating customer and which are incurred by the utility due to the interconnection of the qualifying facility shall be the responsibility of the qualifying facility.  Interconnection costs may be amortized over a period of time not greater than the length of the contract between the utility and the qualifying facility.
    

12. The utility may discontinue purchase from the qualifying facility if the utility determines that purchase from the qualifying facility would result in costs greater than those which the utility would incur if it did not make such purchases.
    

13. The utility will give sufficient notice to the qualifying facility when it intends to invoke subsection L of this article.
    

14. The utility may discontinue sales to the qualifying facility during a system emergency, providing that such discontinuance is on a nondiscriminatory basis.
    

15. By mutual agreement between the utility and the qualifying facility, the utility will transmit energy or capacity and energy to another utility for purchase by that utility.  The utility shall be fairly compensated for such transmission.
    

16. The qualifying facility shall provide an advance payment to the utility if in the opinion of the utility the costs of interconnection will be excessive or the amount of work that must be done by the utility to provide the interconnection facilities will be excessive.

ARTICLE 14-4        RATES FOR SALES

1. The utility shall purchase the surplus energy or surplus capacity and energy from qualifying facilities.  The rate paid by the utility to the qualifying facility for such surplus energy or surplus capacity and energy may be a negotiated rate.
   

2. Qualifying facilities of 100 kw or less shall be paid a standard rate, except as otherwise stated in subsection A of this article, based on avoided cost as outlined in subsections D and E of this article.  The installation of metering equipment shall be according to utility policy.
   

3. For qualifying facilities of 100 kw or more the qualifying facility may negotiate a contract with the utility.  For qualifying facilities who choose not to negotiate, or in the event of an impasse in negotiations between the utility and the qualifying facility, avoided costs will be paid.  Such avoided costs shall be determined as outlined in subsections D and E of this article except as otherwise stated in subsection A of this article.
   

4. Avoided energy costs shall be estimated or actual energy costs adjusted for the following items:

   1.     The costs or savings to the utility resulting from variations in line losses from those that would have existed in the absence of purchase from the qualifying facility, if the utility generated or purchased an equivalent amount of energy.

   2.      Sanctions imposed for noncompliance with these rules and any contract between the utility and the qualifying facility.
   

5. Capacity payments shall be made in any case in which the qualifying facility enters into a legally enforceable contract to provide accredited capacity.  The payment for the capacity purchase from the qualifying facility shall take into account the following items:

   1.      Length of the contract term.

   2.      Reasonable scheduling of maintenance.

   3.      Willingness and ability of the customer to allow the utility to dispatch the customer's generation.

   4.      The utility's ability to defer a purchase from another source or to defer construction of a facility or a portion of a facility.

   5.      Sanctions imposed for noncompliance with these rules and any contract between the utility and the qualifying facility.

   6.      Availability and reliability of the qualifying facility.
   

6. Any tax or payment in lieu thereof imposed on the utility by any lawful authority on the production, transmission, sale or purchase of energy or capacity and energy that would not occur due to a comparable non-generating customer shall be the responsibility of the qualifying facility.

ARTICLE 14-5        CONNECTION WITH COGENERATION AND SMALL POWER PRODUCERS

14-5-1           General Provisions

14-5-2           Conditions of Interconnection

14-5-3           Interconnection

14-5-4           Protective Relaying

14-5-5           Power Factor

14-5-6           Metering

14-5-7           System Disturbances

14-5-8           Daily Reporting

14-5-9           Advance Payment

14-5-10         Sales to Qualifying Facilities

14-5-11         Rates for Purchases from Qualifying Facilities

14-5-12         Wheeling

14-5-13         Liability

Section 14-5-1      General Provisions

1. The utility shall interconnect and operate in parallel with cogenerators and small power producers as defined in the Federal Energy Regulatory Commission's (FERC) regulations, 18 CFR 292.  Such facilities shall be termed "qualifying facilities".
   

2. The utility has the option of purchasing the power output of such facilities or providing wheeling service to an adjacent utility that the owner of the qualifying facility has made prior contractual arrangements with for receiving of such power.
   

3. Nothing in this article shall limit the utility's ability to evaluate such qualifying facility and determine terms and conditions that are mutually satisfactory to all parties and in no way shall be detrimental to the operation of the utility's facilities and customers.

Section 14-5-2      Conditions of Interconnection

1. The utility shall allow interconnection between its facilities and qualifying facilities on a continuing basis as long as the parallel operation of the qualifying facility does not degrade, in any way, the quality of the electric service provided to the utility's other customers.  The qualifying facility shall insure that its operation in no way creates unsafe conditions either at its facility or on the utility's facilities.
   

2. The owner of the qualifying facility shall enter into a written agreement with the utility for interconnections, sale or wheeling of its power prior to actual connection and operation of its facilities.
   

3. The qualifying facility shall comply with all requirements of the National Electrical Safety Code, American National Standards Institute (ANSI), Institute of Electrical and Electronic Engineers (IEEE), American Society of Mechanical Engineers (ASME), the National Electric Code, General Order 95, and all local, state and federal rules and regulations or codes which may be applicable.

Section 14-5-3      Interconnection

1. The owner of the qualifying facility shall, to the point of interconnection, furnish, install, operate and maintain in good repair and without cost to the utility such relays, locks and seals, breakers, automatic synchronizers and other control and protective equipment as shall be designated by the utility as suitable for operations of such a facility.
   

2. The owner of the qualifying facility shall provide at no cost to the utility a manually operated and lockable, visual disconnect device that shall be for the exclusive use of the utility and accessible by utility representatives at all times.  Usually such device will be an air switch or fused cutouts located near the point of interconnection.
   

3. The protective switching equipment outlined above in subsection B of this section may be operated without notice or liability by the utility or utility representative if, in the opinion of the utility or its representative, continued operation of the qualifying facility in connection with the utility's system may create or contribute to a system emergency or safety hazard.  The utility shall endeavor to minimize any adverse effects of such operation on the qualifying facility.
   

4. Any costs of interconnection which are over and above the interconnection costs that would be incurred due to the connection of a comparable non-generating customer and which are incurred by the utility due to interconnection of the qualifying facility shall be the responsibility of the qualifying facility.
   

5. The utility shall be advised of the proposed start up and parallel time for such facilities, and a utility representative shall be in attendance and shall approve parallel operation.

Section 14-5-4      Protective Relaying

1. All generating units must be equipped with short circuit interrupting devices consisting of thermal-magnetic overcurrent devices on each phase as well as undervoltage release and solenoid tripping accessories.
   

2. Over and under voltage and frequency protection shall be provided to effectively isolate the qualifying facility from the utility's facilities should its power output not be within the utility's normal operating tolerances.  The normal tolerances for under and over voltage are 80% with 10 second time delay and 120% with no time delay of normal.  Under and over frequency limits are 58 Hz and 62 Hz with one second time delay.  Frequency relays are not required for solid state inverters which are line commutated.
   

3. For qualifying facilities, primary, ground fault sensing equipment shall be required to isolate the qualifying facility from the utility's facilities unless otherwise specified by the utility.

Section 14-5-5      Power Factor

The power output of the qualifying facility must approach a unity power factor when operated in parallel with the utility's facilities.  Equipment shall be installed to correct any deficiencies in power factor by the owner of the qualifying facility at the owner's expense.

Section 14-5-6      Metering

1. The utility shall provide metering equipment to record all power delivered to the qualifying facility's load during non-operation periods.  Such load may consist of not only the qualifying facility but also the customer's load had he not installed a qualifying facility.
   

2. The owner of the qualifying facility shall install metering as required by the utility's rules and regulations to record all power produced by such facility.
   

3. Metering equipment for non-firm power sales to the utility shall consist of the appropriate kilowatt-hour meter, Q-meter, current and voltage transformers and all necessary installation equipment.  It shall also include a demand recorder capable of producing a record of three inputs.  Such meters, recorder and related equipment shall be designated by the utility.  The owner of the qualifying facility shall provide and dedicate to the utility such equipment and shall be responsible for the continuing administrative costs related to such equipment.
   

4. Metering equipment for non-firm power sales to the utility shall consist of the appropriate kilowatt-hour meter, current and voltage transformers and all necessary installation equipment.  Such metering equipment shall be designated by the utility.  The owner of the qualifying facility shall provide and dedicate to the utility such equipment and shall be responsible for the continuing administrative costs related to such equipment.
   

5. The utility shall own and maintain all necessary meters and associated equipment utilized for billing and monitoring the customer's load.

Section 14-5-7      System Disturbances

Disturbances to the utility's facilities shall be minimized to the greatest extent possible.  Such disturbances shall include but not be limited to lagging or leading power factors, unacceptable voltage regulation, voltage flicker and harmonics.

Section 14-5-8      Daily Reporting

1. The owner or operator of a qualifying facility shall maintain a daily operations log for all facilities.  Such log shall contain information on unit parallel and separation times, maintenance outages, trip operation and other unusual events.  KW operating level may also be required.
   

2. The utility shall have the right to periodically review these logs.

Section 14-5-9      Advance Payment

The qualifying facility shall pay an advance payment to the utility for the cost of interconnection facilities.

Section 14-5-10    Sales to Qualifying Facilities

1. Power shall be provided to qualifying facilities on a non-discriminatory basis.  The qualifying facility shall be provided service under the appropriate general service schedule.
   

2. Should the qualifying facility's load also contain other non-related loads, such load shall also be served on the appropriate general service schedule.
   

3. The owner of the qualifying facility may request electric service under a maintenance, supplementary interruptible or backup power schedule.  Should the utility not have such a schedule in effect at the time of the request, it may find compliance with such a request unacceptable under Section 292.305b (2).
   

4. The utility may discontinue sales to the qualifying facility during a system emergency, providing that such discontinuance is on a nondiscriminatory basis.

Section 14-5-11    Rates for Purchases from Qualifying Facilities

1. Rates for purchase from qualifying facilities under 100 kw may be as designated in the utility's standard rates for such facilities.
   

2. The standard rates for purchases from qualifying facilities shall be based on the utility's "avoided costs".  The utility's avoided costs shall be determined from the current budget year data for purchased power assuming a reduction in the total amount of purchased power required due to qualifying facilities.
   

3. Rates for qualifying facilities shall be based on avoided costs and may be negotiated by the utility.
   

4. Such rates may be adjusted for the qualifying facility's effect on the utility's system losses, administrative costs, dispatchability, reliability, term of contract and other factors which impact the utility's costs.
   

5. Should the utility's actual avoided costs as determined in subsection B of this section drop below a previously contracted rate, the utility retains the right to cancel such contract and offer to renegotiate or wheel such power from a qualifying facility.  Sufficient notice shall be provided to the owner of the qualifying facility of use of this provision.
   

6. The utility shall review annually its avoided costs as determined above and publish standard rates for purchase.

Section 14-5-12    Wheeling

1. Should the owner of a qualifying facility request the utility to wheel its power to an adjacent utility, the utility may do so, at its option.
   

2. If the utility agrees to wheel such power, a charge may be made to the qualifying facility for interconnection costs, any modifications to the utility's facilities to accommodate such wheeling, use of the utility's facilities to wheel and any associated administrative costs.
   

3. The amount of power wheeled may be adjusted up or down according to the effect on the utility's system losses due to wheeling.

Section 14-5-13    Liability

1. The qualifying facility shall defend, indemnify and hold harmless the utility from any and all liability arising from the operation and interconnection of the customer's facilities.  The qualifying facility shall bear full responsibility for the installation and safe operation of the equipment required to generate and deliver energy or capacity and energy to the point of interconnection.
   

2. The owner of a qualifying facility shall maintain worker's compensation insurance as required by law and public liability insurance covering bodily injury and property damage in an amount not less than $5,000,000 per occurrence.  Each public liability policy shall name the utility as an additional insured.
   

3. The utility shall not be liable whether in contract or in tort or under any other legal theory to the owner of a qualifying facility, the owner's customers or any other person or entity for:

   1.      Lost generation revenue;

   2.      Loss of use, revenue or profit;

   3.      Cost of capital;

   4.      Substitute use or performance; or

   5.      Any other incidental, indirect, special or consequential damages.

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