STATE PUCS
Distributed Generation. In December and January the Illinois commission took comments from utilities, marketers, manufacturers, and trade and advocacy groups on how to develop policy on distributed generation.
* Rulemaking Strategy. Enron has urged the state to proceed in a fashion similar to the California PUC's
two-track investigation. It asked for two separate rulemakings on (1) interconnection standards for DG installations of 50 megawatts or less, and (2) rate design and operational issues.
* Unit Size Limits. The commission staff opposed setting any size limit on DG units. It noted that the California PUC set a 20-MW ceiling in its definition of DG to discourage DG owners from wholesale activities, preserving cost savings for consumers:
"The CPUC position was that cost savings from providing less wire and fewer connections (transformers, relays) between the power supply and the end-user, and the savings from reducing line loss and congestion on the transmission and distribution grids, would go directly to the retail customers instead of a third-party marketer or middleman.
"While this approach might be what California was looking for ¼ [we favor] a more even-handed policy that would allow generation or storage of any size to locate on the distribution system."
* Metering and Interconnection. Enron favored net metering for small DG installations, whereas the Edison Electric Institute opposes that. According to EEI, net metering creates subsidies for DG customers: "Net metering does not keep the incumbent whole for transmission and distribution costs or for the on-peak value of power. ¼ [I]t skews the price signals."