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FSEC Policy Advisory Board
Meeting Minutes

February 26, 2008

Attendees:   Judy Albertson, Paul Allen, John Anderson, Addison Bain, Tommy Boroughs, Griff Carrison, Pete DeNapoli, Steve Gorman, C.T. Hsu, Jonathan Hurwitch, Robert Jenkins, Amy Long, Alexander Mack, Louis Rotundo, M.J. Soileau, Mickie Valente

  1. Chairman Louis Rotundo called the meeting to order at 10:00 a.m. and welcomed the Board members and guests.  PAB members and FSEC staff introduced themselves.
  2. Minutes from the October 23, 2007, meeting were approved as submitted.
  3. Jim Fenton updated the group on FSEC activities.
    • FSEC updates - $92 million available from university funds - Solar funding. 4 faculty positions. OUC donated $1 million; FPL $500,000/match for research.
    • FSEC funding is ¼ from the state and ¾ from contracts.
    • Building folks; DOE grant; Southern Energy Efficiency Center. (Want to Promote Florida Green Energy grown in Florida)
    • Contracted through UCF – Solar Calculator created.
    • Type I Center being removed as designation – have to reapply as a Florida institute.
  4. Overview of Education Activities and Job Training (Susan Schleith)
    • Training is for solar installers, contractors, energy raters, students, energy management personnel.
    • PV installers class – 1 week (to become installer); been training since 1999. Right now there is a 3-month waiting list.
    • Florida Energy Raters class. (Utility Report Cards) Rob V. in charge of this tool.
    • Sun Smart School – Funds to school putting PV on their site.
    • Web site  (contest is May 3rd for Energy Whiz Olympics) for Middle, Junior and High School students)
    • Alternative Energy Banner Center – Funding for Workforce Florida. This is for solar thermal & PV installation.
  5. Florida Energy Commission (FEC) Report - Started in 2007. 9 members – Chair is Tommy Boroughs. All members appointed by Senate President.
    4 advisory groups – total of 60.
    7 Policy goals
    “The cheapest kilowatt is the one we don’t use.”
     “Going green doesn’t mean having to go in the red.”

    Set the playing field and let experts play the game. That’s what the FEC goal is.
    2007 recommendations to Fla. Legislature
    * RPS (Renewable Portfolio Standard)
    * All 3rd party ownership of Generation
    * Avoid cost premium on renewable energy from utility (recommendation #46)
    * Instead of solar on every roof, what about a Solar Park on every 200 homes; i.e.,       Babcock Ranch.
    *In 3-5 years the cost of cellulose extraction out of plant will be more affordable as a fuel source.
    * 40-46% of gas emission in Florida is in transportation.

    Decoupling (performance based ratemaking)

    Utility Regulation

    In public utility regulation, decoupling refers to the disassociation of a utility’s profits from its sales of the energy commodity. Instead, a rate of return is aligned with meeting revenue targets, and rates are trued up or down to meet the target at the end of the adjustment period.  This makes the utility indifferent to selling less product and improves the ability of energy efficiency and distributed generation to operate within the utility environment.
    Ideally, utilities should be rewarded based on how well they meet their customers' energy service needs.  However, most current rate design instead places the focus on commodity sales, tying a distribution company's recovery of fixed costs directly to its commodity sales.
    In order to motivate utilities to consider all the options when planning and making resource decisions on how to meet their customers' needs, the sales-revenue link in current rate design must be broken.  Breaking that link between the utility's commodity sales and revenues removes both the incentive to increase electricity sales and the disincentive to run effective energy efficiency programs or invest in other activities that may reduce load.  Decision-making then refocuses on making least-cost investments to deliver reliable energy services to customers even when such investments reduce throughput. The result is a better alignment of shareholder and customer interests to provide for more economically and environmentally efficient resource decisions.
    As an added benefit, breaking the sales-revenue link streamlines the regulatory process for rate adjustments.  Contention over sales forecasts consumes extensive time in every rate case.  If the sales-revenue link is broken, these forecasts carry no economic weight, so the incentive to game forecasts of electricity sales is removed and rate cases become less adversarial.
    Look at Cap & Trade for Emissions (Carbon Credits)

  6. Building performance & solar energy management – J. Fenton presentation Installing Energy Efficiency Equipment first, then renewables.
    HERS (Home Energy Rating System) – Energy Star
    Energy Star Homes are 85 or less.     Typical home   150        
                                                               Standard home  68                                                                                     Net Zero Home   0
    Serve to preserve- Feb 19, 2008 –Governors top priorities. Dollars to Solar $50 mil, Biofuels-$2.5 Mill, R&D $7.5 Mill and $100 Mill in Incentives. 
    Orange County Convention Center putting in a 1 MW solar PV system
    Renewable Energy Technologies Grant Program. – Alexander Mack (only 7 people in the Florida Energy Office (salary paid by Feds).
    $12.5 million -- 139 proposals evaluated for solar.  183 in the queue still.
    $3.5 million gone on Dec. 19th 2006/07 solar funding.  $1.2 million in the queue for 2008/08 already gone, balance is $2.3 million?
    Gov. Christ recommending $10 million on July 1st minus estimated $3.5 million that was already gone.

      June 2006 – July 2007 -$3.5
      June 2007 – July 2008 -$
      June 2008 – July 2009- $10 Million

      Federal dollars are not really there for solar; state is where to look for this funding initiative.
      U of F hustling to get funding in some Solar Research.  They have received a $20 million grant for Biofuel research.
      Proposed legislation:
      Net Metering – HB 0457; HB 0557
      Energy Efficiency- SB0308; SB0312 ;HB 0560;SB0562;HB0023
      Financial Incentives- SB0434; SB0962
      Governance -SB0412; SB 0414; SB 0416; SB 0418

    ** NOTES :

      AI – In the next 9 weeks. (March – April) is when legislation on energy is important.  It would be important to have someone talk to local legislators about money funding into energy.