I
107TH CONGRESS
1ST SESSION
H. R. 3089
To amend the Federal Power Act to promote energy security, environmental
protection, electricity price stability, and electric reliability by providing
for the use of net metering by certain small electric energy generation
systems, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 11, 2001
Mr. TERRY (for himself, Mr. BARTON of Texas, Mr. PICKERING, and Mr.
NORWOOD) introduced the following bill; which was referred to the Com-
mittee on Energy and Commerce
A BILL
To amend the Federal Power Act to promote energy security,
environmental protection, electricity price stability, and
electric reliability by providing for the use of net meter-
ing by certain small electric energy generation systems,
and for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Renewable and Dis-
tributed Energy Net Metering Act’’.
SEC. 2. FINDINGS.
The Congress finds that it is in the public interest
to:
(1) Enable small businesses, residences, schools,
churches, farms, and other retail electric customers
who generate electric energy to reduce their electric
bills.
(2) Encourage private investment in renewable
and unconventional energy resources.
(3) Enhance the diversity of the Nation’s elec-
tric supply by increasing reliance on a wide range of
renewable and other environmentally sound distrib-
uted generation technologies.
(4) Reduce price volatility and enhance reli-
ability by reducing peak load on centrally generated
power supplies.
(5) Protect the environment by promoting clean
energy sources.
SEC. 3. NET METERING.
Part II of the Federal Power Act is amended by add-
ing the following new section at the end thereof:
‘‘SEC. 215. STATE NET METERING PROGRAMS.
‘‘(a) DEFINITIONS.—As used in this section—
‘‘(1) The term ‘customer generator’ means the
owner or operator of an electric generation unit
qualified for net metering under this section.
‘‘(2) The term ‘net metering’ means measuring
the difference between the electricity supplied to a
customer-generator and the electricity generated by
a customer-generator that is delivered to a local dis-
tribution system at the same point of interconnec-
tion during an applicable billing period and pro-
viding a credit to the customer-generator for the net
amount, if any, by which the electricity generated by
the customer-generator exceeds the electricity sup-
plied to the customer generator during that billing
period.
‘‘(3) The terms ‘electric generation unit quali-
fied for net metering’ and ‘qualified generation unit’
mean an electric energy generation unit that meets
the requirements of subsection (b)(1) of this section.
‘‘(4) The term ‘retail electric supplier’ means
any person that sells electric energy to the ultimate
consumer thereof.
‘‘(5) The term ‘local distribution system’ means
any system for the distribution of electric energy to
the ultimate consumer thereof, whether or not the
owner or operator of such system is also a retail
electric supplier.
‘‘(b) NET METERING REQUIREMENT.—Each State,
electric utility not regulated by a State, and Federal power
marketing agency shall consider establishing a net meter-
ing program, or modifying an existing program, to meet
the minimum Federal standards set forth in subsection
(c) of this section. If the Commission determines that a
State, electric utility not regulated by a State, or Federal
power marketing agency has not established a net meter-
ing program that meets such minimum standards within
2 years after the enactment of this Act, the Commission
shall establish a program (in such State or in the service
territory of such electric utility or Federal power mar-
keting agency) consistent with such standards.
‘‘(c) MINIMUM FEDERAL STANDARDS FOR STATE
AND OTHER NET METERING PROGRAMS.—
‘‘(1) QUALIFIED
GENERATION
UNIT.—A gen-
eration unit that meets the following requirements
qualifies for net metering under this section:
‘‘(A) The unit is a fuel cell or uses as its
energy source either solar, wind, or biomass.
‘‘(B) The unit has a generating capacity of
up to 200 kilowatts.
‘‘(C) The unit is located on premises that
are owned, operated, leased, or otherwise con-
trolled by the customer-generator.
‘‘(D) The unit operates in parallel with the
retail electric supplier.
‘‘(E) The unit is used primarily to offset
part or all of the customer-generator’s require-
ments for electric energy.
‘‘(F) The unit is not intended to offset or
provide credits for electric consumption at an-
other location of the customer or for any other
customer.
‘‘(2) METERING AND COSTS.—The retail elec-
tric supplier shall make available upon request net
metering service to any customer-generator that the
supplier serves if the retail customer-generator pays
any incremental costs, including those incurred by
suppliers and local distribution systems for equip-
ment or services for safety or performance that are
necessary to meet the standards referred to in this
section. If a State, nonregulated utility, or Federal
power marketing agency determines that the use of
a real-time net meter or interval net meter will ad-
vance the purposes of this section for such units, a
customer-generator in that State (or, in the case of
a nonregulated utility or Federal power marketing
agency, the relevant service territory) may be re-
quired to use the appropriate meter and pay the rea-
sonable incremental costs for such meter and its in-
stallation.
‘‘(3) RATES.—Rates and charges for retail elec-
tric service to customer-generators, including the
amount of a net metering credit, shall be established
by the appropriate State regulatory authority and
nonpublic utilities. To the extent that a State regu-
latory authority, nonregulated utility, or Federal
power marketing agency does not establish such
rates and charges, such rates and charges shall be
established by the Commission. The rates and
charges established pursuant to this section shall be
just and reasonable.
‘‘(4) SAFETY
AND
PERFORMANCE
STAND-
ARDS.—A qualified generation unit and net metering
system used by a customer-generator shall meet all
applicable safety and performance and reliability
standards established by the national electrical code,
the Institute of Electrical and Electronic Engineers,
Underwriters Laboratories, or the American Na-
tional Standards Institute, except that a State may
adopt additional or different standards provided that
such standard is consistent with the purposes of this
section and does not impose an unjust or unreason-
able burden on a customer-generator that seeks to
participate in the State’s net metering program.
‘‘(5) STATE AUTHORITY TO ESTABLISH ADDI-
TIONAL REQUIREMENTS.—Consistent with the limits
of its jurisdiction under this part, nothing in this
section shall preclude a State from establishing or
imposing—
‘‘(A) requirements or incentives to encour-
age qualified generation and net metering that
are in addition to or in excess of the minimum
standards established in this section (including
but not limited to additional eligible fuels, high-
er capacity limits, and credit amounts that vary
by fuel or capacity);
‘‘(B) limits on the State-wide aggregate
amount of generating capacity of customer-gen-
erators with qualified generation facilities and
net metering systems, provided that such limits
are not unduly discriminatory and are con-
sistent with the purposes of this section; or
‘‘(C) administrative and enforcement pro-
cedures and requirements such State deems
necessary or appropriate to implement a net
metering program under this section, if such
procedures and requirements are consistent
with the purposes of this section and does not
impose an unjust or unreasonable burden on a
customer-generator that seeks to participate in
the State’s net metering program.
‘‘(6) NOT A WHOLESALE SALE.—A net meter-
ing credit under a net metering program established
under this section shall not be considered a sale for
resale for the purposes of Federal or State law.’’.
Æ