Utility Requirements and Buy Backs

From Great Lakes Wiki

After obtaining your permits from your zoning and building code offices, it’s now time to speak with your local utility company. According to the Public Utility Regulator Policies Act of 1978, federal law requires utilities to connect with and purchase power from small wind systems. The manufacturer of the system you purchase should assist you in obtaining utility company approvals, but here are some suggestions to help you in the process.

As wind energy increases in popularity, more utility companies are becoming familiar with customer requests for interconnection to the local grid – it’s been happening for nearly 30 years. However, some utilities are still reluctant to provide connection approval because it just not common in their customer base. An initial call to your state public utility or service commission will provide you with some good information on the utility permitting process and the requirements of utility buy-back based on your utility provider.

Since most wind users will be seeking an interconnection (Michigan) approval, be prepared again to provide blueprints, electrical diagrams, placement of your system, and plans for installation (including who may be doing your installation). Your utility will want to know that you have liability coverage for your equipment and that your equipment has an automatic disconnect in case of power outage. Do your homework on your system to answer your utility company’s questions. The better prepared you are, the more open you are to sharing information about your proposed system, the better the likelihood in being granted permission to interconnect.

After obtaining connection permission, it’s time to discuss the “buy back” or “net metering” (Michigan) rate your utility company will pay you for excess energy your system generates. How do utility companies determine buyback? As you use traditional electricity, your kilowatt meter runs in a forward direction determining how much electricity you will be billed. When you are producing more electricity than you are actually consuming, your meter will run in reverse. Your state’s public utility or service commission determines the rate at which your utility pays you for your excess energy, usually through billing credits.

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