Update: On April 13, 2015, the OMA Energy Group filed comments regarding various policy issues to be addressed in the Kraton and Solvay combined heat and power (CHP) incentive cases. Specifically, OMA Energy Group contended that 2012 SB 315, which authorized the use of CHP and waste energy recovery projects in meeting the Ohio electric distribution utilities’ portfolio plan standards, was already in place when AEP’s last portfolio plan was approved by the Commission. Therefore, authorizing an incentive or mechanism whereby AEP may incentivize customers, such as Kraton and Solvay, who commit their customer-sited CHP project savings to AEP for use in meeting the applicable portfolio standards, does not constitute an amendment under SB 310. OMA Energy Group also argued that AEP’s request to exclude a certain portion of the shared savings it will receive from the Kraton and Solvay CHP projects from the shared savings cap approved in its last portfolio case would constitute an unauthorized amendment of its portfolio plan pursuant to SB 310. OMA Energy Group further reiterated the need for a higher incentive for CHP system owners, with such increased incentive coming from AEP’s shared savings incentive, rather than other AEP customers. Finally, OMA Energy Group argued that AEP should work with PJM to develop a plan for monetizing the savings from the CHP projects in PJM auctions, with the dollars yielded going back to AEP customers.
AEP, Kraton, and Solvay also filed joint comments on April 13, 2015, which incorporated the comments AEP previously filed in the cases and additionally argued that Staff’s recommendation, as adopted by the Commission in the Jay Plastics CHP case, Case No. 13-2440-EL-EEC, that the commitment of energy production as energy efficiency to the electric utility should be for the full life of the CHP facility, should not be followed in the Kraton and Solvay cases. AEP, Kraton, and Solvay also argued that the Commission’s decision in the Jay Plastics case should not be read to require an investing business customer to waive its right to opt out of the EE/PDR Rider just because it chose to invest in a previous project, requesting that the Commission make a distinction between the customers right to opt out of the EE/PDR Rider and the electric distribution utility’s right to count the lifetime measures associated with such a CHP project prior to the point in time that the customer opts out of the EE/PDR rider.
Industrial Energy Users-Ohio also filed correspondence in the CHP incentive cases reiterating its previously offered comments.
On April 14, 2015, the Ohio Environmental Council, Natural Resources Defense Council, the Environmental Law and Policy Center, and the Environmental Defense Fund (collectively, Environmental Advocates) filed motions to intervene in the Kraton and Solvay cases, and also filed comments contending that the incentive offered by for commitment of CHP savings is “woefully low, does not align with other states’ incentive programs for CHP, and would set a precedent that may unfairly undervalue the savings yielded by future projects.” The Environmental Advocates argue that the Commission should align the incentive to reflect the efficiency of the CHP system. The Environmental Advocates further argue that AEP should seek approval to bid the CHP energy efficiency savings into the PJM capacity markets.
