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Renewable Energy FAQs

What is the cooperatives' position on renewable energy?

Today's changing energy landscape is bringing more attention to renewable energy resources, including wind and solar. Sioux Valley Energy supports generation that is safe, reliable, cost-effective and environmentally responsible. 

What is required by the cooperative if I install a Renewable Energy System (RES)?

Cooperatives must adhere to all applicable federal and state laws when working with a member-consumer to connect wind generators to the grid. When considering the installation of a RES, a strong emphasis must be placed on safety considerations for the cooperative's employees and member-consumers; protection of the cooperative's and member-consumers delivery system; and fairness to other member-consumers of the cooperative from a cost (billing) perspective.

A written agreement between the cooperative and the member-consumer is developed to ensure proper communication and protections are in place, prior to connection of the facility to the grid. Consideration must also be given to established requirements for installation, maintenance, metering, switching and liability insurance. Your local cooperative can provide you with a complete list of all of the requirements.

What is the process for installing a Renewable Energy System (RES)?

A member should contact SVE to inform them of their intent to install a Renewable Energy System (RES) at their home or business. An application will need to be filled out and approved by SVE. We recommend the application be approved prior to starting the installation process.  Prior to interconnection with the SVE grid the RES and its associated wiring is required to pass inspection by the State Electrical Inspector in your area and meet SVE guidelines.  The member must also provide SVE with a certificate of liability insurance for the RES.  A Power Purchase Agreement will need to be entered into by the member and the cooperative which will allow the member to be reimbursed for any power delivered to the SVE grid. An SVE employee is available to guide you through the entire process. 

Why does the cooperative have requirements for connecting a Renewable Energy System (RES) to the grid?

As rural electric cooperatives, we are your partners in providing you with safe, reliable electric service. We have requirements in place to address issues of safety, grid integrity and cost fairness. Those requirements ensure that cooperatives can (1) protect the safety of member-consumers and cooperative employees (2) maintain the integrity and reliability of the grid and (3) establish mechanisms to ensure adherence to the cost causation principle.

What if I disagree with some of the requirements of the cooperative -- what is the process for challenging this?

Member-consumers are encouraged to discuss any concerns with their local electric cooperative representatives to resolve questions or issues associated with connecting a RES to the grid. As your rural electric cooperative, it is our goal to work with our member-consumers to address questions and concerns. Your local board of directors makes decisions concerning the policies of the cooperative. If the requirement is one where the cooperative has some discretion, the board could review it. However, many of the requirements are based on federal or state statutes and regulations and cannot be modified.

Isn't wind a cash crop for farmers?

The concept of a "cash crop" may apply to farmers who rent or lease land to large companies who own and operate several wind turbines. The wind farm near Highmore, South Dakota is an example of company-owned wind turbines operating on farmer-owned property. In these types of instances, payment(s) are made to the landowner for the use of their land. This is in contrast to an individual who actually owns a wind turbine.

Do I have to have two meters if I install a renewable energy system?

Sioux Valley Energy’s new metering system is capable of measuring electricity that is drawn from the grid by the member and any electricity that is delivered to the grid from the members Renewable Energy System. No extra meter is needed for a typical renewable installation to an existing service. 

Is a Renewable Energy System a good choice for my situation?

Installing your own RES is an individual decision for each member-consumer. The cooperative can help you obtain information you deem relevant to your decision-making process. However, the decision is one you must make on your own or with the assistance of consultants hired to provide you with advice. 

What rate will the cooperative pay me for kWhs generated from my wind turbine?

Your local electric cooperative will pay rates based on "avoided cost" for kWhs that the member-consumer generates and delivers to the grid.

This avoided cost standard is pursuant to federal regulations. The avoided cost standard represents the costs the utility does not have when it buys energy from a customer owned generation resource.

Since the utility must have in place all of the other facilities for delivering power to the customer, even if the customer is sometimes generating some of their own power, the value to the utility is limited. This value is expressed as the "avoided cost" and is priced to represent the cost of the fuel needed for the cooperative to generate the equivalent amount of kWhs the customer has delivered into the grid.

Our standard rate for customer owned generation can be found in SVE's annual rate schedule.  Click HERE to access the schedule. This rate is reviewed annually, and adjusted to the cost of fuel as required by federal regulations.

Why do I have to carry liability insurance?

It is very common for businesses and individual homeowners to carry liability policies to insure against various types of losses or claims. Conceptually and generally, customers should not view carrying liability insurance on a RES any differently than the liability insurance that is carried to drive an automobile. Insurance on automobiles is carried to provide coverage for damages to others and their property. This basic business principle applies to carrying liability insurance for a RES. Just as it is true for other personal property, it is up to the owner of a RES to assume responsibility for insurance coverage.

What is net metering (net billing)?

In its simplest form Net Metering is the offsetting of kWh’s delivered to the grid from a renewable energy system netted against the kWh’s delivered to the consumer from the utility company. For example if a utility delivers 1000 kWh’s to a member during a billing period and the consumers renewable energy system delivers 300 kWh’s to the utility grid during the same billing period, the consumer would be billed for 700 kWh’s from the utility.

There are other forms of Net Metering in place between consumers and their utility company that  accomplish nearly the same results as the above scenario with slight variations. Net Metering methods may vary slightly from utility to utility or from state to state depending on the statutes in each state. “Net Billing” can be another name or form of “Net Metering” where the monthly netting of the kWh’s is accomplished in the billing process. 

Why are cooperatives opposed to net metering?

Net metering is one of several mechanisms that can be used to deliver subsidies to member-consumers installing a renewable energy system. This mechanism prevents member-consumers who own a renewable energy system from paying their fair share of the costs associated with the poles, wires, metering equipment, transformers and substations necessary to deliver the kWh’s to their premise. 

Does Sioux Valley Energy provide a Standby Service?

If a consumer generates their own power and only chooses to receive power from  Sioux Valley Energy when their generation is not running, they can apply for a Standby Service. This rate reflects the costs to maintain adequate facilities, power supply resources and transmission access to serve the member’s needs. The timing and duration of the need for standby service will need to be determined and the cooperative will price this class of service accordingly. 

Does Sioux Valley Energy pay a Capacity rate for KW delivered to the grid?

Because of the intermittent and unpredictable nature of the output of a Renewable Energy System Sioux Valley Energy does not pay a Capacity rate for KW that is delivered to the grid.

What can I do to attract the attention of wind developers to my land?

Many factors are involved in the site selection process for a wind project. Early in this process, wind developers use publically available land ownership records to find and contact landowners. 

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