Minnesota PUC Fines Xcel Energy $1 Million for Interconnection Failures by Gwen Brown, January 22, 2021, IREC (Interstate Renewable Energy Council)
Minnesota utility Xcel Energy was fined one million dollars on Thursday for exceeding a maximum number of customer service complaints as a result of significant delays in its processing of interconnection requests for solar projects. A ruling from the Minnesota Public Utilities Commission affirms the right of consumers to reasonable customer service in the interconnection process. We provide the inside scoop based on IREC’s participation in the regulatory proceeding.
Interconnection, the process of connecting a solar installation or other distributed energy resource (DER) to the electric grid, is a critical step in the project development process. But around the country, interconnection is also a frequent pain point for clean energy developers and their customers.
Cumbersome paperwork and slow approval times from the utility companies that must review and approve customers’ solar interconnection requests are one reason for this. Strikingly, there is almost no history of regulatory commissions holding utilities accountable for failures to meet their obligations under the interconnection procedures.
A recent case in Minnesota exemplifies both the types of challenges to interconnection that clean energy projects can face and why these delays and other frustrations can be so damaging for consumers and businesses. The resolution, reached yesterday in a hearing of the Minnesota Public Utilities Commission, provides a win for Minnesota consumers and solar companies.
The Commission fined Xcel Energy $1 million for exceeding the threshold of complaints filed, many of which were about significant problems with Xcel’s interconnection process. It also provides a helpful precedent for how utility regulators can hold utilities accountable for providing an efficient interconnection process and good customer service to their ratepayers who are investing in solar and other clean energy technologies.
In this blog post, we provide an update on the regulatory case and its outcomes, and the significance of this decision in the context of clean energy interconnection challenges across the country.
The Background: Xcel Faces Fine for Solar Interconnection Delays
In June of 2019, the Minnesota Public Utilities Commission, which regulates the state’s electric utilities, established new rules for solar interconnection. The rules were supposed to make the interconnection process easier and faster, but after the new rules were implemented, solar developers reported frequent delays and other problems with Xcel Energy’s process. (These issues were specific to Xcel; customers of other Minnesota utilities have not reported similar issues under the new rules.)
After many failed efforts to resolve issues related to approval delays and missed deadlines through direct communication with Xcel, two solar companies saw no other option than to begin to submit complaints to the PUC. In total, the companies submitted 129 separate complaints to the Commission’s Consumer Affairs Office on behalf of their customers in December 2019, explaining that Xcel was not complying with the process and was unnecessarily delaying their projects. 
Juicy kickbacks from big oil and gas?
Xcel Energy is subject to a Quality of Service Plan (“QSP”) that requires it to provide a certain level of service to its customers. Under the QSP, the Minnesota Public Utilities Commission (PUC) is to fine Xcel if it exceeds a certain number of customer complaints in a year. Because of these complaints on behalf of solar customers, Xcel exceeded its maximum number of complaints in 2019—in theory triggering a one million dollar fine.
However, Xcel petitioned the Commission asking it not to count the 129 complaints regarding problems with Xcel’s interconnection process, arguing that these should not count as “customer” complaints. I can’t even imagine being that arrogant.
Our Regulatory Team filed comments on behalf of IREC and our partners Fresh Energy, the Environmental Law and Policy Center (ELPC), and Vote Solar asking the Commission to ensure that the solar installer complaints be counted. We argued that the delays have real impacts—including financial impacts—on Xcel’s customers who seek to install solar, and that Xcel must be held accountable for providing adequate customer service to all customers, including solar customers. Other groups submitted comments in support of counting the complaints including the Minnesota Solar Energy Industry Association, the Citizens Utility Board of Minnesota, and the cities of Minneapolis and St. Paul.
We argued that the delays have real impacts—including financial impacts—on Xcel’s customers who seek to install solar, and that Xcel must be held accountable for providing adequate customer service to all customers, including solar customers.
Following the public comment period, the Commission voted 3-2 on January 21, 2021 that the complaints should be counted under the QSP. In their comments, each of the Commissioners emphasized that it should be absolutely clear that solar customers are indeed customers of Xcel and deserve adequate customer service. They all agreed that the complaint threshold in the QSP had been crossed. When it came to the question of whether to therefore issue the one million dollar fine, a majority of the Commissioners voted in favor of issuing the fine. Two of the five Commissioners did not vote to issue the fine, preferring instead to delay that decision to a later date.
The Commission also recognized that just issuing a fine was insufficient and decided to take additional actions that would ensure greater accountability for Xcel. All five Commissioners voted to adopt a new set of reporting requirements for Xcel Energy that will require the company to regularly report on its adherence to the timelines in the interconnection procedures, on the number of disputes or complaints submitted, and on any work it is doing to improve the interconnection process. They also adopted a process that will require Xcel Energy to work with stakeholders to develop an additional process for resolving disputes when they arise. These additional measures should provide further incentive for Xcel Energy to fix the problems with their interconnection process.
IREC commends the Commission for tackling the issue head on and strongly affirming that solar customers should be treated like all other Xcel Energy customers and be provided with quality customer service. While stakeholders should always be encouraged to work together to try to resolve challenges in the interconnection process, there comes a point where it is necessary for the Commission to exercise its regulatory authority and demand more from the utility. Here the QSP tariff was very clear that if the complaint threshold was crossed that a fine should be issued. We also appreciate the Commission taking steps to help ensure that this situation is not necessary again and we look forward to seeing concrete improvements for solar interconnection customers in the coming months.
Why Does It Matter?
In most aspects of our daily lives, when confronted with poor service, we can choose to take our business elsewhere. If I order a product and it arrives late or is of poor quality, next time, I can choose to buy from another company. Not so in the case of utilities.
As regulated monopolies, electric utilities like Xcel have a captive market. Customers of Xcel cannot simply choose another electric utility. The role of the regulator is to ensure that, despite the monopoly, a utility’s customers still receive adequate service.
As regulated monopolies, electric utilities like Xcel have a captive market. Customers of Xcel cannot simply choose another electric utility. The role of the regulator is to ensure that, despite the monopoly, a utility’s customers still receive adequate service.
Other than submitting complaints through the Commission’s Consumer Affairs Office or filing a very expensive and time consuming formal complaint with the Commission, there is currently no other avenue for customers to ensure that Xcel Energy is providing adequate customer service.
If the Commission were to have agreed with Xcel’s argument that their solar customers do not count as “customers” in terms of their right to seek redress for service issues, people who install solar on their homes and businesses would be deemed in effect “non-customers”—whose rights to reasonable customer service are valued differently than other people that receive electricity from Xcel. Good thing the Trumpski has been punted from his perch of power, I think he’d blow a gasket, or three.
Fortunately, the Commission fulfilled its role protecting the rights of Xcel’s customers and affirmed the QSP is an appropriate mechanism for ensuring that customers receive quality service during the interconnection process. They also took steps to ensure that the specific obligations under the interconnection procedures are complied with as well.
While there are other concerns that remain about how the solar interconnection process is working in Minnesota (particularly for community solar garden projects), today’s resolution is an important win for Minnesota’s solar customers and companies.
It may also provide a valuable model for regulators in other states. Lack of accountability to interconnection timelines remains an issue in many other states, and a similar accountability mechanism could be a solution to consider.
Lack of accountability to interconnection timelines remains an issue in many other states, and a similar accountability mechanism could be a solution to consider.
A Question of Customer Service and the Role of Consumer Advocates
As discussed, this case explored the issue of interconnection delays, and the accountability of utilities to meet interconnection timelines and have functioning interconnection portals, as issues of customer service and consumer rights. But another interesting facet of the case was the role played by the state’s official consumer advocate—the Minnesota Department of Commerce.
The mission of the Minnesota Department of Commerce is to advocate for the state’s consumers and to ensure a “competitive and fair marketplace.” Yet in this instance, Commerce submitted comments that put the interests of Xcel Energy over the rights of Xcel’s solar customers (Minnesota consumers). Kickbacks too juicy?
Their comments suggested that the complaints not be counted as customer complaints because they were filed by solar installers (rather than directly by the customers who hired the installers to manage the process on their behalf). They further argued, inaccurately, that the comments should not be counted because it did not appear anyone was financially harmed by Xcel’s delays. Nasty frac’ers! As nasty as my backstabbing, dishonest ex lead lawyer, Murray Klippenstein! He wrote me repeatedly that he was sending me my case files. Nothing yet, nearly 2.5 yrs after his first written promise.
As a basis for evaluating whether there had been financial harm (something which is not a requirement for determining whether a fine is assessed under the quality of service tariff), the Department of Commerce asked only Xcel whether customers were impacted. Xcel responded that, to its knowledge, no customers or solar installers were harmed by delays.
Remarkably, the Department of Commerce did not actually ask any customers whose solar installations were delayed whether they suffered any harm, and in reality, Xcel’s delays resulted in hundreds of thousands of dollars in harm.
Importantly, both Xcel and the Department of Commerce were wrong about the legal standard for what constitutes a customer complaint under Xcel’s quality of service tariff. Customers seeking to install solar are customers to whom Xcel provides service, and the tariff contains no requirement that the customer show actual harm. The metric measures satisfaction through evidence of the complaint—not actual harm (though in this case, there was actual harm, as we discuss below).
Fortunately, the Commission firmly rejected the idea that customers should be required to show financial harm under the QSP. As noted above, they also strongly affirmed that solar customers are indeed customers deserving of quality customer service. IREC is disappointed that the Department of Commerce chose to protect the monopoly utility instead of the state’s residential customers in this fight. Utility solar customers are at a significant disadvantage when faced with the power of a large utility and they need the state’s designated advocate to have their back. We were pleased however that the Citizens Utility Board of Minnesota and the Cities of St. Paul and Minneapolis spoke up on the behalf of solar customers.
Interconnection Delays Have Real Consequences
“Not only do customers experience delays in their projects, but also increased costs or reduced incentives,” explained Michael R. Allen, President of All Energy Solar, one of the solar companies that submitted complaints, in a public comment letter asking the Minnesota PUC not to accept Xcel’s petition to throw out the complaints.
“Not only do customers experience delays in their projects, but also increased costs or reduced incentives,” explained Michael R. Allen, President of All Energy Solar, one of the solar companies that submitted complaints, in a public comment letter asking the Minnesota PUC not to accept Xcel’s petition to throw out the complaints.
“The Federal Tax Credit reduced from 30% in 2019 to 26% in 2020,” Allen went on to explain. “Xcel failed to meet many deadlines in 2019 causing projects to get pushed to 2020, thereby causing customers to lose out on 4% of their tax credit incentive. Had the deadlines been met on many of those projects, they would have qualified for the larger tax credit. Instead our company alone experienced over $150,000 in penalties from our customers and the commitments that we made to them. Not all of the delays we experienced were due to Xcel delays but a significant percentage were. We made commitments to our customers based on rules that Xcel Energy agreed to follow… Ultimately, Xcel customers were delayed in their projects and we were penalized financially because of it.”
As the race to confront climate change grows increasingly urgent, these kinds of interconnection delays slow down the critical process of getting more solar and other distributed energy resources (DERs) on the grid. They also drive up the cost of developing solar projects, undermining the extensive work being done in states around the country to make solar development faster and more affordable.
As the race to confront climate change grows increasingly urgent, these kinds of interconnection delays slow down the critical process of getting more solar and other distributed energy resources (DERs) on the grid.
It is going to be important in the coming years for regulators across the country to adopt similar accountability metrics for utility performance in the interconnection process if we want to rapidly deploy DERs. The decision yesterday in Minnesota provides an important example of how best to do this. The Commission affirmed that there should be two types of accountability metrics. The first evaluates whether the utilities are meeting their specific obligations under the interconnection procedures with respect to timelines or other steps. The second evaluates the utility’s overall provision of “customer service” which does not look just at whether the specific timelines are met, but also at the overall quality of the customer experience during the interconnection process. IREC believes both metrics should be deployed by Commissions to protect customers and to ensure DER deployment is fast and cost effective.
Century-old home in Michigan produces more energy than it uses, Even an old building can help slow global warming by Yale Climate Connections, Jan 2021
2020 Landmark — Renewables Top Fossil Fuels In Europe For First Time by Steve Hanley, January 25th, 2021
Ember and Agora Energiewende have been tracking electricity generation in Europe for the past 5 years. Their latest annual report shows that renewables provided more electricity than fossil fuels in Europe for the first time ever in 2020. “Renewables rose to generate 38% of Europe’s electricity in 2020 (compared to 34.6% in 2019), for the first time overtaking fossil-fired generation, which fell to 37%. This is an important milestone in Europe’s clean energy transition. At a country level, Germany and Spain (and separately the UK) also achieved this milestone for the first time.”
… “Leaders in wind and solar show what is possible if there is sustained political will, while some countries continue to lag behind despite excellent solar and wind conditions, the report says. See chart above. “Denmark generated 62% of its electricity from wind and solar in 2020, which was almost twice the next country of Ireland. Germany was third, and then Spain overtook Portugal into fourth place. Seven countries, some with excellent conditions for solar and wind, have barely seen any growth since 2015 — Portugal, Romania, Austria, Italy,Czechia, Slovakia and Bulgaria.” …
How U.S. Research Damning Electric Cars Is Funded by Saudi Oil Interests by Matt Smith, Jan. 20, 2021, Barron’s
Hidden in the hardwood forests of eastern Tennessee is a glass-and-steel American Wakanda of impulsed neutron beams, supercomputers, and atom probe microscopes. Here, at the U.S. Department of Energy’s Oak Ridge National Laboratory, Enrico Fermi and fellow scientists raced to develop the neutron bomb, and subsequent generations worked on the world’s-fastest computers, helped develop nuclear submarines and advanced spacecraft, analyzed greenhouse gas emissions, and made world-changing discoveries such as ribonucleic acid and the role of the Y chromosome.
One of ORNL’s latest studies warns that China’s policy of incentivizing electric-car production will lead to the creation of more carbon emissions during coming years than if Beijing were to instead encourage use of efficient gasoline engines.
Despite ORNL’s vaunted history there are reasons for a second look at this last bit of research. The China EV study, published in the scientific journal “Nature Communications,” was paid for by oil giant Saudi Aramco, which counts China as its largest customer and whose revenue depends upon the continued demand for oil. Some analysts say that Aramco’s role in producing the research is a potential conflict of interest, and that the relationship between Aramco and ORNL highlights a broader concern about how some companies fund scientific research at U.S. government facilities that directly supports their business interests.
ORNL was founded in 1943 as part of the Manhattan Project and has a current annual budget of $1.6 billion, making it one of the most significant research facilities on the planet. Its budget is approximately twice the annual funding for research at Harvard University.
With the end of the Cold War, the scientific establishment that grew from World War II pivoted further toward offering itself as a font of private-sector research and development where government science research, new technologies, and world-class facilities would bolster competitiveness on the commercial, rather than military, stage.
There is little transparency around private companies’ financial or other involvement in the U.S. Department of Energy’s research, including research produced at ORNL. ORNL, the Energy Department, and Aramco didn’t respond to questions about the amount and nature of Aramco project’s funding. A U.S. federal court has concluded ORNL isn’t bound by the U.S. Freedom of Information Act because it is managed for the government by a private contractor.
Details of ORNL’s work with private corporations have come to light, however, when internal corporate records have been unearthed in lawsuits involving industries such as tobacco and chemicals. Such records show ORNL working step-by-step with industry representatives, including lobbyists.
The ORNL scientist leading the recent Aramco-funded project, however, said the company hasn’t meddled in his work.
“Yes, Aramco is an oil company, and they support our research, but they never impose their views,” said Zhenhong Lin, the ORNL director of the Aramco funded study of China’s EV market. “My understanding is they want to understand the future of the Chinese vehicle market so they can understand their demand for oil and other energy.”
Some academic research departments have taken a strict line on working with Aramco. Staff at universities such as Massachusetts Institute of Technology and Harvard have protested against taking Saudi money because of the country’s human rights reputation, with MIT in September 2020 moving to exclude Saudi Aramco from energy research programs.
“I would think twice about taking money from Saudi Aramco,” said Venkatesh Narayanamurti, previously head of Harvard’s engineering and applied sciences school, and former vice president for research at ORNL’s sister institute, Sandia National Laboratories.
Because Saudi Aramco is a government firm, having the U.S. Department of Energy perform its policy research raises ethical questions, said Narayanamurti.
“Saudi Arabia, politically, it’s quite a brutal regime,” he said.
Robert Alvarez, who from 1993 to 1999 was a senior U.S. Department of Energy official with oversight over science operations, said that such a sensitive government-to-government deal should have received top diplomatic vetting.
“I suspect this is an example of lack of adult supervision in the national laboratories,” he said.
An ORNL spokeswoman referred questions to Aramco Research Center-Detroit, the division directly funding the ORNL project.
That division is dedicated to the sort of efficient gasoline engine ORNL’s report said would help solve China’s greenhouse gas problems. Its engineers develop energy-saving internal combustion technologies to protect the oil giant’s market share against transport electrification, the Aramco facility’s chief told The Wall Street Journal in 2018. A Saudi Aramco spokesperson said the company had no comment.
The ORNL EV study “Greenhouse gas consequences of the China dual credit policy” calculated that China’s method for reaching its 2035 goal of eliminating sales of traditional gasoline powered vehicles could stumble in reducing pollution during that the coming decade, thanks to the unintended consequences of rewarding EV production by doling out “credits” allowing manufacturers to make traditional cars. Manufacturers are likely to maximize profit from these limited quotas by prioritizing big-ticket gas-guzzlers, the report said. The combination of more gasoline-hungry engines and rapidly increased EV production would create more pollution than a shift to more efficient gasoline engines, the report concluded.
Other analysts have also questioned China’s EV policies. But the ORNL study’s focus is very closely aligned with Aramco’s official position.
“It would be no surprise that people are going to try and shape conclusions and public opinion to serve their own strategic interest, and I think their interests are very clear, and that is to maintain a more carbon intensive system for decades to come,” said Joseph Britton, head of the EV trade group Zero Emission Transportation Association.
Stakes are high. The European Union, Japan, Korea and 110 other countries have pledged carbon neutrality by 2050. China says it will do so before 2060, extending $100 billion thus far in EV subsidies.
Investors have noticed, with shares in Chinese EV manufacturers such as NIO and Xpeng following Tesla stock higher in recent months. EVs Beyond Tesla: How to Invest in Electric VehiclesYou may also likeUp Next
Saudi Aramco is the world’s sixth-largest company by revenue, reporting $259 billion in 2019, a year when it was China’s largest source of crude oil. In the prospectus for the company’s November 2019 initial public offering, Saudi Aramco repeated five times the warning that electric vehicles would pose a business risk, or a threat to oil demand. Aramco and its officials in advertisements, speeches and interviews have urged sticking with petroleum.
“Carbon emissions can be reduced as a result of efficiency introduced by the industry, in a much higher proportion than renewables and electric vehicles can,” said Saudi Aramco Chief Executive Amin Nasser in an interview posted in December 2020 on the website of the French oil company Total.
“My encounters in Davos showed me that fewer and fewer of our stakeholders accept logic and facts, least of all from us,” he said at a 2019 London energy conference.
Aramco and the Saudi government have spent lavishly on their own research centers in 11 countries, while sponsoring additional research at universities and at U.S. government research centers. The academic publications database Crossref shows 472 journal articles published from Aramco sponsored research since 2015. That outstrips other oil companies—the British energy giant BP Global sponsored research resulting in 49 papers in the Crossref database, with Shell Oil behind 33 such papers.
U.S. universities reported receiving $34 million in contract payments from Saudi Aramco between 2014 and 2019, according to U.S. Department of Education data. A search of the U.S. Department of Energy’s database of its research publications shows more than 150 articles based on work either funded by Aramco, co-written by Aramco employees, or involving Aramco collaboration since 2008. Topics included gasoline-engine efficiency, carbon capture, and most recently, the shift to electric vehicles by Aramco’s largest customer, China.
Oil companies have forged differing responses to climate change. Companies such as BP and Shell tout forays into alternate energy, for instance Saudi Aramco has largely advocated remediating petroleum pollution with new technologies. Some of these claims are overblown, said Jonathan White, climate program lawyer for the U.K. environmental group ClientEarth. Last year, Aramco withdrew “sustainability” advertisements after being contacted by the U.K.’s Advertising Standards Authority over complaints they were misleading, he noted.
He said that Saudi Aramco’s efforts with ORNL is “a coordinated campaign to make the research match the publicity.”
Energy Department research centers in the U.S. have faced criticism for taking funding from vested interests in the past.
Tobacco companies during the 1990s and 2000s paid ORNL hundreds of thousands of dollars for studies on the effects of secondhand smoke, in at least one case hiring an industry-sponsored ORNL researcher as an expert witness to testify at trial. A judge tossed the testimony, saying it reminded him of “having the fox in the henhouse.”
Kathryn Mulvey, head of the Union of Concerned Scientists corporate accountability campaign, said she sees parallels between tobacco-funded research and the prominent role that oil companies, including Aramco, currently play sponsoring university and government science.
“These certainly look like pages out of the playbook that the oil-and-gas industry has perfected for decades, picking up plays from the tobacco and other industries that sought to perpetuate harmful practices and gain undue influence over policy markets, and setting the research agenda,” she said.
Refer also to:
Below is a small example of oil-patch-$$$$$$$-tainted Alberta academia (after these posts, Ernst no longer had time to diligently find & follow the bribes, oh ya, gifts):
Cenovus donates $1.5 million to Lakeland College
Talisman pledges $1.25 M to Mount Royal University, Alberta
EPA Fines Talisman For Fracking Violations
Burning Waters: UVic Partner’s environmental record questioned
Encana donates $1.5 Million to Mount Royal University
EnCana donates $7.5 Million to the University of Alberta
Corporate polluters don’t just buy their way out of contaminating community drinking water supplies with settle ‘n gag orders given to them by their judicial friends in our courts, they buy their way out with donations too:
Cenovus donates $3 Million to the University of Alberta
University of Calgary Prostitutes Itself To Big Oil & Gas
EnCana to donate $1 Million to the University of Calgary
Encana donates $1 million to Red Deer College
EnCana $1 Million donation to University of Calgary questioned as company awaits energy decision
Million-dollar Nexen donation to Mount Royal University to benefit future journalists, educators
Imperial Oil donates $1 Million to Mount Royal University
Cenovus donates $3 Million to the Southern Alberta Institute of Technology
Is the Southern Alberta Institute of Technology overflowing with oil money?
ConocoPhillips Canada supports University of Lethbridge and places students link previously went to: http://www.thisismyu.ca/stories/donor/2010/11/conocophillips-canada-sees-benefits-support
Trican Donates $5 million for cancer research at the University of Calgary
Trican donates $5 Million to Fight Chidhood Cancer and for research at the University of Calgary
EnCana donates $50,000 to Northern Medical Program Trust
Enbridge Donates $500,000 to the Alberta School of Business
June 2013 Cenovus 3 million endowment to University of Alberta to assess energy and environmental options for industry and government “How much water is required to produce a unit of energy?”