On June 29, 2009, nearly a year after they were released by the Public Utilities Commission of Ohio (PUCO), the hospital-specific net metering rules1 required by SB 221 became effective. These rules bring advantages to hospitals with available surplus electricity from their on-site generation units, making it easier for these hospitals to sell surplus electricity to their local distribution utility.  

Key Provisions of Hospital Net Metering Rules:

As established in SB 2212 and replicated in the Commission’s rules, in order to qualify for net metering, a non-hospital customer generator’s facilities must be:  

  1. Fueled by solar, wind, biomass, landfill gas or hydropower, or use a microturbine or a fuel cell;
  2. Located on a customer generator’s premises;  
  3. Operated in parallel with the electric utility’s transmission and distribution facilities; and  
  4. Intended primarily to offset part or all of the customer generator’s electricity requirements.  

Hospital customer generators, on the other hand, must have facilities that meet only two requirements. The facilities must be:

  1. Located on a customer generator’s premises;  
  2. Operated in parallel with the electric utility’s transmission and distribution facilities. Hospitals are not restricted from participating in a net metering program due to the type and usage of their on-site generation facilities. In essence, this change to the law allows hospitals alone to use their piston-driven generators to participate in a net metering program.3  

In addition to this major hospital-specific feature, there are two further key revisions to Ohio’s net metering rules.4  

The first is the elimination of the 1 percent peak demand cap on the availability of an electric distribution utility’s net metering tariff. As a result, the self-generator facility’s rated capacity will no longer count toward the utility’s 1 percent customer peak demand limit. Under the new rules, any customer-generator that qualifies for the net metering tariff may take net metering service from its distribution utility.  

The second revision relates to the interplay between a customer’s use of power from the distribution grid and its self-generation of electricity. The value of the excess generation produced by the customer generator will be applied to the customer’s next monthly bill, with any remaining credit for the previous 12 months to be refunded to the customer at the end of the calendar year. This is a change from the current rule, which allows a credit to accumulate until netted against the customer’s bill or until a customer generator requests in writing a refund for excess generation/credits accumulated over a 12 month period. The proposed provision in contrast requires a refund to the customer without requiring a written request.