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To establish the application procedure and qualification criteria for all customers for the <br />delivery, interconnection, metering and purchase of electricity from distributed energy <br />resource facilities and to comply with applicable laws and rules governing distributed energy <br />resources. <br />The utility recognizes its obligation to provide interconnection to eligible qualifying facilities and will <br />comply with all applicable laws and rules governing distributed energy resources. <br />For purposes of this policy, the following terms have the meanings given them: <br /> <br />A.Average retail energy rate - the average of the retail energy rates, exclusive of special rates <br />based on income, age, or energy conservation, according to the applicable rate schedule of <br />the utility for sales to the class of customer of which the customer/qualifying facility <br />belongs. <br />B.Avoided costs - the incremental costs to the utility of electric energy or capacity or both <br />which, but for the purchase from the qualifying facility, the utility would generate itself or <br />purchase from another source. <br />C.Contract - the written agreement between the customer/qualifying facility and the utility, <br />as established in the utility Interconnection of Cogeneration and Small <br />Power Production. <br />D.Distributed energy resource (DER) - a distributed generation system incorporated with or <br />without an electric storage system. <br />E.Interconnection application - the form to be used by the customer to submit its formal <br />request for interconnection to the utility and which shall be substantially similar in form to <br />that contained in the Distributed Energy Resources Interconnection Process adopted by the <br />utility. <br />F.Interconnection rules - any applicable rules developed in accordance with Minnesota <br />Statutes §§216B.164 and 216B.1611. This includes the utilityRules Governing <br />Interconnection of Cogeneration and Small Power Production. It also includes the utility <br />Distributed Energy Resources Interconnection Process which includes its Simplified Process, <br />Fast Track Process, and Study Process as well as the technical requirements incorporated <br />therein or any future technical requirements adopted by the utility. <br />G.Measured capacity - for purposes of determining capacity, it shall be measured based on the <br />highest fifteen (15) minute average demand of the unit in any one billing period. <br />H.Net metering/net billing - the process whereby the customer and the utility compensate <br />each other based on the difference in the amount of energy each sells to the other at the net <br />metered facility. <br />I.Net metered facility - an electric generation facility constructed for the purpose of offsetting <br />energy use through the use of renewable energy or high efficiency generation sources with a <br />capacity of less than 40 kilowatts that has elected in writing to be compensated for excess <br />generation through net metering/net billing. <br />J.Total generator nameplate capacity - the nominal voltage (V), current (A), maximum active <br />power (kWac), apparent power (kVA), and reactive power (kvar) at which a distributed <br />energy resource (DER), is capable of sustained operation. For a qualifying facility with <br />1 <br />72 <br />