Connecticute Regualtion May hold up Fuel Cell Deployment
December 21, 2008
If fuel cells are going to be the energy technology of the future, the state may have to
jettison the regulatory mindset of the past. State energy regulators may stop the largest
residential construction project in the state from using a Connecticut-made fuel cell to
power the building.
The project in question is 360 State St., a 32-story, 500-unit apartment building under
construction across from the State Street train station in New Haven. The building will
contain retail space, including a fitness center and a grocery, and enclosed parking for
500 cars. At nearly 700,000 square feet, it may be the largest single residential building
ever built in the state. Developer Bruce Becker also planned to make it the greenest.
Becker has included 20 energy-saving technologies — a green roof, double-glazed
windows and other features — and hopes to power the building with a 400-kilowatt fuel
cell made by UTC Power of South Windsor. He said if it all comes together, the
skyscraper will be the first residential building in Connecticut to achieve Leadership in
Energy and Environmental Design (LEED) Gold Certification from the U.S. Green
Building Council.
The tricky part is the fuel cell. The project received a $900,000 grant from the
Connecticut Clean Energy Fund to help pay for the power-generating device. The grant
would cover slightly more than half the cost. To pay for the rest, and to maintain the fuel
cell, Becker proposed a plan he used for a similarly sized building called "The Octagon"
he built four years ago on Roosevelt Island in New York City.
Basically, he wants to generate electricity for the building from the fuel cell, and charge the tenants what they would pay if they weregetting the juice from United Illuminating, the local utility.
The building would still have a relationship with UI, to whom it would sell excess generation or buy power if it was needed for summer peak periods. Becker, as landlord, would have one "master meter" for UI. He would install "sub meters" for all the tenants.
This seemingly sensible idea needed approval from the state Department of Public Utility Control. It went before a hearing in September. On Dec.11, the DPUC issued a draft decision turning down the proposal. Master metering, as this arrangement is sometimes called,
has been historically unpopular with regulators. Traditionally, landlords have simply split
the cost of electricity in a building among the tenants. Thus, individual tenants were not
rewarded for conserving electricity, so tended to use and pay more for power.
But Becker said new technology allows each tenant to be accurately billed for only the
power that is used, and for a disinterested third party to monitor the billing. This, he said,
is what is done in New York.
But not in Connecticut. Here, master metering is allowed in marina slips and
campgrounds, and has been allowed in some residential contexts, such as subsidized
senior housing. But the department ruled that Becker's proposal didn't qualify "under
The department said it did not have the authority to create de facto utility companies,
which it does not have the capacity to regulate. The commission also said the proposal
would involve resale of electricity for profit, which is not allowed.
The decision says Becker can achieve the benefits of fuel cell technology by having the
utility buy back the excess power he generates, as a 2007 state law requires. Becker
said the rates of reimbursement under that arrangement are not high enough to cover the
cost of deploying the fuel cell.
This is a preliminary decision. The parties must return for oral arguments, after which it
could change. If the DPUC is interpreting present law correctly, and I have no reason to
think otherwise, then the law has not kept up with technology and needs to be changed,
muy pronto. Otherwise we will have the absurd situation of the legislature and some
state agencies encouraging developers to use fuel cell technology and another state
agency telling them they can't.
Becker hopes to have the DPUC change its mind. If the ruling stands, he said he may
appeal to the courts or ask for legislative relief. Failing that, he said he will be forced to
either abandon the fuel cell idea or use a much smaller cell.
That would be a shameful loss. The legislature has encouraged fuel cells and on-site or
"distributed" generation for many good reasons. Fuel cells are a highly efficient and
extremely clean form of power. Distributed generation lessens power line congestion, a
chronic problem here, and improves energy security.
On the other hand, the new technology has to be implemented without putting distribution
companies such as UI and their customers at risk of higher costs or service changes. So
it's complicated. But it must be worked out.
Whole Article @ Curant.com
If fuel cells are going to be the energy technology of the future, the state may have to
jettison the regulatory mindset of the past. State energy regulators may stop the largest
residential construction project in the state from using a Connecticut-made fuel cell to
power the building.
The project in question is 360 State St., a 32-story, 500-unit apartment building under
construction across from the State Street train station in New Haven. The building will
contain retail space, including a fitness center and a grocery, and enclosed parking for
500 cars. At nearly 700,000 square feet, it may be the largest single residential building
ever built in the state. Developer Bruce Becker also planned to make it the greenest.
Becker has included 20 energy-saving technologies — a green roof, double-glazed
windows and other features — and hopes to power the building with a 400-kilowatt fuel
cell made by UTC Power of South Windsor. He said if it all comes together, the
skyscraper will be the first residential building in Connecticut to achieve Leadership in
Energy and Environmental Design (LEED) Gold Certification from the U.S. Green
Building Council.
The tricky part is the fuel cell. The project received a $900,000 grant from the
Connecticut Clean Energy Fund to help pay for the power-generating device. The grant
would cover slightly more than half the cost. To pay for the rest, and to maintain the fuel
cell, Becker proposed a plan he used for a similarly sized building called "The Octagon"
he built four years ago on Roosevelt Island in New York City.
Basically, he wants to generate electricity for the building from the fuel cell, and charge the tenants what they would pay if they weregetting the juice from United Illuminating, the local utility.
The building would still have a relationship with UI, to whom it would sell excess generation or buy power if it was needed for summer peak periods. Becker, as landlord, would have one "master meter" for UI. He would install "sub meters" for all the tenants.
This seemingly sensible idea needed approval from the state Department of Public Utility Control. It went before a hearing in September. On Dec.11, the DPUC issued a draft decision turning down the proposal. Master metering, as this arrangement is sometimes called,
has been historically unpopular with regulators. Traditionally, landlords have simply split
the cost of electricity in a building among the tenants. Thus, individual tenants were not
rewarded for conserving electricity, so tended to use and pay more for power.
But Becker said new technology allows each tenant to be accurately billed for only the
power that is used, and for a disinterested third party to monitor the billing. This, he said,
is what is done in New York.
But not in Connecticut. Here, master metering is allowed in marina slips and
campgrounds, and has been allowed in some residential contexts, such as subsidized
senior housing. But the department ruled that Becker's proposal didn't qualify "under
The department said it did not have the authority to create de facto utility companies,
which it does not have the capacity to regulate. The commission also said the proposal
would involve resale of electricity for profit, which is not allowed.
The decision says Becker can achieve the benefits of fuel cell technology by having the
utility buy back the excess power he generates, as a 2007 state law requires. Becker
said the rates of reimbursement under that arrangement are not high enough to cover the
cost of deploying the fuel cell.
This is a preliminary decision. The parties must return for oral arguments, after which it
could change. If the DPUC is interpreting present law correctly, and I have no reason to
think otherwise, then the law has not kept up with technology and needs to be changed,
muy pronto. Otherwise we will have the absurd situation of the legislature and some
state agencies encouraging developers to use fuel cell technology and another state
agency telling them they can't.
Becker hopes to have the DPUC change its mind. If the ruling stands, he said he may
appeal to the courts or ask for legislative relief. Failing that, he said he will be forced to
either abandon the fuel cell idea or use a much smaller cell.
That would be a shameful loss. The legislature has encouraged fuel cells and on-site or
"distributed" generation for many good reasons. Fuel cells are a highly efficient and
extremely clean form of power. Distributed generation lessens power line congestion, a
chronic problem here, and improves energy security.
On the other hand, the new technology has to be implemented without putting distribution
companies such as UI and their customers at risk of higher costs or service changes. So
it's complicated. But it must be worked out.
Whole Article @ Curant.com
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