1. Overview Interconnection Federal Regulations –1978 PURPA Legislation –1992, 2005 & 2007 PURPA Legislation Changes –RUS Rules DG Policy State Regulations –Legislation--Wind Innovations Zone –Rules Wind Innovation Zones DG Interconnections 1

2. IUB Rules Changes to chapter 15 (apply to RECs) New chapter (applies only to IUB rate regulated electric utilities) but… Wind Innovation legislation “Electric utilities shall consider adopting the model interconnection agreement” 2

3. IUB order adopting new chapter "Those that advocate extending these interconnection standards to all utilities could seek legislation that would end any debate over the extent to the Board's jurisdiction over non-rate regulated utilities. However, if problems develop with respect to interconnections with non-rate regulated utilities, the Board may revisit the jurisdictional issue in a new rule making that would seek to apply the adopted rules to non-rate regulated utilities, even in the absence of new legislation" 3

4. IAEC Regulatory Affairs Committee Reviewed Requirements for IUB Rate Regulated Utilities Developed new IAEC model tariff interconnection section of tariff Other deliverables –Model application forms –Model contracts –Letters –Workshop and Webinar 4

5. NEW IAEC MODEL DG TARIFF The IAEC model establishes 4 different levels of interconnection –Level 1 - Capacity of 10 kVA or less; lab certified equipment; inverter-based; no utility construction required –Level 2 - Capacity of 150 kVA or less; lab certified equipment; no construction of utility facilities required –Level 3 - Non-Exporting generators; Capacity of 150 kVA or less; No shared transformer; no construction of utility facilities required –Level 4 - Capacity of 10 MVA or less; equipment is not lab certified or one of the screens for levels 1, 2, or 3 have not been met. 5

6. Standard Forms –There is one standard application form and agreement for level 1 interconnections The purchase power terms for level one are set forth in attachment 2 –There is another standard application form and agreement for any interconnection that is not a level 1 interconnection. For levels 2-4 a separate purchase power agreement is required 6 NEW IAEC MODEL DG TARIFF

7. What are the Insurance Provisions? The insurance requirements are established in the model agreements –Anything less than 150 kVA, the interconnection customer is required to carry general liability insurance coverage, such as, but not limited to, homeowner's insurance - the utility cannot demand it be named as an additional insured but can require member-consumer to provide insurance certificate annually. –Anything greater than 150 kVA, but less than 1 MVA, the interconnection customer is required to carry sufficient coverage so that the maximum comprehensive/general liability coverage that is continuously maintained by the interconnection member-consumer during the terms shall be not less than $1,000,000 for each occurrence. The Cooperative, its officers, employees and agents shall be added as an additional insured on this policy. –Anything 1 MVA or above, the interconnection customer shall carry comprehensive general liability coverage of not less than $2 million for each occurrence, and an aggregate, if any, of at least $4 million. The utility shall be named as an additional insured and the utility is to be notified at least 30 days in advance of any cancellation, reduction in limits, or non-renewal. 7 NEW IAEC MODEL DG TARIFF

8. Application Fees –Maximum Application fees are established - See chart. –For levels 1, 2, and 3 - The application fee is generally all that can be required to be paid. (May charge for minor modifications to the utility system if utility agrees to make the same and still proceed under one of the expedited levels of review) –For level 4 interconnections, the generator will also be required to pay for the costs of interconnection studies and the interconnection facilities or system upgrades 8 NEW IAEC MODEL DG TARIFF