GPS Generation Partners® Questions & Answers

(For External Distribution)

What is Green Power Switch® (GPS) Generation Partners?

GPS Generation Partners is a program that provides technical support and incentives for
the installation of renewable generation facilities. GPS Generation Partners was started
as a pilot in 2003 as a result of requests from end-use customers for “net-metering”
standards in the TVA service territory. Net-metering enables customers to use their own
generation to offset their consumption over a billing period by allowing their electric
meters to turn backwards when they generate electricity in excess of their demand. This
offset means that customers receive retail prices for the excess electricity they generate.
Because of TVA’s current power contracts with its local power companies, net-metering
is not an option in the TVA service territory. TVA created GPS Generation Partners as a
“dual-metering” option, an alternative to net-metering. With the GPS Generation
Partners program, there are two meters and TVA purchases 100% of the green energy
output and then uses solar, wind, low impact hydropower, and biomass as a Green
Power Switch resource.

Green Power Switch is an energy option that allows local power companies throughout
the Tennessee Valley to provide their customers the choice to buy electricity produced
by renewable resources. TVA owned generation in the Green Power Switch® Program
includes solar, wind, and methane gas from waste water treatment. See
www.greenpowerswitch.com for more information on Green Power Switch®.

What are the benefits for the participants of GPS Generation Partners?
Program participants support the environment by helping keep the Tennessee Valley
clean and green. For example, a 3 kilowatt (kW) system's annual benefits are equal to
planting an acre of trees or taking a car off the road for 4 months. In addition, solar
systems help improve air quality by reducing emissions of fine particulate matter,
nitrogen oxide, and sulfur dioxide. They also benefit by defraying the costs of their
renewable system installation and lowering their monthly energy bills through the
revenue they receive from the sale of the green power. TVA likes to call GPS
Generation Partners a Win-Win-Win for the end-use customer, the power company, and
TVA.

How does the program work?

Below an overview of how the program works:

• An eligible, renewable generation system is installed by a residential,

commercial, or industrial power customer served by a participating local power
company of TVA power.
• TVA will purchase 100% of the green energy output at a premium of $0.12 cents
per kilowatt-hour (kWh) for solar and $0.03 for all other renewable generation
sources above the retail rate plus any fuel cost adjustments. All new participants
will qualify for an additional $1000.00 incentive to help offset start-up costs.
• Payment is issued in the form of a credit on the participant’s monthly power bill
by the local power company, who will meter both the power use of the home or
business as well as the output of the renewable generation system.
 • The power company will provide monthly statements showing energy used and
any applicable credit due. The power bill will be reconciled monthly with these
energy credits. If the system produces more than the home or business
consumes, a check will be issued monthly or annually, at the discretion of the
local power company.
• All equipment must be in compliance with environmental regulations and national
standards, certified by a licensed electrician, and meet all applicable codes.
• The customer is guaranteed payments for 10 years from the start of the
agreement with the local power company.

Customers should contact their local power company to apply for participation in the
program prior to purchasing a renewable generation system.

What renewable resources and technologies are eligible for the program?
Projects that generate electricity from technologies using any one of the following
sources are eligible for the program: solar, wind, low impact hydropower, and biomass.

Biomass includes all solid, liquid, and gaseous forms of the following fuels:
• All woody waste
• All agricultural crops or waste
• All animal or other organic waste
• All energy crops
• Landfill gas and wastewater methane

Go to the Renewable Energy Resources page to learn more about each technology.

What size renewable systems are eligible for the GPS Generation Partners
program?
To maintain consistency among TVA offerings and to provide consumers with a standard
offer, the minimum size for all eligible generation systems is 500 watts and the maximum
size is 999 kilowatts. Systems 1 MW or larger will be negotiated on a case-by-case
basis.

Where can customers buy these systems? Is there a list of qualified vendors?
TVA does not recommend or require specific contractors and installers. However, we do
recommend researching contractors to ensure quality work. System sizing tips, cost
estimations, supplier/installer information, and related information can be researched at
the following Websites:

North American Board of Certified Energy Practitioners

NABCEP is a volunteer board working to develop national voluntary standards and
certifications for renewable energy professionals, beginning with solar electric installers.
Look for the listings of these certified installers under the Resources link on the Web
site.

American Solar Energy Society

Center for Renewable Energy and Sustainable Technology - Click on Solar
Consumer Energy Council of America, Distributed Energy Forum
U.S. Department of Energy, Energy Efficiency and Renewable Energy
U.S. Department of Energy, Energy Efficiency and Renewable Energy Solar Technology
Division
Florida Solar Energy Center - click on Photovoltaics and/or Solar Energy
Tennessee Solar Energy Association
National Association of State Energy Officials
North Carolina Solar Center
National Renewable Energy Laboratory
Solar Electric Power Association
Low Impact Hydropower Institute
Biomass Magazine

Solar Energy Industries Association (202-682-0556)

Note: The listings provided here are for informational purposes only. The listing of any group or organization is not to be
considered as an endorsement by TVA. TVA assumes no responsibility for actions taken by the mentioned groups or
organizations.

Be sure to call your local power company prior to purchasing and installing renewable
generation.

How safe are these systems?

All interconnection and safety equipment must be tested by a Nationally Recognized
Testing Laboratory for continuous interactive operation with an electric distribution
system in compliance with IEEE 1547 (Standard for Interconnecting Distributed
Resources with Electric Power Systems), IEEE 1547.1 (Standard Conformance Test
Procedures for Equipment Interconnecting Distributed Resources with Electric Power
Systems), and UL 1741 (Inverters, Converters, and Controllers for use in Independent
Power Systems). In addition, all systems must be manufactured and installed in
compliance with the National Electric Code (NEC). Systems must be permitted and
certified by a licensed electrician along with passing all applicable code inspections.

Having your system meet these national standards means that your system is very safe.
In addition to these national standards, GPS Generation Partners requires an outside
lockable disconnect device that provides additional security and peace of mind in the
event of a power outage. The lockable disconnect device must be accessible by
personnel from the local power company, who have the ability and authority to lock out
the power from the grid via the disconnect device. For more information about safety,
see the following sites:

• National Fire Protection Association

• Underwriters Laboratories
• Institute of Electrical and Electronics Engineers
• Solar Electric Power Association

Do all power companies participate in the Generation Partners program?

Participation in the program is entirely at the discretion of the power company. Go to the
Participating Power Companies page for more information. If your local power company
isn’t currently a participant in the program, let them know you are interested in installing
renewable generation at your home or business.
How were the premiums of $0.12 for solar and $0.03 for all other renewables
determined?
TVA looked at the incentives from several perspectives:

TVA

• Current REC Markets

• Purchasing emission allowances for potential RPS scenarios
• Cost to build and own renewable resources

Customer

• Comparison to current incentives

• Rate of return and payback analysis

Why are there different premiums for the various renewable sources?
Solar systems receive a higher premium than other projects. This recognizes that solar
systems cannot be successful under the same premium for other renewable sources.
The cost of installing solar energy is generally much more expensive than other
renewable technologies. All premiums will be reviewed on an ongoing basis.

How much will the generation system cost?

For an average size solar system, 1.5 kilowatts to 2 kilowatts, a customer can expect to
pay on average $8 - $10 per watt for parts and installation. An average size wind turbine
system averages $2 to $4 per watt for equipment, plus the cost of installation. There are
several factors that must be taken into consideration when pricing either solar or wind
systems, such as federal and state tax credits and rebates.

For example, a 2 kW solar photovoltaic (PV) installation averages 200 kWh per month or
roughly $44 per month Generation Credit:

200kWh + $0.22/kWh (average retail rate of $0.10 + premium $0.12) = $44 X $0.22/kWh

In comparison, a 10 kW solar PV installation would average $220 per month Generation

Credit.

Are there ways to help pay for installations?

• Federal Tax Credits

o Solar – 30% Residential & Commercial tax credit with no cap through
12/31/2016
o Wind – Maximum system size of 100kW. 30% tax credit with $4000 cap
through 12/31/2016
• State Tax Credits – varies by state
• Property Tax Credits – varies by state
• Additional information regarding federal and state incentives is available at the
DSIRE website at www.dsireusa.org.
• $1000 TVA Incentive
• Financing for solar installations may be available.
What are the environmental requirements for installations?
• All installations must be in compliance with National Environmental Policy Act
(NEPA).
• Solar over 100kW and all other installations
o Require environmental assessment to be conducted by TVA.
o Commercial customers are responsible for costs.
o Length and cost will vary depending upon the complexity of the
installation.
• Solar up to 100kW
o TVA is conducting a General Environmental Assessment (GEA) that will
include all solar installation up to 100kW.
o Information checklist must be completed by TVA prior to installation.
Results of checklist may require further action.

Are GPS Generation Partners installations certified for Green Power Switch?
Yes. In the previous program, end-use installations were not included in the verification
process. For the expanded offering, these installations will be accredited.

What are the specific connection requirements?

Each customer must submit an interconnection application to their local power
company. The local power company will determine whether the project can be fast-
tracked or if the project must undergo a feasibility study process to determine the
impacts on the distribution system. Individual local power companies may alter or revise
the proposed Interconnection Procedures and Interconnection Agreement guidelines
drafted by TVA, in order to better specify the local guidelines or process.

Contact your local power company for more information.

In the event of a power outage, will I be able to supply power to my home?

In order to be a participant in GPS Generation Partners, the system must be connected
to and generate power to the grid. Each installation must have a grid-tied inverter that
synchronizes the power generated with the utility grid, and also prevents electricity
or generation from flowing to the grid during an outage. The condition where an inverter
continues to electrify the grid during an outage is called islanding. For the safety of line
workers, inverters must stop sending generation to the grid when there is a grid failure.
This is a serious concern for utilities because they do not want any utility lines to be
energized while they are trying to fix the cause of the power outage. It is recommended
that the participant must install a manual, lockable, visible load break disconnect switch
between the generation facility and the distribution system. The participant must also
ensure that the manual disconnect is readily accessible to the power company.

As a result, GPS Generation Partners participants will not be able to supply power to
their homes during the event of an outage due to safety concerns and should discuss
other outage options with their local power company.