Florida solar utility liability insurance requirements

[LandToSea]

I am sending the below to FPL net metering after finding out today from Tesla Solar that I need to add additional insurance to comply to the FPL interconnection agreement. How does everyone feel about this? Am I missing something?

"Good afternoon! I am currently looking into adding solar to my residence. Our average usage is 75kW/day so we are looking at installing a 16kW system. Our home is only 3/2 at 2300sf with 2 residents and a pool. The tier category of tier 1 meant for residential installations seems to be undersized considering Florida energy requirements. Most homes who can afford a solar installation would not be able to stay in the tier 1 category at 10kW. The liability insurance and FPL fee requirements of tier 2 considerably penalize the average homeowner trying to add solar. I would assume the intent of these tiers are to categorize residential, commercial and industrial uses? While an additional $1200 in annual insurance premiums may not impact the bottom line of a Walmart who likely already exceeds such coverage it is significant to middle class homeowners like myself. Tier 1 should apply to installations up to 20kW at a minimum to not unfairly impact the middle class homeowner.

Given my position expressed above can I please get a detailed explanation justifying this insurance requirement per the interconnection agreement? I honestly can't speculate why this requirement applies to a 16kW system but not a 10kW system. Thank you in advance for taking the time to provide a thoughtful explanation and hopefully a suggestion for addressing the concern at FPL."

 

[BrettS]

It seems like a good letter and it probably needs to be sent, but I’m not sure that FPL is the place to send it. My utility is Duke Energy and they have the exact same tiers and requirements, which makes me think that this is legislated by the state and is not something specifically required by the power companies.

It would definitely be interesting to do some research to see exactly where it’s coming from.

On a side note, one solar installer told me that a lot of his clients will get a policy with $1 million of liability coverage when they have their solar system installed and will then cancel the policy as soon as they get their PTO. Apparently the utilities only check the policy at the time of the PTO and never check it again. However, I don’t plan to do that as I feel like in the unlikely event that something does happen and the utility wants to sue me then having the coverage that they require would put me at a lot less risk.

 

[Southpasfan]

I would add, that a $1 million rider is usually pretty inexpensive on homeowners' policies and has really, and I mean REALLY, saved the bacon of a few clients of mine for mishaps having nothing to do with solar.

Its kind of the reverse of the extremely expensive "electronics" insurance, which is way out of line with the cost of replacement. Its very cheap and incredibly valuable.

 

[LandToSea]

I would add, that a $1 million rider is usually pretty inexpensive on homeowners' policies and has really, and I mean REALLY, saved the bacon of a few clients of mine for mishaps having nothing to do with solar.

Its kind of the reverse of the extremely expensive "electronics" insurance, which is way out of line with the cost of replacement. Its very cheap and incredibly valuable.

It is the auto umbrella and required limits increase to $500k liability on the auto policy that kills it. I am looking further for an option that is premises only like Brad mentioned. My agent didn't offer it when asked for a quote. I am ok with a premises policy for a few hundred because I feel it is a good safety net for dogs that the homeowner's will not cover. After all, why would a Tesla owner need added auto protection, we drive in AI.

 

[Southpasfan]

Huh. So in FLA they want an increase to the auto umbrella for a home solar install? What does anyone's auto policy have to do with it? I mean, someone in theory might not even have a car, or, they might have a car owned by their company.

 

[BrettS]

Huh. So in FLA they want an increase to the auto umbrella for a home solar install? What does anyone's auto policy have to do with it? I mean, someone in theory might not even have a car, or, they might have a car owned by their company.

No, they want an insurance policy with at least $1 million in liability coverage and typically the way to get that is with an umbrella policy because most standard homeowners policies won’t go up to $1 million. However, most umbrella policies also cover your autos and because of that it requires certain coverage on your regular auto policy.

 

[Southpasfan]

No, they want an insurance policy with at least $1 million in liability coverage and typically the way to get that is with an umbrella policy because most standard homeowners policies won’t go up to $1 million. However, most umbrella policies also cover your autos and because of that it requires certain coverage on your regular auto policy.

It obviously varies state by state. In CA a one million umbrella is very common, cheap (you can even get them on renters policies), and if it required a tie in with auto liability I don't recall that. Thanks again BrettS.

 

[X-pilot]

It seems like a good letter and it probably needs to be sent, but I’m not sure that FPL is the place to send it. My utility is Duke Energy and they have the exact same tiers and requirements, which makes me think that this is legislated by the state and is not something specifically required by the power companies.

It would definitely be interesting to do some research to see exactly where it’s coming from.

On a side note, one solar installer told me that a lot of his clients will get a policy with $1 million of liability coverage when they have their solar system installed and will then cancel the policy as soon as they get their PTO. Apparently the utilities only check the policy at the time of the PTO and never check it again. However, I don’t plan to do that as I feel like in the unlikely event that something does happen and the utility wants to sue me then having the coverage that they require would put me at a lot less risk.

It is a Florida State Law requirement to my understanding. I have FP&L. I have USAA homeowners insurance, which only upped me about $28 per year.

 

[sleevemedia]

You probably want to send the letter to the Florida Public Service Commission, they're the regulator. Welcome to the PSC Web Site - Florida Public Service Commission

 

[sleevemedia]

It is a Florida State Law requirement to my understanding. I have FP&L. I have USAA homeowners insurance, which only upped me about $28 per year.

Were you already at 500k personal liability, and they just bumped the liability to $1m? And your cars are on a different policy?

I have an AAA package policy, so they need auto BI at 250/500 to attach a $1m umbrella liability rider. That's $443/year and while it does include extra car coverage, it's excessive.

The cheapest standalone $1m personal liability policy I've found was from a local agent, it only covers one property, does not cover cars/drivers, and it's $185/year.

I'm probably going to look at whether Duke notifies AAA that they are a Party of Interest and if not, mumble mumble, ...

 

[LandToSea]

Below is the initial response from FPL Net Metering:

"In reference to your insurance question, please show your agent the language from our tier 2 agreement highlighted below and the attached insurance certificate examples, this is for tier 2 systems only.

Yes, for tier 2 solar PV systems it is an requirement and it is in the FPL agreement that you signed.

The Tier 2 system size ranges from 10,000 watts to 100,000 watts, if something goes wrong with these larger systems it could cause a lot of damage. The additional insurance is needed for the larger tier 2 systems just in case your solar PV system malfunctions, causes damage to our equipment and/or hurts one of our linemen.

Just FYI, If you stay below 10,000 watts AC you do not have to deal with the insurance or pay the $400 fee.

Please review the tier 2 guidelines link below.

FPL | Clean Energy | Net Metering Guidelines


11. Insurance

11.1 The Customer agrees to provide and maintain general liability insurance for personal and property damage, or sufficient guarantee and proof of self-insurance, in the amount of not less than $1 million during the entire period of this Interconnection Agreement, to the extent permitted by law. Initial proof of insurance shall be in the form of a copy of the policy or certificate of insurance attached to this Interconnection Agreement evidencing the Homeowner’s or other insurance policy in effect at the time of interconnection. For government entities, the policy coverage shall not exceed the entity’s maximum liability established by law. Proof of self-insurance consistent with law shall satisfy this requirement.

Before you purchase a solar PV system please make sure you read through all of the information on this email and review all of the links. This will help you make an educated decision. Please review the Solar Photovoltaic information below and read the attached FAQ’s.

FPL | Clean Energy | Net Metering Guidelines this link explains the difference between tier 1 and tier 2 solar PV systems.

The link below will allow you to apply for net metering

FPL | Clean Energy | Net Metering

The PV Watts link, below, is very valuable as it gives you unbiased information on what level of savings you can expect from a solar PV system installed on your specific home. PVWatts Calculator

The links below have additional net metering information and answers to your solar PV and/or water heating questions. FPL | Clean Energy | Net Metering


Before you purchase a solar PV system please make sure you read through all of the information on this email and review all of the links. This will help you make an educated decision. Please review the Solar Photovoltaic information below and read the attached FAQ’s.

FPL | Clean Energy | Net Metering Guidelines this link explains the difference between tier 1 and tier 2 solar PV systems.

The link below will allow you to apply for net metering

http://www.fpl.com/residential/savings/net_metering/index.shtml

The PV Watts link, below, is very valuable as it gives you unbiased information on what level of savings you can expect from a solar PV system installed on your specific home. PVWatts Calculator

The links below have additional net metering information and answers to your solar PV and/or water heating questions. FPL | Clean Energy | Net Metering

I hope this information is helpful. "

 

[BrettS]

That doesn’t really seem very helpful. It just seems like it’s a form letter. There’s a big difference between a 16kW system and a 99kW system, and it seems like the minimums should be raised. Even if they add another tier with, say, a $500k insurance requirement.

But like I said, I believe that this is regulated by the state, so I don’t think going to the utility is really the right place to go.

 

[h2oAok]

You probably want to send the letter to the Florida Public Service Commission, they're the regulator. Welcome to the PSC Web Site - Florida Public Service Commission

As someone in the utility business, I can confirm that you should direct your letter to the Florida PSC. FPL will not budge from these requirements. All electric utilities in Florida have similar requirements. They are regulated by the PSC and they potentially can force changes. It would probably take a campaign of similar complaints to the PSC to start some action.

 

[Troglodytes]

Just to add another person's info on this item. 17.64kW system, 3 powerwalls. Tier II Interconnection Agreement through Duke Energy in Florida. $1M umbrella policy for ~$250/year through a small insurance company after shopping a bit. Home insurance is through a different company than the umbrella. Umbrella kicks in after home insurance and is subject to the same terms as the home insurance.

Personal opinion is that the requirement for this amount of liability insurance is rooted in lobbying by the utilities. Then legislative give-and-take arrived at this multi-tiered system as it stands now. It'll take legistlative remediation to modify it.

 

[wjgjr]

Personal opinion is that the requirement for this amount of liability insurance is rooted in lobbying by the utilities. Then legislative give-and-take arrived at this multi-tiered system as it stands now. It'll take legistlative remediation to modify it.

I think you are right on that, but I think part of it was also that the 10 kW threshold seems to have been around for a long time (don't know about FL in particular) in many places. And back then, considering the cost per Watt and the lower efficiency of the panels, the total cost and roof space constraints probably meant 10 kW was seen as the extent of what a "regular" home would be able to support, so it was a cutoff between a home system and a commercial and/or luxury system. Things have changed, but unfortunately the thresholds seem to have remained in many places. I know our utility has higher costs at 10 kW (though no liability coverage rules) though it looks like at least one nearby utility sets their cutoff for tier 1/tier 2 at 20 kW.

 

[chrisbailey13]

I had the same situation occur with Tampa Electric when I had my system installed. The adding of a $1 million liability limit to my policy cost me $28.00 a year through State Farm. Much to do about nothing

 

[charlesj]

J...

Personal opinion is that the requirement for this amount of liability insurance is rooted in lobbying by the utilities. Then legislative give-and-take arrived at this multi-tiered system as it stands now. It'll take legislative remediation to modify it.

Yep, I would agree that the power companies lobbied for this, not a natural legislation action on their own.

 

[LandToSea]

I was eventually able to find a premises only umbrella policy for under $300 so not nearly as bad.

 

[evmusic]

Couple of comments. I have seen lot of people just install tier 1 system first, get the net metering and extend wherever they want. I have never heard a story that FPL ever checked it. PSC is eating from FPL hands. So, this is intentional BS. There are states where the tier-1 ends at 25kw system. Which is more reasonable. The whole insurance thing is a scheme to discourage people installing bigger solar. There is no way you can ever make any harm in their system. Actually, they are making harm in your electronic items when the lines hit by lightening and wipes out your devices. They provide zero liability. If you have a 200amp service which can deliver like 48kw power there is no way in hell you will push back more energy then that. For the cables and transformators it is indifferent which directions the electrons are going. So, IMHO, the tier1 system should be at 50kw. That is the first point they really have to check their system/service point capabilities. You can be activist but irrelevant. Maybe if you play a long game. I have a 36KW system and I had anyway a much higher liability, umbrella insurance. That is a cheap and very effective insurance to have.

 

[Speedr117]

Ironically, Florida, the sunshine state, has done almost everything in their power for average people to NOT install solar. Their suggestion is to have Solar farms though the utility! Therefore, it doesn't surprise me in the least that they've created a system to try and slow the deployment of it, including extra costs as a deterrent.

If you get a big enough solar array and enough powerwalls to power your house, can you unhook from the power company? Or are there regulations on that too?