This week, the Massachusetts legislature reached an end to the solar impasse that existed in the Commonwealth, when the Massachusetts House of Representatives and Senate struck a deal regarding the net metering cap and reimbursement rates. Specifically, the legislation will:
- Lift the cap on solar net metering by three percent (3%) for both public and private solar projects; and
- Decrease the reimbursement rate paid by utilities to most solar energy producers by 40%. (This decrease in rates, however, does not apply to government and municipality owned projects, residential and small commercial projects – which will all still receive the full retail rate.)
The legislation also authorizes distribution companies to submit to the Massachusetts Department of Energy Resources (“DOER”) proposals for a “monthly minimum reliability contribution” to be included on electric bills for solar-producing customers. DOER then has the authority to approve a monthly minimum reliability contribution that meets certain enumerated factors. The bill explains that any such contributions “shall ensure that all distribution company customers contribute to the fixed costs of ensuring the reliability, proper maintenance and safety of the electric distribution system.” DOER is prohibited, however, from approving a proposal for a monthly minimum reliability contribution, until after the aggregate nameplate capacity of installed solar generating facilities in Massachusetts is equal to or greater than 1,600 MW. DOER was given the authority by the legislature to exempt or modify any such contributions for low-income ratepayers.
While the legislation serves as a temporary solution to the net metering problem in Massachusetts, stakeholders, however, predict the cap will likely be reached by the end of 2016.
The attorneys at GreeneHurlocker will continue to monitor the legislative landscape in Massachusetts as many of our clients are currently pursuing solar projects in the Commonwealth of Massachusetts.If you have any questions about this legislation or other isses related to renewable energy and regulation, contact any of our solar energy lawyers.