An Act To Modernize Maine's Solar Power Policy and Encourage Economic Development
Sec. 1. 35-A MRSA §3210-F, sub-§1, as enacted by PL 2013, c. 454, §2, is amended to read:
Sec. 2. 35-A MRSA §3210-F, sub-§3, as enacted by PL 2013, c. 454, §2, is amended to read:
Sec. 3. 35-A MRSA §3212-B is enacted to read:
§ 3212-B. Solar power options
The commission shall adopt rules to implement this subsection. Rules adopted under this subsection are routine technical rules as defined in Title 5, chapter 375, subchapter 2-A.
Sec. 4. 35-A MRSA §3471-A is enacted to read:
§ 3471-A. Definitions
As used in this chapter, unless the context otherwise indicates, the following terms have the following meanings.
Sec. 5. 35-A MRSA §3473, sub-§§3 to 5 are enacted to read:
Sec. 6. 35-A MRSA §§3475 to 3481 are enacted to read:
§ 3475. Solar procurement targets
§ 3476. Standard buyer
The standard buyer is designated pursuant to this section to aggregate the output of the portfolio of distributed generation resources procured pursuant to this chapter and sell or use the output of these resources in a manner that maximizes the value of this portfolio of resources to all ratepayers.
The commission shall ensure that the rules and procedures established under this chapter provide opportunities for entities other than the standard buyer to aggregate and sell the output of distributed generation resources in the applicable markets.
§ 3477. Grid-scale solar procurement
§ 3478. Large-scale community solar procurement
The monthly output available for allocation as subscribed or unsubscribed energy must be determined by a revenue-grade meter installed and paid for by the project sponsor.
The commission shall establish a mechanism to allow a residential or small business customer who has entered into a long-term contract under this section to purchase renewable energy credits equivalent to those the customer has sold to the standard solar buyer at a price equal to 80% of market value.
The commission through its own counsel or through the Attorney General may apply to the Superior Court of any county of the State to enforce any lawful order made or action taken by the commission pursuant to this subsection. The court may issue such orders, preliminary or final, as it considers proper under the facts established before it.
The commission may establish a standard disclosure to be provided to potential subscribers by a project sponsor to disclose this information or such other information as the commission may determine necessary to protect the interests of potential subscribers.
A transmission and distribution utility may propose fees for services provided or may file annually to recover any reasonable costs of collaboration to advance large-scale community solar distributed generation resource projects under this section.
Collaboration with a project sponsor under this subsection does not create an affiliated interest or a financial interest in generation or generation-related assets.
§ 3479. Commercial and industrial solar procurement
The monthly production must be determined by a revenue-grade meter installed and paid for by the participating commercial and industrial customer.
§ 3480. Residential and small business procurement
The initial rate paid to new installations must decline as the total level of new residential and small business capacity relative to the targets in section 3475, subsection 4 increases.
Rates must be sufficient to ensure that the total capacity of installations meets the residential and small business procurement targets set forth in section 3475, subsection 4. In determining whether rates are sufficient, the commission shall consider independent analysis of installation costs and development projections in establishing the rates, including but not limited to those from the United States Department of Energy, Office of Energy Efficiency and Renewable Energy, National Renewable Energy Laboratory.
Rates must be set at levels intended to ensure that total annual contract payments for new solar distributed generation resources procured under this section are not expected to exceed $10,500,000 per year in 2022, if the procurement targets in section 3475, subsection 4 are met, assuming an export rate of 50% and that the adjustment mechanism in subsection 3 is not triggered. Rates set under this subsection may be constant or increase over the term of the contract.
The commission may establish separate rates for specific types of distributed generation resources or additional incentives or a per kilowatt-hour increase in contract price for resources with attributes that maximize benefits or lower costs to all customers.
A customer who has elected net energy billing between January 1, 2016 and the effective date of the rules established pursuant to subsection 10 may choose to enter into a contract at the initial rate established by the commission under subsection 2 prior to any decline in rate, as long as that customer makes that choice within one year of the effective date of the rules.
The capacity of a net energy billing customer who has installed a solar distributed generation resource and participated in net energy billing under section 3209-A prior to the effective date of rules established pursuant to subsection 10 and elects to enter into a long-term contract under this subsection may not be counted against the procurement target in section 3475, subsection 4 or the cap on total annual contract payments under subsection 2 or trigger any decline in prices.
No later than December 31, 2028, the commission shall initiate a proceeding to consider methods to allow an owner of a distributed generation resource to continue to offset that owner's own consumption and receive fair compensation for exported power in a manner that benefits all ratepayers.
The commission shall establish a mechanism to allow a residential or small business customer who has entered into a long-term contract under this section to purchase renewable energy credits equivalent to those the customer has sold to the standard solar buyer at a price equal to 80% of market value.
If the commission concludes that both conditions under paragraphs A and B will be met, the rules established pursuant to subsection 10 remain in effect, and net energy billing pursuant to section 3209-A is not available to new customers in the future.
If the commission concludes that the condition under paragraph A or B will not be met, the commission shall make findings regarding the reasons the condition will not be met and provide a report summarizing its conclusions to the joint standing committee of the Legislature having jurisdiction over utility matters within 30 days of the start of the Second Regular Session of the 129th Legislature. If the commission determines that the rules adopted under this section can be modified to enable the program to meet procurement targets or reduce costs so that the conditions under paragraphs A and B are likely to be met in the future, it shall make and submit such changes to the Second Regular Session of the 129th Legislature. If the commission determines that these rules cannot be modified to meet these targets or reduce costs, the commission shall review its net energy billing rules or recommend alternative mechanisms to support distributed generation in a manner that benefits all ratepayers. If the commission does not propose changes to the rules adopted pursuant to subsection 10 or new rules are not adopted within 60 days of the adjournment of the Second Regular Session of the 129th Legislature, net energy billing pursuant to section 3209-A must be made available to new customers on that date.
§ 3481. Bill credits
This section applies to any credits assigned to a customer's bill under this chapter.
If the value of the credit to be applied to a customer's bill is less than the amount owed by the customer at the end of the applicable billing period, the customer must be billed for the difference between the amount shown on the bill and the value of the available credits.
If the value of the credits to be applied to a customer's bill is greater than the amount owed by the customer at the end of the billing period, the remaining value of the credit must carry over from month to month until a specified date each year. The commission shall establish a minimum of 2 standard credit expiration dates that provide customers the opportunity to use bill credits to the maximum extent practicable in a given 12-month period. Any remaining credits as of that date must be credited to the standard buyer and may not be applied against any future customer bill.
Sec. 7. Siting of solar distributed generation resources. By January 1, 2019, the Public Utilities Commission shall report to the joint standing committees of the Legislature having jurisdiction over utility matters and natural resources matters the number of new solar distributed generation resources procured pursuant to the Maine Revised Statutes, Title 35-A, sections 3477 to 3479 that have been built on pre-existing impervious surfaces or brownfields where future development is affected by the presence or potential presence of a hazardous substance. The report must include measures to encourage siting of distributed generation resources at such locations identified by the commission in cooperation with the Department of Environmental Protection.
SUMMARY
This bill is reported out by the Joint Standing Committee on Energy, Utilities and Technology pursuant to Resolve 2015, chapter 37, section 2. The resolve directed the Public Utilities Commission to convene a stakeholder group to develop an alternative to net energy billing. This bill reflects the consensus developed in that process and subsequent negotiations between stakeholders and establishes a comprehensive framework to support distributed generation in Maine.
The committee has not taken a position on the substance of this bill, and by reporting this bill out, the committee is not suggesting and does not intend to suggest that it agrees or disagrees with any aspect of this bill. The committee is reporting the bill out for the sole purpose of turning the commission's proposal into a printed bill that can be referred to the committee for an appropriate public hearing and subsequent processing in the normal course. The committee is taking this action to ensure clarity and transparency in the legislative review of the proposal.
The bill directs the Public Utilities Commission to enter into long-term contracts with a duration of 20 years for the procurement of 248 megawatts of solar energy over a 5-year period beginning in 2017. The bill specifies that 24% or 60 megawatts are to be allotted to grid-scale solar distributed generation resources; 19% or 45 megawatts to large-scale community solar distributed generation resources; 10% or 25 megawatts to commercial and industrial distributed generation resources; and 47% or 118 megawatts to residential and small business distributed generation resources.
The bill creates a standard buyer, which the bill specifies is the investor-owned transmission and distribution utility in its service territory. The bill allows the commission to designate another entity as the standard buyer if it determines it is in the best interest of ratepayers to do so. The purpose of the standard buyer is to purchase the output of each category of distributed generation resource, aggregate the portfolio of distributed generation resources procured and sell it into the relevant New England markets.
The bill directs the commission to conduct competitive solicitations for 20% of the 5-year target procurement for long-term contracts for the output of grid-scale, large-scale community, and commercial and industrial solar distributed generation. The frequency of solicitation varies with the particular category of distributed generation resource. The bill directs the commission and standard buyer to develop a contract prior to a solicitation that will ensure that projects proceed to commercial operation on a reasonable timeline and commits all parties to commercially reasonable behavior. The bill gives the commission authority to establish requirements for bidder eligibility and standards to ensure competition in the bidding process. The bill also specifies that if the solicitation is deemed competitive the commission must select one or more winning bids and direct the standard buyer to negotiate and enter into a contract with the winning bidder or bidders. The bill requires the commission to select bids that maximize the benefits or minimize the costs to all ratepayers.
The bill provides that residential and small business customers receive 20-year contracts at a set price for new distributed generation resources that are 250 kilowatts or less. The bill specifies that those customers would have the option of selling their entire output or using their generation to offset their electric consumption with the ability to sell any excess electricity at prices established under the contracts. The bill provides that the commission would set the contract price and the price new customers receive would decrease over time as the installations increase. Contract prices set by the commission must be high enough to meet the specified targets but be below a cap on the overall cost of this portion of the program. The bill also allows the commission to establish a rate adjustment mechanism to increase rates for new customers to increase the number of installations and to meet targets.
The bill specifies that existing net metering customers may continue to net meter under commission rules for 12 years after the effective date of major substantive rules adopted as required by the bill to implement the residential and small business solar program. The bill allows existing net metering customers to enter into a long-term contract under the new program, but does not allow new customers to participate in net metering.
The bill requires the commission to initiate a proceeding 18 months after the effective date of major substantive rules adopted to implement the residential and small business solar program, or 21 megawatts of capacity has been installed, whichever is sooner, to determine if installation targets are likely to be met by 2022, and the total cost to all customers is likely to be less using long-term contracts, rather than net metering. The bill specifies that if the commission does not find that installation targets are going to be met and long-term contracts are not going to be more cost-effective than net metering, the commission may modify the rules, with legislative approval, to meet the goals and reduce costs. If the rules cannot be modified and the commission does not propose an alternative to the Second Regular Session of the 129th Legislature, or if the Legislature fails to act, then net metering will be available to new customers.
The bill also allows for a solar power offer, in addition to the existing green power offer under the Maine Revised Statutes, Title 35-A, section 3212-A, that is available to all residential and small commercial electricity customers. Like the green power offer, the solar power offer sunsets on April 1, 2021.