State leaders urged to lift renewable energy purchase caps on utilities
HANCOCK — A dark cloud has just appeared over the burgeoning field of solar energy in the Bay State.
With the development of large solar installations increasing in frequency and size, utilities are closing in on — or in some cases bumping into — a state-imposed cap on how much power they may purchase from renewable energy facilities.
Fearing the loss of momentum in the growth of solar, environmental advocates are calling on the state to remove the caps, which they say will put a chill on the development of large-capacity renewable energy facilities.
"Solar energy is extremely popular and has brought clear benefits to our air, our health and our economy," said Ben Hellerstein, a spokesman for Environment Massachusetts. "So we need our state leaders to think bigger. We should be doing as much as possible to bring more solar into the state instead of imposing mandatory caps."
The growth in renewable — particularly solar — energy has been driven in large part by a process known as net metering, through which utilities pay generating facilities for the power they pump into the grid. Net metering caps, which do not apply to residential-size solar installations, are divided among the territories served by five different utility companies.
On Friday, National Grid hit its cap of 205 megawatts of publicly owned power installations that are either already online or have been approved for construction.
Privately owned renewable energy installations are closing in on its cap in National Grid territory — there are still 16 megawatts available with about 13 megawatts on the waiting list, leaving only 3 megawatts remaining under the cap.
Statewide, the cap for private renewable net metering is 444 megawatts, with 143 megawatts of capacity still available. For publicly owned renewable power facilities, the cap statewide is 555 megawatts, with 117 megawatts still available.
Eversource still has a ways to go before they hit the cap: There is still more than 22 megawatts available for privately owned facilities and nearly 19 megawatts available for publicly owned renewable energy plants.
Today, a coalition of solar energy supporters are at Beacon Hill for the Stand Up For Solar lobby day during which low-income advocates, business leaders, public health advocates, environmentalists, and others will meet with legislators and administration officials to urge support for solar energy. In addition, a letter signed by hundreds of small business leaders will be delivered to Governor Baker asking him to set big goals for solar energy.
According to Seth Ginsberg, managing partner at Apis Energy, utility companies lobbied the state to impose regulatory caps on how much solar power could be introduced into the grid statewide.
Ginsberg said the market will regulate that naturally — a company will not want to develop a solar plant if it won't be profitable. So enforcing an arbitrary regulatory cap artificially depresses the marketplace.
"There's no need for caps," Ginsberg said. "The market is the best cap."
But National Grid spokeswoman Danielle Williamson said increasing renewable energy should a gradual, measured process to allow time for a long-term plan that encourages renewables while still lowering the cost impact to customers' energy bills.
"National Grid believes it is crucial for Massachusetts to develop a long-term sustainable plan to encourage growth in the solar industry while lowering the overall cost of the program, which will in turn reduce the impact on customers' electric bills," she said in a prepared statement. "With over 250 MW still available under the net metering caps statewide, there is no need to raise the net metering caps while the state develops this long-term sustainable solution."
She said raising the net metering cap would affect National Grid customers more than other utilities and wind up "increasing rates at a time that our customers are looking for lower energy prices."
"Instead, we need to introduce a more transparent process which could substantially lower the costs of solar and continue to nurture the industry," Williamson said. "We are currently working with the net metering task force to develop such a program."
Ginsberg said the general idea is that if someone has enough solar power to add up to net zero use of grid-supplied power, then the cost of maintaining the grid infrastructure falls to the customer without solar and not on net metering.
But, he added, charging everyone a minimum bill of, say, $5 would take care of that issue by spreading the cost of maintaining the infrastructure to all users while still allowing the unrestrained practice of using solar power to reduce the use of fossil fuel-supplied energy.
According to Tyler Fairbank, CEO of EOS Ventures, a renewable power development firm based in Hancock, the changing nature of the net metering caps has been a consistent source of aggravation for renewable energy developers around the state.
"The minefield of having to navigate rules and regulations that are constantly changing — two to three times from the start to the finish of a project — makes it much more difficult to justify the spending of risk capital," Fairbank said. "It's an investment that you just don't know you're going to get back. It's just so much uncertainty."
According to state Sen. Benjamin B. Downing, the caps are likely to be raised, but not until a dispute over rules for committees between the Senate and House can be resolved and committees can begin with their schedules of hearings.
"Net metering is vitally important to growing solar power in Massachusetts," Downing said. "And we've got almost 400 times the solar capacity we had in 2007."
He noted that while many have determined that the overall cost of solar is more expensive than power generated by coal or natural gas, the cost of health care needed due to air pollution or the cost of disasters exacerbated by climate change actually makes solar power much less expensive.
The Legislature is working on a longer-term legislative solution to the need to develop more renewable energy that would address such issues. But in the meantime, Downing said, there should be a way to allow growth in solar to continue at a measured pace "in the long term."
"So I think we're absolutely going to raise the [net metering] cap — it's just a question of when," Downing added. "You don't want to slow down solar development, but we do need to develop the best ways to increase the development of renewable energy generation."
What: Stand Up For Solar lobby day. Low-income advocates, business leaders, public health advocates, environmentalists, and others will meet with legislators and administration officials to urge support for solar energy. Participating organizations will deliver a letter signed by hundreds of small business leaders asking Governor Baker to set big goals for solar energy.
When: 10:10 to 10:30 a.m. today.
Where: Gardner Auditorium, Massachusetts Statehouse; Enter at the General Hooker entrance, turn right, and proceed to the basement level.
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