Huge Victories for Solar in Maine’s 2019 Legislative Session
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Huge Victories for Solar in Maine’s 2019 Legislative Session
Recap of the major legislative victories for Maine solar policy in 2019
After 8 years of hovering on pause or going backwards, 2019 marks the year Maine’s solar policy made strong forward progress. Here’s a quick rundown of the legislative victories and what they mean for all Mainers.
LD91 – Eliminate Gross Metering
Sponsored by Rep. Seth Berry (D) of Bowdoinham, LD91 was the first, and most rapid, victory, undoing the LePage-era “Gross Metering,” which penalized homeowners for going solar. Covered in more detail at: Death to Gross Metering FAQ
LD1711: Transforms Solar Market for Commercial, Municipal, Nonprofits, and Community Solar
Sponsored by Sen. Dana Dow (R) of Waldoboro, LD1711 passed with overwhelming bipartisan support in the senate and strong support in the House, and was signed by Gov Mills on June 26th. Many of the ideas for this bill were part of comprehensive solar policy we’ve worked on with a broad coalition of solar allies since 2015, with the goal of harnessing solar’s unique value to the grid and broadening the set of people who can benefit from solar development.
This bill is a game-changer for commercial, nonprofit, municipal, and community solar:
- Modernizes Net Metering by eliminating a 10 meter cap on community shared solar projects, raises project size limit to 5,000 kilowatts (enabling economies of scale), and makes it explicit that third-party ownership (e.g. non profit PPAs, solar leases) are allowed under net metering. This effectively revives the opportunity for the community solar farm market in Maine, which went dormant during the LePage years.
- Creates a net metering program specifically for Commercial and Institutional (C&I) customers.C&I projects have often been difficult to make work under conventional net metering, because many of these customers pay a substantial portion of their electric bill based on ‘demand’ charges, a fixed fee based on the highest 15 minute usage of any given month, rather than on a volumetric basis (per kwhr). Conventional net metering works by compensating 1:1 for kilowatt-hours generated offsetting kilowatt-hours consumed. Since the cost these businesses pay much less per kilowatt-hour than smaller customers (who don’t pay demand rates and instead pay a higher T&D rate), the economics of net metered solar projects have often been challenging for these medium sized commercial and institutional/municipal customers.Under the new legislation, these C&I customers will receive a compensation rate for exported solar that will be much closer to what small commercial and residential customers receive under retail net metering. The result is that project economics should improve by 20-26% for many commercial projects, dropping a 10+ year project payback to a 5-6 year payback in many cases. Leveling the playing field for these medium commercial scale customers means that many more Maine businesses (and towns and schools and other non profits) can now invest in cost effective solar projects to offset their electrical load.
- The legislation directs the PUC to enter into long term contracts for large C&I (up to 5 MW) and large Community solar projects. The idea is similar in design to the procurement designed by the OPA for LD1649 several years ago and builds on some of the experience of the industry with procurement programs to our south (like SMART in MA).The long term contract rates are initially set by a competitive procurement to be held in early to mid 2020. Rates for projects after the initial auction are set through a series of declining blocks over the next several years. In short, the competitive procurements and long term contracts will result in the development of solar projects with large economies of scale that can offer broad social and economic benefits for both residential and commercial customers. In addition, the large community solar projects have the potential to significantly help low and moderate income Mainers participate and benefit from the clean energy transition, which has been a central policy goal of ours for a long time.
Some portions of LD1711, including the net metering updates and C&I net metering program, will go into effect relatively quickly this fall, while others (the procurements and long term contracts) will require additional rule making by the PUC and so will mostly affect projects being built in late 2020 or beyond.
LD1430 – Fixes Taxation Issues Around Solar
While it received less public attention than some of the other policy changes, LD1430 (sponsored by Rep. Ryan Tipping (D) of Orono) is incredibly important in that it fixes property tax issues with solar projects which have caused grief for existing customers and acted as a drag on residential, community and commercial solar projects across the state for the last few years.
The issue had been that municipalities did not have clear guidance on how to handle property taxation for solar projects, and in the absence of such guidance, some municipalities had applied property tax assessments at levels that were punitive and significantly undermine the value proposition for customers.. This issue and uncertainty has been a particular pain point for some of our customers in affected communities including a number of community solar farms, and we are proud to have worked with stakeholders inside and outside the Statehouse to help make sure the issue was addressed in this session.
With LD1430, Maine joins the majority of New England states in enacting a statewide property tax exemption for residential and commercial solar property (except for utility scale solar projects). It also directs Maine Revenue to develop standardized methods for solar valuation to create a predictable and consistent climate for these investments.
LD1494 – Modernizes Maine’s RPS and Pushes Toward 100% Renewables
This bill (sponsored by Sen. Eloise Vitelli (D) of Sagadahoc, a longstanding solar champion) modernizes Maine’s Renewable Portfolio Standard (RPS), clarifying definitions about what constitutes ‘renewable energy’ and setting ambitious goals of achieving 80% renewable generation by 2030 and 100% by 2050. This policy matches the renewable energy targets Gov Mills outlined earlier in the year and that she talked about at her inauguration.
The RPS is a mechanism that requires power companies to source a certain amount of their power from renewable sources each year. There is a lot of technical nuance about types (Classes) of RPS and which types of power generation qualifies under which Class, but in short the purpose of these policies is to encourage grid-scale deployment of renewables and provides a mechanism to do so.
Something that has been problematic about Maine’s RPS is that much of the current RPS is filled by existing biomass power plants, which, while important, doesn’t create the appropriate incentive to develop new, indigenous energy generation from wind and solar. This has had the effect of encouraging more natural gas deployment in Maine than we otherwise would have had.
Maine’s RPS has lagged behind other New England states, and with the passage of this new legislation, we are now returning to a position of leading our region. Over time, this policy is expected to lead to the development of a whopping an estimated 500 MW of new solar and 200 MW of new wind, and the creation of nearly 2,000 jobs over the next 10 years.
More on the implications of the RPS – https://www.nrcm.org/wp-content/uploads/2019/05/MERPSAnalysisFacts.pdf
LD1519: Allows for Creation of Benefit Corporations in Maine
Not directly solar-related, but as a Certified B Corp we laud this bill (sponsored by Sen. Erin Herbig (D) of Belfast), which makes Maine the 30th state to allow for the creation of Benefit Corporations, and highlights the growing movement toward businesses with a social purpose and conscious capitalism.
Certified B Corps and Benefit Corporations are two different but related concepts and a company can be one or the other or both. A Benefit Corporation is a specific legal business structure whereby the social benefit purpose of the business is expressly incorporated into its founding documents. Certified B Corp, on the other hand, is a rigorous, independent, voluntary, third party evaluation and certification of a company’s overall business practices and social purpose. ReVision Energy has proudly been a Certified B Corporation since 2015 and we are excited to investigate conversion to a Benefit Corporation now that that option is available in Maine.
LD1282 – Solar on Schools
The ambitiously titled “Green New Deal” legislation (sponsored by Rep. Chloe Maxmin (D) of Nobleboro) includes a provision whereby solar should be installed on every new school built in Maine. Today’s students are tomorrow’s leaders – this is a solid idea we can get behind!
The bill also includes provisions on workforce development for the green jobs of tomorrow. With the development of our in house electrical apprentice training program, ReVision Energy Technical Center, ReVision has been a regional leader in new economy workforce development and we look forward to working with state leaders, labor and the community college system to deepen that effort in the future.
It was an extremely busy legislative session in Augusta on topics of energy as well as a broad host of other issues. We’re very pleased with the outcome and so incredibly grateful for the hard work of our community of solar champions. It would be impossible to name all the individuals who worked tirelessly for these outcomes but they include a broad bipartisan coalition of lawmakers and legislative leadership (special shout-out to Sen. David Woodsome (R) of Waterboro, who as Chair of the Energy, Utilities & Technology Committee has been a consistent, bipartisan voice for common sense solar policy), environmental advocates, and many passionate and dedicated individual environmental and solar champions who share our belief that Maine can, and should, build its future economy on renewable energy. We thank you all for your efforts and are so grateful to have the opportunity to do this important work together with you.
The accomplishments and progress we made in this legislative session will lead to the creation of hundreds of new solar jobs, an enormous reduction in Maine’s carbon pollution, and will begin to point Maine in the direction of a promising and prosperous clean energy future. Though Maine is still behind the pack in terms of solar adoption, we’re finally pointed in the right direction, and so expect to see us move up the national leaderboard over the next few years. Onward!