Mass. Solar Companies Unhappy With Proposed Incentive Changes


The Solar Energy Business Association of New England (SEBANE) says certain provisions of a bill (H.4185) produced by the Massachusetts legislature are problematic from the standpoint of its membership, which consists of solar sector companies of various sizes and functions, including manufacturers, developers and installers.

In particular, the organization opposes the apparent exclusion of municipal utilities from the program, a minimum utility bill provision that does not specify how the amount is to be calculated and reduced compensation for virtual net metering.

Thomas Thompson, key account manager at JA Solar USA Inc. and president of SEBANE, says what concerns him is the lack of transparency in the negotiating process.

‘They seem to be fast-tracking this legislation,’ Thompson says. ‘There has not been adequate time or opportunity for us to comment.’

The legislation has drawn public support from the Solar Energy Industries Association (SEIA), which applauds the Massachusetts Department of Energy Resources (DOER) for its efforts to facilitate the legislation, especially for its elimination of the commonwealth's net energy metering cap.

‘SEIA supports the legislation as it immediately relieves a short-term bottleneck on solar projects in Massachusetts by removing the caps on net metering,’ says Carrie Cullen Hitt, SEIA's senior vice president of state affairs, in a statement. ‘This proposed bill reflects the hard work and engagement of a wide range of stakeholders. I commend the DOER and legislature for convening a process that sets a national precedent and will result in good public policy, improving the efficiency of the state's solar program for all ratepayers.’

Susan Boucher, marketing director for Hudson, Mass.-based developer and installer New England Clean Energy, says that while the DOER included investor-owned utilities (IOU) and national solar associations in its deliberations, a lot of local people were not represented.

‘It all happened very fast," Boucher says. ‘Now is the time to get these comments heard, before it is too late.’

In particular, Boucher says she is very concerned that the program the legislation creates to replace the recently enacted solar renewable energy certificate (SREC) program appears to exclude municipal lighting department customers, which is an important market for many developers. While the current SREC program is run by the DOER, which oversees all utilities in the state, the future program as proposed in H.4185 will be overseen by the Massachusetts Department of Public Utilities, which only regulates the IOUs and has no jurisdiction over the municipal utilities.

‘The SRECs are even more important to [municipal lighting customers] than to customers of IOUs, because the IOU customers get a rebate,’ Boucher says. ‘Without that incentive, solar is not going to be feasible for a lot of people.’

As for the subsidy incentive intended to replace SRECs, Boucher says the current language is hazy with regard to how long it takes to pay out. Currently, the legislation says that the payout of the subsidy for residential and small business customers would be between 10 and 15 years, to be determined.

‘That's a big difference,’ she says. ‘When we lay out the economics for homeowners and small businesses going solar, getting that incentive all paid in 10 years is very important. Getting it paid in 15 years completely changes the economics.’

According to SEBANE's Thompson, the proposed legislation also discriminates against solar customers who take advantage of virtual net metering by reducing the compensation they receive from utilities.

Also troubling from Thompson's perspective is the minimum bill provision that would guarantee utilities payment from ratepayers. The charge is supposed to reflect the costs to non-solar ratepayers from distributed generation. Thompson says the charge does not take into account solar's substantial benefits to ratepayers, which far outweigh any cost.

In March, the Minnesota Public Utilities Commission approved a standard methodology for calculating the value of solar.

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