The Governor just signed into law our major energy bill for this session, the full text of which appears here.
It is very significant legislation and represents a hard fought compromise among competing interests within the energy industry. It also represents a compromise of public policy goals — maintaining a reliable and affordable power supply for the region and reducing our carbon footprint. We will need to do much more if we are to achieve our carbon reduction goals and that will remain a central concern of mine.
The summary below was prepared the staff of the Senate Chair of the Committee on Telecommunications Utilities and Energy, Senator Ben Downing.
Conference Committee Report Summary- An Act relative to energy diversity
Section 1 and 2- Commercial Property Assessed Clean Energy
- Mass Development, in consultation with Department of Energy Resources (DOER), to establish a Commercial Sustainable Energy Program. This program would oversee the issuance of Property Assessed Clean Energy (PACE) bonds to finance energy improvements on a property owner’s commercial or industrial property.
- Municipalities would have the option to participate in the program by agreeing to assess, collect, remit and assign betterment assessments on energy improvements on properties located within their municipality.
Sections 3 and 17- Waste to Energy
- Adds waste to energy facilities, in operation as of January 1, 2016, to the Alternative Portfolio Standard.
Sections 4 through 7- Fuel cells
- Adds full cell technology to the Alternative Portfolio Standard.
Section 8, 9 and 15- Energy Storage
- Requires DOER to consider setting appropriate targets for electric distribution companies to procure cost-effective energy storage systems to be achieved by Jan. 1, 2020.
Section 10- Small hydro tariff
- Creates a tariff programs to support small hydro facilities. The tariff shall be the default service kilowatt-hour rate of the local distribution company paid to the facility based on the amount of electricity produced. Caps programs 60 megawatts.
Section 11 and 13- Natural Gas Leak Repairs
- Require gas companies to survey for grade 3 leaks that have been determined to have a significant environmental impact, in addition to grade 1 and 2 leaks, during certain road repair projects.
- Requires the Department of Public Utilities (DPU), in consultation to the department of environmental protection, to open an investigations establish specific criteria for the identification of the environmental impact of gas leaks that have been classified as Grade 3 and to establish a plan to repair leaks that are determined to have a significant environmental impact.
Section 12- Offshore Wind and Clean Energy Procurements
- Offshore Wind
- Distribution companies shall solicit proposals for 1,600 megawatts of nameplate capacity of offshore wind not later than June 30, 2017. Distribution companies shall conduct 1 or more competitive solicitations through staggered procurements and the first solicitation must seek proposals for no less than 400 megawatts of aggregate nameplate capacity.
- Additional long term contracts will not be approved unless the levelized price per megawatt hour, plus associated transmission costs decrease from prior contracts.
- DOER, in consultation with the independent evaluator, may terminate the solicitation if reasonable proposals were not received.
- If distribution companies are unable to agree on a winning bid, DOER, in consultation with the independent evaluator will determine the final winning bid.
- DPU must approve all long term contracts and shall promulgates regulations including requiring transmission costs to be included into a proposal, allowing offshore proposals to be paired with storage and require proposals to be cost effective, avoid line loss and mitigate transmission costs, mitigate environmental impacts and promote employment and economic development. Preference for projects that demonstrate a benefit to low income ratepayers.
- DOER and the Attorney General’s Office (AGO) shall select an independent evaluator (IE) to assist in the solicitation and bid selection process. The IE shall submit a report to the DPU that summarizes and analyzes the solicitation and the bid selection process and provide an independent assessment of whether all bids were evaluated in a fair and nondiscriminatory manner. If the IE concludes in the findings that the solicitation and bid selection of a long-term contract was not fair and objective and that the process was substantially prejudiced as a result, the DPU shall reject the bid proposal.
- DPU must consider the AGOs comments which must be submitted within 45 days following the filing of the proposed contract at the DPU.
- Distribution companies shall each enter into a contract with the winning bidders for their apportioned share of the market products being purchased from the project.
- Requires a unit-specific tracking system to ensure an accounting of the energy delivered pursuant to the offshore wind energy contract and ensures accurate measure of the commonwealth’s progress in achieving the goals under chapter 298 of the acts of 2008 and chapter 21N of the General Laws.
- DOER and the DPU may each require a bond or other security to ensure performance.
- Hydro/Class1 RPS procurement
- Distribution companies shall solicit proposals for 9,450,000 megawatt-hours of clean energy generation by April 1, 2017. Distribution companies shall conduct 1 or more competitive solicitations through a staggered procurement schedule.
- DOER, in consultation with the independent evaluator, may terminate the solicitation if reasonable proposals were not received.
- If distribution companies are unable to agree on a winning bid, DOER, in consultation with the independent evaluator will determine the final winning bid.
- DPU must approve all long term contracts and shall promulgates regulations including requiring transmission costs to be included into a proposal, allowing clean energy generation proposals to be paired with storage and require proposals to cost effective, avoid line loss and mitigate transmission costs, mitigate environmental impacts and promote employment and economic development. Preference will be given to proposals that include both firm hydroelectric generation and new Class 1 resources and to proposals that demonstrate a benefit to low income ratepayers.
- DOER and AGO shall select an independent evaluator (IE) to assist in the solicitation and bid selection process. The IE shall submit a report to the DPU that summarizes and analyzes the solicitation and the bid selection process and provide its independent assessment of whether all bids were evaluated in a fair and nondiscriminatory manner. If the IE concludes that the solicitation and bid selection of a long-term contract was not fair and objective and that the process was substantially prejudiced as a result, the DPU shall reject the bid proposal.
- DPU must consider the AGOs comments which must be submitted within 45 days following the filing of the proposed contract at the DPU.
- Distribution companies shall each enter into a contract with the winning bidders for their apportioned share of the market products being purchased from the project.
- Requires a unit-specific tracking system to ensure an accounting of the energy delivered pursuant to the clean energy resources contract and ensures accurate measure of the commonwealth’s progress in achieving the goals under chapter 298 of the acts of 2008 and chapter 21N of the General Laws.
- DOER and the DPU may each require a bond or other security to ensure performance
Section 14- Nuclear Decommissioning Citizens Advisory Panel
- Creates a Nuclear Decommissioning Citizens Advisory Panel. The Panel’s duties shall include: (1) to commence public meetings for the purpose of discussing issues related to decommissioning planning activities; (2) to hold a minimum of four public meetings each year for the purpose of discussing issues relating to the progress of decommissioning; (3) to advise the Commonwealth and the public on issues related to the decommissioning with a written report being provided annually; (4) to serve as a conduit for public information and education on and to encourage community involvement; (5) to periodically receive reports on the Decommissioning Trust Fund; and (6) to receive reports regarding the decommissioning plans and to provide comment on those plans.
Section 16- Carbon Reduction Research Center
- DOER may establish a carbon reduction research center with the goal of advancing the Commonwealth’s carbon reduction goals.