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New solar law casts shadow on small businesses

Local legislators say amendments are possible

To further Massachusetts’ role as a leader in clean energy policy, the state Legislature is poised to change rules and incentives that have driven installation of more than 600 megawatts of solar generation in the past 4½ years.

But advocates of small-scale solar projects are concerned that a compromise worked out between large renewable energy developers and utilities — which nationally are pushing back against so-called “net metering” rules — could darken the state’s successful solar development.

Compromise legislation now before the House Ways and Means Committee would do away with the 6 percent cap of peak load that each utility is required to buy from photovoltaic projects.

That 6-percent limit already represents a doubling of what the cap was a couple of years ago, and is already being reached by National Grid.

The outgoing administration of Gov. Deval Patrick is also eager to see its goal of 1,600 megawatts of solar generation by 2020 codified under state statute so that regardless of who wins November’s gubernatorial and legislative elections, the aggressive program will live on.

Small photovoltaic system dealers, like the Greenfield Solar Store and the Pioneer Valley Photovoltaic (PV Squared) cooperative, agree that the 6 percent cap needs to be raised and that the 1,600 megawatt goal should be written into law. But they argue that other elements of the compromise legislation would set back the clock on the state’s aggressive program.

Among the provisions of the bill, which cleared the Joint Committee on Telecommunications, Utilities and Energy that is co-chaired by Sen. Benjamin Downing, D-Pittsfield, is one that would limit systems to only on-site electrical demands rather than allowing excess power to be allocated to friends and family, according to Solar Store owners Claire Chang and John Henry. It would nearly halve the “virtual net metering” rates for community shared solar projects, like a 997-kilowatt project being designed in Hadley.

The proposal, which was hashed out in working group sessions convened by the state that included utilities and large renewable-energy businesses but not smaller dealers and installers, also would allow a monthly minimum charge for all electric customers to pay for distribution and transmission systems. And it would replace a popular program of Solar Renewable Energy Credits with a declining incentive to be determined by the state Department of Public Utilities after a complete tariff process.

“The effect of this bill is to dampen the process of solar PV installation, and it empowers centralized power generators,” says Chang. “They have more of an advantage under this new bill, and the utilities will get much more control of solar PV so that not every rooftop will be taken advantage of, with people being restricted on how big a system they can put up.”

Bill Sillinger of PV Squared complained in a written statement, “Even the process of developing the bill was flawed: the interests of only the investor-owned electric utilities and those of large out-of-state corporations were included, not the concerns of the state’s electric ratepayers and of the many Massachusetts-based, locally owned and operated solar companies.”

The proposal, written in collaboration with Solar Energy Industries Association, the New England Clean Energy Council, National Grid, and Northeast Utilities, has been criticized by the Solar Energy Business Association of New England, as well as by organizations including Environment Massachusetts, Clean Water Action, the Environmental League of Massachusetts and the Massachusetts Solar Owners Association.

State Undersecretary of Energy and Environmental Affairs Mark Sylvia defended the legislation,which he said maintains the goals and momentum of the Massachusetts renewable energy program while also addressing utility concerns over the cost of existing incentives and their effect on electricity prices.

“This will in essence create one combined, integrated program that will address solar incentives and net metering,” he said. “Now we won’t have to go back to the Legislature to raise net-metering caps and we’ll have a declining block structure, so as the cost of solar goes down, the incentive structure would go down with it.”

Sylvia said the expedited legislative process,which began in March and led to a compromise bill that was introduced in Downing’s committee with little time for review before it had to be acted on, was necessitated by the net-metering cap being reached in the eastern part of the state and the possibility that action would otherwise have to wait until the next legislative session, when there will be a new governor, new legislators and possibly new priorities.

“We have a very important issue we have to address now to continue the momentum of the solar program,” he said. Unlike some states where utilities and other groups are gutting net-metering, “Massachusetts is the first state that was actually able to bring utilities and the renewable energy community to the table and come up with a compromises that could be supported by both. ... In Massachusetts, we want to be in charge of our own destiny and continue to support those initiatives that have been very successful. Now is the time to do that.

Downing said that he’s heard over the past couple of weeks from small renewable-energy businesses that should have been involved in the process earlier on and have raised issues that can be addressed in several amendments that he is considering and could be added before the legislation is acted on by the end of this month.

Rep. Stephen Kulik, D-Worthington, who is Ways and Means vice chairman, and Rep. Paul Mark, D-Peru, say they also are open to amendments to address those concerns, which they believe have merit.

“I think there is legitimacy to the issues raised by the folks I’ve talked to,” said Kulik. “I think that what’s important is that we not be taking steps backward in our national leadership in increasing use of renewables. I’m very concerned that the bill as written now might have a negative impact on people who have installed systems and be off the grid.”

On the Web: http://1.usa.gov/1jhxZkb

You can reach Richie Davis at: rdavis@recorder.com or 413-772-0261, Ext. 269

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