United States: In 2017 Legislative Sessions, New England States Continue To Lead In Clean Energy And Climate Change Measures

Meredith L. Hiller is an associate in Holland & Knight's Boston office

In their 2017 legislative sessions, New England states continued to show support for clean energy projects and policies, as well as efforts to reduce greenhouse gases, and continue to look to each other in determining what programs have been successful.

Connecticut

In Connecticut, legislators spent a significant amount of time focused on nuclear energy, including a viability study by the Department of Energy and Environmental Protection (DEEP) and the Public Utilities Regulatory Authority on Dominion Energy's Millstone Nuclear Power Station included in the state's Comprehensive Energy Strategy (CES), and a stalled proposal in SB 106, which would have up to 50 percent of Millstone's output sold directly to electric distribution companies (EDCs), bypassing the wholesale market. There is currently discussion of including support for Millstone in the budget, though details of any such mechanism are as yet unclear.

Connecticut's CES also includes expanding the RPS to achieve 30 percent Class I by 2030, phasing down biomass and landfill gas in Class I of the RPS, setting up a working group on siting and land-use pressures, and prioritizing grid-scale DEEP-led procurements for renewables so these resources are deployed at a lower cost to consumers, somewhat like the SMART program in Massachusetts. In addition to the CES, the governor signed an omnibus bill allowing EDCs to own and operate up to 30 MW of new fuel cell generation and requiring ratepayer impact statements for all bills from the General Assembly. New legislation will also require EDCs to satisfy any deficiencies in their RPS requirements from a previous calendar year within the first three months of the following calendar year. Finally, the DEEP will have to consider environmental impacts of solar energy proposals received in response to solicitations, including impacts on farmland and core forests, and reuse of certain brownfields and landfills.

Massachusetts

In Massachusetts, because the state sits in a biennial session, final action was not taken on any of the proposed energy legislation, and hearings on the main bills will continue in the fall. However, three proposed bills address carbon pricing, with one redistributing 80 percent of any carbon tax revenues to low- and middle-income populations, and two returning funds to residents more broadly. Energy storage was also the focus of two bills, one related to tax exemptions and another establishing a 1766 MW target for the Commonwealth by 2025, echoing a trend seen in Vermont. Another proposed bill would transition Massachusetts to 100 percent clean, renewable energy by 2050 and establish a council to oversee the change, with interim targets for 2030 and 2040. Other possible legislation would establish a greenhouse gas emissions limit of 35-60 percent below 1990 emissions for 2030, requiring the Secretary of Energy and Environmental Affairs to consult with all state agencies and regional authorities with relevant jurisdiction. As in Rhode Island, Commonwealth legislation focused on electric vehicles (EV), with four separate bills supporting EV programs. Two proposals would require development of specific plans – one a comprehensive energy plan every three years, and another a comprehensive climate change adaption management action plan at least once every ten years.

Maine

Maine's recent legislative session was marked by the governor's vetoes and attempts to override those vetoes. Legislators overturned the governor's veto of a bill extending the RPS through 2028, while an attempt to remove the 100 MW cap on hydro for the RPS was defeated. The governor also vetoed a bill that directed the Maine Public Utilities Commission (PUC) to perform a cost-benefit analysis on net metering and would have effectively put a PUC decision to gradually phase out net metering for solar energy in the state on hold. An attempt to override the veto fell short, leaving the future of net metering in Maine appearing bleak. The governor similarly vetoed a bill to establish a rebate program for EV charging stations. Countering trends seen in other New England states, future offshore wind is also looking less likely in Maine following bitter debate over the sole offshore wind project in the state, and a requirement that the Maine Department of Environmental Protection convene a stakeholder group on the effect of expedited wind energy on scenic character and existing uses.

New Hampshire

In New Hampshire, a proposed repeal of the RPS was blocked, while the RPS limit for Class II solar was increased and the 10kW limit on the residential solar rebate program was lifted. A proposal to repeal RGGI was also defeated. Following patterns of reducing net metering prices seen in other states, a bill that would drop net metering rates to the wholesale price was retained in committee. On net metering, the New Hampshire Public Utilities Commission also issued an order effective next month including a lower reimbursement value on systems 100kW and smaller, but leaving systems 101-1000kW mostly unchanged, with a significant amount of information gathering and studies planned. Legislation establishing a joint committee to study subsidies for energy projects provided by the RPS, and repealing the voluntary greenhouse gas emissions reductions registry administered by the New Hampshire Department of Environmental Services passed also. Not unlike two pieces of pending legislation in Massachusetts, legislation requiring a portion of the Renewable Energy Fund to benefit low- to middle-income residential customers also passed.

Rhode Island

Also taking action on net metering, Rhode Island saw enactment of a bill to expand net metering to educational institutions, non-profits and hospitals enacted. Bills launching municipal solar permitting, and imposing interconnection deadlines passed, easing the process for solar by streamlining building and electrical permits and setting damages for delayed interconnections that the EDC's shareholders, not state ratepayers, will be responsible for. The state's Renewable Energy Growth program was extended through 2029 at 40MW/year, a new grid modernization effort will be undertaken, and an EV rebate program will be established, rounding out the clean energy measures passed.  Rhode Island also saw legislation requiring a plan to study the effectiveness of state and multi-state carbon pricing programs to incentivize carbon emission reductions.

Vermont

In keeping with past legislative sessions, and despite a major reset in the state with a Republican governor and about 25 percent of the house being newly elected, Vermont will continue energy storage deployment and require a Public Service Board (PSB) study of storage measures.  Also acting on net metering rates, and showing some similarities to the Massachusetts SMART program, a bill allowing the PSB to apply new (lower) rates to preexisting customers after ten years was enacted and 150-500 kW projects will be allowed only at "preferred locations." The new net metering compensation rate will be based on the lower of the utility's blended residential rate or the statewide average blended residential rate, with some adjustors based on whether RECs are held by the generator or passed to the utility. The state's Standard Offer program will remain in place for two more years, and proposed moratoria on wind failed, meaning it is still viable. In addition, the PSB will retain authority over project permitting, which would have gone to individual towns under Act 250, but towns will be given more deference at the PSB under Act 174. Finally, carbon pricing could appear as part of comprehensive tax reform in the state.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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