News from DSIRE: week of June 14th

COLORADO – New Law Sows Bed for Solar Gardens
Colorado enacted legislation in June that allows community net metering (“solar gardens”) in the service territory of investor-owned utilities. PV systems up to 2 MW that have at least 10 subscribers are generally eligible. Each subscriber will receive kWh credits on his or her utility bill in an amount equal to the proportion of shares he or she has in the project. The Colorado Public Utilities Commission will begin a rulemaking process by October 1, 2010, to develop rules for the program.

COLORADO – More Renewables Join Property Tax Incentive Club
Colorado changed the way wind turbines are assessed for property taxes in 2006, and legislation enacted in 2009 extended this special assessment to solar-electric systems. Three separate bills recently enacted have added geothermal-electric, biomass and certain hydropower facilities to the growing list of technologies eligible for this special assessment.

COLORADO – Xcel PV Rebates Step Down
Xcel Energy, Colorado’s largest electric utility, offers an upfront payment of $2/W for PV systems and a REC payment that varies by system size and ownership class. Xcel developed a schedule by which the REC payments “step down” as certain MW goals are met. The REC payments for small customer-owned systems and for certain medium-tier systems have decreased. The schedule for these systems is now on Step 6.

FLORIDA – New Law Clarifies PACE Financing
Existing Florida law authorizes municipalities and counties to create “dependent special districts” for financing a variety of projects that serve the public purpose and benefit the municipality or county. In addition to the existing statutory authority to created dependent special districts, local governments have been granted clear authority to create PACE financing programs with the enactment of HB 7179 in May 2010. This legislation authorizes local governments — including counties, municipalities and dependent special districts — to levy non-ad valorem assessments to fund energy efficiency and conservation improvements, renewable energy improvements, and wind-resistance improvements.

GEORGIA – Utility Solar Incentive Program Expanded
Georgia Power offers performance-based incentives for PV systems through the utility’s Solar Buyback Program. The Georgia Public Service Commission has previously expanded this program, which has filled to capacity over the past year. In April 2010, the commission ordered another expansion of the program, adding an additional megawatt of capacity to the program and increasing the aggregate program cap to 2.5 MW. At the same time, the commission lowered the incentive from 18.31¢/kWh to 17¢/kWh. These changes took effect June 1, 2010.

IOWA – Marathon Process Yields Interconnection Standards
In May 2010, the Iowa Utilities Board adopted detailed interconnection rules for the state’s regulated utilities. The new standards, which are based largely on those adopted by Illinois in 2008, include four levels of review for generators up to 10 MW. Iowa’s initial investigation into statewide interconnection standards began in July 2006 in response to requirements of the federal Energy Policy Act of 2005.

MARYLAND – Rebate Levels for Small PV Shuffled
Effective June 2, 2010, incentive levels for the Maryland Energy Administration’s Solar Energy Grant Program have been revised. The new calculation method retains an incentive of $1.25/W for the first 2 kW, but changes the subsequent incentive “tiers” to $0.50/W for the next 8 kW (previously $0.75/watt for the next 6 kW) and $0.35/W for the next 10 kW (previously $0.25/W for the next 12 kW). The maximum rebate of is still $10,000.

MASSACHUSETTS – Micro-Wind Incentives Resurrected
The Massachusetts Clean Energy Center has reactivated its micro-wind incentive program after a short hiatus to update program guidelines. Many tweaks were made to the program. The general structure of the incentive — an initial capacity-based rebate and a second, performance-based incentive paid after one year of production — remains intact, but the incentive levels have changed slightly. The maximum incentive is still capped at $4/W, up to $100,000. The new program rules also allow for third-party ownership and reserve 25% of the available funds for systems up to 15 kW for the first nine months of the fiscal year (starting in FY11). But wait, there’s more! Only turbines certified by the Small Wind Certification Council or those listed by NYSERDA are eligible.

MASSACHUSETTS – Final RPS Regulations Filed
The Massachusetts Department of Energy Resources has filed final RPS regulations, which are now subject to a 60-day review period before becoming final. Since the emergency regulations were adopted in January 2010, the DOER has issued draft final regulations, held stakeholder meetings, accepted comments, and incorporated the terms of a settlement agreement between the Massachusetts Department of Public Utilities (DPU) and TransCanada after the latter sued the DPU over issues related to the state’s RPS. What does it all mean? Basically that the solar carve-out will not ramp up as quickly as it appeared from the January 2010 emergency regulations, but that the state remains committed to renewables and solar, and is working to maintain pricing stability and predictability necessary to support the state’s emerging solar industry.

MISSOURI – New RPS Rules Require Standard SREC Contracts
The Missouri Public Service Commission has adopted rules for the state’s renewable portfolio standard (RPS), which was established by ballot initiative in November 2008. Along with numerous other implementation details and clarifications, the rules require that electric utilities establish standard offer contracts for the purchase of solar renewable energy certificates (SRECs) from customer-sited solar facilities. Details differ by system size, but utilities must offer systems up to 10 kW a standard contract that provides a lump-sum payment for SREC production over 10 years. The rules also require that renewable electricity be delivered to Missouri customers in order to qualify under the standard.

NEW YORK – LIPA Keeps PV Rebate Connoisseurs on Their Toes
In 2010, the Long Island Power Authority’s PV rebate program was transitioned to a declining block structure, where incentives decline each time approved applications reach pre-determined capacity benchmarks. The program initially authorized a total of four 1-MW blocks of 1 for residential and non-residential applications combined. In May 2010, with two unfilled capacity blocks remaining, the program was restructured to designate one block each for residential and non-residential applications. At the same time, non-residential incentives were adjusted to offer flat rebates of $1.75/W, up to 50 kW, with a $1.00/W bonus incentive for non-profits, governments and schools.

NORTH CAROLINA – Small Tweak Bears Potentially Large Impact on State Tax Credit
When taken together, North Carolina’s tax credit for renewables and the federal investment tax credit for renewable are both calculated based on the full installed cost of the project, rather than having to back one out before calculating the other. The North Carolina Department of Revenue had ruled in at least two cases that cash grants received from the U.S. Treasury Department in lieu of the federal investment tax credit would be treated differently, and would reduce the cost basis for determining the state credit. However, legislation enacted in June allows a taxpayer to take the cash grant without impacting the state tax credit.

OKLAHOMA – Renewable Portfolio Goal Established
Oklahoma has become the most recent state to establish a renewables portfolio goal, which differs from a renewable portfolio standard in that a goal is generally considered voluntary. Oklahoma’s goal calls on all utilities to use renewables to account for 15% of their generating capacity by 2015. Energy efficiency may be used to meet up to 25% of the goal.

OREGON – FIT Mutates, Takes Effect
In June 2009, Oregon enacted legislation establishing a pilot solar volumetric incentive rate and payment program. While certain bills referenced the development of a “solar feed-in tariff,” the rules and rates for this program were determined by the Oregon Public Utility Commission. Due to concerns regarding FERC jurisdiction and the ability of the state to set rates for the feed-in tariff, the current pilot program differs from a typical “feed-in tariff.” In late May 2010, the PUC finalized rules for the volumetric incentive rate and payment program. For systems up to 100 kW, incentive payments range from $0.55/kWh – $0.65/kWh minus the retail rate. The incentive for smaller systems is structured as “super net metering,” where residential and small commercial systems are paid for the amount of electricity generated, up to the amount of electricity consumed. Systems sized 100 kW – 500 kW participate in a competitive bidding process.

TEXAS – New Funding, Rules for Oncor PV Rebates
Oncor’s popular PV rebate program will re-open to new applications June 21, 2010, under revised program rules and with $6.9 million in new funding. Incentives have been reduced from $2.46/W to $2.25/W for residential systems and from $2/W to $1.75/W for non-residential systems. Other notable revisions include a reduction in the maximum amount of incentive payments that an individual service provider may receive, and the removal of a requirement that equipment be listed as eligible under the California Solar Initiative, in favor of specific module and inverter requirements. Residential and non-residential systems are each allocated an equal share of the fresh program funding.

VERMONT – Legislature Ruins DSIRE Staff’s Social Life
The last bill signed during Vermont’s legislative session — and the last bill signed by outgoing Gov. Jim Douglas – primarily addressed renewable energy. While modest when compared to last year’s energy legislation bonanza (remember Vermont’s feed-in tariff?), many of the state’s renewables policies were affected. Here’s a summary:

• The cap on net metering was raised to 2.2 MW for systems installed on military land and for military consumption. Such installations will not affect and are not subject to the aggregate limit on net metering.
• H.B. 781 allows any system up to 150 kW to follow the simplified interconnection standards currently available for net-metered systems only, and it allows the Vermont Public Service Board (PSB) to reconsider and amend the state’s interconnection standards for systems 150 kW to 2.2 MW.
• The state’s business energy tax credit for solar was revised. System owners are now required to apply for the credit and receive pre-approval from the Clean Energy Development Board. Application deadlines are July 1 and December 1, depending on system size. The credit is available only for systems up to 2.2 MW.
• Fourth, the new law allows natural gas vehicles and related infrastructure (such as fueling stations) to qualify for funding from the state’s Clean Energy Development Fund.
• Vermont’s feed-in tariff, officially known as the “Standard Offer for Qualifying SPEED Resources,” was amended in order to provide better support for pre-existing farm methane generators up to 2.2 MW. Such facilities are now eligible for the standard offer and will not impact the program cap. These systems still retain their renewable energy certificates.
• The state’s renewable portfolio goal was amended. Beginning in 2012, hydropower of any size may be certified as an eligible resource; until that time, only hydropower plants up to 200 MW are eligible. The bill instructs the PSB to consider changing the goal and adopting a mandated renewable portfolio standard. The PSB’s findings will be submitted to the legislature by October 2011.

Jane Pulaski