ORIGINAL REPORTING: MA delivers a landmark replacement for net metering
SMART start? Massachusetts utilities, solar at odds over proposed incentive program; SMART, an innovative declining-block incentive program, is drawing criticism from both sides over auction design and rates
Herman K. Trabish, March 17, 2017 (Utility Dive)
Editor’s note: In August, the MA DOER sent the final version of the SMART program described below to the DPU. The only major change was imposing an upper cap of $0.17/kWh on the initial auction bidding.
Of all the efforts nationwide to find common ground between utilities and solar companies on net metering successors, Massachusetts’ proposed program is one of the most novel. The state’s electric utilities and solar advocates agree the Department of Energy Resources did yeomanly work to design the Solar Massachusetts Renewable Target (SMART) program. The program aims to add 1,600 MW of various types of solar capacity, setting the base incentive price for the first 100 MW through a competitive bidding process. National Grid pushed for competitive auctioning of at least 400 MW, and is concerned that a lack of competition will result in higher prices for customers. Solar advocates are pushing for changes to the program which they say will help better align solar deployment with the policy objectives outlined by Gov. Charlie Baker (R). But National grid and fellow utility Eversource are worried that special incentives for arrays that meet the policy objectives — such as installation on brownfields or service to low-income customers — will complicate the auctioning process so much that it will not be able to function properly.
If the Department of Public Utilities (DPU) approves the program by December, DOER could put SMART into effect in January 2018. SMART fulfills the directive imposed on DOER by Chapter 75 of the Acts of 2016. Lawmakers, weary of debates over net metering and the SREC incentives, mandated a new policy to support ‘a stable and equitable solar market at a reasonable cost to ratepayers.’ After setting a base price for the first 100 MW of solar through a competitive auction, the program would allocate eight 200-MW blocks of solar energy over time and declining incentive prices. Through SMART, solar projects of different types would be eligible for different incentives. Arrays of 1 MW or more in all utility service territories would be eligible for 100% of the first auction's clearing price. Projects of less than 1 MW would get from 110% to 230% of the clearing price. Prices would be fixed for 10 years for 25 kW systems and 20 years for larger systems. For each successive block, the incentive price would decline at a fixed pace. Projects meeting policy objectives would be eligible for “adders” to the incentive price of between $0.02/kWh and $0.06/kWh… click here for more
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