A Hard Fought Solar Victory in Massachusetts

It was a hard fought victory for a short-term compromise, but today Massachusetts Governor Charlie Baker signed a bill to raise the net metering cap for non-residential solar energy systems—which will clear the way for Bay Staters to keep going solar and put workers back on the job. While the bill provides much-needed cap relief, lawmakers did make some tough choices to get it across the finish line—notably, it makes unjustified cuts to the rates at which non-government customers are credited for solar power. It all means that our work is not done, but in the meantime we joined forces with the Northeast Clean Energy Council, Solar Energy Business Association of New England, Solar Energy Industries Association and the Coalition for Community Solar Access to thank state leaders for this step forward for solar.

The bill is the result of a year and a half of debate about the future of Massachusetts net metering. Back in 2015, we participated in the Solar and Net Metering Task Force, which had been convened as a result of prior net metering legislation. Among its recommendations, the Task Force found that solar policies are delivering benefits that far exceed the total costs to consumers and that a scenario with no net metering caps would be the most cost-effective way to develop a diverse solar market in Massachusetts. As the Task Force was issuing its recommendations, customers in the state began hitting the very caps in question. More than a year, 500 stalled solar projects and millions of dollars in lost local investment later, the Conference Committee of the House and Senate hammered out today’s resolution.

Bill will move stalled solar projects forward across Massachusetts. Map: Bill Sullivan / The Republican

Impressive grassroots, stakeholder and industry engagement helped get this bill across the finish line. Many of the state’s 15,000 solar workers showed up to tell their stories to the lawmakers at public hearings, rallies and lobby days. More than 6,000 solar supporters from across the state petitioned the Governor to take action, and then 5,000 more urged Speaker Robert DeLeo to follow suit. Huge thanks to our many members and partners who helped make solar a priority for state leaders.

On to the details of the compromise bill. First the good stuff:

• Raises the net metering cap to expand access to net metering compensation: The bill raises caps on net metering by 3 percent, from 4 to 7 percent of peak capacity for private projects and from 5 to 8 percent for public projects. Unfortunately, while this is a significant raise in the existing caps, it is not expected to last more than a few months at the current rate of solar growth.

• Continues full, fair credit for residential and municipal customers: The bill continues to exempt residential customers—projects smaller than 25 kilowatts—from the net metering caps and maintains full retail net metering for those projects. In addition, it keeps municipal customers’ net metering credit value at the full retail rate.

• Reforms the Solar Renewable Energy Credit incentive program. The bill orders the Department of Energy Resources to continue provide an incentive for solar and reform the existing program to deliver ratepayer savings, sustained solar growth and a diverse market that supports low-income and community shared solar projects.

Unfortunately, the electric utilities and their industry mouthpiece, the Associated Industries of Massachusetts, managed to garner significant concessions in the final negotiation:

• Cut the net metering credits for excess generation by 40 percent: The bill sets a “market net metering credit” rate for a customers’ net excess generation that is 60 percent of the full retail value, a reduction that was made based on politics rather than data. Projects that interconnect after Massachusetts has reached 1,600 megawatts of solar will generate these credits for any excess generation after their bill is netted for their on-site use. This will hit off-site projects, such as low-income and community shared solar, the hardest. Again, the residential and municipal markets are exempt from this change.

• Authorize the utilities to propose, and the Department of Public Utilities to consider, a minimum bill: The bill authorizes the utilities to propose a minimum bill charge on solar customers to ensure they are paying for fixed costs of the electric grid. The Department of Public Utilities will need to consider these proposals as part of a full rate case or other revenue-neutral adjudicated proceeding and consider many factors, including the growth of the solar industry.

We look forward to continuing to work hand in hand with lawmakers as solar moves forward. The bill’s small increase to a new 3 percent program cap means that we’ll need to have this net metering conversation again soon to avoid repeating history. As part of that conversation, we hope to chart a long-term policy path that addresses the Commonwealth’s energy challenges by taking full advantage of all that homegrown, reliable and affordable solar power has to offer.