Who is a member?
Our members are the local governments of Massachusetts and their elected and appointed leadership.
The Honorable Thomas H. Golden, House Chair
The Honorable Benjamin Downing, Senate Chair
Joint Committee on Telecommunications, Utilities and Energy
State House, Boston
Dear Chairman Golden, Chairman Downing, and Members of the Committee,
On behalf of the cities and towns of the Commonwealth, the Massachusetts Municipal Association wishes to express our appreciation for the efforts of the Administration, the Legislature and your Committee to ensure that the Commonwealth continues to lead the nation in energy efficiency and renewable energy. Collectively, cities and towns are among the largest consumers of energy in Massachusetts. This is why communities understand that a balanced, long-term energy plan with a range of energy sources that can provide safe, efficient and uninterrupted energy delivery is essential if we want to maintain and improve our economic growth and provide a high quality of life for our residents. We look forward to working with you and your colleagues on the Committee to craft such a comprehensive energy management plan.
We are pleased that there are several bills before the Committee today that would enhance and diversify our state’s energy portfolio. However, because of the urgent need to raise the net metering cap, we are focusing our testimony on H. 3724, An Act Relative to a Long-Term Sustainable Solar Industry, filed by Governor Baker.
H. 3724 would raise the cap for all net metering facilities by 2% (from 4% to 6% for private entities, and from 5% to 7% for municipalities and other public entities) of each distribution company’s peak load. The legislation would also provide the Department of Public Utilities with authority to increase the caps if it finds an increase to be in the public interest.
The MMA strongly supports lifting the net metering cap. Net metering is a critical part of solar development financing. The public sector cap of 5 percent has already been reached in the National Grid area, stalling existing municipal projects currently under development and precluding new ones from beginning.
Solar development legislation was signed into law last session, raising the cap on public projects from 3 percent to 5 percent of a utility’s total power generation, and raising the cap on private projects to 4 percent. However, the measure did not take action on a proposed comprehensive overhaul of the state’s net metering allocation system for renewable energy projects. Instead, the Legislature created a task force to study the long-term feasibility of net metering in Massachusetts. The MMA would like to thank the task force members for their detailed and thoughtful suggestions on the continued growth of solar energy here in the Bay State.
In recent years, Massachusetts has become a true leader in solar development, with over 900 megawatts (MW) of installed solar capacity statewide. This far exceeds the original solar goal of 250 MW by 2017, established in the 2008 Green Communities Act. Cities and towns have been the bedrock of this success, hosting solar developments on municipal property statewide. However, in order to meet the Commonwealth’s new goal of 1,600 MW by 2020, and to continue to build on past achievements, the net metering cap for municipal projects must be increased to allow for sustained progress.
Once enacted, H. 3724 would immediately increase the public net metering cap from 5% to 7%. However, once the goal of 1600-megawattis is reached, new projects would not receive a net metering credit at the full retail rate, as is current policy. Specifically, the legislation would establish a net metering credit equal to the basic service rate for municipal projects, including community shared net metering projects. Although this is higher than the commodity rate because it includes a risk premium and the costs associated with the renewable portfolio standard, it is less than the current market rate credit. While we appreciate the Administration’s efforts to support municipal solar projects and sustain solar development, we are concerned that the proposed change in the municipal net metering credit would make future projects less feasible, or result in much less overall savings or revenue generation.
Rather than restructuring the incentive system in this legislation, we recommend that the Committee work with the Administration, members of Task Force, and the full membership in the General Court to construct a fair and equitable solution for the long-term viability of net metering and the best long-term path forward. We also support amending the bill to eliminate any net metering caps through December 31, 2016, to assure host communities that their projects will receive the necessary net metering credits to allow those solar developments to move forward and take advantage of the 30 percent federal tax credit due to expire on that date. This would leverage a great deal of progress over the next 14 months.
Again, we ask you to support raising the cap on net metering as quickly as possible. This is the only way that Massachusetts will be able to achieve continued progress and meet our ambitious solar energy goals.
If you have any further questions or wish to receive further information, please do not hesitate to have your office contact me or Tom Philbin of the MMA staff at 617-426-7272 at any time.
Thank you very much.
Sincerely,
Geoffrey C. Beckwith
Executive Director & CEO