July 2, 2008 Massachusetts Governor Signs Green Communities Act
The new Green Communities Act signed into law by Massachusetts Governor Deval Patrick on July 2, 2008 not only takes the Commonwealth forward on its statewide renewable energy policy, but augments neighborhood energy independence.
This act does so by allowing a group of customers in a neighborhood (described in the bill as a geographic area including and limited to a unique community of interests that is recognized by residents of such area) to construct a renewable facility for net-metering on neighborhood land. Those customers would have to be in the same ISO-NE load zone to benefit from the net-metering (the process in which excess energy produced is sold back to the distribution company for credit). This includes not just residential properties but encompasses undeveloped properties and commercial properties.
Massachusetts also allows “neighborhood net metering” for neighborhood-based Class I, II or III facilities that are owned by (or serve the energy needs of) a group of 10 or more residential customers in a single neighborhood and served by a single utility. If a neighborhood facility has NEG (net excess generation) at the end of a billing period, the credits are awarded to designated neighborhood customers that have an ownership interest in the facility. The amount of NEG attributed to each such customer is determined by the allocation provided by the neighborhood net metering facility. Credits may be carried forward to the next month indefinitely.
These net-metering facilities can be any of three classes.
– Class I being solar, wind, new and incremental hydro and low emission advanced biomass technologies facilities in scale of less than 60kw.
– Class II would include solar or wind with a generating capacity of more than 60kw but less than or equal to 1mw.
– An agricultural net-metering facility generating renewable energy would fit into this class and could be operated as part of the agricultural business and wouldn’t exceed a generating capacity greater than 2mw. This facility would be located on land owned or controlled by the agricultural business and would be used to provide energy to the metered accounts of that business.
– A Class III net-metering facility’s capacity would be more than 1mw but less than or equal to 2mw.
Credits for net-metering are designated to the written identities of the customers on account and can be carried forward month to month. A credit is equal to the excess kilowatt-hours by the time of use billing period if applicable and is multiplied by: the default service kilowatt-hour charge in the ISO-NE load zone where the customer is located; distribution kilowatt-hour charge; transmission kilowatt-hour charge without demand side management and renewable energy kilowatt-hour charges. These charges combine to meet the retail rate for energy.
– Class III net-metering facilities may not be allocated credits by decision of the distribution company but instead the distribution company may purchase net-metering credits from the facility.
One requirement of all net-metering facilities includes the maintenance of adequate insurance during a possible tariff by the distribution company.
– For Class I facilities, distribution companies are prohibited from imposing special fees such as back-up charges, demand charges, additional controls or liability insurance.
– A requirement for Class II and Class III net-metering facilities, states that before service, the facility shall provide all necessary information and cooperate with the distribution utility to which it is interconnected to enable the utility to obtain the appropriate asset identification for reporting to ISO-NE.
You cannot be an electric utility, generation company, aggregator, supplier, energy marketer or energy broker to own a net-metering facility or to be a net-metering customer. Therefore net-metering participants are citizens of Massachusetts who have no professional business affiliation with power generation.
The bill also states that the aggregate capacity of net-metering shall not exceed 1 percent of a distribution company’s peak load. The capacity of a solar net-metering facility shall be 80% of the facility’s direct current rating at standard test conditions and the capacity of a wind net-metering facility shall be the nameplate rating.