Maine advances legislation restoring net metering

The Maine state legislature has voted to advance a bill that would amend the state's statute governing the net metering of small distributed renewable energy projects. If enacted into law, the amendment would reverse regulatory changes imposed in 2017 that reduced the value of net energy billing to participating customers.

Maine has allowed customers with distributed renewable energy generation to use the power they produce to offset their electricity bill since the 1980s. In 2017, the Maine Public Utilities Commission amended its rules governing net energy billing to reduce the amount of power that a customer could net against its electric utility bill. The Commission did this by inventing a concept called "gross metering," which allowed electric utilities to collect charges even for power generated and consumed on-site in real time, while requiring participating customers to install a second meter.

The "gross metering" concept was controversial for a variety of reasons, including the fact that it deterred customer adoption of solar power and other distributed renewables (by adding costs while cutting compensation), and the fact that for the first time ever it allowed utilities to collect charges from customers for power produced and consumed entirely on the customer's premises even where that power never went on utility grid facilities.  The Commission later exempted most medium and large customers from this policy after finding that the cost of installing an extra meter wasn't justified, but left the gross metering requirements in its Rule Chapter 313 governing net energy billing. In response, in 2019 various state legislators proposed bills that would alter or restore the net energy billing paradigm.

One of these bills has now received favorable votes in both the state House and Senate. LD 91, An Act to Eliminate Gross Metering, was originally sponsored by Representative Seth Berry. It clarifies the statutory definition of net energy billing, which currently defines the concept as "a billing and metering practice under which a customer is billed on the basis of net energy over the billing period taking into account accumulated unused kilowatt-hour credits from the previous billing period." As amended by LD 91, the definition would specifically define "net energy" as the "difference between the kilowatt-hours delivered by a transmission and distribution utility to the customer over a billing period and the kilowatt-hours delivered by the customer to the transmission and distribution utility over the billing period." This clarification removes the Public Utilities Commission's ability to define "net energy" in any other way. LD 91 also directs the Commission to amend its rules "to be substantively equivalent to the rules in effect on January 1, 2017" (that is, before the Commission's 2017 regulatory amendment.)

LD 91 faces additional votes in the state legislature, before it would move to the desk of Governor Janet Mills for her signature. The legislature is also expected to consider other bills affecting net energy billing or expanding incentives for solar development, later this session.

Maine solar legislation released

The Maine legislature has printed a bill whose enactment would reshape the state's solar energy laws.  The bill, An Act To Modernize Maine's Solar Power Policy and Encourage Economic Development, has been numbered as LD 1649.  It would replace a billing treatment called net metering with a series of long-term contracts and utility procurement orders.

Solar photovoltaic panels on the roof of Gallagher's Auto Parts, in Patten, Maine.

Under net metering or “net energy billing,” an electric utility invoices a customer with solar panels based on the difference between the customer's energy use and the solar project's output.  If the generator output exceeds monthly usage in any billing period, the customer earns kilowatt-hour credits that can be banked and netted against future usage.  The bipartisan non-governmental organization National Conference of State Legislatures has noted that "Net metering policies have facilitated the expansion of renewable energy through on-site generation, also known as distributed generation."

But a 2015 Maine legislative resolve directed the Public Utilities Commission to convene a stakeholder group to consider alternatives to net energy billing, largely in the hopes of helping more consumers connect with solar power.  As part of that case, the state's Office of Public Advocate proposed a structure where individual solar projects would enter into contracts to sell solar power to their local utility.  While stakeholders developed consensus around exploring the concept, there was not uniform agreement around whether it should immediately replace net metering, or whether the new concept should operate "side by side" with net metering for some test period.

The bill now printed as LD 1649 largely reflects the contract-based, solar standard buyer proposal.  It would direct the Public Utilities Commission to enter into twenty-year contracts for the procurement of 248 megawatts of solar energy between 2017 and 2022.  The bill allocates 60 megawatts (24%) to grid-scale solar distributed generation resources; 45 megawatts (19%) to large-scale community solar resources; 25 megawatts (10%) to commercial and industrial resources; and 118 (47%) megawatts to residential and small business resources.  This would represent a significant expansion of solar capacity in Maine compared to what has been developed to date.

Under LD 1649, customers could seek contracts to sell solar power to a standard buyer (the utility) at prices set by the Public Utilities Commission. The standard buyer's stated role is to purchase the output of these distributed generation resources, aggregate the portfolio of resources procured, and sell it into the relevant New England markets. 

Consumers with projects up to 250 kilowatts in capacity could have two options.  The first is to sell the project's entire output to the utility under a contract, and buy all the customer's electricity requirements back from the utility in a separate transaction.  This is sometimes described as a "buy-all, sell-all" structure.

The second option is to use onsite generation to first offset electric consumption, and sell any excess electricity.  This would allow hourly offsetting of onsite load, but would not allow customers to carry forward monthly credits for excess production that could be used to offset future load.  This differs from net metering under Maine's current regulations, which measure net energy use over an entire month billing period, and carry credits forward for up to 12 billing months.

This contracting structure would effectively replace net metering. No new customers could participate in net metering once the new rules take effect.  Those residential and small business customers who already net meter their loads against a distributed solar project would face a choice: either seek a long-term contract under the new program, or elect to net meter for 12 more years.    

The bill would also largely eliminate Maine's policy of virtual net metering, which has allowed customers to net meter load at one site against a solar project located elsewhere in the same utility's service territory.

As of late on March 9, LD 1649, An Act To Modernize Maine's Solar Power Policy and Encourage Economic Development, had not yet been referred to committee, nor a public hearing scheduled.