Maine considers community solar rules

As Maine utility regulators consider changes to the state’s net metering rule for solar panels and other customer-owned generation, revisions proposed by the Public Utilities Commission could change how consumers can participate in community and shared ownership solar projects.

For years, the Maine Public Utilities Commission’s rules have allowed “net energy billing,” a metering and billing mechanism that promotes the development and operation of smaller renewable generation facilities. Net metering is responsible for nearly all customer-owned solar power projects developed in Maine to date, including a handful of shared ownership or community solar farms. But as utility Central Maine Power Company reported that its customers' net metering reached 1% of peak load last year, the Commission launched a process to consider revisions to its net energy billing rules.

On September 14, 2016, the Commission released a Notice of Rulemaking along with proposed amendments to its rule. As proposed by the Commission, the amended rule would expand net energy billing in Maine in several ways. It would increases the size cap for an eligible facility by 50%, from 660 kilowatts to one megawatt. It would also recognize four different types of net energy billing arrangements that would be allowed: individual customer; customer leases; shared ownership; and community NEB.

Under the shared ownership model, each participating customer must have a shared ownership interest in the eligible facility under which the customers have joint responsibility for the costs of the shared ownership facility and have rights to the output of the shared ownership facility in proportion to their cost responsibilities. Under shared ownership net energy billing, the transmission and distribution utility would allocate the nettable energy of the shared ownership facility to customers in proportion to each customer’s ownership interest in the eligible facility.

The proposed rule would also explicitly allow for “community” net energy billing, a model that the Commission recognized as “increasing as a means to promote smaller solar installations.” The proposal suggests that community projects would have similarities to shared ownership projects, with additional registration and consumer protection provisions, but potentially with different ownership requirements.

The case over the rule change’s adoption remains pending for now. While some elements of the proposal would expand net metering opportunities, the proposal would also ratchet down the amount of energy that new projects could net against their T&D bill, from 100% in 2016 to 0% for new NEB customers after 2025. Elements of the Commission’s proposal remain controversial. Nevertheless the Commission’s proposal suggests a potential direction for future community solar projects in Maine.

Maine opens net metering inquiry

The Maine Public Utilities Commission has issued a Notice of Inquiry to obtain feedback on whether its net energy billing rules should be modified, or other action taken to affect Maine's net metering policy.

Rooftop solar panels on a Maine business.

Under Chapter 313 of the Commission's rules, Maine electricity customers may net the output of qualified solar panels or other distributed generation resources against their utility loads.  To date, this rate treatment, known as "net energy billing," has been a major incentive for the development of solar photovoltaic and other customer-sited renewable energy projects in Maine.  Most other U.S. jurisdictions have adopted similar net metering programs.

But the Maine regulations provide for a review by the Commission of its rules once a utility gives notice that net metered capacity reaches 1% of peak demand.  Maine transmission and distribution utility Central Maine Power Company gave that notice earlier this year.

At a deliberative session held on June 14, the Commission unanimously decided to initiate an inquiry into the matter.  The Commission's 4-page Notice of Inquiry seeks comment and information on a list of specific issues related to the net metering rules.  Issues identified in that notice include possible changes to the value of net metering credits or the kinds of customer generating facilities may be net metered, grandfathering of existing systems, the adoption of consumer protection standards, and an alternative contracting structure:

1. In what respects (if at all) should Chapter 313 be revised, and what objective is each such revision intended to achieve?

2. In what respects (if at all) should there be revisions to the retail rate components that are netted such that less than the full retail rate (T&D and supply) would be netted, and what objectives are such revisions intended to achieve?

3. Should the Commission consider changes in the current kWh (660kW) threshold for qualified projects? What is the rationale for such a change?

4. If there are revisions to NEB, should existing NEB customers be “grandfathered” with respect to any future changes that affect NEB? Please provide the rationale for your answer, and, if yes, for how long should customers be grandfathered?

5. How can an NEB program be designed to track changes in the costs of distributed generation facilities?

6. Should issues of revenue loss and rate impacts be addressed through T&D utility rate design? How should rate design be approached--through cost of service, avoided cost, or a value of solar approach? Please discuss any equity issues that might arise from these approaches.

7. With respect to the structural app roach discussed in the Commission’s Report to the Legislature Regarding Market-Based Solar Policy Design Stakeholder Process Pursuant to Resolves 2015, ch. 37 (Jan. 30, 2016) (which was the basic structural approach that was considered by the Legislature last session through LD 1649) in which the output from solar facilities would be purchased and re-sold into the wholesale market, please comment on the statutory authority under which the Commission could implement such an approach. In the event the Commission has the statutory authority, should the Commission pursue such an approach and, if so, how should the purchase price be established for the various distributed generation resources that participate in NEB?

8. Should solar PV be treated differently than other NEB eligible resources with regard to any changes that might be adopted to the program?

9. How should any changes to NEB arising from CMP’s January 14, 2016 letter request for review apply to Emera Maine and the consumer-owned utilities?

10. Does the Commission have statutory authority to regulate or oversee lease arrangements or other custom er agreements that involve NEB? If so, should the Commission consider additional consumer protection standards with respect to distributed generation lease programs or other customer arrangements (i.e., sales of community solar project shares)?

11. Please comment on any other issues related to NEB?

The Commission requested comments on these issues by July 22, 2016.  Public comment and information will help inform the Commission's review of its Chapter 313 rules.

Maine to consider net metering rules

The Maine Public Utilities Commission is set to consider opening an inquiry into the state's net energy billing rules, which allow electric utility customers to offset their load with distributed generation.

Under Maine's form of net metering, customers with qualifying distributed electric generation may net the power they produce against their consumption of power from the grid.  The Maine Public Utilities Commission adopted rules governing this "net energy billing" or net metering arrangement, which is a key incentive for customer-scale solar photovoltaic projects in Maine.

But those rules, found in Chapter 313 of the Commission's regulations, provide for an agency review of net metering as more customers go solar or participate in other net-metered distributed generation.  Earlier this year, Maine transmission and distribution utility Central Maine Power Company notified the Commission that the cumulative capacity of net metered generating facilities in its service territory had exceeded 1 percent of annual peak demand.  By rule, this notification will trigger a review by the Commission "to determine whether net energy billing ... should continue or be modified."

The Commission has now placed consideration of a Notice of Inquiry related to this item on its agenda for deliberations on June 14, 2016.