Maine distributed generation procurement rulemaking

Following the Maine legislature's enactment of a law creating a new distributed generation procurement program, state utility regulators have issued a proposed rule governing the periodic procurement of distributed renewable resources. Once finalized, the rule will define how Maine implements its new program to procure the output of 375 megawatts from at least 75 new small renewable generating projects.

Earlier this year, the Maine State Legislature enacted An Act To Promote Solar Energy Projects and Distributed Generation Resources in Maine. The act defines "distributed generation resource" as an electric generating facility that uses a renewable fuel or technology and is located in the service territory of a transmission and distribution utility in Maine, and includes various provisions designed to promote the development of these resources.

Part A of the law expands and creates new opportunities for net energy billing, including by:  eliminating the cap on how many customers may share interests in a net metered project;  clarifying that shared interests could include ownership, leases, or power purchase agreements; expanding the maximum facility size to just under 5 megawatts; and creating a new net energy billing program providing monetary credits that could be used by commercial and institutional customers of investor-owned utilities to offset their customer or demand charges (as opposed to providing only volumetric energy credits).

Part B of the law creates a procurement program for distributed generation, requiring the Maine Public Utilities Commission to hold a series of competitive procurements for the output of renewable distributed generation resources with nameplate capacity of less than 5 megawatts.In all, the law requires the Commission to procure 125 megawatts of the output of distributed generation resources associated with commercial or institutional customer accounts and another 250 megawatts from shared distributed generation resources, by July 1, 2024. It requires an initial procurement of 75 megawatts in 2020, followed by four additional procurement blocks, each of which would be priced at 97% of the previous block price.

In response to the enactment of Part B, the Commission has issued a notice of rulemaking proposing to adopt new a rule Chapter 312, and has released a draft of the proposed rule chapter itself. The Commission has requested public comments by September 20, with a public hearing scheduled for October 8, and final written comments due no later than October 18.

The procurement program comes in addition to the implementation of other recently enacted incentives and mandates for clean energy, including a pilot program seeking proposals to support the beneficial electrification of the transportation sector, other reforms to net metering, and a significant expansion of Maine's renewable portfolio standard.