Maine PUC opens thermal REC inquiry

The Maine Public Utilities Commission has opened an inquiry into issues related to an upcoming rulemaking proceeding regarding the new thermal renewable portfolio standard requirement created by legislation enacted last year.

In 2019, Maine Governor Janet Mills signed L.D. 1494, An Act To Reform Maine’s Renewable Portfolio Standard. Enacted as P.L. 2019, c. 477, the legislation significantly expanded Maine's renewable portfolio standards (RPS), which require retail electricity providers to source power from renewable resources meeting defined criteria. The law created a new Class 1A portfolio requirement, requiring suppliers to source at least 40% of their retail sales from renewable resources meeting defined standards, on top of preexisting laws requiring another 40% to come from existing and new renewable resources. It also created a new long-term contracting program, requiring the Commission to solicit and direct utilities to enter into contracts with Class 1A resources covering 14% of Maine's load.

Another portion of the RPS reform law added a new thermal renewable energy resource requirement. As enacted, it requires competitive electricity providers to source an amount of thermal renewable energy credits (sometimes referred to as T-RECs) beginning at 0.4% in 2021 and increasing to 4% in 2030 and thereafter. Each T-REC of one megawatt-hour represents 3,412,000 British thermal units of thermal energy, delivered to an end user in Maine in a manner that can be verified, from a qualifying resource that begins operation after June 30, 2019, used for heating, cooling, humidity control, process use or other end use to meet a need of the end user that would otherwise be met using another energy source such as electricity or an on-site thermal energy system, and generated or delivered in accordance with any efficiency performance standards established by the Commission.

On March 23, 2020, the Commission issued a Notice of Inquiry Regarding Thermal Renewable Portfolio Requirement, docketed as Docket No. 2020-00090. Through the inquiry, the Commission seeks comment on issues including what alternative compliance payment for T-RECs the Commission should set, what criteria the Commission should use to verify that a facility is qualified pursuant to the Act to provide thermal energy (such as the size of the facility or technology type) and how the Commission should ensure that the criteria are met, how the Commission should verify and certify the quantity of thermal energy generated and its use to confirm compliance with the Act; and what, if any, efficiency performance standards should be required.