Massachusetts community microgrid projects solicited

A Massachusetts economic development agency focused on clean energy has launched a program seeking to catalyze the development of community microgrids throughout Massachusetts.

Generally speaking, a microgrid is a localized power grid that can disconnect from the traditional grid to operate autonomously.  According to the U.S. Department of Energy, a microgrid's ability to operate while the main grid is down means microgrids can strengthen grid resilience and mitigate disturbances, while enabling faster system response and recovery once reconnected to the main grid. Microgrids can also support flexibility and efficiency, by enabling the integration of growing deployments of renewable and distributed energy resources like solar, and by reducing energy losses in transmission and distribution.
 
A "community microgrid" could be defined in several ways, but a typical definition focuses on a multi-user microgrid providing electrical and/or thermal energy to multiple consumers, integrated with and supported by the local community, relevant utilities, and building or site owners.  As with other microgrids, a community microgrid implementation could reduce energy costs and reduce greenhouse gas emissions, while providing increased energy resilience.

While federal support for microgrids has existed for years, states are now becoming active in exploring how microgrids can help meet society's energy needs and policy goals. Massachusetts is one hotbed of interest in microgrids, and a recently announced program could help stimulate the microgrid industry. The Massachusetts Clean Energy Center’s (MassCEC) Community Microgrids Program anticipates providing about $75,000 in funding to support each of 3 to 5 prospective community microgrid projects with the following characteristics:

• Are community, multi-user microgrids (as opposed to single owner or campus-style microgrids) located in Massachusetts -- but MassCEC will consider proposals from Applicants with an existing campus wishing to extend the microgrid to additional parties outside of its borders;
• Demonstrate significant potential to reduce greenhouse gas emissions through the integration of energy efficiency, Combined Heat and Power (“CHP”), renewable energy systems, electric and/or thermal storage technologies, demand management, energy efficiency, and other relevant technologies;
• Have the active and engaged support of the local utility (either investor-owned or municipal light plants) and other relevant stakeholders;
• Encompass a public or private critical facility, including but not limited to schools, hospitals, shelters, libraries, grocery stores, service (gas) stations, fire/police stations or waste water treatment plants;
• Support the distribution system by addressing capacity concerns, providing black start capability, facilitating renewables integration, or providing other services that are meaningful to the local utility;
• Attract third party investment; and 
• Highlight Massachusetts-based clean energy/microgrid technology.

MassCEC is presently soliciting Expressions of Interest from groups interested in participating in feasibility assessments for community microgrid projects meeting its defined criteria.  According to MassCEC, respondents may include municipalities and their public works departments, electric distribution companies, municipal light plants, emergency services departments, owners of critical infrastructure such as hospitals and financial institutions, self-organized groups of commercial building owners, developers or any other actor that either owns property within a potential microgrid or can demonstrate that they represent stakeholders with the capability of developing a community microgrid.  Support from the local government and the relevant electric or gas distribution company is also required.

MassCEC says it intends its funding to support feasibility assessments to advance the selected microgrid projects through the early project origination stages, enabling them to attract third-party investment. Projects that produce a favorable feasibility assessment may then be eligible for additional technical assistance or grants for later stages of project development

Completed expressions of interest, including all required documentation, must be received by MassCEC by Friday, June 23, 2017 by 4:00pm. MassCEC anticipates awarding the first round of feasibility assessments in Q3 2017.

MA net metering, Single Parcel and Subdivision rules

Massachusetts utility regulators have opened an inquiry to review the current standards and procedures by which distributed generation projects seek exceptions to the net metering rules and regulations that generally require each facility to be sited on a single parcel of land.  The case could lead to changes in the Department of Public Utilities' Single Parcel Rule and Subdivision Rule.

On March 15, 2017, the Massachusetts Department of Public Utilities issued an order opening an inquiry relating to the application of its net metering rules, which it docketed as DPU 17-22.  As described in that order, under Massachusetts statutes and regulations, "net metering allows customers to generate credits for excess electricity that net metering facilities generate."  The rules include limitations on the size of a generation facility eligible for net metering -- below 60 kW generally, or up to 2 MW for renewable projects (or 10 MW for certain public facilities).

Because the rules include project size limits, how you define the "facility" can affect its eligibility for net metering.  In one case, the Department established a "Single Parcel Rule", defining an eligible net metering facility as “the energy generating equipment associated with a single parcel of land, interconnected with the electric distribution system at a single point, behind a single meter." In 2016, the Department received 13 petitions seeking an exception to the Single Parcel Rule, an increase over three petitions in 2015 and one petition in 2014.

The Department also recognized if it was adopting parcel boundaries as a factor for defining a net metering facility, it should also set a date after which it would presume that the further subdivision of parcels was to game the net metering rule.  In its Subdivision Rule, the Department required that any customer who seeks to establish a net metering facility on a parcel of land that was subdivided after January 1, 2010, file a petition demonstrating that the subdivision was not for the purpose of creating multiple parcels specifically to support multiple net metering facilities.

But in a move that could lead to changes to these regulations, in its March 15 order opening inquiry, the Department identified a series of questions on which it seeks written comment.

Questions posed by the Department relate to the aggregation of capacity, blanket exemptions and case-by-case exemptions, the treatment of multiple facilities on one parcel, the treatment of a single facility on multiple parcels,  possible methods of streamlining submission and review of petitions for exceptions from the net metering rules and regulations, process requirements for petitions for exemptions, and challenges in allocating credits to multiple accounts and related solutions.

The Department has requested initial written comments no later than 5:00 p.m. on April 10, 2017.  It has also scheduled a technical conference for May 3, 2017.

MA utility merger may help Cape Wind

A $17.5 billion merger proposal by two Massachusetts utilities seems more likely to win regulatory approval after yesterday's announcement of a settlement that would provide offshore wind developer Cape Wind a buyer for more of its electricity.

The two utilities, NSTAR and Northeast Utilities, had asked the Department of Public Utilities to approve their merger, but the case dragged on and faced challenges from ratepayer advocates.  Yesterday, Governor Deval Patrick announced that his administration had negotiated an agreement to settle the case.  In exchange for allowing the merger, the proposed settlement contains a number of provisions that are said to create enhanced ratepayer benefit.  For example, the utilities must provide customers a one-time credit totalling $21 milllion, and NSTAR must fund an independent audit of its returns and assets.

The proposed settlement would also require the merged utility to enter into a contract to buy part of the electricity to be produced by the Cape Wind offshore wind project.  NSTAR would enter into a 15-year contract to purchase 129 MW, or about 27.5% of Cape Wind's projected electricity output.  This would be on top of the agreement to sell National Grid buy half of Cape Wind's power for a price starting at 18.7 cents per kilowatt-hour.  The terms of this agreement have yet to be approved by the DPU, but the settlement contemplates that NSTAR could look elsewhere for its renewable electricity if Cape Wind has not started physical construction by 2016.  Buying power from an offshore wind project is seen as important in helping the utilities comply with the Green Communities Act and the Massachusetts renewable portfolio standard or RPS.

If the merger settlement is approved, the utility would then negotiate the terms of a power purchase agreement with Cape Wind and submit them to the DPU for approval.  Would having signed PPAs for 77.5% of the project's output be enough for Cape Wind's project to be financed and built?