Creating A Cleaner Energy Future For the Commonwealth
Policy Support for the
Development of a Robust
Solar PV Market in MA
Electricity
Restructuring
Roundtable
Dwayne Breger, Ph.D.
Director, Renewable and Alternative
Energy Division
Boston, MA
September 16, 2011
Outline
• Solar Goals and Market Creation since 2007
• Policy Design of the MA RPS Solar Carve-Out
• Current Status of the SREC Market
• Update on Net-Metering
• Associated Activities
– Solarize Massachusetts
– Renewable Thermal Initiatives
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Creating A Cleaner Energy Future For the Commonwealth
Cumulative Obligations of
RPS / APS* Programs
RPS / APS Minimum Standard
Percent Obligation, %
30%
APS
25%
Class II - WTE
20%
Class II
15%
Class I - Solar
Class I
10%
5%
Compliance Year
*Alternative Energy Portfolio Standard (APS)
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Creating A Cleaner Energy Future For the Commonwealth
2020
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
0%
Massachusetts Solar Development Strategies
(apart from the RPS Solar Carve-Out)
• Governor Patrick’s goal – 250 MW by 2017
• Commonwealth Solar (Rebates) – initiated Dec. 2007
– Rebate Program: $68 million, 27 MW
– Successfully achieved and completed Oct. 2009
– Created the beginning of a robust PV development sector in MA
• Commonwealth Solar II (Rebates) for small (<10kW)
systems has maintained residential PV market (managed
by the MassCEC)
• Federal Stimulus/ARRA funds used by DOER to support
10 MW of PV at state/municipal facilities.
• Green Communities Act allows for Distribution Utility
ownership of PV Generation
4
– National Grid approved for 5 MW, 3.3 MW installed
– WMECO approved for 6 MW, 1.8 MW installed
Creating A Cleaner Energy Future For the Commonwealth
Installed Capacity
Leading up to Solar Carve-Out
80
70
CS II &
CS Stimulus
60
50
Utility Owned
40
Federal Stimulus
30
20
10
2007
Pre
2007
0
2007-2011
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Creating A Cleaner Energy Future For the Commonwealth
RPS Solar Carve-Out
Will Carry Market Far Forward
PV Solar Growth (Cumulative MW)
500
450
400
MW Installed
350
300
250
200
150
100
50
0
2010
2011
2012
Commonwealth Solar
6
2013
2014
Federal Stimulus
2015
Solar Carve-Out
Creating A Cleaner Energy Future For the Commonwealth
2016
2017
RPS Solar Carve-Out Program Basics
• Market-based incentive, part of the broader RPS Program
• Program is capped at 400 MW of qualified capacity
• 1 SREC (Solar Renewable Energy Certificate) represents the
attributes associated with 1 MWh of qualified generation
• Units must be qualified by DOER before they can begin
generating SRECs
• All generation is metered and reported to MassCEC’s
Production Tracking System (PTS)
• MassCEC provides data verification and reports generation
to NEPOOL GIS where SRECs are minted on a quarterly
basis
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Creating A Cleaner Energy Future For the Commonwealth
Eligibility Criteria and
Qualification Process
• Eligibility criteria

Have a capacity of 6 MW (DC) or less per parcel of land

Be located in the Commonwealth of Massachusetts, which
includes municipal light district territories

Use some of its generation on-site and be interconnected to
the utility grid

Have a Commercial Operation Date of January 1, 2008, or later
• Online application
• Need Authorization to Interconnect from local utility before SRECs
can be generated
• Review process is quick and straightforward (30 days or less)
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Creating A Cleaner Energy Future For the Commonwealth
SREC Program Design Features
Program design features help ensure market stability and
balance
 Adjustable Minimum Standard
maintains SREC demand/supply in reasonable balance
 Forward ACP Rate Schedule
proposed; provides investor certainty
 Solar Credit Clearinghouse Auction Account
essential price support mechanism to assure SREC floor price
 Opt-In Term
provides right to use Auction, adjusted to throttle installation growth rate
• These features work together to ensure the market will
remain in balance as more PV is built
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Creating A Cleaner Energy Future For the Commonwealth
Minimum Standard Adjustment
Compliance Compliance Obligation
Year
(MWh)
2010
2011
2012
34,164
78,577
81,559
Minimum
Standard
Equivalent FullYear Solar
Capacity (MW)
0.0679%
0.1627%
0.1630%
30
69
72
For 2012 and beyond, the Minimum Standard (Compliance Obligation) is
adjusted each August according to a formula set in the program regulation.
2012 Min. Stand = 2011 Min. Stand
+ [Projected 2011 SRECs – Actual 2010 SRECs] x 1.3
– 2010 ACP Volume + 2010 Banked Volume + 2010 Auction Volume
Actual 2012 Calculation
81,559 MWh = 78,577 MWh + [29,056 – 2,738] x 1.3 – 31,231 + 0 + 0
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Creating A Cleaner Energy Future For the Commonwealth
Proposed ACP Rate Schedule
11
•
2011 ACP Rate set at $550 (reduced
from $600 in 2010)
•
DOER recently proposed a 10-year
forward ACP Rate Schedule
•
Designed to reduce market risk and
uncertainty
•
Maintains current ACP Rate through
2013 before reducing 5% annually
•
DOER accepted written comments on
proposal through August 15th
•
Will issue an RPS Guideline after
considering comments received
•
Will move to insert schedule into the
MA RPS Class I Regulation shortly after
the Guideline has gone into effect
Compliance
ACP Rate per MWh
Year
2012
$550
2013
$550
2014
$523
2015
$496
2016
$472
2017
$448
2018
$426
2019
$404
2020
$384
2021
$365
2022 and after added no later than
January 31, 2012
(and annually
thereafter)
following
stakeholder review
Creating A Cleaner Energy Future For the Commonwealth
Program Design: Opt-in Term
• The Opt-In Term is the number of quarters a qualified
project has the right to deposit SRECs into the Auction
Account (to be assured floor price). The Opt-In Term is
currently 10 years (40 quarters), but can be adjusted
each July for subsequent qualified projects.
• Opt-In Term Adjustments
– Long Market: Opt-In Term reduced by 4 quarters for each 10%
of Compliance Obligation deposited into the Auction Account
– Short Market: Opt-In Term increased by 4 quarters for each
10% of Compliance Obligation met through ACP Payments
– Opt-In Term may not increase or decrease more than two years
as a result of an annual adjustment, nor can it exceed 10 years.
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Creating A Cleaner Energy Future For the Commonwealth
Price Support – Auction Mechanism
•
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Solar Credit Clearinghouse Auction Account

Open every year from May 16th – June 15th

Any unsold SRECs may be deposited into the Account

Designed as option of last resort for SREC owners that have not found
buyers for their SRECs by the end of the Compliance Year
•
Auction held no later than July 31st, but after the Minimum Standard
adjustment is announced
•
Deposited SRECs re-minted as “extended life” SRECs (good for compliance in
one of the following two Compliance Years)
•
SRECs offered to bidders for a fixed price of $300/MWh before being assessed a
$15/MWh auction fee by DOER. SREC owners will be paid $285/MWh for each
SREC sold through the Auction.
•
Bidders bid on volume willing to buy at the fixed price. Auction clears if bid
volume exceeds volume deposited. Multiple rounds of Auction are used, if
necessary, to clear deposits.
Creating A Cleaner Energy Future For the Commonwealth
Current SREC Program Statistics – 9/16/11
• Over 1,000 applications
received and qualified
• Approximately 41 MW
qualified
• Nearly 27 MW of projects are
installed
• 2,741 SRECs created in 2010
• 2,358 SRECs created in Q1
2011
Number of
Systems
Capacity
(MW)
Applications
Received
1,038
49.7
Applications
Qualified
1,008
41.0
31
14.1
977
26.9
Qualified but
Installation
Incomplete
Installed
• More than 6,000 SRECs
expected to be created in Q2
2011
Creating A Cleaner Energy Future For the Commonwealth
Current SREC Program Statistics – 9/16/11
Activity by System Size
# of Applications
63
# of MW
21
4.1
< 10 kW
6.6
154
100-500 kW
27.7
800
10-100 kW
11.3
Creating A Cleaner Energy Future For the Commonwealth
500kW and up
Solarize Massachusetts
Pilot program in
Harvard
Hatfield
Scituate
Winchester
Goals
 Utilization of community networks and local
marketing to decrease the installer’s customer
acquisition cost (soft costs)
 Reduce cost of materials through bulk
purchasing (hard costs)
 Increase adoption rate of solar PV
Methods
• Educating community about solar PV
Collaboration
• Partnering with the town and solar integrator to
between MassCEC
offer reduced pricing to community members
and DOER Green
Communities Program • Tier pricing structure – the more people sign up,
the more everyone saves!
Initial Outcomes are encouraging
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Creating A Greener Energy Future For the Commonwealth
Net Metering
Changes Adopted in 2010
Requires DPU to adopt an “assurance of net
metering process”
• New definition for public net metering facility
•
• Owned or operated by a public entity; OR
• 100% of output is assigned to the public entity
New Caps of 1% for private projects and 2% for
public projects
• Currently DPU Dockets 11-10 and 11-11 are
addressing implementation of these and other
changes.
•
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Creating A Greener Energy Future For the Commonwealth
Solar Hot Water Pilots and
Low-Income Program (MassCEC)
Commonwealth Solar Hot Water Residential Pilot Program


$1 million budget for SHW systems serving 1-4 units
129 projects awarded to date
Commonwealth Solar Hot Water Commercial Pilot Program
$1 million budget for pre-design study grants and construction rebates
 $350,000 for pre-design studies and $600,000 for construction rebates with
the goal of supporting 100 projects.

Low Income Solar Thermal Program


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MassCEC awarded the Low-Income Energy Affordability Network (LEAN) $2
million to manage program
Install SHW systems at multi-family residential and nonprofit facilities serving
low income residents and participants
Creating A Greener Energy Future For the Commonwealth
Renewable Thermal Policy
• No comprehensive policies supporting development of
renewable thermal in place
 Despite large potential for decreasing dependence on
fossil fuels, meeting GWSA GHG reduction
commitments, and job creation
• MA Clean Energy Plan 2020 calls for Policy Framework
• DOER/MassCEC
 RE Thermal technology assessment (ongoing)
 Solar, Biomass, High Efficiency Heat Pumps, Biofuels
In fall 2011 RE Thermal policy options will be assessed
• MassCEC
 Implement pilot programs (solar ongoing)

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Creating A Greener Energy Future For the Commonwealth
Links and Contact Info
DOER
Website: www.mass.gov/energy/solar
Contact: DOER.SREC@state.ma.us
Production Tracking System
Website: www.masscec.com/pts
Contact: pts@masscec.com
Commonwealth Solar II
Website: www.masscec.com/solar
Contact: cs@masscec.com
Solarize Mass
Website: www.masscec.com/solarizemass
Contact: solarize@masscec.com
Commonwealth Solar Hot Water
Website: www.masscec.com/solarhotwater
Contact: solarhotwater@masscec.com
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Creating A Cleaner Energy Future For the Commonwealth
Appendix Slide
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Creating A Greener Energy Future For the Commonwealth
Price Support – Auction Mechanism
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Creating A Cleaner Energy Future For the Commonwealth