Archive for the ‘Environmental Policy’ Category

Ohio Governor Signs Nuclear Bailout Bill Into Law; RPS Gutted

Posted July 23rd, 2019 by SRECTrade.

On July 23rd, the Ohio House of Representatives approved legislation (HB 6) to subsidize two ailing nuclear power plants owned by bankrupt FirstEnergy Solutions and eliminate the state’s Renewable Portfolio Standard (RPS) at 8.5% in 2026. Governor Mike DeWine signed the bill into law shortly thereafter.

The Bill provides an average of $150 million per year in funding to the two nuclear plants from April 2021 through the end of 2026. In addition, the Bill will deliver $50 million per year in funding to two large, coal-fired power plants owned by Ohio Valley Electric Corp., through additional rate-payer charges.

With regards to the state’s RPS, the Bill lowers the renewable energy target from 12.5% to 8.5% by 2026, and eliminates the solar-carve out all-together from 2020 onward. As such, solar assets currently registered in the OH SREC market will no longer produce OH SRECs after 2019. Please feel free to reach out to the SRECTrade team for more information regarding this transition and impact on your eligibility.

Ohio House Advances Nuclear Subsidy Bill that Would Eliminate the State’s Renewable Portfolio Standard (RPS)

Posted May 31st, 2019 by SRECTrade.
The Davis-Basse Nuclear Power Station will be subsidized under Ohio House Bill 6. Source: News-Herald

On Wednesday, May 29th, the Ohio House of Representatives passed House Bill 6 (HB 6) 53-43 that would repeal the state’s renewable energy mandate and replace it with a nuclear subsidy program under the moniker “Clean Air Program”. This nuclear subsidy program would help bailout two ailing nuclear power plants in Ohio owned by bankrupt utility FirstEnergy Solutions by adding a $1 surcharge on customers’ monthly utility bills. The program would also extend a surcharge of $2.50 per month through 2030 to support ailing coal plants across the state.

The bill would eliminate the renewable portfolio standard (RPS) in Ohio, a key component to maintaining the financial viability of renewables compared with other fossil-fuel based electricity generation resources. As such, nearly all renewable assets generating OH-certified renewable energy credit (REC) or solar renewable energy credit (SREC) products would cease to generate these credits as of the effective date of the bill. Additionally, the bill would do away with the nearly $200 million program to fund energy efficiency and demand response initiatives, which saved Ohio customers over $5 billion from 2009 to 2017, according to the Midwest Energy Efficiency Alliance.

The bill now moves on to the Ohio Senate. While state senators have not publicly voiced their support of the bill, outspoken support from Governor Mike DeWine and the Republican majority in the senate gives the bill momentum to pass.

SRECTrade strongly urges constituents and market stakeholders to reach out to members of the Ohio State Senate and voice their concern with this Bill. The Senate directory can be found here. SRECTrade will continue monitoring these policy proceedings closely and provide updates.

Maryland General Assembly Passes the Clean Energy Jobs Act (CEJA)

Posted April 9th, 2019 by SRECTrade.

On April 8th, the Clean Energy Jobs Act (CEJA) passed the Maryland House of Delegates, 95-40, and Senate, 31-15, respectively. Most notably, the Bill increases the state’s renewable energy mandate from 25% to 50% by 2030. The in-state solar carve-out follows suit, raising the 2019 solar carve-out to 5.5%, increasing to 14.5% by 2028. The solar carve-out and Solar Alternative Compliance Penalty (SACP) schedule is amended as follows:

The bill now heads to Governor Larry Hogan’s desk, where he has the option to either sign, veto, or let the bill go into law without his signature. While uncertainty remains on Governor Hogan’s view on the legislation, some believe his recently shared perspective demonstrates positive support.

SRECTrade will continue to monitor the situation and provide further analysis if and when the Bill goes into law.

Massachusetts DOER Files Alternative Portfolio Standard (APS) Emergency Rulemaking

Posted April 9th, 2019 by SRECTrade.

On April 5th, the Massachusetts Department of Energy Resources (DOER) filed emergency regulations that amend portions of the current version of 225 CMR 16: Alternative Energy Portfolio Standard (“APS”).

Specifically, the emergency regulation cancels the transition from pre-minting to forward minting for all small (residential) renewable thermal technologies. As such, small systems will continue to receive their credits upfront, in lump-sum. These proposed changes will take effect immediately and remain in effect for three months. If the DOER successfully concludes the entire rulemaking process within the next three months, the emergency amendments will become law.

SRECTrade provides comprehensive management and transaction services for renewable thermal asset owners within the APS program. Please reach out to SRECTrade if you believe you are eligible or have any questions regarding the program.

NJ Gov. Murphy Signs AB-3723 / SB-2314 Increasing State RPS

Posted May 25th, 2018 by SRECTrade.

On Wednesday, May 23rd, New Jersey Governor Phil Murphy (Dem) signed Assembly Bill 3723 (AB-3723) and Senate Bill 2314 (SB-2314), increasing the state’s Renewable Portfolio Standard (RPS) requirements. The bill establishes renewable energy goals of 21 percent by 2020, 35 percent by 2025, and 50 percent by 2030, making the New Jersey RPS one of the highest in the nation.

Notably, the state’s solar carve-out requirement is raised and accelerated to 5.1 percent of total electricity sales by EY2021 before beginning to ramp-down in 2024. The requirement ramps down in consideration of solar facilities that will be reaching the end of their 15-year SREC production eligibility term.

On the other hand, the bill lowers the solar alternative compliance payment (SACP) schedule to $268.00 in EY2019 with an additional $10.00 reduction each following year.

The bill also shortens the 15-year period that qualified solar projects can generate solar renewable energy credits (SREC) to ten years, effective for all New Jersey SREC Registration Program applications received as of the enactment date. Lastly, the bill mandates that the current SREC program be closed upon reaching the 5.1 percent target and no later than June 1, 2021. It is anticipated that a supplemental “SREC-II” program will follow shortly after the closure of the first program.

The bill also introduces other clean energy initiatives, including:

  • Community Solar: establishes the Community Solar Energy Pilot Program to allow utility customers access to solar projects that are located away from their properties, but within their utility’s service territory. The pilot program is planned to be converted to a permanent community solar program within 36 months.
  • Energy Efficiency: requires individual utilities to implement energy efficiency measures to reduce electricity usage by 2 percent and natural gas usage by 0.75 percent.
  • Energy Storage: mandates Gov. Murphy’s goal of achieving 600 MW of energy storage by 2021 and 2,000 MW by 2030.
  • Offshore Wind: establishes a goal of 3,500 MW of offshore wind by 2030 that will be supported by an offshore wind renewable energy credit (OREC) program.

Simultaneously, Gov. Murphy signed Executive Order No. 28, requiring state agencies to update the Energy Master Plan (EMP) that prepares a strategy for achieving 100 percent clean energy by January 1, 2050. The new EMP is scheduled to be finalized and published by June 1, 2019.

For more information on the bill and its passage through the New Jersey legislature, please visit our previous blog post on the topic here. SRECTrade expects to publish a detailed New Jersey supply and demand analysis reflecting this new legislation soon.

PA PUC Enters Final Implementation Order of Act 40

Posted May 10th, 2018 by SRECTrade.

On Thursday, May 3rd, the Pennsylvania Public Utilities Commission (PUC) entered its Final Implementation Order of Act 40 of 2017, clarifying some questions that remained from its adoption of the Final Implementation Order. Notably, the entry confirmed that PA-certified but out-of-state facilities would not be grandfathered with solar renewable energy credit (SREC) eligibility (i.e. Tier I solar), since the PUC found that grandfathering these facilities would result in minimal improvement for state SREC prices and fail to effectuate the intentions of the PA General Assembly.

The entry also clarified that PA SRECs associated with energy generated after October 30, 2017 would be re-certified to non-solar RECs (i.e. Tier I non-solar). The PA REC Program Administrator and PJM GATS have already worked together to modify the Tier I certification numbers attributed to all out-of-state facilities and SRECs that no longer qualify for Tier I solar eligibility. This means that SRECs with a Month of Generation of November 2017 and later have now been re-certified as Tier I non-solar RECs.

Some facilities that were re-certified with Tier I non-solar eligibility will be permitted to temporarily maintain SREC certification if under an SREC contract with an electric distribution company (EDC) or electric generation supplier (EGS) serving PA customers. EDCs and EGSs seeking to qualify contracted RECs as Tier I solar-eligible under the Final Implementation Order’s ruling must file a petition within 60 days of the entry date of the Order (May 3rd). Please note that such facilities will only be permitted to maintain certification until the expiration of the SREC contract.

Moving forward, it appears that the PA REC Program Administrator will be responsible for working with PJM GATS to re-certify SREC-contracted facilities for Tier I non-solar REC generation once their contract term expires.

Additionally, the entry clarified that:

  • Solar facilities interconnected in PJM service territory are permitted to continue generating RECs eligible to be used toward Tier I non-solar requirements in the AEPS.
  • Out-of-state grid-supply solar facilities must be serving end-use electricity load in PA to continue to generate energy and SRECs eligible for compliance under the Tier I solar requirement. Specifically, solar facilities must meet one of the following criteria:
    • Physical connection to a PA EDC customer’s internal electrical system
    • Physical interconnection to an EDC’s distribution system
    • Physical connection to a PA electric cooperative’s or municipal electric system’s distribution network
    • Physical connection to any PA-located transmission system, including utility-scale solar facilities that are within a PA EDC’s service territory and operating under PJM wholesale generator rules
  • SRECs generated by out-of-state facilities prior to October 30, 2017 will maintain their Tier I solar certification

PA PUC Adopts Final Implementation Order of Act 40 – Impacts Out-of-State PA-Certified Solar Projects

Posted April 19th, 2018 by SRECTrade.

On Thursday, April 19th, the Pennsylvania Public Utilities Commission (PUC) adopted its Final Implementation Order of Act 40 of 2017. The Order amends the qualifications to certify Tier I solar photovoltaic facilities under Pennsylvania’s Alternative Energy Portfolio Standards (AEPS) Act. As summarized in our previous blog post, ambiguous language in Section 2804(2)(i) and Section 2804(2)(ii) of Act 40 made it unclear whether certified but out-of-state facilities would retain their certifications under the AEPS. The Order clarified the PUC’s interpretations of Section 2804(2)(i) and Section 2804(2)(ii) which are as follows:

  • Section 2804(2)(i) – “[a] certification originating within the geographical boundaries of this Commonwealth…” shall mean a facility located within PA having received an AEPS Tier I solar photovoltaic certification.
  • Section 2804(2)(ii) – shall only permit out-of-state facilities that are 1) already certified as AEPS Tier I Solar Photovoltaic and 2) entered into an SREC contract with a PA electric distribution company (EDC) or electric generation supplier (EGS) serving PA customers to maintain certification until the expiration of the contract.

Solar facilities that meet the two Section 2804(2)(ii) criteria listed above are limited to maintaining certification only for the applicable amount of Solar Renewable Energy Credits (SRECs) contractually committed to an EDC or EGS. EDCs and EGSs seeking to qualify SRECs under this interpretation must file a Petition with 60 days of the entry date of the Order.

In addition, the Order clarified that SRECs generated by certified but out-of-state facilities prior to October 30, 2017 will retain their Tier I solar qualification for their standard banking lifetime (current reporting year and following two). The Order did not clarify whether SRECs generated by such facilities after October 30, 2017 will also be able to retain their Tier I solar qualification.

At this time, it is unclear how implementation of these interpretations will be administered. SRECTrade will continue to monitor the proceedings and provide updates as they become available.

NJ Solar RPS Increase – New Jersey Assembly and Senate Pass AB-3723 / SB-2314

Posted April 13th, 2018 by SRECTrade.

On Thursday, April 12th, the New Jersey Assembly and Senate passed Assembly Bill 3723 (AB-3723) and Senate Bill 2314 (SB-2314). The bill now sits on the desk of Governor Phil Murphy (Dem) waiting to be signed, after passing the Assembly by a margin of 49-20-2 and the Senate by a margin of 29-8. The bill requires a number of action items to be carried out, including:

  • Requiring the New Jersey Board of Public Utilities to:
    • Administer an energy storage analysis
    • Advance, increase, and extend the solar carve-out schedule and reduce and extend the solar alternative compliance payment schedule
    • Introduce structural changes to the state SREC program
    • Implement energy efficiency and peak demand reduction programs
    • Implement a “Community Solar Energy Pilot Program”
    • Offer tax credits for specified offshore wind facilities
  • Requiring the Department of Labor and Workforce Development to establish job training programs for professionals in manufacturing and maintenance of offshore wind facilities

The bill requires 21% of statewide electricity sales to be derived from Class I renewable energy sources by January 1, 2020, 35% by January 1, 2025, and 50% by January 1, 2030. The cost of this requirement shall not exceed 9% of the electricity purchased by all NJ ratepayers for each energy year 2019-2021 and shall not exceed 7% in each energy year thereafter. In addition, all facilities filing SREC applications after the bill’s enactment date will be subject to a reduced SREC eligibility term of 10 years, down from 15.

No later than 180 days after the enactment of the bill, the board will implement rules to close the SREC program to new systems upon reaching the 5.1% solar carve-out target. The legislation intends to close the existing SREC program to new projects on or before June 1, 2021. Within 24 months from signing the legislation, the Board of Public Utilities will be required to conduct a study that evaluates how to modify or implement a new solar incentive program. A variety of market stakeholders will be consulted in the process to determine the next best steps forward for the NJ SREC market.

As shown below, the bill brings forward and raises the state’s solar carve-out requirements beginning with EY2019 and extends the requirements through EY2033. The requirement peaks at 5.10% in EY2021-2023 before gradually declining through EY2033. The reduction mechanic was introduced to account for solar facilities that will be reaching the end of their SREC production eligibility term.

The bill also reduces the solar alternative compliance payment (SACP) beginning with EY2019 and extends the SACP schedule through EY2033. The SACP level drops to $268 in EY2019 and then gradually decreases by $10 each year following.

For more information on the historical progress of the bill, please view our previous blog post on the topic here. SRECTrade will be publishing an updated New Jersey Supply and Demand Analysis to its blog shortly in consideration of this bill.

Trump Administration Establishes 30% Solar Panel Import Tariff

Posted February 1st, 2018 by SRECTrade.

On January 22nd, President Donald Trump’s administration announced that it approved a four-year tariff on imported crystalline silicon photovoltaic (CSPV) cells and modules. Effective February 7, 2018, the tariff imposes a 30% duty set to decline by 5% each following year. The first 2.5 gigawatts of CSPV products imported in each year will be exempt from the tariff.

The decision followed the U.S. International Trade Commission’s (ITC) unanimous determination that solar cell and module imports are inflicting “serious injury” on domestic manufacturers. Although the Commissioners recommended a variety of tariff rate structures, they agreed upon an increase in duties with an allowance for a limited quantity of imported cells in their proposal to the Trump administration.

The initial Year 1 tariff is expected to increase install costs by 10-15 cents per watt, which Greentech Media estimates could result in approximately a 10 percent reduction in U.S. installed solar capacity. According to the Solar Energy Industries Association (SEIA), of the 260,000 Americans employed in the solar industry, only 2,000 are manufacturing solar cells and modules. SEIA reports that the tariff could cause the loss of approximately 23,000 American jobs in 2018 alone.

Proposed Amendments to 310 CMR 7.75: Clean Energy Standard

Posted November 9th, 2017 by SRECTrade.

The Massachusetts Executive Office of Energy and Environmental Affairs (EEA) and the Massachusetts Department of Environmental Protection (MassDEP) have proposed amendments to 310 CMR 7.75: Clean Energy Standard. The amendments are intended to achieve greater consistency among all Executive Office of Energy and Environmental Affairs (EOEEA) clean energy programs and policies.

The amendments, a background document, and a notice with information about attending a November 27, 2017 public hearing in Boston at 10:00am and submitting written comments, are available on the Commonwealth of Massachusetts’s website here. Additional information about 310 CMR 7.75, including relevant stakeholder comments, is also available on their website.

The MassDEP published 310 CMR 7.75: Clean Energy Standard as a final regulation to reduce statewide greenhouse gas emissions. For more information on the promulgation of the MA Global Warming Solutions Act regulations, please visit our recent blog post on the topic here.