{"id":1148,"date":"2014-06-30T14:55:00","date_gmt":"2014-06-30T14:55:00","guid":{"rendered":"https:\/\/www.sherin.com\/real-estate\/2014\/06\/30\/2014-massachusetts-solar-update\/"},"modified":"2023-11-08T18:31:06","modified_gmt":"2023-11-08T18:31:06","slug":"2014-massachusetts-solar-update","status":"publish","type":"post","link":"https:\/\/www.sherin.com\/real-estate\/2014\/06\/30\/2014-massachusetts-solar-update\/","title":{"rendered":"2014 Massachusetts Solar Update"},"content":{"rendered":"<p><span style=\"text-decoration: underline;\">SREC II: It seems we hardly knew you<\/span>.<\/p>\n<p>In April of 2014, the Massachusetts Department of Energy Resources (DOER) published amendments to 225 CMR 14.00 creating the next generation of the Solar Carve-Out Renewable policy known as SREC II.\u00a0 The major differences between the SREC II program and its predecessor was (a) the creation of SREC factors based on four different market sectors, and (b) a declining auction bid price for SRECs over the life of the program.\u00a0 The Managed Growth sector contains all those projects which do not meet the criteria for the other three sectors (which cover residential, solar canopy, emergency power, community solar, units located on landfills or Brownfields (the definition of which is the subject of a draft DOER guideline) and roof top along with ground mounted units with capacity greater than 25 kW with 67% or more of the output used on-site).\u00a0 Unless large commercial ground mounted projects (the type of projects that underwent a growth explosion under SREC I) are built on landfills or Brownfields, they would need to qualify under the Managed Growth sector.\u00a0 SREC II limited the number of these large projects by capping the Managed Growth sector at 26 MW for Compliance Year 2014 and at 80 MW for Compliance Year 2015.<\/p>\n<p><!--more--><\/p>\n<p>On May 27<sup>th<\/sup>, DOER announced the projects that would receive an Assurance of Qualification (AoQ) for the SREC II Managed Growth Annual Capacity Block for years 2014 and 2015.\u00a0\u00a0 A few days later, DOER purchased 10,000 SRECs at a weighted average price of $280.80 to satisfy the remainder of its regulatory obligation for 2013 eligible SRECs.<\/p>\n<p>With all those loose ends tied up, and an uncertain political climate looming with a new administration at year end and two competing bills in the legislature that dealt with net metering on different paths, many in the solar community were surprised to learn of a new legislative proposal brokered by DOER that involved the regulated utilities and a number of solar stakeholders.\u00a0 On the heels of the infant SREC II program, DOER held a stakeholder meeting on June 11<sup>th<\/sup> summarizing the legislative proposal that would become effective July 1, 2015, if adopted.\u00a0 The draft proposal:<\/p>\n<ul>\n<li>Provides a statutory framework for achieving 1,600 MW of solar PV by 2020<\/li>\n<li>Permanently lifts the cap on solar net metering<\/li>\n<li>Replaces the SREC with a Declining Block incentive program<\/li>\n<li>Limits project size to 5 MW AC<\/li>\n<li>Restructures phase 2 net metering and virtual metering credits<\/li>\n<li>Proposes a minimum billing rate for all utility customers<\/li>\n<\/ul>\n<p><span style=\"text-decoration: underline;\">Hello, Declining Block<\/span>.<\/p>\n<p>One of the advantages of the proposed Declining Block scheme, particularly for larger facilities, is that lenders will be able to underwrite projects easier, as the tariff based Declining Block rate will be fixed for a 15 year period, which differs from the current revenue stream combination of a power purchase agreement coupled with a tradable SREC of fluctuating value over a 10 year period.\u00a0 The current big unknown is the value to be assigned to the Declining Block rate, which will be the subject of upcoming DOER stakeholder meetings and followed by filing a petition with the Massachusetts Department of Public Utilities (DPU) to approve the Declining Block rate as a tariff.<\/p>\n<p>Not all solar participants feel a change is needed to a performing SREC market that has helped to achieve the existing 600 MW of projects in the Commonwealth.\u00a0\u00a0 After a lengthy stakeholder process was just completed to create the new market sector factors, some speculate this change is triggered by the need to lift the net metering caps, which should not be directly tied to SRECs.<\/p>\n<p><span style=\"text-decoration: underline;\">The choice is yours (for a while)<\/span>.<\/p>\n<p>The proposed legislation will not affect existing SREC I or SREC II projects developed before approval of the DPU tariff, which is estimated to be in July 2015.\u00a0 Projects obtaining an AoQ prior to the effective date of the tariff will be safe harbored under SREC II and existing net metering rules.\u00a0 Projects receiving an AoQ during the 6 month transitional period following the tariff effective date, could opt for either the SREC II or Declining Block program, subject to a proposed $60\/kW deposit against completion for choosing SREC II.\u00a0 Subsequent to the 6 month transitional period, all projects without an AoQ will be in the Declining Block scheme and new metering framework.<\/p>\n<p><span style=\"text-decoration: underline;\">All good things come at a price.<\/span><\/p>\n<p>The tradeoffs in the proposed legislation which directly correlate to net metering include monthly bills for all utility customers, including those solar projects which produce more electricity than they use and were previously able to pay nominal or no fees to the utility.\u00a0 This effectively spreads the distribution and infrastructure costs to all utility customers.\u00a0 The distribution credit for virtual net metering systems will also be removed, again to assist in shifting costs for use of the utility infrastructure.<\/p>\n<p>Revised House Bill 4185, which was endorsed by both the New England Clean Energy Council and the Solar Energy Industries Association was reported favorably by the Joint Committee on Telecommunications, Utilities and Energy and has been referred to and is currently under consideration by the House Ways and Means committee and proponents are hoping will pass before the legislative session ends on July 31<sup>st<\/sup>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>SREC II: It seems we hardly knew you. In April of 2014, the Massachusetts Department of Energy Resources (DOER) published amendments to 225 CMR 14.00 creating the next generation of the Solar Carve-Out Renewable policy known as SREC II.\u00a0 The major differences between the SREC II program and its predecessor was (a) the creation of [&hellip;]<\/p>\n","protected":false},"author":9,"featured_media":1753,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[],"tags":[],"class_list":["post-1148","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>2014 Massachusetts Solar Update - Real Estate<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.sherin.com\/real-estate\/2014\/06\/30\/2014-massachusetts-solar-update\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"2014 Massachusetts Solar Update - Real Estate\" \/>\n<meta property=\"og:description\" content=\"SREC II: It seems we hardly knew you. In April of 2014, the Massachusetts Department of Energy Resources (DOER) published amendments to 225 CMR 14.00 creating the next generation of the Solar Carve-Out Renewable policy known as SREC II.\u00a0 The major differences between the SREC II program and its predecessor was (a) the creation of [&hellip;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.sherin.com\/real-estate\/2014\/06\/30\/2014-massachusetts-solar-update\/\" \/>\n<meta property=\"og:site_name\" content=\"Real Estate\" \/>\n<meta property=\"article:published_time\" content=\"2014-06-30T14:55:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-11-08T18:31:06+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.sherin.com\/real-estate\/wp-content\/uploads\/sites\/2\/2013\/05\/44834485_s.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"450\" \/>\n\t<meta property=\"og:image:height\" content=\"300\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Sherin and Lodgen\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Sherin and Lodgen\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/2014\\\/06\\\/30\\\/2014-massachusetts-solar-update\\\/#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/2014\\\/06\\\/30\\\/2014-massachusetts-solar-update\\\/\"},\"author\":{\"name\":\"Sherin and Lodgen\",\"@id\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/#\\\/schema\\\/person\\\/96bd34e7823afde2e3e7e561023c5a44\"},\"headline\":\"2014 Massachusetts Solar Update\",\"datePublished\":\"2014-06-30T14:55:00+00:00\",\"dateModified\":\"2023-11-08T18:31:06+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/2014\\\/06\\\/30\\\/2014-massachusetts-solar-update\\\/\"},\"wordCount\":846,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/2014\\\/06\\\/30\\\/2014-massachusetts-solar-update\\\/#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/wp-content\\\/uploads\\\/sites\\\/2\\\/2013\\\/05\\\/44834485_s.jpg\",\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/2014\\\/06\\\/30\\\/2014-massachusetts-solar-update\\\/\",\"url\":\"https:\\\/\\\/www.sherin.com\\\/real-estate\\\/2014\\\/06\\\/30\\\/2014-massachusetts-solar-update\\\/\",\"name\":\"2014 Massachusetts Solar Update - 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