On April 11th, Massachusetts Governor Charlie Baker signed a bill into law which raised the state’s caps on Net Energy Metering (NEM) projects. Previously, NEM projects were capped at 5% of a utility’s load for public projects and 4% for privately-owned projects. The bill contained other measures directed at NEM projects, including one which reduced the reimbursement rate for new private projects by 40% once the state reaches a 1,600 MW solar capacity goal previously set in 2013.
- The new caps of 7% for private projects and 8% for public projects are expected to be reached by early 2017, as there is already a queue of projects slated for construction
- Under this new legislation, public and residential projects will continue to receive retail rates for electricity sold back to the grid
- Projects currently in operation will be grandfathered in at the retail rate, regardless of ownership,
for a 25-year period
- The approved legislation also allows Massachusetts utilities to charge a minimum fee to cover
Stakeholders see this bill as a stop-gap measure, as the caps are likely to be reached within a year. The bill is the result of a compromise reached by a joint legislative committee. The Massachusetts Senate and House have had differing viewpoints on how utilities should compensate NEM projects, and thus have contended on the issue for months. Read more on the issue here and here.
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