Wednesday, August 15, 2012

Massachusetts Doubles Net Metering Cap & Long-Term Renewable Contracts

Broad public support for increasing the amount of electricity coming from renewable energy is turning into new law in states.  Following the footsteps of New Jersey and Governor Christie who signed in July a major solar bill, Massachusetts just enacted provisions boosting new renewable energy power facilities. See: Also see:

The new legislation increases to 7% the amount of renewable energy that utilities must purchase through long-term contracts and doubles the cap on the amount of on-site generation that can qualify for net metering.  Massachusetts had limited net metering to 3% of a utility's peak demand but raised that to 6%.  The boom in on-site generation, especially solar systems, had meant that the original 3% cap had been reached this year in some areas.

Raising the long-term purchase requirement from 3% to 7% will also insure a significant amount of new renewable generation capacity will receive financing and thus get built.  The long-term contract increase combined with doubling the net metering cap means substantial new investment and renewable energy business activity in Massachusetts during the next few years.


  1. "It is impossible to introduce into society a greater change and a greater evil than this: the conversion of law into an instrument of plunder."
    Frederick Bastiat

    For a hilarious laugh at the expense of RENT SEEKERS and PROTECTIONISTS in the renewable energy field read Bastiat's satire "The Candelmakers' Petition." Satire is such a great tool

  2. The Massachusetts approach to renewables procurement really is the "gold standard" for renewables procurement in restructured markets. NSTAR's competitive procurement under the initial law was fully competitive and required the company to take the "least cost" bids. The new law requires all future long-term renewables solicitations to be competitively sourced as well. This is a much different approach than the regulated, guaranteed rate of return approach under which virtually all of the nation's conventional electricity generation was built. Renewable energy projets in restructured markets are exposed to far more competitive market pressures than legacy generation ever was.

    NSTAR's witness before the Massachusetts Department of Public Utilities estimated that the wind projects competitively contracted for under the initial part of the law will save it's ratepayers $15 million over the life of the contract (this does include Renewable Energy Certificates, which are seperate from energy).

    Eric T.