Newton Mayor Setti Warren sent a letter in March to key state legislators, urging them to reject legislative proposals to reduce the value of net metering credits associated with municipal solar projects. Such reductions, he said, “could halt the development of projects now underway, and drastically curtail future solar development in the Commonwealth’s cities and towns.”
The letter was co-signed by 32 mayors and town managers from municipalities throughout Massachusetts. It was directed to six members of the Joint Committee on Telecommunications, Utilities and Energy, which is considering the proposals. Copies also went to the Speaker of the House, the Senate President and the governor.
Net metering enables those that host solar panels to sell excess power back to the energy grid, usually for credit on their electricity bills. Under current law, electric companies pay for net metering at the retail rate — the same rate they charge customers for electricity. The proposals would reduce the price of net metering credits by as much as 75 percent, permitting utilities to purchase the power at the wholesale rate — the cost of production — thus making solar power development financially challenging for municipal hosts and solar developers.
Newton plans to lease 11 municipal sites to a developer to build three megawatts of solar power by the end of 2016. The project is expected to generate $4 million in savings for Newton residents over its 20-year term. “The proposed rate reductions would wipe out most, if not all, of those savings,” said Warren.
Newton also plans to develop a community solar share program in 2017 that would enable low-income residents, and those with rooftops that will not accommodate solar power, to share solar power with the city.
“Although all ratepayers pay fees on their utility bills to support solar power, only about twenty percent of them are in a position to obtain it,” said Warren. “That is simply unfair,” he said.
“If net metering credits are set at the wholesale rate, projects like these simply won’t make financial sense for Newton or for any other city or town in Massachusetts. This legislation will make it very hard for any mayor or town manager to propose solar projects in the future.”
Massachusetts has brought online 985 megawatts of solar since 2009, enough to power 150,000 homes. Current solar policies are estimated to have created over 15,000 jobs in Massachusetts and resulted in $791 million in investment in 2014. The state has made a commitment to reduce carbon emissions by 80 percent by 2050.
“Massachusetts has been a national leader in the transformation to clean energy, and our cities and towns have been at the forefront of that movement,” said Warren. “These proposals threaten to halt that progress. They will also eliminate local jobs, reduce local investment and make it much more difficult for cities and towns, and the state, to reach their greenhouse gas reduction goals.”
“We thank Mayor Warren and city and town leaders around the Commonwealth for standing up for solar development in our state,” said George Bachrach, president of the Environmental League of Massachusetts. “The legislature must now do its part and move forward with solar legislation that lifts the cap on net metering and preserves fair compensation to continue solar development in our cities and towns.”
The proposals to reduce the value of net metering credits is opposed by the Massachusetts Municipal Association, the Environmental League of Massachusetts, Environment Massachusetts, the Massachusetts chapter of the Sierra Club, Clean Water Action, and other environmental advocates.