Clean energy scored important wins in Massachusetts in the 2014 legislative session with new laws that encourage renewable thermal energy; fix dangerous and polluting gas pipeline leaks; and authorize a $2.2 billion environmental bond bill. However, two major bills, one that would have required purchase of 2400 megawatts of ‘clean energy’ and another that would have revamped the state’s solar program, failed to pass.
 
Legislation promotes renewable energy to heat and cool buildings
One of the bright spots of the Massachusetts’ 2013-14 legislative session was S2214, a bill that provides financial incentives for heating and cooling buildings with renewable technologies such as solar heating, geothermal and air source heat pumps, biofuels and wood pellets, wood chips, renewable bio-oils or renewable biogas. Under the bill, these technologies will now qualify for alternative energy credits. Before passage of the bill, these technologies could earn credits when used to produce electricity, but not for production of thermal energy. 
 
This bill is the first in the nation to address renewable thermal and will likely provide a model for the rest of the country while spurring innovation and investment here in Massachusetts.

Businesses and homes that install these technologies will likely reduce their energy costs, especially compared to the use of petroleum fuels. The new incentives will also encourage the Commonwealth’s emerging renewable thermal business sector, which creates many local jobs for installation, operation, fuel delivery and maintenance.

New law aims to reduce gas leaks

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  Map of gas leaks in Boston

Massachusetts’ gas pipeline system is among the oldest in the country. Nearly one-third of the state’s natural gas pipes are considered “leak-prone.” [1]  Those aging pipes are leaking methane gas, a powerful greenhouse gas—22 to 34 times more potent than carbon dioxide — into the atmosphere. This creates a public safety and environmental hazard, and significantly adds to the state’s global warming pollution.
 
This lost gas costs Massachusetts’ ratepayers tens of millions of dollars for gas they never receive. According to a study released in 2013, the state’s gas customers paid between $640 million and $1.5 billion from 2000–2011 for gas that never reached their homes and businesses.
 
The recently passed bill, H2963, creates a uniform system that classifies the severity of leaks and sets a timeline for their repair based on risk. It also requires utilities to fix all but the least hazardous of leaks whenever road construction projects expose a pipeline and to give priority to leaks within 50 feet of a school.
 
Environmental bond bill plugs gaps in funding
The legislature also authorized a much-needed $2.2 billion environmental bond bill that is designed to pay for four years of state environmental agency capital projects. The bill includes over $350 million for land conservation programs; $120 million for coastal infrastructure; $117 million to improve coastal and inland waterways, and $75 million to assess and monitor waterways. It will also provide significant funding to improve energy efficiency of state-owned buildings and funds new programs to support comprehensive climate change adaptation management planning.
 
Major energy questions remain unanswered
Because so many of the region’s oldest and dirtiest power plants are likely to retire, experts estimate that New England will need about 6,300 MW of new capacity[2] by 2020, an amount equal to about 20% of current capacity.[3]  Energy costs are also a challenge. During the past very cold winter, prices of natural gas and electricity rose to new highs during peak periods.  
 
Hoping to address both capacity and price issues, the six New England governors signed an unprecedented agreement to expand the region’s energy infrastructure, including new gas pipelines and new transmission lines for clean energy imports.
 
That proposal is currently on hold and many questions remain unanswered about the future of the region’s energy supply. For example, a study commissioned by these same Governors[4] found that under a low demand scenario, no new major infrastructure would be required, beyond that which is already planned. In a letter[5] sent to all six New England governors, over 100 non-profits and business organizations including E2, urged a thorough study of the low demand scenario and a host of measures that could meet demand without costly investment in long-lasting fossil fuel infrastructure.
 
Controversial pipeline proposal highlights the issue
Meanwhile — with or without the governors’ initiative — Kinder Morgan, a large gas pipeline conglomerate, is moving ahead with plans to build a massive 180-mile gas pipeline across Massachusetts. Opponents object based on potential risks to the environment as well as the effects of fracking used to extract the gas that will flow through the pipeline. Even those who support additional natural gas have expressed concerns about the size of the project. 
 
Legislature declines to act on hydropower imports
There is broad consensus that Massachusetts needs more clean energy, including Canadian hydropower, to replace power from retiring coal fired power plants and to reach its greenhouse gas pollution mandates. The Clean Energy Resources Bill, H4187, would have required utilities to use long term contracts to purchase 2400 megawatts of clean energy –about one third of the state’s total electric use. The bill envisioned purchase of imported hydropower and possibly wind — and would have imposed a tariff on ratepayers to pay for necessary transmission lines.
 
However, key stakeholders felt the bill went too far, too fast and might cause severe market distortions. They sought changes to ensure a level playing field for all renewables, including an amendment to ensure that a minimum of 30% of the energy purchased would come from zero emission sources, such as wind or solar – and not just hydropower, which has a higher emissions profile. Some feared that contracting for new hydropower from Canada would spur new large-scale dams with adverse environmental impacts.  Also, they feared that the long-term commitments for such a large amount of energy would crowd out other renewable sources, especially off shore wind, which is not yet price competitive. In the end, the legislature declined to act on the bill.
 
Massachusetts’ solar power: victim of its own success?

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Massachusetts, though not exactly in the Sunbelt, has one of the most successful solar programs in the country. In 2013, the state installed 237 MW of solar electric capacity, ranking it 4th nationally. The 615 MW of solar energy currently installed puts the state among the top in the nation.[6]  
 
Enlightened state policies are largely responsible for this success: an incentive system based on tradable solar renewable energy credits (SRECs) and a net metering program that allows customers who generate their own power to pay only for the amount of grid-based energy they actually use and be compensated for excess power that flows into the grid.
 
As a result, the state blew past its solar energy goal of 250 megawatts by 2017 four years early and set a new goal of 1600 megawatts by 2020. However, the solar industry was pushing up against the state’s 6% cap on net metering – a barrier that could bring the industry to a grinding halt.
 
Legislative leaders asked state officials to convene a working group of solar industry and utility representatives to create a longer term incentive system. The working group produced a consensus bill, HB4185 that would have removed all caps on the program and mandated the 1600 megawatts goal by 2020. It also would have replaced the variable SREC system with a flat and predictable incentive payment, thereby reducing risk to developers and investors.  
 
However, some developers and advocates believed the proposal would have unintended adverse impacts and actually inhibit solar development. Currently, even if your roof is not suitable for a solar panel or you are a renter, you can participate in a community solar project. The bill would have severely cut the benefits for this program and implemented new size and eligibility restrictions.  It would have also imposed a minimum bill requirement and limited incentives for larger rooftop solar developments. Others disliked the proposed move away from net metering credits.
 
Ultimately, differences could not be overcome and the bill never came to the floor. As an interim measure to avoid a major slowdown in the industry, the legislature provided a small increase in the net metering cap and commissioned a study to recommend longer-term solutions to reconcile the competing visions. Solar developers predict that the new cap will be exceeded in early spring.

– Berl Hartman is an E2 New England Chapter Director.

 


[1] Massachusetts’ Triple Threat – Understanding the Impact of Natural Gas Leaks on Public Safety, the Environment and Your Wallet, CLF, http://www.clf.org/map/          
[2] Enhancing Capacity Markets to Improve Resource performance and Investment in New England, Robert Ethier; Restructuring Roundtable; http://www.iso-ne.com/pubs/pubcomm/pres_spchs/2014/ethier_roundtable_ppt_02-28-14_final.pdf           
[3] ISO New England 2014 Regional Electricity Outlook, p.42, http://www.iso-ne.com/aboutiso/fin/annl_reports/2000/2014_reo.pdf, Total NE 2013 capacity 32,000 MW.
[4] Natural Gas Infrastructure and Electric Generation: Proposed Solutions for New England, B&V Project No. 178511, October 2013 at http://www.nescoe.com/uploads/Phase_III_Gas-Elec_Report_Sept._2013.pdf       
[5] Right-Sizing Energy Infrastructure for an Energy System in Transition; June 24, 2014, http://www.env-ne.org/public/resources/Right-Sizing_Energy_Infrastructure_sign-on_letter_07_22__2014.pdf