Dive Brief:
- The Massachusetts Department of Public Utilities, or DPU, announced sweeping net metering program changes on Feb. 15 that could expand distributed energy generation across the state, Massachusetts Undersecretary of Energy Michael Judge told Utility Dive in an interview.
- Among the most impactful changes are new net metering cap exemptions for private behind-the-meter facilities generating 60 kW to 2,000 kW and public behind-the-meter facilities generating 60 kW to 10,000 kW. The exemptions immediately benefit net metering facilities served by two of Massachusetts’s three investor-owned utilities, Judge said.
- Separately, larger solar arrays could benefit from a first-in-the-nation ability for net metering facilities to transfer credits across Massachusetts’ three ISO New England load zones and investor-owned utility territories, Judge said. The credit transfer framework is a model for other states with geographic constraints on renewable generation in high-load areas, such as New York, he added.
Dive Insight:
The DPU’s enhancements come as other states restrict or roll back net metering benefits. A 2017 Indiana law meant to phase out net metering by 2047 could more than double the typical residential solar system’s payback period from under 10 to more than 20 years, according to testimony heard in 2022 by the Indiana Utility Regulatory Commission. California’s solar industry shed up to 17,000 jobs last year following net metering tariff changes intended to incentivize onsite load service and battery storage, according to the California Solar + Storage Association.
Though the Massachusetts regulations’ final text excludes batteries and other on-premise energy storage systems from the definition of “onsite load,” the new net metering cap exemptions for onsite generation could benefit commercial users looking to add behind-the-meter generation capacity, Judge said.
Lifting the net metering cap exemption for private behind-the-meter generation from the current 25-kW limit to 2,000 kW immediately improves behind-the-meter project economics for power-hungry businesses in National Grid and Unitil territory, where net metering capacity is fully subscribed, Judge said. Net metering capacity is nearly full in territory served by Eversource, Massachusetts’ third investor-owned utility, “so these changes will also benefit Eversource customers over time,” Executive Office of Energy & Environmental Affairs Director of Communications Maria Hardiman told Utility Dive in an email.
The DPU’s rules allow even higher net metering caps for state and municipal facilities — up to 10,000 kW per site, enough to power about 1,700 U.S. homes, per the Solar Energy Industries Association.
“We are very optimistic for the impact on behind-the-meter generation in Massachusetts,” Judge said.
The new rules show a “clear preference” for onsite generation because “it creates fewer issues for the distribution system” and alleviates land-use concerns around utility-scale renewable generation projects, Judge said. Many behind-the-meter solar projects adorn existing buildings or parking lots.
Other types of generation eligible for net metering include wind, anaerobic digestion and certain small hydropower units, but “99%” of capacity is solar, Judge said.
The DPU’s net metering enhancements will also benefit off-premise generation, including new and existing utility-scale and community solar arrays in less densely populated parts of Massachusetts, said Judge. The rule change allowing net metering credit transfers among the state’s three ISO-NE load zones enables larger-scale renewable generators in the Western/Central and Southeastern Load Zones to serve customers in the more densely populated Northeastern Load Zone, which includes the Boston area and accounts for much of the state’s electricity demand.
Other states, including New York, have hesitated to ease restrictions on credit transfers between load zones and utility territories over concerns that the framework would be difficult to manage, Judge said. But Massachusetts’ three investor-owned utilities offered “no specific pushback” to the proposal and seemed confident that they could overcome any operational issues, he said.
The DPU’s net metering changes will take effect “very soon,” Judge said. Additional tweaks may follow, including closing a “donut hole” that binds projects between 25 kW and 60 kW capacity to the old program caps, he added.
