Massachusetts Announces New RPS Rules

The Massachusetts Department of Energy Resources (DOER) has released regulations expanding support for renewable energy and alternative energy technologies mandated by the Green Communities Act, the energy reform legislation that the state enacted last year.

The Green Communities Act called for changes in the state’s Renewable Energy Portfolio Standard (RPS) that would double the rate of increase in the use of new renewable energy, create a new Class II RPS to support the continued operation of older (pre-1998) renewable energy generating facilities. Principal provisions of the regulations include creating two different classes of renewable technologies under the RPS.

RPS Class I Renewables

Geothermal, hydroelectric, and marine and hydro-kinetic (including wave and tidal) energy are now eligible technologies under RPS Class I (in addition to solar and wind technologies), as is algae, as an eligible biomass fuel. In addition, liquid biofuels eligible for RPS Class I are required to meet lifecycle greenhouse gas emissions and other standards set by the Clean Energy Biofuels Act of 2008.

Compliance by utilities and other electric suppliers with the RPS requirement will be by purchase of the renewable attributes of electricity generated by eligible renewable energy facilities in the form of Renewable Energy Certificates (RECs) or by making an Alternative Compliance Payment (ACP). The ACP rate began at US $50 per megawatt-hour of RPS obligation in 2003 and is currently US $58.58, changing each year with the Consumer Price Index.

RPS Class II Renewables

This new class of RPS, is limited to generation that went online on or before December 31, 1997. Utilities and other electricity suppliers are required to purchase RECs from Class II facilities equal to at least 3.6 percent of sales, or to make ACPs per megawatt-hour to meet the Class II RPS obligation. The initial ACP rate is US $25 per megawatt-hour in 2009, and will be adjusted each year with the Consumer Price Index.

“By increasing our commitment to renewables, ensuring strict carbon emission standards are met before receiving state support, and creating new incentives for efficient power generation such as Combined Heat and Power, the state is taking several important steps down the clean energy highway,” said Sam Krasnow, policy advocate at Environment Northeast.

The new RPS and APS emergency regulations can be found downloaded from the state, which will be holding public hearning on the topic in the coming weeks.

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