Here’s what’s in the Legislature’s energy/climate change legislation
Utility bill assessments scrapped; funding levels still to be determined
THE LEGISLATURE suspended its rules and whisked through a climate change bill on Thursday that seeks to make Massachusetts the “Saudi Arabia of wind,” promotes the adoption of zero emission vehicles, and allows 10 communities to bar fossil fuel infrastructure in new construction.
The precise contents of the bill were not available and the funding for various initiatives will be worked out separately, but the House and Senate passed the measure swiftly – the House by a 143-9 vote and the Senate by a tally of 38-2.
Most members of the House stood and clapped after Rep. Jeffrey Roy, the House chair of the Legislature’s Telecommunications, Utilities, and Energy Committee, spoke in favor of the bill he helped fashion.
The compromise bill blends two very different pieces of legislation – a House bill focused primarily on offshore wind development and a Senate bill targeting ways to use that green power to reduce climate emissions.
Roy said in an interview that the bill creates several funds that will be used to dispense money for the legislation’s various priorities. He said the amount of money going into each of the funds is not settled on yet, and depends to a large degree on appropriations in an economic development bill making its way through the Legislature.
Presumably much of the initial funding will come from state surplus funds and federal aid. Roy had initially proposed assessments on utility bills to provide the funding, but that idea was scrapped.
Gov. Charlie Baker filed legislation proposing a $750 million investment in clean energy. Roy indicated the Legislature’s bill would not go that high, but he said the amount would be significant.
“It’s up there. It’s several hundred million dollars. These are topics of discussion and negotiation,” he said.
Here’s a breakdown of key areas of the legislation, based on interviews and some handouts from Roy and his Senate counterpart, Sen. Michael Barrett of Lexington.
Offshore wind: Under the bill, the way Massachusetts procures clean energy will change. Currently, the state’s three major utilities negotiate deals with energy suppliers and carry the resulting contracts on their books, typically receiving 2.5 percent of the value of the contract for their trouble.
The new legislation removes the utilities from the contracting process, turning that job over to the state Department of Energy Resources. The utilities will still carry the contracts on their books and receive 2.25 percent of the value of the contract as a fee.
The House had sought to eliminate a requirement under current law that each successive offshore wind contract come in at a lower price than the previous one. House leaders had argued the so-called price cap was hurting efforts to promote greater onshore economic development\, but Barrett had raised concerns about abandoning the price protection.
The two sides compromised on the final language. Roy said the compromise was complicated, but basically dispensed with the price cap when three or more companies were bidding on the procurement and retained it if two or fewer companies were bidding.
Clean Energy Center: The fairly obscure Clean Energy Center will become a major player in the state’s clean energy efforts, issuing grants, tax credits, and other subsidies to support energy development, companies building out the local supply chain, workforce training, and educational programming.
The center will administer two funds, one focused on offshore wind and the other targeting clean energy in general, including fusion and geothermal energy.
Barrett said the Clean Energy Center will be tasked with spurring development yielding good blue-collar jobs. “These tax breaks are not going to be handed out profligately,” he said.
Roy said he expects the Clean Energy Center to expand significantly to meet its new responsibilities. He said the center’s board will expand from 12 to 15 members, with four appointed by the governor and two each by the House speaker and Senate president.
Power grid: Roy said the bill establishes committees and working groups focused on improving the regional power grid and identifying the best ways to bring electricity ashore from the offshore wind farms. He said the Department of Energy Resources is directed to explore independent transmission systems – building one transmission line to serve multiple wind farms.
Zero emission vehicles: The bill increases the state rebate for electric vehicles priced under $55,000 to $3,500 from the current $2,500. It also provides an additional $1,000 rebate for trade-ins of internal combustion vehicles and $1,500 for qualifying low-income customers.
The bill also authorizes rebates at the point of sale, something not allowed currently.
The bill says only zero emission vehicles can be sold in Massachusetts starting in 2035.
The MBTA would be required to purchase only electric buses starting in 2030 and convert all of its bus fleet to zero emission vehicles by 2040.
To reduce fears about the driving range of electric vehicles, the legislation requires the Massachusetts Department of Transportation to install electric vehicle charging stations at all Turnpike plazas, at at least five commuter rail stations, five subway stations, and one ferry terminal.
All-electric buildings: The Baker administration has developed zoning codes that incentivize the use of electricity in buildings but don’t prohibit the use of fossil fuels. The governor has raised concerns about the impact on housing development from going all-electric.
The Legislature’s bill authorizes 10 communities to test the concept of prohibiting fossil fuel infrastructure in new construction as long 10 percent of the municipality’s housing is affordable and the prohibition doesn’t apply to life science labs or health care facilities.
Other elements of the bill: Subsidies for fossil fuel infrastructure would be banned as part of the utility-run MassSAVE energy savings program starting in 2025 except as a backup for electric heat pumps.
Massachusetts subsidies for biomass energy facilities would be eliminated.
A ban on competitive electric suppliers sought by Attorney General Maura Healey failed to make it out of the conference committee.
Roy said the bill authorizes the Department of Energy Resources to explore other pathways for securing clean energy from out of state, including a possible new transmission line in Maine and purchasing nuclear power from the Millstone nuclear power plant in Connecticut.