House passes solar bill; Senate leader hopeful

THE MASSACHUSETTS HOUSE voted 150-2 on Tuesday in favor of a solar power bill that is very different from what the Senate passed in June, yet the Senate’s energy expert said he was optimistic the two branches could approve legislation and send it to the governor before the Legislature recesses Wednesday night.

Sen. Benjamin Downing of Pittsfield, the Senate chair of the Joint Committee on Telecommunications, Utilities, and Energy, said after presiding at a four-hour hearing that he was headed upstairs to his office to study the House proposal and to work on language that would be acceptable to both branches. He acknowledged the Senate and House bills are philosophically far apart, but he said he was optimistic a compromise could be reached and enacted in a day.

“I don’t think we need to dilly dally with a conference committee. We know the issues before us. I think we can get into conference, sit down, and bang this thing out,” he said.

Solar developers have been pressing lawmakers to lift the so-called net metering cap before the Legislature recesses for the holidays. Without action on the cap before next year, the developers say, many solar projects on the drawing board will be put on hold and likely canceled because of uncertainty about the Massachusetts regulatory environment. A key federal tax credit, worth 30 percent of a solar project’s cost, expires at the end of next year, adding urgency to the Beacon Hill negotiations.

The focus of the solar legislation is net metering, a payment system for solar power generators who feed electricity into the regional power grid. Under the existing regulatory framework, developers are paid the retail price of electricity for the power they deliver to the grid. Caps in utility service territories limit how many commercial and large-scale solar projects qualify for net metering; the number maxed out in the National Grid territory several months ago.

The Senate passed a bill in June that included provisions lifting the cap and leaving the existing regulatory framework in place, at least temporarily. The House took no action on the measure until Monday night when the House Ways and Means Committee released a bill that lifted the cap slightly, allowing the state to reach 1,600 megawatts of installed capacity. After that goal is reached, the House bill would sharply rein in the net metering incentive, paying solar developers the wholesale price of electricity for any power they feed into the grid. The wholesale price, depending on market conditions, would represent a reduction of 50 to 70 percent from the retail price solar developers are currently paid.

The House bill would also set in motion a regulatory process that could lead to utilities charging solar power generators a fixed charge on their electric bills. Utilities argue some solar projects produce more power that they consume, allowing them to use the power grid yet pay none of the costs to maintain it. The fixed monthly charge would insure that all solar power generators pay.

House leaders kept using the word “balanced” to describe their solar bill.  House Speaker Robert DeLeo issued a statement saying the bill would foster a sustainable renewable energy industry while ensuring that ratepayers are treated fairly. Rep. Brian Dempsey of Haverhill, the chair of the House Ways and Means Committee, issued a statement saying he was “proud that the House is standing firmly on the side of the ratepayer by including reforms that will, over time, lessen their burden and lower peoples’ monthly bills.”

Rep. Thomas Golden, the House’s point person on energy, said during the brief debate that the issue is very contentious. “Some people just aren’t going to be happy with any type of change at all,” he said.

The comments by the House leaders echoed those made by the state’s utilities over the last several months. Utility officials from Eversource and National Grid have been saying the state’s solar power program is way too costly for ratepayers and needs to be scaled back.

Solar power advocates said the House measure would be devastating to their industry by significantly lowering the payments solar developers receive. They said the House bill also lifts the net metering cap only enough to clear a backlog of existing projects and would probably restrict expansion again starting in early 2016.

The solar advocates issued a statement saying they found it ironic that utilities, who have complained about the high cost of Massachusetts solar, won a carveout in the legislation to build new solar installations themselves. “This is an outrageous overreach,” the solar advocates said in their analysis of the House bill. “Solar is too expensive when it works for someone else’s business, but not when the utilities can put it on their balance sheets.”

The House spent a little over an hour debating the bill. Two amendments were adopted, one that would extend from 15 years to 20 years the amount of time grandfathered projects (those in place before the 1,600 megawatt goal is reached) would qualify for net metering credits at the retail rate.

Rep. Jonathan Hecht, a Watertown Democrat who voted against eliminating term limits for the speaker’s post in January and then fell into disfavor with House leadership, proposed a series of amendments to the bill. But he did so in a way that essentially recognized the futility of his efforts. He spoke in favor of each amendment and then withdrew them from consideration so no one had to actually take a vote on them.

Downing, the Senate energy expert, said he needed to review the House bill more thoroughly before commenting on it. But he said shifting the net metering payment rate to the wholesale price of electricity would cut payments to solar developers from roughly 17 cents a kilowatt hour to 5 cents. “I think that’s a bit much,” he said.

Figures released on Tuesday by the US Bureau of Labor Statistics indicate Boston households pay electricity prices that are 30 percent higher than the national average. The bureau said the average price of electricity in Boston was 17.7 cents a kilowatt hour in October, compared with 13.6 cents nationwide.