As previewed at a recent solar stakeholder meeting, the Massachusetts Department of Energy Resources (DOER) released its emergency regulation on June 28, 2013 to address the excess of applications for Massachusetts’ Solar Carve-Out program and to guide the program’s future. Qualification for the program enables a solar project to sell valuable Solar Renewable Energy Certificates (SRECs) to distribution companies, which are required to fill a minimum percentage of their electricity sales with generation qualified under the Solar Carve-Out. Last month DOER reported that an unexpectedly high volume of applications for the Solar Carve-Out blew through the program’s 400 megawatt (MW) cap, creating uncertainty as to which projects would qualify under the program.
The emergency regulation sets the 400 MW cap aside and permits all projects that meet certain conditions and construction deadlines to qualify for the Solar Carve-Out. The conditions in the emergency regulation were previously announced by DOER at its solar stakeholder meeting and described in an earlier article. The emergency regulation changes the date for extension of the construction schedule from March 31, 2014 to June 30, 2014. In addition, the emergency regulation clarifies that all solar projects under 100 kilowatts will qualify for the Solar Carve-Out so long as they have submitted their Statement of Qualification Application and receive authorization to interconnect or permission to operate by the effective date of the next Solar Carve-Out program or June 30, 2014, whichever is earlier.
Along with new qualification requirements, the emergency regulation changes the formula used to calculate the compliance obligation of retail electricity suppliers, who must fill a minimum percentage of their electricity sales from generation qualified under the Solar Carve-Out program. The updated compliance obligation formula is based on the new Program Capacity Cap, which will be announced by DOER on or before July 31, 2014, and will reflect actual supply beyond 400 MW. However, DOER will provide exemptions to the additional compliance obligations for load that was under contract before the effective date of the emergency regulation.
Under Massachusetts law, the emergency regulation is only effective for three months unless DOER gives notice and holds a public hearing to formalize the rule. According to the explanatory release accompanying the emergency regulation, DOER plans soon to schedule a public hearing and comment period in order to finalize the regulation.