Massachusetts Governor Deval Patrick yesterday signed the Green Communities Act, a comprehensive energy reform bill that aims to lower energy costs, promote renewable energy and green current state and municipal power supplies.
The Act is a strong piece of legislation, showing how states can take a proactive approach to addressing their future energy needs and reducing greenhouse gas emissions.
Under the new law, utility companies (NSTAR, National Grid, Western Mass. Electric, etc.) will be required to purchase all available energy efficiency improvements that cost less than it does to generate power.
Utility companies will also be required to offer rebates and other incentives for customers to upgrade lighting, air conditioning, and industrial equipment to more efficient models, whenever those incentives cost less than generating the electricity it would take to power the older, less-efficient equipment.
The Green Communities Act also requires utility companies to enter into 10- to 15-year contracts with renewable energy developers to help developers of clean energy technology obtain financing to build their projects. The agreements will target Massachusetts-based projects.
The law also makes it possible for people who own wind turbines and solar-generated power to sell their excess electricity into the grid (net-metering) at favorable rates, for installations of up to 2 megawatts (MW), up from 60 kilowatts currently.
The measure also authorizes utility companies to own solar electric installations they put on their customers’ roofs–a practice that was previously prohibited.
Under the new law, the state Division of Energy Resources, which is expanded and elevated into the Department of Energy Resources, will now include a Green Communities Division to provide technical and financial assistance to municipalities for energy efficiency and renewable energy efforts. The program will receive $10 million in funding from a variety of sources, including emissions allowance trading programs, utility efficiency charges, alternative compliance payments generated by the Renewable Portfolio Standard, and the Renewable Energy Trust Fund.
In addition to these provisions, the new energy law doubles the rate of increase in the Renewable Portfolio Standard from 0.5% per year to 1% per year, with no cap. As a result, utilities and other electricity suppliers will be required to obtain renewable power equal to 4% of sales in 2009–rising to 15% in 2020 and 25% in 2030, and more thereafter.
The law also requires the State Board of Building Regulations and Standards to adopt, as its minimum standard, the latest edition of the International Energy Conservation Code as part of the State Building Code. This will keep Massachusetts building standards at the highest international levels of energy efficiency.
The Green Communities Act gives final legislative approval to the Commonwealth’s participation in the Regional Greenhouse Gas Initiative (RGGI). Substantially all of the emissions allowances issued under the program will be auctioned–in accordance with the policy announced by Governor Patrick in January 2007–allowing the proceeds to go toward reimbursing municipalities that lose property tax receipts as a result of RGGI mandates, funding Green Communities, providing no-interest loans for municipal energy efficiency project, and promoting energy conservation.
"Today, Massachusetts has taken a giant step forward toward a clean
energy future," said Governor Deval Patrick, who signed the bill at a
ceremony at the Museum of Science. "This legislation will reduce
electric bills, promote the development of renewable energy, and
stimulate the clean energy industry that is taking root here in the
Commonwealth."
Rhode Island Governor Donald Carcieri earlier this week vetoed a similar bill.
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