DPU Adopts Emergency Net Metering Regulation: New Caps to Take Effect Immediately

In the Press · November 7, 2012

On November 1, 2012 the Department of Public Utilities (DPU)
issued an emergency regulation updating its existing net metering rules, and
implementing the new net metering caps scheduled to take effect immediately.  The emergency regulation brings some much-needed
stability to the renewable energy industry, which has experienced a period of
regulatory uncertainty.

The adoption of the emergency regulation has been timed to
coincide with the net metering statutory changes in Chapter 209 of the Acts of
2012, which Governor Patrick signed into law on August 1, 2012, but did not
take effect until 90 days later.

Unlike the last regulatory process, which saw significant
delays in implementation, the net metering caps of three percent for municipal/governmental
facilities and three percent for private facilities are effective immediately.  Further, the distribution company tariffs now
incorporate the caps by reference and these tariffs will not have to be updated
in order for projects to receive service under these new caps.

Other major changes are:

  • Small net metering renewable energy projects, defined as those with a
    nameplate rating of 10 kw or smaller on a single-phase circuit and 25 kw or
    less on a three-phase circuit, are now exempt from the net metering caps entirely,
    and may seek net metering service irrespective of available cap space.
  • While the net metering program has allowed agricultural-based renewable
    energy projects to qualify as Class II and III Net Metering Facilities, the
    statute was changed to allow all otherwise eligible anaerobic digestion
    facilities, not just those located on farms, to qualify.
  • The new definition of “Anaerobic 
    Digestion Net Metering Facility” is:
  • A facility that (a) generates electricity from biogas
    produced by the accelerated biodegradation of organic materials under
    controlled anaerobic conditions; (b) has been determined by the Department of
    Energy Resources, in coordination with the Department of Environmental
    Protection, to qualify under the Department of Energy Resources’ regulations
    [RPS] as a Class I renewable generating source under M.G.L. c. 25A §11F; and
    (c) is interconnected to a Distribution Company.
  • Allows Government Cooperatives, ones organized under M.G.L. c. 164 §136
    comprised solely of Municipalities or Other Governmental Entities, to serve as
    Host Customer and receive allocation of capacity from members.

Under state law, emergency regulations are valid for three months
from the date filed with the Secretary of State.  During that time, the DPU must comply with
administrative law requirements, including an opportunity for public comment,
before it can finalize this regulation. 

If you have any questions or would like additional
information about the emergency regulation, or want to learn more about renewable
energy and energy efficiency regulations and programs, please contact
Craig M. Tateronis at 617 456 8021 or ctateronis@princelobel.com.