October 18, 2021

Volume XI, Number 291

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October 18, 2021

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October 15, 2021

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Massachusetts Department of Energy Finalizes Solar Incentive Program

This past July, the Massachusetts Department of Energy Resources (DOER) announced a final set of regulations for the Solar Massachusetts Renewable Target program (SMART). Such regulations are intended to promote cost-effective solar development throughout Massachusetts.

According to the DOER, the SMART program is a long-term sustainable solar incentive program sponsored by Eversource Energy, National Grid and Unitil Corporation. The program began with  17 projects totaling 53.273 megawatts (MW) of solar photovoltaic (PV), having since become available to solar PV projects of all types and sizes, up to 5 MW per project. Massachusetts’ expansion of the SMART program aligns with its goals to become the most energy-efficient state in the nation.

In April, the DOER conducted a mandatory review of SMART using an emergency regulatory process. The review was initiated because the program reached 400 megawatts of subscription this past spring. The Massachusetts Municipal Association (MMA) submitted comments during the fall review period, raising questions and concerns about the function of the program. These comments contributed to the regulatory changes made in April.

The additional changes to the SMART program made this past July (under 225 CMR 20.00) follow the DOER’s filing of emergency regulations in April. While the publication of emergency regulations offered insight into the size of the SMART program, outstanding questions concerning new land-use restrictions as well as consumer protection enhancements remained. The April guidelines imposed stricter land use provisions, raising concerns amongst companies that the new rules would limit solar development. The final set of updates sheds light onto these outstanding questions.

The DOER’s finalized rules double the SMART program from 1.6 gigawatts to 3.2 gigawatts. Although the regulations increase the size of the program, the DOER has also imposed guidelines on land use concerning the solar industry. The final regulations pull back on the emergency revisions issued in April. According to analysis from developer Borrego Solar Systems, Inc. and trade group the Coalition for Community Solar Access, revisions included restrictions on “three categories of land—critical natural landscape, core habitat and priority habitat—all of which cover a significant portion of the state.” These revisions address a conflict between cost of solar and protecting land.

With the new regulations, the DOER seeks to increase distributed solar development, encouraging the expansion of solar projects on previously developed land as well as buildings with rooftops. However, many developers prefer to undertake solar projects on greenfields—land that has never been used for developmental projects. Such land plots are cheaper for building solar panels than rooftops. This creates a conflict over land use—solar companies argue that these guidelines would upend solar development in the state, whereas environmentalists claim that the state should take greater measures to preserve vulnerable land.

The final regulations strike a compromise between both groups by expanding the size of SMART while maintaining land-use restrictions. Solar projects sited on private property, either “owned or operated by a municipality or where the project’s owner has assigned 100% of the output to the host municipality” can now be defined as public entity Solar Tariff Generation Units. The DOER defines a Solar Tariff Generation Unit as a “raised structure allowing for continuous growth of crops underneath the solar photovoltaic modules, with height enough for labor and/or machinery as it relates to tilling, cultivating, soil amendments, harvesting, etc.; and grazing animals.” This change may lead to the development of solar projects on more varied types of land. According to DOER Commissioner Patrick Woodcock, the guidelines will “allow for Massachusetts to maintain its national leadership role in the solar industry while protecting the Commonwealth’s natural resources.”

Changes to SMART also include an increased financial incentive for public entities developing solar, from 2 cents to 4 cents per kilowatt hour.  The Solar Energy Industries Association, which initially planned to halt 477 megawatts of solar development in Massachusetts following the release of the April regulations, may resume activities under the finalized plan. The finalized regulations rely on solar development to promote Massachusetts’ energy and sustainability goals in effort to satisfy the preferences of both private developers and environmentalists.

©1994-2021 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume X, Number 244
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About this Author

Kati Pajak Corporate Finance Attorney Mintz Law Firm
Associate

Kati focuses her practice on corporate finance, venture capital, and emerging technology. In addition, Kati handles licensing and other corporate agreements, general corporate and securities matters, and corporate governance. She advises clients in a wide variety of industries, including technology and retail & consumer products. Kati was a Summer Associate at Mintz in 2017.

Kati maintains an active pro bono practice, in which she counsels clients in matters relating to asylum, immigration, and bankruptcy. She also provides legal assistance...

617-210-6876
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