PROVIDENCE — Rhode Island’s
unique renewable-energy program is close to a contract extension after the
House and Senate both approved clean-energy bills on June 11. The bills (S2690, H7727) are nearly identical and enhance
the state’s distributed generation (DG) program to build small and large wind
turbines and solar-energy arrays.
The House and Senate next vote on
each other’s bill before the legislation heads to the governor’s desk. Gov.
Lincoln Chafee is expected to sign the bills.
Since the DG program was launched in 2011, about 20 large solar arrays and two wind turbines have been built in 15 communities across the state. Notable projects include a 14-acre solar array on a landfill in East Providence and a 1.5-megawatt wind turbine in North Kingstown.
The program is unlike others in
the country because it awards 15- to 20-year contracts to renewable-energy
developers, allowing them sell the energy at a fixed price to the electric
utility company. The fixed price is typically above the market price for
electricity, thus allowing the projects to attract investors.
The legislation would extend the
DG program for five years and quadruples the power to 160 megawatts of
electricity allotted to new renewable-energy projects.
A new provision to the DG program
permits homeowners to apply for a fixed-price agreement with National Grid. The
pricing means that homeowners can receive payments for generating excess
electricity. Currently, homeowners use net metering, which applies electricity
generated from a solar project to offset costs on future bills.
The program helps fill a whole
left by a 25 percent tax credit for small renewable projects that was dropped
in 2010. The tax credit was omitted from the latest budget despite efforts to
reinstate it.
A recent report commissioned by the Office of
Energy Resource and the General Assembly suggested the expanded DG program
would create $30.65 million in economic benefits annually and 225 new jobs.
Opponents of the bill said the
program raises electricity costs. Rep. Patricia Morgan, R-Coventry, noted that
some of the initial contracts are three to five times the cost of standard
electric rates. The total cost to ratepayers for the DG program is an estimated
$17 million a year.
“The problem right now is that
the technology simply hasn’t developed to be efficient and affordable,” she
said.
Rep. Deborah Ruggiero,
D-Jamestown, sponsor of the House bill, said the new DG program would cost the
average ratepayer about 90 cents a month. An expanded DG program, she said,
creates more work for local renewable-energy companies. Many of the companies
already do most do most of their business in Massachusetts, which has one of
the top renewable sectors in the country.
“We are just trying to be
competitive,” Ruggiero said.
To help the cause, she noted that
the House and Senate also passed a bill that allows renewable companies
to earn a special certificate that allows installation of portions of solar
projects without licensed electricians and pipefitters.
The Rhode Island Builders
Association, National Grid and several environmental groups support the DG
bills.
Rep. Brian Newberry, R-North
Smithfield, opposed the bill, saying it written by ideological supporters of
the environment. “They don’t really care what the cost is. That’s fine. If you
are one of those people you should vote for this bill. Nobody who wrote this
bill gives one fig about ratepayers.”
The House approved the bill 62-8;
the Senate passed its DG bill 35-0.