Bill would require Mass. utilities to get contracts for clean energy, transmission

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Gov. Charles Baker on July 9 introduced a bill that, if passed, would require Massachusetts’ electric distribution companies to jointly and competitively solicit long-term contracts for clean power generation resources and associated transmission.

In a July 9 companion letter to the Massachusetts Senate and House of Representatives, Baker said that although the state’s electric distribution companies can procure hydroelectric power under existing law, they have not done so, and it is highly unlikely that they will absent legislation authorizing long-term contracts.

“This legislation authorizes [long-term] contracts for both stand-alone firm hydroelectric power and new Class I [renewable portfolio standard] resources as long as they are firmed up with hydroelectric power,” he said, adding that Massachusetts is at risk of not meeting its goal of reducing greenhouse gas emissions to 25 percent below 1990 levels by 2020.

Baker also said that the state’s assumptions for meeting the 2020 goal include procurement of about 1,200 MW of hydroelectric power, accounting for 5.3 percent of the targeted 25 percent reduction.

“This power has not yet been procured,” he said.

According to the bill text, the legislation directs all of Massachusetts’ distribution companies, together with the Massachusetts Department of Energy Resources (DER), to jointly and competitively solicit proposals for clean energy generation resources to deliver no more than about 2 GWh of energy annually via long-term contracts, and to enter into cost-effective long-term contracts for about 1 GWh of energy annually per project.

Initial solicitations would begin by April 1, 2016.

The bill allows solicitations and subsequent procurements of resources to include proposals for electric transmission to interconnect load centers in the New England control area with regions or areas where clean energy generation resources may be available. The transmission proposals can provide for procurement separate from a power purchase agreement for clean energy generation resources or can bundle the transmission into a power purchase agreement.

Unbundled transmission projects would be subject to FERC rules, and the DER would be authorized to determine whether a transmission project would be pursued through an elective transmission upgrade; under the rules applicable to transmission advanced to meet public policy requirements; or other means available under federal rules as appropriate.

The DER would be tasked with coordinating, through a staggered schedule, one or more solicitations, which could be executed jointly with other New England states.

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