On April 8, 2016, the Massachusetts Department of Energy Resources (DOER) issued an emergency regulation expanding the state’s SREC II solar incentive program to all otherwise eligible solar projects that can be complete by January 8, 2017. The regulation represents DOER’s response to the oversubscription of the SREC II program in early February 2016 and provides a bridge to help the market transition to a successor solar incentive program that DOER is in the process of developing.
Under the emergency regulation, notwithstanding the prior cumulative SREC I/SREC II program cap of 1600 MW DC, all new Massachusetts solar facilities that otherwise meet SREC II qualification requirements will be able to participate in the SREC II program under certain conditions.
In the case of a large facility (> 25 kW DC), the facility will be able to participate in the SREC II program if the facility achieves interconnection by January 8, 2017. Such a facility may receive an indefinite extension of that deadline if the facility is mechanically complete by January 8, 2017 and is then only awaiting interconnection authorization from the utility. Facilities with an existing SREC II Assurance of Qualification or those with a pending SREC II Assurance of Qualification application will now receive SREC II Statements of Qualification along these lines. Projects may also seek an extension to this requirement based on good cause.
In the case of a small facility (< 25 kW DC), the facility will be able to participate in the SREC II program if it submits an application for an SREC II Statement of Qualification after receiving authorization to interconnect from the utility and prior to the effective date of DOER’s to-be-designed successor solar incentive program.
Important Note: The emergency regulation does not only benefit facilities that had filed a complete application for an Assurance of Qualification and expected to either be within the program capacity or on a “waiting list.” The emergency regulation certainly benefits those facilities that had previously filed an Assurance of Qualification application by immediately providing a Statement of Qualification for such facilities. However, the regulation also benefits facilities that had not done so but can meet the construction requirement time frame.
Potential Drawback: To facilitate an orderly and predicable termination of the SREC II program, the emergency regulation provides for the SREC II program to end with Compliance Year 2027. In other words, even though certain facilities that achieve commercial operation after January 8, 2017 can still participate in the SREC II program, Q1 2017 will be the first of such facilities’ 40 quarters (10 years) of SREC II generation regardless of whether the facility has actually started operating. This means, for example, that a facility that is mechanically complete by January 8, 2017 but does not achieve interconnection until April 1, 2017 would end up having only 39 quarters of SREC II generation.
Under state law, the emergency regulation remains in effect for 3 months but DOER is already in the process of making the regulation permanent through a notice and comment rulemaking. DOER plans to post information regarding the rulemaking on its RPS regulatory proceedings webpage.
For further information about these matters, please contact Jonathan Klavens at firstname.lastname@example.org or 617-502-6281 or Courtney Feeley Karp at email@example.com or 617-502-6284.
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