Massachusetts SMART Program Clears Major Hurdle with Long-Awaited DPU Order

On September 26, the Massachusetts Department of Public Utilities (DPU) issued the long awaited Order approving the model tariff for the Solar Massachusetts Renewable Target (SMART) program. The approval clears the way for the transition from the SREC II program to the state’s new tariff-based solar incentive program, which has been under development by the Department of Energy Resources (DOER) since 2016. It is an exciting moment for the industry at large, especially for those of us who’ve been working on the program over the last two years.

The DPU’s Order, in docket 17-140, is one of the final major steps in SMART program design and implementation. NECEC supported the intervention of the Solar Energy Industries Association (SEIA) in this proceeding, and we offer our congratulations to the SEIA team and our fellow intervention supporters. (#ICYMI: See the press statement from the solar industry on the issuance of the Order.) 

In the 219-page Order, the DPU ruled on a range of important issues that have been the subject of debate since the proceeding was opened one year ago. NECEC’s full summary of the Order is available for members and sponsors on our Policy Web Portal. Of top importance, the DPU went our way on a number of issues and left others still open. Briefly, the DPU: 

  • Rejected the utilities’ proposed kWh/usage cap on alternative on-bill credits, removing what would have been a major barrier to community shared solar;
  • Rejected the utilities’ fixed charge proposal for cost recovery, choosing a volumetric ($-per-kWh) energy charge proposal instead of a flat $-per-month fee;
  • Found it appropriate for Eversource to be considered a single distribution company in the SMART Program now that Eversource (NSTAR) and WMECO are one company, directing Eversource to work with DOER to determine new SMART capacity blocks and base compensation rates for the combined east-west territory (Update: we now understand that Eversource and DOER will be proposing to change WMECO’s name to Eversource West but to keep intact the separate capacity block allocations and base compensation rates. We will get more information on this front next week);
  • Ruled that neither SMART owners nor the utilities may assert title to the capacity of SMART facilities during an interim period prior to a future ruling on permanent Forward Capacity Market (FCM) treatment in a parallel docket, 17-146;
  • Allowed energy storage systems to operate under existing guidelines, but recommended that DOER work with stakeholders to evaluate and modify the operational requirements for co-located solar and energy storage systems; and
  • Directed utilities to amend the tariff to match the SMART Program Regulations’ definition for environmental attributes, which is less expansive than the utilities had proposed.

While the Order created some uncertainty regarding when the SMART program would begin, DOER has since clarified that the program would start accepting project applications on November 26.

So, what are the major questions following the Order?

  • With capacity rights “in limbo” for an interim period, how will the first batch of solar and solar+storage projects address this uncertainty?
  • What steps will DOER take, if any, to modify the operational requirements of SMART facilities paired with energy storage systems? What is the timeframe for this review?
  • What are the major areas DOER is considering for its 400 MW review period, which is specified in the SMART regulations? How soon will that review process and stakeholder engagement begin?

And, what are the major next steps?

  • DOER will continue its series of “SMART Launch” presentations between October 11 and 19, and release more information related to the application portal going live on November 26;
  • The utilities are to file a revised SMART Provision (tariff) not later than October 15, 2018, in compliance with the directives in the Order. Following this submission, the DPU will render its decision and subsequently direct each EDC to file a company-specific SMART Provision for Department review and approval;
  • The utilities are to make the Payment / Credit Form available on each company’s website within 15 days of the date of the Order (September 26) and make a compliance filing by October 15;
  • DPU will release order(s) in docket 17-146 providing rulings on net metering+storage rules and treatment of FCM rights (likely Q42018 or Q12019); and
  • DOER will release its straw proposal for SMART 2.0 (Kidding! But only partially!).

 Stay with NECEC as your go-to source for up-to-the-hour developments on SMART and all things solar, storage, and beyond in the Northeast. If you are not a member, check out what NECEC membership looks like and join our efforts to unlock opportunities for clean energy solutions across the region.

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Jamie Dickerson

Jamie is NECEC's Policy Analyst.