Massachusetts Renewable Portfolio Standard Regulations Patricia D Stanton

Massachusetts Renewable Portfolio Standard Regulations Patricia D. Stanton Deputy Commissioner Massachusetts Division of Energy Resources 1

Renewable Portfolio Standard Starting with calendar year 2003, Retail Electricity Suppliers must comply with the Renewable Portfolio Standard by demonstrating that their generation portfolio(s) for sales to Massachusetts retail customers contain a minimum of New Renewables. 2

Presentation z. Brief Summary of Regulations y. Eligibility y. Applicability y. Standard y. Compliance y. Non-compliance z. Policy Issues 3

Eligibility New Renewable Generation Unit z Fuel, Energy Resources and Technologies y Landfill gas y Wind y Solar y Ocean thermal, wave or tidal y Fuel cells utilizing renewable fuels y “Low-emission advanced technology” Biomass z. Commercial Operation Date after 12/31/97 z. Metering 4

Eligibility z. Vintage Generation Unit z. Co-Firing z. Small Generation z. Imports 5

Applicability Retail Electricity Suppliers (RES) z. Not defined in the Act z. Definition in the regulations y. Competitive retail suppliers y. Distribution companies y. Exempts Municipal lighting plants (unless they open to retail competition) 6

Standard Year 2003 % required 1. 0% 2004 - 09 +. 5% per year for total in 2009 of 4. 0% 2010. . . +1. 0% per year until sunset by DOER 7

Compliance z. Normal Compliance z. Early Compliance z. Banked Compliance z. Alternative Compliance 8

Non-compliance z. Make up z. Compliance plan z. Publication of Notice of Non-compliance z. Referral to DTE 9

Policy Issues 1. Biomass Eligibility 2. Imports 3. Compliance Documentation 4. Renewable Energy Credit 5. Product Compliance 6. Early Compliance 7. Banked Compliance 8. Alternative Compliance 9. Existing Renewables Requirement 10

1. Biomass Eligibility z. Fuel z. Vintage z. Air Permit z. Technology y. Gasification -- Categorically Eligible y. Pile burn, stoker combustion -- Categorically Excluded y. Other -- case by case review 11

2. Imports z. New Renewables Generation Unit z“External Transaction Unit Contract for Energy 1 or 2, as defined in NEPOOL Market Rules Section 12. 2. 1(a)” 12

3. Compliance Documentation z. Regulations are silent z. Specifics will be in guidance z. DOER will accept NEPOOL Generation Information System Certificates 13

4. Renewable Energy Credit z. Section 332 Study www. state. ma. us/doer/rps z. DOER recommends that RPS implementation not include the creation of a MA-REC z. DOER does not seek penalty authority at this time 14

5. Product Compliance z. Product compliance z. Consistent with DTE and AG regulations 15

6. Early Compliance z. RES can use 2002 attributes toward 2003 compliance requirement 16

7. Banked Compliance z. RES possessing surplus attributes may apply them to future compliance obligations provided y. RES is in compliance y 30% Limit ytwo year limit y. Non-transferable 17

8. Alternative Compliance z. Alternative Compliance Payment (ACP) z. ACP = $50 Megawatt/hr in 2002 z. ACP adjusted by Consumer Price Index z. Funds managed by MTPC yseparate accounting ypurchase and retire RPS attributes yinvest in construction of New Renewable Generation Units 18

9. Existing Renewables z. Existing standard not mandated z. DOER has authority & discretion z. Supply greatly exceeds demand - under all scenarios - for many years z. Reporting by RES z. DOER will re-evaluate annually 19

Public Comment Hearings Thursday Oct. 25 in Springfield Friday Oct. 26 in Boston Deadline for Written Comments Friday Nov. 2 20