Dive Brief:

• Following the failure of a bill to replace retail rate net metering with a market-based incentive system, the Maine Public Utilities Commission (PUC) must now evaluate the solar incentive scheme and decide how to proceed, Maine Public Broadcasting reports. 
• The PUC has not announced when it will consider the question. The law that instituted the NEM policy requires them to take it up because the state's utilities have reached or will soon reach the cap on the amount of net metered distributed solar they can interconnect.
• The commission’s choices are to keep the existing policy in place, reduce the credit to the wholesale market price, or eliminate NEM entirely, according to Tim Schneider, head of the Office of Public Advocate, who wrote the bill approved by the legislature but vetoed by Gov. Paul LePage (R).

Dive Insight:

The solar bill, LD 1649, was designed grow solar from Maine’s present 18 MW to 196 MW by 2021 by instituting a novel market-based incentive structure.

Under the bill, the state's regulated utilities would purchase and aggregate solar generation from rooftop and utility-scale developers under long-term contracts. They would then bid the solar generation into New England electricity markets in one of the first such aggregations of smaller-scale solar. 

The price paid by utilities for the generation would drop over time as solar costs declined and penetration increased. The bill would also have opened commercial-industrial, community, and utility-scale solar development to competitive bidding subject to caps.

The legislation was supported by ReVision Energy, Maine’s biggest solar installer, multiple smaller installers, the Maine Renewable Energy Association, Sierra Club Maine, Maine Audubon, and the Natural Resources Council of Maine. Both Maine’s investor-owned utilities, Central Maine Power and Emera Maine, also endorsed the bill.

Some out-of-state solar interests reacted more skeptically, with the advocacy group The Alliance for Solar Choice (TASC) calling for the preservation of retail rate net metering alongside the new incentive structure.

But now that the bill has been sunk, some installers in the state are worried that what comes next could be worse for the industry. ReVison Energy CEO Fortunat Mueller said its defeat may allow the commission to severely erode the net metering credit and make other changes that will impede solar.

“We have already seen one of our IOUs ask the PUC for approval of substantial fixed charges and lower volumetric charges,” he told Utility Dive. “Over time that risk is even more substantial than the availability of NEM.”