Cap stands in the way of solar project

HARTFORD — A cap on a renewable energy credit is clouding the plans of Beacon Falls to create a solar farm on town-owned land.

State Rep. Theresa Conroy, D-Seymour, urged the legislature’s Energy and Technology Committee on March 10 to support legislation increasing the availability of the Zero Renewable Energy Credit (ZREC) to more municipal projects, including Beacon Falls.

“The solar project is projected to save my constituents in Beacon Falls more than $900,000 in municipal electric costs over the next several decades,” she said.

In February, the Beacon Falls Board of Selectmen approved a 20-year power purchase agreement with the Troy, N.Y.-based Jordan Energy.

Jordan Energy, a solar energy company, plans to install solar panels on town property on Lopus Road as part of the state’s ZREC program. Under the program, the state pays companies, such as Jordan Energy, a set rate for every 1,000 kilowatt hours of power generated. The company then sells the energy it generates back to the town at a lower rate than what Eversource Energy charges.

Current law sets an annual cap of $10 million for distribution among the municipal, state and agricultural sectors through the state’s virtual net metering program. No sector may receive more than $4 million.

Virtual net metering generally allows owners of renewable energy systems to share the billing credits that are generated when the system produces more power than the owner uses.

The $10 million is divided proportionately between the state’s two largest electric distribution companies, Eversource Energy and United Illuminating, based on their respective consumers’ electric loads. The current division is $8 million for Eversource and $2 million for UI.

The cap is frustrating the plans of other “stranded” communities in addition to Beacon Falls that unable to take advantage of the credit.

The town of Cheshire is in jeopardy of losing a solar project that has been more than a year in the making, said George Noewatne, the public works director. Eight other communities face the same predicament, he said.

In Beacon Falls, its planned system is expected to cover almost 77 percent of the town’s municipal electricity usage, Conroy said.

First Selectman Christopher Bielik said the town has ZREC credits, but needs to wait for approvals for the net metering piece of the project.

“The project hinges on this,” Bielik said.

Bielik said being allowed to move forward with the project would reap huge benefits for the town.

“I think there is potential for not only cost saving, but it’s consistent for our overall approach for green energy solution and moving ahead where they are feasible for us,” Bielik said. “It also provides us with a certain amount of cost certainty going forward. If you are able to project what your costs are going to be that gives us the ability to accurately budget for other things. The town would benefit from not only the savings but the knowledge of what the cost will be in the budget.”

Senate Bill 394 proposed to expand the virtual net metering program, but the legislation does not specify the amount.

The lack of specificity concerned the Department of Environmental Protection, Eversource and the state Office of the Consumer Council.

Consumer Counsel Elin Swanson Katz offered conditional support for Senate Bill 394. He testified that his office would be willing to support an increase of $5 million to $15 million.

DEEP Commissioner Robert Klee told the committee that his agency needs more specifics about the size of the expansion.

He reported that the virtual net metering program has resulted in 22 different clean energy projects across the Eversource and UI service regions, consisting of 14 projects municipal projects and eight agricultural ones.

Luke Marshall contributed to this article.