Vol. 5: Issue 1 | February 2017
A South Carolina bill proposes an 80 percent property tax exemption for distributed energy resources and 100 percent exemption for residential renewable energy systems. Proponents contend it is necessary to drive growth in the state, and to not lose business to neighboring states. Opponents express concern that the exemption for distributed systems will leave revenue on the table that could benefit counties and local economic development. According to the Solar Energy Industry Association, 38 states offer some form of a property tax exemption for renewable energy.
The Kansas Legislature is considering a bill (H.B. 2166) that would amend the definition of a public utility in the state's Retail Electric Supply Act to exempt electric vehicle charging station owners. The bill would allow retailers and other commercial entities in the state to charge customers for use of electric vehicle charging stations. The intent of the legislation is to ensure that non-utilities such as grocery stores can recoup their investments in charging stations and pass through costs of electricity to electric vehicle owners. At least 18 other states have adopted similar policies.
In late December, Ohio Governor John Kasich vetoed legislation that would have extended the freeze on the state’s renewable portfolio standard (RPS) and altered the state’s energy efficiency requirements. In addition to extending the RPS freeze, it would have reduced efficiency savings requirements for several years, ultimately reducing the cumulative efficiency from 22 percent by 2025 to 17 percent by 2027. The Maryland General Assembly voted in early February to override Governor Larry Hogan’s veto of two bills (S.B. 921 and H.B. 1106) that increased the state’s RPS. The measures will increase Maryland’s RPS to 25 percent by 2020, up from 20 percent by 2022, and will also raise the solar carve-out to 2.5 percent by 2020, up from 2 percent by 2020. In his veto message last spring, Hogan said the tax increase that would occur under the plan was his reason for the veto. In addition, legislators in New Mexico have introduced legislation (S.B. 312) that would significantly expand the state’s RPS to 80 percent by 2040, up from the current goal of 20 percent by 2020.
Companion bills introduced in Minnesota’s House (House File 113) and Senate (Senate File 85) would authorize Xcel Energy to construct a new combined cycle natural gas power plant, giving the company the ability to circumvent additional consideration by the state’s Public Service Commission. Last October, the commission approved Xcel’s plan to close two coal units at the Sherburne County plant. Xcel is now seeking to replace a portion of the lost capacity with a new gas unit, but the commission ordered a review of the cost of adding more renewable energy instead. Opponents of the proposed measures argue that the bill sets a precedent that may erode the commission’s+ oversight of energy matters. Supporters argue that the measures, if passed, would replace the jobs lost when the two coal units are retired and provide income to Sherburne County. In addition, several legislators in California are questioning whether a new natural gas plant in Ventura County is necessary. According to the report by the Los Angeles Times, the state is building more power plants than it needs. The California Public Utilities approved the project last summer, with plans to have it online by 2020.
New York’s Long Island Power Authority approved the largest-ever offshore wind project in the country. The 90 megawatt wind project will be located off the South Fork of Long Island and will be constructed by Deepwater Wind LLC, the company that built the country’s first commercial offshore wind project off Rhode Island. The project is expected to be operational by 2020. Earlier this year, New York set a target of building 2.4 gigawatts of offshore wind power by 2030.
The energy storage industry has seen its standing rise substantially over the past year. After the Aliso Canyon natural gas leak raised reliability concerns, the California Public Utilities Commission expedited the approval of around 100 MW of storage in Southern California. Within six months, three companies—Tesla, Greensmith Energy and AES Energy Storage—had completed 70 MW of large-scale lithium-ion battery storage, with more on the way. On the East Coast, Massachusetts set the wheels in motion to adopt a storage mandate that could be around 600 MW. Meanwhile, federal regulators are in the process of responding to concerns over market access. The Federal Energy Regulatory Commission (FERC) has ordered the Midcontinent ISO (MISO) to change its tariffs to provide better access to storage resources. At the same time, FERC has undertaken its own rulemaking for the nation’s six grid operators in order to ensure storage has fair access to markets. All of this appears to bode well for the nascent industry.
Governors in Maryland and New York have announced separate initiatives to increase job growth in the renewable energy and energy efficiency sectors. Maryland Governor Larry Hogan announced a funding proposal for several environmental and energy iniatives, including a new green energy research center at the University of Maryland and job training. Most of the funds result from the Exelon Corp. and Constellation Energy merger settlement. The proposal must be approved by the legislature. New York Governor Andrew Cuomo announced a $4.2 million funding initiative to train building operators and maintenance workers on best practices to promote energy efficiency and bill reductions. Eligible entities must have energy expenses greater than $1 million annually. A January report highlights that the energy efficiency sector supports at least 1.9 million jobs domestically.
With FERC Commissioner Norman Bay’s exit on the horizon, the commission approved an array of decisions in quick succession before being left without a quorum in early February. Among the projects approved was the 713-mile Rover Pipeline, which would move natural gas from Appalachian basins to several markets. The pipeline would transport up to 3.25 billion cubic feet of gas to markets in the Midwest, Northeast, East Coast, Gulf Coast and Canada. FERC also gave the green light to the Atlantic Bridge pipeline project, which would boost natural gas deliveries in New England and Canada, and approved a $3.3 billion acquisition of around 9,000 MW of generation by Dynegy. President Donald Trump appointed Commissioner Cheryl LaFluer as Chairwoman, but the commission still has only two of five commissioners and will be unable to reach quorum until the president nominates, and the Senate confirms, a third commissioner.
The president has signed a series of executive orders since taking office, a number of which have implications for the nation’s energy infrastructure. Two of the executive orders breathed new life into stalled pipeline projects. The Keystone XL Pipeline and the Dakota Access Pipeline are both back on the table, while a third executive order addressed pipeline construction more broadly by mandating that, as much as possible, new pipeline projects use American-made materials. A fourth executive order aims to expedite the review and approval of high priority infrastructure projects, including projects to improve the electric grid and expand other energy infrastructure, like pipelines.
The U.S. Department of Energy (DOE) released a memorandum in January providing Weatherization Assistance Program (WAP) grantees guidance on the use of WAP funding for solar photovoltaics. The memo informs grantees of the existing regulations related to the integration of renewable technologies in WAP and DOE approval processes for including renewable technologies within WAP and identifies resources that will assist grantees in the approval process.
Nuclear power plants are closing across the country, drawing the attention of utilities, regulators, federal officials and state policymakers. Read NCSL’s recent report, "State Options to Keep Nuclear in the Energy Mix," which offers a comprehensive background on the forces behind recent closures and highlights a variety of state actions to prevent the premature closures of nuclear plants.
Shared renewable energy programs provide access to renewable energy for customers who are unable or unwilling to install distributed generation systems on their homes or businesses. Through these programs, customers invest in a medium-sized renewable energy facility and directly benefit from the energy produced. At least 15 states and Washington, D.C., have enacted legislation authorizing shared renewables. NCSL’s recent LegisBrief explores this increasingly popular policy and outlines legislative action around shared renewables.
The Energy Supply Task Force met in Scottsdale, Ariz. on Jan. 14-15. The meeting included a tour of a natural gas demonstration facility operated by Southwest Gas and a tour of Arizona Public Service’s electricity trading floor. Task Force members also explored a range of topics including the challenges and needs of the U.S. energy infrastructure, how energy markets function, new technologies to improve efficiency and reliability, and much more. Check out the agenda and presentations from the meeting.
In collaboration with the National Renewable Energy Laboratory (NREL), the Lawrence Berkeley National Laboratory (LBNL) has released two new solar-related studies. One report, released in January, evaluates the ability of rooftop solar to reduce residential demand charges. The first in a series of related reports, this analysis explores the potential role of demand charges in aligning customer bill savings and utility cost savings from rooftop solar. Additionally, LBNL released a roadmap outlining the best route to increasing the availability of solar home data for real estate agents, appraisers and consumers. The report also discusses the potential of auto-populating solar data into the Multiple Listing Service to grow demand for solar homes.
Duke University’s Nicholas Institute for Environmental Policy Solutions released a paper in January focusing on the planning challenges presented by the aging nuclear fleet in the region in the southeast, and how states can better incorporate the uncertainty of these unions in to their energy planning processes.