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On net energy billing, nuclear power and time-of-use rates
The 132nd Legislative Session is shaping up to be a packed one. Several weeks ago, Monitor staff covered some of the first bills to watch in the session (need a refresher on how the legislative process works in Maine? Click here).
But a number of bills have come out of the revisor’s office since then, so we at Climate Monitor thought it was time for an update.
You can watch archived hearings and live hearings by clicking on the following links:
Energy, Utilities and Technology Committee
Environment and Natural Resources Committee
Eliminate net energy billing:
Sponsors: Sen. Trey Stewart (R-Aroostook), Sen. Stacey Guerin (R-Penobscot)
Committee: Energy, Utilities and Technology
A hearing on two bills to repeal Maine’s net energy billing rules was postponed this week but has already garnered dozens of pieces of testimony, most of it in support of the program, which allows owners of solar projects to get paid for the energy they send back into the grid.
“The elimination of the NEB program would have a devastating impact on our small community in Northern Maine and would undermine the efforts we have made to make our community more resilient,” wrote Chuck Kelley, chairman of the Limestone Water and Sewer District, which installed more than 1,700 panels on a former industrial park in 2018.
The two pieces of legislation – LD 32 and LD 257 – are functionally identical, and would repeal Maine’s net energy billing rules, which allow owners of solar projects of a certain size to get paid for the energy they send back into the grid. Both bills are sponsored by Republicans, with no Democratic co-sponsors.
The program has been controversial since it was first implemented in Maine in 2019, with proponents arguing that it has catalyzed the growth of solar in Maine and detractors saying it unfairly shifts costs onto low-income ratepayers who can’t afford panels and drives up the overall price of electricity.
"Net energy billing creates a situation where those who invest in solar panels receive significant credits for the excess energy they produce, effectively shifting the cost of maintaining the grid to those who don't have solar," said Sen. Stacey Guerin (R-Penobscot) at a press conference this week.
In a presentation to the energy, utilities and technology committee in January, Public Utilities Commission staff told lawmakers that the system has cost about $130 million but has resulted in $160 million in direct or non-monetized benefits, in part because solar developers are sometimes paying for upgrades to the grid or reducing load during peak hours, which reduces reliance on natural gas.
The major drivers of increased energy supply costs in recent years have been volatile natural gas prices, which have been impacted by the wars in Ukraine and Israel, and upgrades to modernize the grid and make it more reliable and able to handle increased amounts of electricity in the coming decades.
If you need a refresher on how the grid works or want to know more about energy prices, check out this primer from 2023.
The hearings have yet to be rescheduled.
Include nuclear power in the state’s renewable energy portfolio standard
Sponsor: Rep. Reagan Paul (R-Winterport)
Committee: Energy, Utilities and Technology
Renewable Portfolio Standards require that a specified percentage of the electricity utilities sell comes from renewable resources. Maine’s goal is to have 80 percent of its energy be renewable by 2030 and 100 percent by 2050.
What counts as renewable is the big question. In Maine, a renewable resource is defined as one that’s “capable of being reproduced, replenished or restored following the use of these resources and resources that are inexhaustible.” Maine considers biomass, wood, water, waste, certain kinds of solid waste, solar and wind energy to count toward the state’s renewable energy goals, as well as small hydropower plants (although that could change with legislation proposed this session).
The Environmental Protection Agency defines renewable resources as “fuel sources that restore themselves over short periods of time and do not diminish,” which include sun, wind, moving water, certain kinds of biomass, and geothermal energy.
What counts as “clean” is a bit squishier. The EPA and the Department of Energy don’t define the term, which is often used in the same breath as “renewable.” For those who do draw a line, most consider energy to be “clean” if it is produced by a generator that doesn’t emit carbon as it produces electricity.
Under that definition, a fuel can be clean without being renewable — solar, wind and water are typically thought of as both clean and renewable, while nuclear is clean (in that it doesn’t emit carbon) but not renewable.
Maine statute currently does not make a distinction between the terms, but does say that renewable energy does not include nuclear, coal or oil.
This bipartisan bill, which is also supported by Passamaquoddy Tribal Representative Aaron Dana, would allow nuclear power plants built after the first of this year to count as renewable energy in Maine.
After several decades of decline, nuclear power has been gaining popularity in recent years as a reliable, zero-carbon resource, particularly with the advent of new nuclear technologies. Both the Biden and Trump administrations have been supportive of nuclear power.
The legislation is scheduled for a hearing at 9 a.m. on Feb. 13.
Clarify the PUC’s authority to set time-of-use pricing
Sponsor: Rep. Walter Runte (D-York)
Committee: Energy, Utilities and Technology
This bill, sponsored by three Democrats at the request of the Maine Public Utilities Commission, aims to clarify the authority that the PUC has the authority to set time-of-use rates.
While time-of-use rates can get very complicated, the gist is this: the price of electricity rises and falls throughout the day for various reasons. Generally, as demand increases (in the evenings, on very hot or very cold days), so, too, does the cost of generating that electricity and delivering it to homes and businesses. Electricity rates, however, are set only once or twice a year, and don’t reflect this daily volatility, so residential consumers aren’t exposed on a daily or monthly basis to these fluctuating costs.
Implementing time-of-use rates would change that by adjusting rates across the course of the day, week or month. Proponents of the idea say this allows electricity consumers to adjust their use with the cost of electricity and makes the system more equitable by forcing those who use a lot of electricity and contribute to the expensive peaks in demand to pay more. Detractors say this kind of rate structure can hit low-income consumers – who often have less flexible working schedules and less ability to change their electricity use patterns – the hardest. The PUC is already studying the issue.
Central Maine Power has submitted testimony neither for nor against the bill, urging further study. The Natural Resources Council of Maine is supportive of the legislation, while Preserve Rural Maine is opposed. Electricity users are already able to sign up for time-of-use rates for the delivery side of their bill, which accounts for about half of a monthly bill. According to reporting by the Portland Press Herald, "signing up for time-of-use delivery rates can save a typical Maine household about $6 a month. But CMP and Versant Power say few residential customers participate."
“Time of use (TOU) rate design is very complex, and can mean different things to different people,” wrote Seth Berry, former legislator and executive director of Our Power, which is neither for nor against the bill. “Done wrong, TOU rates will benefit a few at the expense of the many. Done right, they could benefit all of us.”
Lawmakers heard public testimony on the bill at a hearing on Feb. 6; you can watch it here.
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