In September 1999, Maine's Public Utilities Commission (PUC) adopted rules for the state's Renewable Resource Portfolio Requirement, pursuant to the state's 1997 electric-utility restructuring law. The rules require each competitive electricity provider, including standard offer providers, to supply at least 30% of their total retail electric sales in Maine using electricity generated by eligible renewables and certain energy-efficiency resources. However, at the time of passage, the required percentage of renewables was actually lower than the then existing percentage of renewables supply.
To qualify, electricity must be generated by a facility no greater than 100 megawatts (MW) in capacity that uses fuel cells, tidal power, solar arrays and installations, wind power, geothermal power, hydropower, biomass power or generators fueled by municipal solid waste in conjunction with recycling.* Electricity generated by efficient combined heat and power (CHP) facilities and other systems that qualify as "small power production facilities" under the federal Public Utility Regulatory Policies Act of 1978 (PURPA) also are eligible. The PUC has since designated this 30% standard the "Class II" standard.
In June 2006, Maine enacted legislation (L.D. 2041) creating a renewable portfolio
goal to increase
new renewable-energy capacity by 10% by 2017. Eligible
new renewables include those placed into service after September 1, 2005. Unlike the Class I standard, municipal solid waste facilities and CHP systems are not eligible under the new renewables goal, and hydropower facilities must meet all state and federal fish passage requirements. New wind-power installations may exceed 100 MW in capacity.
Public Law 403 of 2007 converted the 2006 goal into a mandatory standard,* which the PUC has since designated the "Class I" standard. The schedule for the Class I standard is as follows:
- 1% for the period from 1/1/2008 to 12/31/2008
- 2% for the period from 1/1/2009 to 12/31/2009
- 3% for the period from 1/1/2010 to 12/31/2010
- 4% for the period from 1/1/2011 to 12/31/2011
- 5% for the period from 1/1/2012 to 12/31/2012
- 6% for the period from 1/1/2013 to 12/31/2013
- 7% for the period from 1/1/2014 to 12/31/2014
- 8% for the period from 1/1/2015 to 12/31/2015
- 9% for the period from 1/1/2016 to 12/31/2016
- 10% for the period from 1/1/2017 to 12/31/2017, and for each year thereafter
The PUC has approved the use of NEPOOL Generation Information System (GIS) certificates (which are similar to renewable-energy credits, or RECs) to satisfy the portfolio requirement. GIS certificates are awarded based on the number of kilowatt-hours (kWh) of eligible electricity generated. GIS certificates used to meet the Class I standard may not also be used to satisfy the Class II standard. Legislation enacted in June 2009 (L.D. 1075) provides a 1.5 credit multiplier for eligible community-based renewable energy projects; it is expected that the PUC will address this issue in a subsequent rule-making.
Legislation enacted in June 2007 (Public Law, Chapter 403) authorized the PUC to set an alternative compliance payment (ACP) that utilities may pay instead of satisfying the standard by procuring GIS certificates. The PUC set the ACP base rate for the Class I standard at $57.12 per megawatt-hour (MWh) in 2007; this rate will be adjusted annually for inflation beginning in 2008. The current ACP rate (2009) is $60.92. Revenues from ACPs will be directed to the state's
Renewable Resource Fund.
The PUC may review the Class I standard to determine if progress has been sufficient. The PUC may suspend scheduled increases in the Class I standard under certain circumstances. Electric providers that fail to comply with the standard are subject to certain penalties, including license revocation, an optional payment into the Renewable Resource Fund, or other monetary penalties determined by the PUC. However, the PUC may waive penalties if it determines that a utility made good faith efforts but could not reasonably satisfy the standard due to market conditions.
* Legislation enacted in April 2008 (L.D. 2283) established two goals for wind-energy development in Maine: (1) at least 2,000 MW of installed capacity by 2015; and (2) at least 3,000 MW of installed capacity by 2020, of which there is a potential to produce 300 MW from facilities located in coastal waters.
