The state's deregulation officially starts on March 1. Not only does the deregulation law include a Renewables Portfolio Standard (RPS), as championed by the American Wind Energy Association, but also a system benefits charge to raise money for renewables in recognition of their value on a supply system. The provision should raise a sum amounting to $30 million a year support for clean energy development. With the landmark law, Massachusetts becomes the fourth state to adopt a Renewable Portfolio Standard, along with Maine, Nevada, and Arizona. Vermont had passed an RPS last year but the measure was unfinished when the session of the state government ended.
Under the Massachusetts law, new renewables plants -- using clean power technologies such as wind, solar or low emission biomass -- must equal at least 1% of all electricity sold in the state starting in 2003. The percentage requirement would then increase by 0.5% yearly until 2009, when it would have reached 4%, and by 1% a year after that until some date that has yet to be determined.
The start date for the RPS percentage, however, could be sooner. This is unlikely to happen if the price of renewables can be shown to be within one-tenth of the spot market price for electricity. Renewables are thought to currently constitute some 6-7% of the electricity now sold in Massachusetts.
The legislation also contains a system benefits charge on electricity sales to be used to fund renewables projects and renewables research and education as a way of boosting jobs in the state. More than $30 million will be available yearly starting this year, for which wind is one of the eligible technologies. There is also a requirement that electricity suppliers disclose the fuel sources and emissions of their product.
"It's great for renewables. You've got money in the short term and a market in the longer term," says Mike Jacobs of Second Wind Inc of Somerville, Massachusetts, who has been watching the legislation closely for some time. "After all the politicking, it came out better than anyone expected."