Comprehensive Energy Strategy Bill Clears State House, Senate

Issues & Policies

Legislation implementing the state’s latest Comprehensive Energy Strategy—including changes intended to sustain and stabilize renewables—passed both the Senate and House this week.
The House approved SB 9 in the early hours of May 9 by a 100-45 vote following earlier approval by the Senate.
It awaits the signature of Governor Dannel Malloy, who has publicly supported the bill.
CBIA’s Eric Brown said that while the bill includes some provisions that will continue to place upward pressure on electricity prices, it is also expected to begin the process of moving Connecticut closer to a more market-based, cost-effective energy future.
The bill changes how residential solar power is priced, drawing concerns from some in the solar industry.
Currently, homeowners whose solar panels generate excess power that is sold back to the utility are reimbursed at the same rate the utility charges its customers.

PURA Will Determine Solar Rates

But under the bill, the state Public Utilities Regulatory Authority will determine that reimbursement rate—expected to be less than homeowners with solar panels are current paid.
A representative from the state Department of Energy and Environmental Protection said homes that already have solar panels will be grandfathered into current rates.
Some in the solar industry decried the new tariff system, saying it will reduce incentives for people to install solar panels and, thus, hurt the industry.

While the renewable portfolio standard leads to more renewable power, that power comes with a cost premium.

But Brown said this transition was inevitable as the cost of solar panels fell and market demand increased.
The bill reflects the feeling that the solar marketplace, as an industry, has become more secure and established.
The bill also changes how ratepayer dollars collected for incentives in efficiency and renewable power will be distributed, and makes it harder for those funds to be raided by the state legislature—as they have been in recent years.

Renewable Energy Goals Increased

And the bill also increases annually the percentage of Connecticut's energy that must come from renewable power.
For the past 15 or so years, energy policymakers in Connecticut have struggled between moving toward cleaner energy production versus the economics that it's more expensive than conventional fuels.
Policymakers realized that renewable power was not going to get traction on its own and set standards that required energy companies to provide electricity to their customers that was partially derived from clean energy.
That helped move the marketplace toward clean energy.
This bill established additional renewable portfolio standard levels through 2030, when 40% of the power supplied to customers will need to come from renewable sources.
While the RPS leads to more renewable power, that power comes with a cost premium.

Cost Mitigation

To mitigate these higher costs, the state relies on providing incentives to electric customers to invest in energy efficiency and renewable power.
The incentives largely come courtesy of the state's electric ratepayers.
"Those incentive programs only save power and money for those who take advantage, but everyone pays into it," Brown said.
“That's why it makes sense for our members to have someone from their utility visit them and see if they can take advantage of these programs."
The bill also creates a statewide shared solar program for lower income neighborhoods, allowing  residential and commercial customers to take advantage of solar energy without necessarily having a solar installation on their property.
Learn more about these changes and their implications at CBIA's 2018 Energy & Environment Conference, May 18 in Farmington. Featured speakers include U.S. Environmental Protection Agency administrator Alexandra Dapolito Dunn and state Department of Energy and Environmental Protection commissioner Rob Klee.

For more information, contact CBIA's Eric Brown  (860.944.8792 | @CBIAericb


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