The enhanced financial incentive program that supports Maine’s solar energy boom is creating benefits for both electricity customers and the broader economy at levels that haven’t been previously seen, according to a new report released Tuesday.
The state’s net energy billing program already has stimulated $60 million in economic activity and has supported an estimated 549 job-years, according to Daymark Energy Advisors, a Massachusetts consultant hired by the Coalition for Community Solar Access. A job-year represents one year of full-time work for one person.
Economic activity could grow to $782 million and support roughly 7,000 job-years, the study says, if all projects currently in the development pipeline are built.
The coalition, a nonprofit advocacy group of businesses and other supporters of community solar projects, released its study on Tuesday to coincide with a legislative hearing on four proposed laws that would either repeal, dilute or pause the state’s net energy billing program, which credits solar energy users for any excess electricity they feed into the grid.
The study, titled “Costs and Benefits of Maine’s Net Energy Billing Program,” was meant as a counterpoint to a report issued last fall by the Maine Public Utilities Commission. That report estimated the current net metering program would lead to significant rate hikes for consumers if changes weren’t made, leading some lawmakers to ask whether it should be revised.
But the PUC’s review wasn’t as comprehensive as the one undertaken by Daymark, and it has come under fire by clean-energy advocates for underestimating the value of the fast-growing industry.
“This study makes it clear that community solar and Maine’s net energy billing program have been incredibly successful,” said Kaitlin Kelly O’Neill, Northeast regional director for the coalition. “Not only have these projects moved Maine toward our decarbonization goals, they’ve also saved consumers money and driven job creation at the same time.”
Net energy billing programs of various designs have been used around the country for years to encourage small renewable energy projects. In 2019, following the election of Gov. Janet Mills and legislative control by Democrats, new solar policies expanded the scope of traditional net metering. That’s the practice by which customers receive a kilowatt-hour credit on their bills for the energy generated by their solar panels. A new program also was added, called a tariff rate, for large commercial customers.
Daymark concluded that the traditional kilowatt-hour program was benefiting utility customers. It found 55 percent of the benefit came from lower electric costs and 45 percent came from reduced air emissions and economic activity.
The new tariff program, which operated at the wholesale level, needed some adjustments to be beneficial for customers, the study said.
In a statement Tuesday, Daymark said the additional information regarding the full value of solar, including the environmental and economic impacts, can help the PUC and lawmakers evaluate the program.
“It’s important to understand that the (net energy billing’s) cost to utilities does not necessarily translate to increased consumer costs,” said Carrie Gilbert, managing consultant for Daymark. “Our study shows that the program provides a net benefit to Maine when all factors are considered.”
In making its economic projections, Daymark looked at four scenarios based on the extent to which solar energy could contribute to supplying Maine’s peak electric demand in the years ahead. It’s now at 1 percent, but set to expand quickly. For instance, if solar reached 10 percent of peak load in 2030, it could support 1,400 jobs. If it grows to 40 percent of load by then, it could support 7,100 jobs.
From a climate standpoint, solar output already is displacing gas-fired power plant generation on New England’s electric grid, the study said. Operating projects are reducing carbon dioxide emissions by 34,000 tons a year, the study estimated, a figure that could grow to 600,00 tons, if all planned projects are built.
Formerly named LaCapra Associates, Worcester, Massachusetts-based Daymark offers management and investment advisory services in the electric and natural gas industries.