The Smart Electric Power Alliance (SEPA) and ScottMadden released their latest report in SEPA’s 51st State Perspective series: “Massachusetts: A Great Clean Energy Story – DERs and the Next Chapter,” which explores the potential for Massachusetts to deploy significantly more clean energy.
Massachusetts has been a long leader in the deployment of clean energy and has demonstrated a strong commitment to reducing greenhouse gases. The Commonwealth’s approach to integrating clean energy has included a combination of policies such as renewable portfolio standards, capacity and generation targets for specific technologies, an energy efficiency resource standard, as well as solar and other incentive programs. Additionally state policy makers have set targets for solar PV, storage, and electric vehicles, resulting in high penetrations of renewables. The SEPA-ScottMadden report summarizes the legislative and regulatory actions that are contributing to further integration of distributed energy resources (DERs) as customers adopt them.
Legislative and other initiatives driving energy market transformation in the state include:
• Policies such as the Green Communities Act of 2008 and the Energy Efficiency Resources Standard, which have contributed to Massachusetts’ position as the leading state in energy efficiency for several consecutive years
• Revenue decoupling in 2008 to promote energy efficiency investments
• Net metering since 1982 and the increase of caps (% capacity in MW) over the years
• The ability for utilities to earn a return on energy efficiency investments
Compared to other states such as California, Illinois and New York, the Commonwealth’s approach to advancing DERs has been far less aggressive. These states have placed an emphasis on the value that DERs can provide to the distribution grid that goes beyond their renewable characteristics through various proceedings and pilots to more fully integrate and optimize DERs. Whereas Massachusetts’ focus has been on a variety of policies to advance clean energy and reduction of GHG, which has resulted in high penetrations of renewable energy resources, but it has not focused on upgrading infrastructure, deploying AMI, or optimizing DERs in the way that other states have.
While the Commonwealth’s progress to date on advancing clean energy, increasing economic development, and reducing impacts of GHG emissions is quite impressive, questions remain about whether recent legislative and regulatory initiatives will enable innovation to support further DER deployment. The lack of AMI and related customer-side infrastructure, as well as limited rate options, make further DER deployment and integration uncertain.
Co-author Sharon Thomas, Senior Analyst at the Smart Electric Power Alliance, added, “Massachusetts’ nation-leading role in energy efficiency is very impressive. However, demand-side resources are not prominently prioritized in current regulatory and legislative actions. We will have to wait and see if the Commonwealth’s current business models and structures will support continued growth.
“The focus in Massachusetts has been on the integration of clean energy and the reduction of GHG, which has resulted in high penetrations of renewables. To date, however, the same focus has not been placed on upgrading physical infrastructure (e.g., AMI) and changing the utility business model to drive integration and optimization of DERs,” adds Cristin Lyons, partner and energy practice leader at ScottMadden.