PPH - CMP ratepayers could see bills jump 12% to cover rising solar power subsidies

The utility is asking the Maine Public Utilities Commission for permission to bill ratepayers $116 million for subsidies paid to solar developers in the net energy billing program that is part of Maine's effort to cut greenhouse gas emissions.

March 29, 2024

Stephen Singer
Press Herald

Central Maine Power asked state regulators on Friday for permission to bill ratepayers $116 million for subsidies to companies that develop solar power, a steadily increasing cost imposed by state laws designed to reduce greenhouse gas emissions.
Electricity bills could rise 12% July 1 if the Public Utilities Commission approves the utility’s request. The utility does not profit from the billed amount that is instead a pass-through that is paid to the solar developers in the net energy billing program.
“That’s just not good news for ratepayers,” Public Advocate William Harwood said. “This is going to be hard for a lot of ratepayers, particularly low-income (customers).”
The utility also asked the PUC to bill ratepayers $33.8 million for purchase agreements, required by the Legislature, for power generated by wind and solar farms. And it’s seeking $33.4 million to maintain unused CMP assets, such as the shuttered Maine Yankee Nuclear Power Plant in Wiscasset.

The $183.2 million total, if approved by regulators, is in addition to $162 million CMP is seeking to be paid over two years to cover the costs of restoring power after three destructive storms last year. The PUC is reviewing that request, which, with the most recent rate request, would take effect July 1.
For the average residential customer using 550 kilowatt hours a month, the CMP request, if approved by regulators, would boost an electricity bill by $15.55 a month, to $79.95 for the delivery portion. Accounting for falling natural gas prices that prompted regulators in November to reduce the standard offer price by 35%, the average increase will be about 12%, CMP said.
Costs related to net energy billing, which provides generators with credit for renewable power they produce and send to the electric grid, , have increased from $98 million last year and $7.5 million in 2022. It’s the result of state legislation encouraging the use of renewable energy.
CMP said net energy billing contracts are based on 20-year terms. The total cost of the program will be more than $2 billion over the next two decades, it said.
Harwood said ratepayers “will be on the hook” for about $220 million a year.

The solar subsidy is “very burdensome and very expensive” and provides an excessive subsidy to solar developers, he said. The net energy billing program reimburses solar developers at 20 cents a kWh, twice what could be offered, Harwood said.
Some of the rate increases can be delayed to reduce the impact on ratepayers, he said.
Anthony Buxton, who represents the Industrial Energy Consumer Group, a Maine business organization, said state officials need to “take notice of the devastation” to businesses struggling to pay rising electricity rates he said are partly due to solar subsidies.
Buxton has been a frequent critic of net energy billing and has called on the Legislature to accelerate the deployment of heat pumps, already broadly used in Maine, and building weatherization.
Before 2019, eligibility for net energy billing was restricted to very small generators in response to opposition from then-Gov. Paul LePage and many Republican lawmakers. Democrats and Gov. Janet Mills changed the rules in 2019, directing utilities to buy power from solar projects with up to 5 megawatts of capacity at fixed rates.
The changes led to growth in community solar projects, but also complaints about escalating costs.

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