11-04-2025
List of proposals to reform Maine's clean energy program continues to grow
Solar panels in Damariscotta, Maine. (Photo by Evan Houk/ Maine Morning Star)
The efforts to modify Maine's solar energy incentive program continued Thursday as lawmakers introduced two more proposals to rework net energy billing.
The Legislature's Energy, Utilities and Technology Committee held a public hearing Thursday afternoon on the bills that as packed as the late February hearing on several proposals to tweak or toss net energy billing. Rather than scrap it altogether, the latest round of hearings focused on more ideas to amend the program by placing more limitations on new and existing projects and lowering the compensation rate.
Net energy billing is a utility program designed to encourage customers to develop or participate in small-scale renewable energy projects like solar panels by offering credits to offset their electricity bills. The program's supporters see it as a tool to transition the state to clean energy that has been a scapegoat for rising energy costs. But critics argue that it's already achieved the desired environmental goals and is now just a flawed system driving up bills.
There are two programs within net energy billing. First is the kilowatt hour program, which is open to all customers and provides kilowatt hour credits on participating customers' bills if they install renewable energy generators such as solar panels or join a community solar project, where customers receive a portion of a solar farm's credits. The credits expire after 12 months.
The tariff rate program for nonresidential customers provides dollar credits for those who use their own projects or share in someone else's. The Public Utilities Commission sets an annual rate for the credits, which also expire after 12 months, depending on the customer's size and utility provider.
With LD 1317, Sen. Rick Bennett (R-Oxford) wants to adjust the tariff rate over the next few years to eventually reach 12 cents per kilowatt-hour in 2028.
Many believe Maine's net energy billing needs reform, but diverge on whether to tweak or toss
Solar companies, including ReVision Energy, said that while they appreciated the attempt at a compromise, the 12 cent rate would not be sufficient. In response to Bennett saying that he landed on that amount so solar developers could still make a profit, albeit not as fast, industry representatives said that it isn't workable for projects designed with a higher compensation rate in mind.
Though the rate adjustment would apply retroactively, Bennett said he tried to strike a balance with his bill to reduce costs for ratepayers without changing other rules for people who have already entered into contracts.
Rep. Steven Foster (R-Dexter) proposed going further to limit the growth of net energy billing costs by reducing qualifying project size and adding termination dates with LD 1321. The bill would not only reduce the capacity of projects to 60 kilowatts from 1 megawatts, but it would also limit compensation, increase transmission costs for net energy bill participants and restrict how long someone may participate in the program to either 20 years or until Dec. 31, 2045 — whichever is sooner.
Individuals who work in community solar opposed the bill, fearing it would threaten the viability of an industry they have seen bring down costs for ratepayers and create jobs for Mainers. They argued that the proposed sunset and size limits could have a chilling effect on investments in these projects that have contributed to local economies and helped reduce greenhouse gas emissions.
'Broad retroactive modifications to the core mechanisms in determining compensation under the program as these bills propose and others will have a dramatic effect on 16,000 projects in the state, more than 114,000 customers,' said Caroline Colan, legislative liaison for the Governor's Energy Office, testifying against the bills.
The Maine State Chamber of Commerce supports Foster's proposal because it addresses 'concerns in a way that balances cost predictability with program flexibility,' said Government Relations Specialist Ashley Luszczki. However, she suggested a successor program that would still encourage solar development projects between 60 kilowatts and 1 megawatt.
The Maine Wild Blueberry Commission was similarly supportive of LD 1321, seeing it as a means to reduce skyrocketing energy costs that they said have hit the profits of farms and other Maine businesses in recent years.
However, because half of all electricity used in New England is generated using natural gas, that market is the primary driver of energy prices, according to the Governor's Energy Office.
The Public Utilities Commission and the Office of Public Advocate testified neither for nor against the proposals heard Thursday.
Like the two bills heard Thursday, the other proposals related to net energy billing were introduced by Republicans, who have largely opposed the program since the tenure of former Republican Gov. Paul LePage, who vetoed several legislative efforts to incentivize the proliferation of cleaner energy.
Net energy billing, or Maine's version of net metering, was expanded in 2019 under Gov. Janet Mills so that customers can use renewable generators located outside of their property but within the same utility service territory, such as a community solar project. Legislation passed two years later added a goal of 750 megawatts of distributed generation through net energy billing.
