Massachusetts Public Benefit Funds
Massachusetts's 1997 electric utility restructuring legislation created two separate public benefit funds to promote renewable energy and energy efficiency for all customer classes. Both funds were significantly revised by legislation enacted in July 2008 (The Green Communities Act, S.B. 2768). The 2008 Green Communities Act directs the electric and gas program administrators to “first acquire all available energy efficiency that is cost effective or less than the cost of supply."
Funding and Administration
The Massachusetts Renewable Energy Trust Fund is supported by a non-bypassable surcharge of $0.0005 per kilowatt-hour (0.5 mill/kWh), imposed on customers of all investor-owned electric utilities and competitive municipal utilities in Massachusetts. (Non-competitive municipal utilities generally may opt into the Fund by agreeing to the same provisions that apply to investor-owned utilities and competitive municipal utilities.)
The Massachusetts Clean Energy Center, a quasi-public research and development entity, administers the Fund with oversight and planning assistance from the Massachusetts Department of Energy Resources (DOER) and an advisory board. The Fund does not have an expiration date.
The Fund may provide grants, contracts, loans, equity investments, energy production credits, bill credits, and rebates to customers. The fund is authorized to support “Class I” and “Class II” renewables, which generally include solar photovoltaics (PV); solar thermal electric energy; wind energy; ocean thermal, wave, or tidal energy; fuel cells utilizing renewable fuels; landfill gas; energy generated by certain existing hydroelectric facilities up to five megawatts in capacity; certain waste-to-energy which is a component of conventional municipal solid waste plant technology in commercial use; low-emission advanced biomass power conversion technologies using fuels such as wood, by-products or waste from agricultural crops, food or animals, energy crops, biogas, and liquid biofuels; marine or hydrokinetic energy; and geothermal energy. In addition, the Fund may support combined heat and power (CHP) systems less than 60 kilowatts (kW) and solar hot water.
The Fund is required to transfer, upon the written request of the governor, moneys in the fund, in an amount not exceeding $17 million in the aggregate, for deposit in the state's general fund. In turn, the state must use any transferred money to enter into long-term contracts for the purchase of renewable energy. The maximum payment in any fiscal year under all such contracts is limited to $5 million.
Additional information regarding the Fund and the programs it supports is available on the Massachusetts Clean Energy Center's website.
Massachusetts' 1997 electric utility restructuring legislation created separate public benefits funds to promote renewable energy and energy efficiency for all customer classes. Both funds were significantly revised by legislation enacted in July 2008 (The Green Communities Act, S.B. 2768). In 2009, the Massachusetts Clean Energy Center became the administrator of the Renewable Energy Trust Fund. Previously, the Trust Fund was administered by Massachusetts Technology Collaborative.
For a thorough report on the history of the fund under the Massachusetts Technology Collaborative administration, please refer to the Renewable Energy Results for Massachusetts: A Report on the Renewable Energy Trust Fund 1998–2008. See Massachusetts Technology Collaborative Annual Reports.
Massachusetts also established a renewable portfolio standard (RPS) through restructuring in 1997. It was the first state to have enacted both an RPS and a public benefits fund for renewables.