Maine Lawmakers Revive Microgrid Bill as New Governor Creates a Pro-Green Climate

March 29, 2019
Microgrids that regulators determine “serve the public interest” are back in play in Maine this year as lawmakers try to pass a bill that fell short a year ago.

Microgrids that regulators determine “serve the public interest” are back in play in Maine this year as lawmakers try to pass a bill that fell short a year ago.

Legislators passed a bipartisan bill last year more clearly defining how microgrids could be created, but former Republican Gov. Paul LePage vetoed it. Newly elected Gov. Janet Mills has clear majorities of fellow Democrats in both houses of the legislature.

Mills’ aggressive clean energy agenda has included a goal of 100 percent renewable energy, supporting a transmission project to import hydropower destined for Massachusetts, lifting a moratorium on wind pr0ject permits and expanded use of heat pumps. Legislative colleagues have introduced virtually the same microgrid bill that was vetoed last year, now known as LD 13.

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Rep. Mick Devin, the bill’s prime sponsor, said Vermont, which has aggressively promoted distributed energy resources and its utility Green Mountain Power was working to integrate clean energy into its power system. “It’s an example of how Maine might move forward on energy policy, particularly via the establishment of microgrids,” Devin said.

LD 13 would create a process through which the Maine Public Utilities Commission (PUC) could approve the construction and operation of new microgrids.

Local, green and under 10 MW

The microgrid could serve load no larger than 10 MW, and its generation resources must qualify as eligible under the state’s renewable portfolio standard (RPS) and would have to be located nearby. Investor-owned utilities or their affiliates could not own or operate microgrids.

At a Jan. 31 legislative hearing, Paulina Collins, legislative liaison for the PUC, said the commission would suggest some flexibility be written into the RPS requirement. “For example, a microgrid that contains solar generation, may need back-up generation from a source that does not qualify for the portfolio requirement,” she said.

A 2014 study by a Stanford University professor concluded that Maine could switch to 100 percent renewable energy completely powered by microgrids by 2050. That could create over 13,000 permanent jobs, reduce energy demand by 33 percent and reduce average electricity cost by 31 percent.

Olin Jenner of Sierra Club Maine supported the bill for both reliability enhancements and costs savings, citing studies and a pilot project by Central Maine Power that aimed to reduce transmission costs.

Incentivize non-wires alternatives

“Allowing the development of microgrids in Maine would likely help to lower rates by incentivizing non-transmission alternatives throughout the state. Investments in transmission lines are how utilities make a profit, because they are guaranteed a 12 percent return on investment. While this has improved the utility infrastructure, it is not always fiscally prudent to focus investments on transmission lines due to their large expense,” Jenner said.

Jim Cohen, an attorney representing Emera Maine, said in many parts of Maine, 10 MW would be too large of an area for microgrids to serve, though the utility supports the concept of microgrids to enhance reliability.

“We believe the bill is too open-ended and could allow unregulated entities to deliver electricity to customers, or result in costly duplication of facilities,” Cohen said. “We would encourage the committee to step back and identify goals and policies before enacting legislation.”

However, a natural gas company took the opposite tack, saying the 10-megawatt limit could limit potential and drive up costs.

“Smaller caps may prevent some level of creativity, especially in island communities, universities, and other existing unique energy consumers. Additionally, there may be a cost advantage. As a general rule, as energy projects increase in size, their unit costs go down due to economies of scale,” said James Cote, representing Summit Natural Gas of Maine.

Small, consumer-owned utilities have also objected, saying microgrids would not be regulated as public utilities, and therefore would lack oversight from the Public Utilities Commission.

Recent Maine microgrids

Recent project examples required unique circumstances to get microgrids developed, including active participation by the host utility.

A pilot program at Boothbay was developed in response to Central Maine Power transmission projects throughout the state. In 2013 through 2015 the program combined 2 MW of demand response, solar power and battery storage at a congested coastal area. The project, costing under $2 million, eliminated the need for a $18 million transmission upgrade. The project ended when expected load growth did not materialize.

A project under development now at Isle du Haut will combine solar arrays and battery storage to provide emergency power to an island six miles offshore. The island is served by an aging undersea cable connected to the mainland 20 years past its useful life that could fail at any time. Replacement cost is $1.7 million.

The privately financed microgrid should be completed this year. A Department of Energy grant funded technology developed by Introspective Systems that is going into the island project. In addition to Introspective Systems, the team creating the microgrid includes Solar Design Associates and Isle au Haut Electric Power

Trajectory for microgrid bill

LD 13 is awaiting action at the Joint Standing Committee on Energy, Utilities and Technology. Committee Chair Rep. Seth Berry said it is one of a large number of energy initiatives before it with further action not yet scheduled.

The bill directs the PUC to submit a report to the Legislature by Jan. 15, 2021.

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Bill Opalka

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