Massachusetts Blocks National Grid’s Untested Rate Design Plans
A big win for solar in Massachusetts! The Bay State’s Department of Public Utilities (DPU) issued an order that prevents the utility National Grid from hitting homeowners with exorbitantly high fees, which would have damaged prospects for solar in this burgeoning clean energy state.
Working with our regional partner, the Northeast Clean Energy Council, and other aligned parties including our friends at Vote Solar, the Energy Freedom Coalition, and the Acadia Center, we successfully blocked several potentially harmful rate design proposals advanced by National Grid.
The Company had proposed to shift cost recovery from standard kWh charges for residential, small commercial and certain industrial customers to a tiered charge based on maximum monthly kWh usage in a 12-month period. The charge ranged from $6 to $30. The aligned parties argued that the company failed to appropriately justify its proposal on a variety of grounds. The DPU agreed.
The DPU found that the tiered customer charge proposed by National Grid did not provide accurate price signals to the consumer and discouraged energy efficiency. It also diminished and distorted incentives for customers to conserve electricity, as well as install on site generation, DPU said.
The company also proposed a new access fee on stand-alone distributed generation facilities, including solar, to recover costs beyond those already associated with the existing customer charge, taxes, and payments for system upgrades. This provision was of particular concern for the solar industry. The Company proposed assessing the fee at $7 by kW-month for certain customers and $8.50 per kW per month for others.
Together, the aligned partners argued that this access fee proposal was flawed and the Company failed to provide the evidence on cost and benefits associated with distributed generation (DG) more broadly that would have justified the need for the fee. Without that information, DG customers would not be charged appropriately.
Once again the DPU agreed and rejected the company’s plan, arguing that National Grid failed to provide the analysis needed to justify the cost.
SEIA applauds the DPU for rejecting the Company’s rate design plans, and continuing to help pave the way for solar in the Commonwealth.