The Public Utility Commission Thursday approved a Final Implementation Order for Act 40 of 2017 (Act 40), formally establishing new qualifications for systems that qualify for the solar photovoltaic (solar PV) requirements under the state’s Alternative Energy Portfolio Standards (AEPS) Act.
Previously, the Commission sought comment on tentative interpretations of certain provisions of Act 40.
In approving the final order, the Commission voted 5-0 to adopt a joint motion by PUC Chairman Gladys M. Brown and Vice Chairman Andrew G. Place reaffirming the law’s provisions to “close the borders” for Tier 1 solar credit qualifications; thereby eliminating eligibility for certain out-of-state facilities.
“The Commission is clarifying Act 40 implementation in a way that has broad-based support among stakeholders and is consistent with legislative intent,” said Chairman Brown. “As other states that have passed similar legislation have recognized, this is an important tool for Pennsylvania to promote environmental stewardship and economic development.”
Chairman Brown noted Thursday’s motion still enables some out-of-state facilities - specifically facilities already certified as AEPS Tier 1 Solar Photovoltaic and having contracts with a Pennsylvania utility, supplier, load serving entity, electric or municipal cooperative for the sale of solar credits – to maintain certification until those contracts expire.
Additionally, any out-of-state Tier 1 solar credit generated before Oct. 30, 2017, retains its Tier 1 solar attribute for the banking life span enumerated in the AEPS.
Pennsylvania’s AEPS Act requires Electric Distribution Companies (EDCs) and Electric Generation Suppliers (EGSs) to source a specific percentage of electricity from alternative resources in the generation that they sell to Pennsylvania customers.
That percentage increases annually and will require 0.5 percent of the electricity supplied by Pennsylvania’s EDCs and EGSs to come from solar PV resources by 2021.
While Act 40 does not change the solar requirements under the AEPS Act, it does modify the requirements that facilities must meet to qualify for Pennsylvania’s solar PV carveout.
The Final Implementation Order will be published in the Pennsylvania Bulletin and posted on the PUC’s website. Additionally, copies of the Order will be distributed by the PUC’s Office of Competitive Market Oversight (OCMO) to OCMO’s Committee Handling Activities for Retail Growth in Electricity.
Documents related to this action can be found at the PUC Docket No.: M-2017-2631527.
To learn more the PUC's role in encouraging alternative energy generation, visit the PUC's Alternative Energy webpage.
To learn more the PUC's role in encouraging alternative energy generation, visit the PUC's Alternative Energy webpage.
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PennFuture said the PUC’s action Thursday took an important step forward for clean energy by reversing a decision that had allowed out-of-state solar energy projects to count towards in-state credits for renewable and clean energy, thus removing a major barrier that has stalled growth of the Commonwealth’s solar industry.
Pennsylvania, like many surrounding states, has a program that requires a certain amount of electricity generated by clean renewable energy like solar. These programs have provided a useful tool to jumpstart renewable energy industries in states around the country.
Unfortunately, Pennsylvania was one of the only states with “open borders,” which meant it allowed solar energy projects from 13 surrounding states and the District of Columbia, to count towards compliance with the program.
This greatly decreased the number of solar projects in the state, lowered the value of solar credits, and resulted in Pennsylvania losing solar job growth and industry market share, while other surrounding states saw the industry’s success increase.
Last December, Gov. Tom Wolf signed into law a bipartisan bill that would require credited solar projects to be developed and sourced in state.
Unfortunately, the PUC Law Bureau originally proposed implementing that bill in a way that would make it almost completely ineffective, further holding back the solar energy sector’s growth in Pennsylvania.
Thursday, the five PUC commissioners voted unanimously to support the intent of the Legislature, creating increased and better quality opportunities for solar businesses in Pennsylvania.
“PennFuture congratulates the PUC for taking an important step toward leveling the playing field for solar energy in the Commonwealth,” said PennFuture President and CEO Jacquelyn Bonomo. “This decision is a critical first step in our work to ensure that clean energy investments are prioritized and provided the same support fossil fuel technologies have received for well over a century. While Pennsylvania still has much more to do to support renewable energy, it’s positive that an overwhelming bipartisan group of legislators recognized the importance of supporting the state solar industry.”
Around the nation, solar energy is a success story. The Solar Foundation reports: “Solar makes up just under two percent of overall U.S. energy generation, yet it employs twice as many workers as the coal industry, almost five times as many as nuclear power, and nearly as many workers as the natural gas industry.”
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