An Act To Replace Net Energy Billing with a Market-based Mechanism
Maine Legislature, Session 129, LD 0041
Committee: Energy, Utilities and Technology
Sponsors: O'CONNOR, TIMBERLAKE, BICKFORD, GRIGNON, HANLEY, SAMPSON, STETKIS, STEWART, WADSWORTH
Amends: 35-A MRSA §3209-A, 35-A MRSA §3209-B

Legislative Document
No. 41
H.P. 42
House of Representatives, January 9, 2019
An Act To Replace Net Energy Billing with a Market-based 
Mechanism
Reference to the Committee on Energy, Utilities and Technology suggested and ordered 
printed.
ROBERT B. HUNT
Clerk
Presented by Representative O'CONNOR of Berwick.
Cosponsored by Senator TIMBERLAKE of Androscoggin and
Representatives: BICKFORD of Auburn, GRIGNON of Athens, HANLEY of Pittston, 
SAMPSON of Alfred, STETKIS of Canaan, STEWART of Presque Isle, WADSWORTH of 
Hiram.
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  35-A MRSA §3209-A, as corrected by RR 2017, c. 1, §32, is repealed and 
the following enacted in its place:
§3209-A.  Net energy billing
1.  Definitions.  As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings.
A.  "Eligible customer" means a person or an entity that takes electricity service 
through a transmission and distribution utility and that owns or has an interest in an 
eligible facility located in that transmission and distribution utility's service territory.
B.  "Eligible facility" means an electric generating facility that meets eligibility 
requirements established by the commission by rule.
C.  "Gross output" means all of the energy generated by an eligible facility during an 
applicable period, including all energy that is used to offset the usage of eligible 
customers.
D.  "Net energy" means the difference between the kilowatt-hours delivered by the 
transmission and distribution utility to an eligible customer over a billing period and 
the kilowatt-hours exported by the customer from an eligible facility to the 
transmission and distribution system over the same billing period.
E.  "Net energy billing" means a billing and metering practice under which customers 
are billed on the basis of net energy.
F.  "Shared interest" means an interest in an eligible facility shared by multiple 
eligible customers that have distinct billing accounts with a transmission and 
distribution utility.
G.  "Transmission and distribution bill" means an eligible customer's bill, over a 
billing period, for transmission and distribution utility service.
2.  Net energy billing. A person that is an eligible customer as of December 31, 2019 
may elect net energy billing for the customer's accounts or meters in accordance with the 
following.
A.  An eligible customer whose eligible facility is placed in service by December 31, 
2019 must be allowed to use net energy billing until December 31, 2034.
B.  A transmission and distribution utility may not require an eligible customer to 
meter the gross output of an eligible facility in order to participate in net energy 
billing.
C.  The number of eligible customers that participate in a single shared interest in an 
eligible facility or the number of meters associated with a single shared interest in an 
eligible facility may not exceed 50, except that the number of eligible customers or 
meters is limited to 10 for a shared interest in an eligible facility located in the service 
territory of a transmission and distribution utility located in an area administered by 
the independent system administrator for northern Maine or any successor of the 
independent system administrator for northern Maine unless the commission 
determines that the utility's billing system can accommodate more than 10 accounts 
or meters for the purpose of net energy billing.
D.  No new net energy billing arrangements may be entered into after December 31, 
2019.
3.  Rules.  The commission may adopt or amend rules governing net energy billing to 
implement this section. Rules adopted or amended under this section are routine technical 
rules as defined in Title 5, chapter 375, subchapter 2-A.
Sec. 2.  35-A MRSA §3209-B is enacted to read:
§3209-B.  Market-based crediting system
The commission shall adopt rules in accordance with this section to create a market-
based crediting system for energy generated by an eligible facility.
1.  Definitions.  As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings.
A.   "Eligible customer" means a person or an entity that takes electricity service 
through a transmission and distribution utility and that owns or has an interest in an 
eligible facility located in that transmission and distribution utility's service territory.
B.  "Eligible facility" means an electric generating facility, regardless of capacity, 
that meets noncapacity-related eligibility requirements established by the commission 
by rule.
C.   "Gross output" means all of the energy generated by an eligible facility during an 
applicable period, including all energy that is used to offset the usage of eligible 
customers.
D.  "Shared interest" means an interest in an eligible facility shared by multiple 
eligible customers that have distinct billing accounts with a transmission and 
distribution utility.
2.  Calculation of rates.  In accordance with rules adopted pursuant to this section, 
an eligible customer must receive a monetary credit for energy generated by an eligible 
facility in excess of the customer's usage and exported to the grid at the real-time 
wholesale market price of that energy, including the renewable energy credit value of the 
energy and capacity value, if such value can be monetized.  The commission shall 
designate an entity located within each transmission and distribution service territory to 
purchase any electricity available from any eligible facility.  The transmission and 
distribution utility serving the eligible customer shall administer the transaction between 
the eligible customer and the entity that purchases the electricity and shall aggregate and 
sell any renewable energy credits on behalf of the eligible customer.
A negative wholesale electricity price may not be used to calculate a bill credit under this 
section.
3.  Prohibition on gross output.  A transmission and distribution utility may not 
require a customer to meter the gross output of an eligible facility in order to participate 
in the crediting system under this section.
4.  Limit on accounts.  The number of eligible customers that participate in a single 
shared interest in an eligible facility or the number of meters associated with a single 
shared interest in an eligible facility may not exceed 50.
5.  Exemption.  This section does not apply to a transmission and distribution utility 
located in an area administered by the independent system administrator for northern 
Maine or any successor of the independent system administrator for northern Maine until 
such time as the commission determines the utility's billing system can perform the 
necessary functions to implement this section.  The commission, as part of its rulemaking 
to implement this section, shall consider whether an alternative system could reasonably 
be developed for northern Maine in the interim period before the utility's billing system is 
modified to allow a market-based crediting system.
6.  Rules.  Rules adopted or amended pursuant to this section are routine technical 
rules as defined in Title 5, chapter 375, subchapter 2-A.
Sec. 3.  Community solar procurement.  The Public Utilities Commission shall 
procure, to the maximum extent possible, 20 megawatts of large-scale community solar 
distributed generation resources in accordance with the Maine Revised Statutes, Title 
35-A, section 3210-C by December 31, 2020. The long-term contract rate must be 
calculated annually, and no long-term contract entered into under this section may be for 
more than 6¢ per kilowatt-hour or the average wholesale electricity rate over the 
preceding 12 months, whichever is less. For purposes of this section, "large-scale 
community solar distributed generation resource" means a solar distributed generation 
resource with a nameplate capacity of greater than 660 kilowatts.
Sec. 4.  Report.  The Public Utilities Commission shall conduct an analysis of the 
costs and benefits to ratepayers for both net energy billing under the Maine Revised 
Statutes, Title 35-A, section 3209-A and the market-based crediting system in Title 35-A, 
section 3209-B in an adjudicatory proceeding. The analysis must at a minimum look at 
costs and benefits over a 10-year period and a 25-year period. Upon conclusion of this 
proceeding, but no later than January 1, 2021, the Public Utilities Commission shall 
submit a report to the joint standing committee of the Legislature having jurisdiction over 
utilities and energy matters that includes the results of this proceeding.  The Public 
Utilities Commission shall also explore rate design options that would be in the best 
interest of ratepayers and support the long-term, sustainable development of distributed 
generation.
Sec. 5.  Rules.  The Public Utilities Commission shall amend its net energy billing 
rule to be consistent with the Maine Revised Statutes, Title 35-A, section 3209-A and 
adopt rules pursuant to Title 35-A, section 3209-B before January 1, 2020.
SUMMARY
This bill does the following regarding net energy billing:
1.  It allows an eligible customer to elect net energy billing until December 31, 2019, 
after which time no new net energy billing arrangements may be allowed;
2.  It allows net energy billing arrangements entered into prior to December 31, 2019 
to remain in effect until December 31, 2034;
3.  It prohibits a transmission and distribution utility from requiring a customer to 
meter the gross output of an eligible facility in order to participate in net energy billing; 
and
4.  It limits to 50 the number of eligible customers that may participate in a single 
shared interest in an eligible facility or the number of meters associated with a single 
shared interest, except in the service territory of a transmission and distribution utility 
located in an area administered by the independent system administrator for northern 
Maine.
The bill establishes a market-based crediting system for energy generated by eligible 
facilities. It requires the Public Utilities Commission to adopt rules to allow an eligible 
customer to receive a monetary credit for energy generated by an eligible facility in 
excess of the customer's usage and exported to the grid at the real-time wholesale market 
price of that energy. As in the provisions relating to net energy billing, a transmission and 
distribution utility is prohibited from requiring a customer to meter the gross output of an 
eligible facility in order to participate in the crediting system, and the number of eligible 
customers that may participate in a single shared interest in an eligible facility, or the 
number of meters associated with a single shared interest, is limited to 50. The bill 
exempts a transmission and distribution utility located in an area administered by the 
independent system administrator for northern Maine, or any successor of the 
independent system administrator for northern Maine, from using this crediting system 
until the Public Utilities Commission determines the utility's billing system can perform 
the necessary functions to implement the system. It requires the commission to consider 
whether an alternative system to the crediting system for northern Maine could be 
developed and utilized in the interim period before the utility's billing system is modified 
to allow a market-based crediting system.
It requires the Public Utilities Commission to procure, to the maximum extent 
possible, 20 megawatts of large-scale community solar distributed generation resources. 
It requires that the contract rate be calculated annually and that no contract may be for 
more than 6¢ per kilowatt-hour or the average wholesale electricity rate over the 
preceding 12 months, whichever is less.
Lastly, it requires the Public Utilities Commission to conduct an analysis of the costs 
and benefits to ratepayers for both net energy billing and the market-based crediting 
system in an adjudicatory proceeding and to report those findings to the joint standing 
committee of the Legislature having jurisdiction over utilities and energy matters no later 
than January 1, 2021.