An Act To Establish a Wood-fired Combined Heat and Power Program
Maine Legislature, Session 130, LD 1202
Committee Amendment CA_A_H932 (House)

COMMITTEE AMENDMENT" A'' to H.P. 880, L.D. 1202, "An Act To Establish a 
Wood-fired Combined Heat and Power Program" 
Amend the bill by striking out all of section 3 and inserting the following: 
'Sec. 3. 35-A MRSA c. 36-A is enacted to read: 
CHAPTER 36-A 
WOOD-FIRED COMBINED HEAT AND POWER ACT 
§3621. Short title 
This chapter may be known and cited as "the Wood-fired Combined Heat and Power 
Act." 
§3622. Definitions 
As used in this chapter, unless the context otherwise indicates, the following terms 
have the following meanings. 
1. Combined heat and power proiect. "Combined heat and power project" means a 
facility that uses wood fuel to generate electric heat and power that is used for industrial or 
space heating purposes. 
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2. Net generating capacity. "Net generating capacity" means the electric output of 
an electricity generating facility delivered to the transmission and distribution utility 
system. "Net generating capacity" does not include any energy consumed by the generator 
to operate the electricity generating facility or any energy consumed for facility lighting, 
power and auxiliary facilities. 
3. Program participant. "Program participant" means a combined heat and power 
project that is participating in the combined heat and power program established in section 
3623. 
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COMMITTEE AMENDMENT "A" to H.P. 880, L.D. 1202 
4. Wood fuel. "Wood fuel" means biomass derived from: 
A. Forest products manufacturing residuals. including. but not limited tci. mill chips. 
sawdust. bark, shavings and fines: 
B. Harvest residues. including trees or portions of harvested treesthat are too small or 
of too poor quality to be used for wood products: or 
C. Downed trees from weather events and natural disasters. nonhazardous landscape 
or right-of-way trimmings and plant material removed for purposes of invasive species 
control. 
§3623. Combined heat and power program 
1. Program established, The combined heat and power program. referred to in this 
chapter as "the program." is established to encourage the development in the State of 
combined heat and power projects that will promote the climate action plan developed in 
accordance with Title 38. section 577. subsection 1. The program is administered by the 
commission. 
2. Program scope; limits on net generating capacity. The commission shall limit 
participation in the program in accordance with this subsection. 
A. The net generating capacity of a program participant may not be less than 3 
megawatts or more than 10 megawatts. 
B. The total net generating capacity of all program participants combined may not 
exceed 20 megawatts. 
The commission may modify the amount of total net generating capacity stipulated 
under this paragraph based 011 program experience. 
3. Program eligibility criteria. To be eligible to participate in the program. a 
combined heat and power project must: 
A. Be connected to the electric grid of this State: 
B. Have an in-service date after November 1. 2022; 
C. Satisfy the limits on net generating capacity established in subsection 2. paragraph 
A;_ 
D. Be highly efficient. as determined by the commission; and 
E. Not be a participant in net energy billing under section 3209-A or 3209-B. 
The commission shall prescribe an application form or procedure that must be used to apply 
to the program under this chapter. which must include any information that the commission 
determines necessary for the purpose of administering the program. The commission shall 
inform an applicant. within 30 days of receipt of an application. if the application is 
complete. The commission shall determine whether the combined heat and power project 
qualifies for participation in the program as soon as practicable and respond in writing. 
§3624. Long-term contracts for combined heat and power 
1. Investor-owned transmission and distribution utilities; required participation. 
Notwithstanding section 3204. the commission may direct an investor-owned transmission 
and distribution utility to enter into long-term contracts with one or more program 
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COMMITTEE AMENDMENT" 4 
"to H.P. 880, L.D. 1202 
participants located within the service territory of the utility for energy, capacity resources 
or renewable energy credits. The commission may direct investor-owned transmission and 
distribution utilities to enter into contracts under this subsection only as agents for their 
customers and only in accordance with this section. An investor-owned transmission and 
distribution utility shall sell energy, capacity resources or renewable energy credits 
purchased pursuant to this subsection into the wholesale electricity market or take other 
action relative to such energy, capacity resources or renewable energy credits as directed 
by the commission. 
2. 
Consumer-owned transmission and distribution utilities; voluntary 
participation. A consumer-owned transmission and distribution utility may, at the option 
of the utility, enter into long-term contracts with one or more program participants located 
within the service territory of the utility for energy, capacity resources or renewable energy 
credits. Consumer-owned transmission and distribution utilities may enter into contracts 
under this subsection only as agents for their customers and only in accordance with this 
section. 
3. Sale of energy; contract procedures. Energy, capacity resources ot renewable 
energy credits contracted through long-term contracts pursuant to this section may be sold 
into the wholesale electricity market separately or in conjunction with solicitations for 
standard-offer supply bids under section 3212 or solicitations for green power offer bids 
under section 3212-B. To the greatest extent possible, the commission shall develop 
procedures for long-term contracts for transmission and distribution utilities under this 
section having the same legal and financial effect as the procedures used for standard-offer 
service pursuant to section 3212 for transmission and distribution utilities. 
4. Contract term. A contract entered into pursuant to this section may not be for 
more than 20 years. 
5. Contract pricing; cost containment. The commission shall solicit contract bids 
under the program. In selecting contracts, the commission shall weigh the characteristics 
of a proposed combined heat and power project as follows: 
A. A weight of 30% must be given to the combined efficiency of the electricity 
generation and heat utilization of the project: 
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B. A weight of 40% must be given to the total cost of the project: and 
C. A weight of30% must be given to the following factors: 
(1) The design of the project to meet the State's waste reduction and diversion 
priorities established by Title 38, section 2101, including, but not limited to, the 
proximity of the project to wood fuel derived from forest products manufacturing 
residuals: 
(2) The location of the project and whether electricity generated will meet a 
demand for electricity; 
(3) The net greenhouse gas emissions from the project, as determined in 
consultation with the Department of Environmental Protection; 
(4) The economic impact to the State from the project, including, but not limited 
to, jobs the project will create and maintain in wood fuel supply, at the electric 
generation plant and at the facility using the heat; 
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COMMITTEE AMENDMENT" A" to H.P. 880, L.D. 1202 
(5) Whether the generation of electricity most effectively accounts for the changing 
seasonal time of day and other electricity usage characteristics associated with 
beneficial electrification as defined in section 10102, subsection 3-A over the 
duration of the contract; and 
(6) The effect on other Class I resources and Class IA resources, as defined in 
section 3210, subsection 2. 
The commission may not direct an investor-owned transmission and distribution utility to 
enter into a long-term contract under this chapter in which the contract price for energy 
exceeds 10 cents per kilowatt-hour. 
If at the close of the competitive bidding process under this subsection the commission 
determines that no proposal meets the requirements of the solicitation or that an approval 
is not in the public interest, the commission may reject all proposals and may open a new 
competitive bidding process. 
6. Cost and benefit allocation. The commission shall ensure that all costs and 
benefits associated with contracts involving investor-owned transmission and distribution 
utilities entered into under this section are allocated to electricity consumers in accordance 
with section 3210-F. 
7. 
Contract payments. Contracts for capacity and related energy entered into 
pursuant to this section must provide that payments will be made only after contracted 
amounts of energy have been provided. 
8. 
Ratepayer protection, 
The commission shall ensure that mechanisms are 
established to provide protections for ratepayers over the term of contracts entered into 
pursuant to this section. 
§3625. Rules 
The commission may adopt rules to implement this chapter. Rules adopted pursuant to 
this section are routine technical rules as defined in Title 5, chapter 375, subchapter 2-A. 
§3626. Tracking; biennial report 
The commission shall develop and administer a system to register and track the 
development of combined heat and power projects under this chapter and by January 15, 
2023, and biennially thereafter, shall report to the joint standing committee of the 
Legislature having jurisdiction over utilities and energy matters on the program and the 
development of combined heat and power projects. The report must include, but is not 
limited to: 
1. Combined heat and power project development. Documentation of the progress 
of combined heat and power project development. including the number of such projects 
in the State, the net. generating capacity of those projects and the kilowatt-hours of 
electricity purchased from those projects; and 
2. Program implementation; assessment; recommendations. Actions taken by the 
commission to implement the program, an assessment of the effectiveness of the program 
with respect to encouraging the sustainable development of combined heat and power 
projects in the State and recommendations, including any necessary implementing 
le~;islation, to improve the program. 
COMMITTEE AMENDMENT 
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COMMITTEE AMENDMENT 'tf "to H.P. 880, L.D. 1202 
§3627. Regulatory approvals; use of public resources 
1. Regulatory approval. The development, siting and operation of a combined heat 
arid power project is subject to all applicable regulatory reviews and approvals required by 
governmental entities, including, but not limited to, municipalities and state agencies, 
pursuant to law, ordinance or rule. 
2. Use of publicly owned land, water or facilities. Nothing in this chapter limits the 
authority of the State or a political subdivision of the State to use publicly owned land. 
water or facilities in the development and operation of a combined heat and power project 
or to lease publicly owned land. water or facilities to other qualifying owners for the 
development and operation of a combined heat and power project.' 
Amend the bill by relettering or renumbering any nonconsecutive Part letter or section 
number to read consecutively. 
SUMMARY 
This amendment makes several changes to the provisions in the bill that establish the 
combined heat and power program administered by the Public Utilities Commission. The 
definition of "wood fuel" for the purposes of the program is limited to biomass derived 
from forest products manufacturing residuals, harvest residues and downed trees and other 
plant materials removed for landscaping and invasive species control. The amendment also 
limits the program to 20 megawatts of net generating capacity across all projects. 
The amendment changes the long-term contracting provision in the bill to clarify that 
the commission must seek competitive bids and it allows the commission, in requesting 
competitive bids for long-te1m contracts for energy, capacity resources or renewable 
energy credits, to reject all bids and open a new competitive bidding process if no proposals 
meet the requirements of the solicitation or the approval would not be in the public interest. 
The amendment establishes project characteristics that must be considered by the 
commission in selecting contracts and the weights of the characteristics, and it caps the 
energy contract price at no more than 10 cents per kilowatt-hour. The amendment also 
clarifies that transmission and distribution utilities may sell energy, capacity resources or 
renewable energy credits into the wholesale market separately or in conjunction with 
solicitations for standard-offer supply bids. Additionally, the amendment makes the 
commission's rulemaking to implement the program permissive and updates the 
commission's first reporting date relating to the development of combined heat and power 
projects to January 15, 2023. 
FISCAL NOTE REQUIRED 
(See attached) 
COMMITTEE AMENDMENT 
Approved: 03/29/22 .;:?dae 
LD 1202 
LR 1542(02) 
An Act To Establish a Wood-fired Combined Heat and Power Program 
Fiscal Note for Bill as Amended by Committee Amendment ;3/ f /-/-1 j 2) 
Committee: Energy, Utilities and Technology 
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Fiscal Note Required: Yes 
Fiscal Note 
Minor cost increase - Other Special Revenue Funds 
Fiscal Detail and Notes 
Any additional costs to the Public Utilities Commission as a result of the establishment of a wood-fired combined heat 
and power program or their administration of the program are anticipated to be minor and can be absorbed within 
existing budgeted resources. 
LR1542(02) - Fiscal Note - Page 1 of 1