An Act to Implement Recommendations of the Distributed Generation Stakeholder Group
Maine Legislature, Session 131, LD 2016
Committee: Energy, Utilities and Technology
Amends: 35-A MRSA §3209-C

Legislative Document
No. 2016
S.P. 838
In Senate, June 22, 2023
An Act to Implement Recommendations of the Distributed 
Generation Stakeholder Group
Reported by Senator LAWRENCE of York for the Joint Standing Committee on Energy, 
Utilities and Technology pursuant to Joint Order 2023, S.P. 747.
Reference to the Committee on Energy, Utilities and Technology suggested and ordered 
printed pursuant to Joint Rule 218.
DAREK M. GRANT
Secretary of the Senate
Be it enacted by the People of the State of Maine as follows:
Sec. 1.  35-A MRSA §3209-C is enacted to read:
§3209-C.  Distributed generation
1.  Definitions.  As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings.
A.  "Combined project" means a distributed generation resource that is paired with an 
energy storage system in accordance with rules adopted by the commission.
B.  "Community" means:
(1) The State or an agency of the State;
(2) A municipality;
(3) A school administrative unit, as defined in Title 20-A, section 1, subsection 26; 
or
(4) A federally recognized Indian nation, tribe or band in the State.
C. "Distributed generation resource" means an electric generating facility that uses a 
renewable fuel or technology under section 3210, subsection 2, paragraph B‑3, is 
located in the service territory of a transmission and distribution utility in the State and 
has a nameplate capacity of one megawatt or greater and not more than 5 megawatts.
D.  "Energy storage system" has the same meaning as in section 3481, subsection 6.
E. "Previously developed or impacted land" has the same meaning as in section 3484, 
subsection 6.
F. "Program goal" means the development, by 2028, of commercially operational 
combined projects in the State that have a combined capacity to generate an amount of 
electric energy that is, as close as possible, equal to 7% of the total megawatts of 
electricity load in this State minus any amount of capacity in excess of 750 megawatts 
procured pursuant to sections 3209-A and 3209-B, as determined by the commission 
by rule.
2.  Program.  The Distributed Generation and Energy Storage System Program, 
referred to in this section as "the program," is established to achieve the program goal.  The 
commission, in consultation with the Governor's Energy Office, shall by rule design the 
program to achieve the program goal.  Rules adopted under this section are routine 
technical rules as defined in Title 5, chapter 375, subchapter 2‑A.
3.  Competitive procurement.  Under the program, beginning in 2024, the 
commission shall seek to procure at least 70% of the program goal through a competitive 
procurement process in accordance with this subsection.
A.  Each year, beginning in 2024 and ending in 2028, the commission shall seek to 
procure 25% of the total amount to be procured under this subsection.  If the 
commission fails to procure this target amount in any year, the commission shall 
increase the amount solicited in the following year in order to achieve the program 
goal. 
B.  Each year, beginning in 2024 and ending in 2028, the commission shall conduct 
annual competitive solicitations for power purchase agreements in accordance with this 
subsection.  A bid in response to a competitive solicitation under this paragraph must 
offer both the energy and the associated renewable energy credits from a combined 
project and must offer a fixed price or a price with an annual escalator.  The 
commission shall evaluate a bid for a combined project located on previously 
developed or impacted land as if it were 15% lower than the price actually bid. 
C.  Upon selecting winning bids in a competitive solicitation, the commission shall 
direct the transmission and distribution utility in whose service territory a winning 
bidder's combined project is located to enter into a power purchase agreement for that 
combined project on terms established by the commission by rule and at the bid price 
for the combined project.
(1)  A contract under this paragraph may not exceed 20 years.
(2)  The commission shall require a transmission and distribution utility to apply 
the value of the renewable energy credits purchased under the contract to benefit 
low-income or moderate-income customers of the transmission and distribution 
utility.  The manner in which this value is applied must be designed to ensure that 
the combined project from which the credits are purchased qualifies for the 
maximum available federal income tax credits.
4. Community owners.  Under the program, the commission shall seek to procure up 
to 30% of the program goal from community-owned combined projects in accordance with 
this subsection.
A.  Each year, beginning in 2024 and ending in 2028, the commission shall seek to 
procure 1/4 of the amount of the program goal to be procured under this subsection.  If 
the commission fails to procure this amount in any year, the commission shall increase 
the amount to be procured in the following year in order to achieve the program goal.
B.  Each year, beginning in 2024 and ending in 2028, the commission shall establish 
an open enrollment for communities to apply for contracts under this subsection.  The 
commission shall establish the terms of the contracts by rule.  The commission shall 
award contracts to community owners of combined projects that meet requirements 
established by the commission by rule on a first-come, first-awarded basis.  Each year, 
beginning in 2024 and ending in 2028, the commission shall set the base contract price 
for contracts available under this subsection equal to the capacity-weighted 50th 
percentile of all selected bids under subsection 3 for that year, as determined by the 
commission by rule, except that any combined project located on previously developed 
or impacted land must receive a contract price that is equal to the base price divided by 
0.85.  The commission by rule may include an escalator on a base price. 
C.  The commission shall require a transmission and distribution utility to apply the 
value of the renewable energy credits purchased under the contract pursuant to this 
subsection in a manner that maximizes the benefits to all customers of the transmission 
and distribution utility, as determined by the commission by rule.
SUMMARY
This bill is reported out by the Joint Standing Committee on Energy, Utilities and 
Technology pursuant to Public Law 2021, chapter 390 and Joint Order, S.P. 747 for the 
sole purpose of obtaining a printed bill that can be referred to the committee.
The bill establishes the Distributed Generation and Energy Storage System Program.  
Under the program, the Public Utilities Commission, beginning in 2024, is directed to seek 
to procure distributed generation resources paired with energy storage systems, called 
combined projects.  
By 2028 the commission is directed to procure combined projects that will have a 
capacity to generate an amount of electric energy that is, as close as possible, equal to 7% 
of the total megawatts of electricity load in this State minus any amount of capacity in 
excess of 750 megawatts that is procured through current net energy billing programs.  The 
commission is directed to procure at least 70% of this amount through a competitive 
procurement process resulting in power purchase agreements.  The commission is directed 
to procure up to 30% of the amount from community-owned projects through an open 
enrollment process resulting in standardized power purchase agreements with prices set in 
relation to the winning bids under the competitive procurement.  
A contract with a combined project under the program must be for both the energy 
from the project and renewable energy credits associated with that energy. The renewable 
energy credits purchased under the program must be monetized and applied to benefit 
transmission and distribution utility ratepayers.