Lexology: MA Legislature Passes Clean Energy Legislation; Cape Wind will be barred from bidding on the offshore wind contracts

August 2, 2016

Lexology: Massachusetts Legislature Passes Clean Energy Legislation
Mintz Levin, Cohn Ferris Glovsky, and Popeo PC, August 2, 2016

Late Sunday night, the Massachusetts Legislature passed a compromise energy bill that will significantly increase electricity produced by offshore wind, hydropower and other renewable energy sources. The state's utilities will be required to enter into long-term contracts to purchase power from on and offshore wind farms, as well as power from hydroelectric dams located largely in Canada. Governor Baker is expected sign the bill in short order, as he has strongly advocated for purchasing imports of clean energy.

In a compromise between the House proposal and a more aggressive Senate provision, the bill will guarantee contracts for 1,600 megawatts of offshore wind energy and 1,200 megawatts of hydroelectricity from Canada and onshore wind energy. Taken together, these contracts will eventually provide about one-third of electricity consumed in Massachusetts annually for up to 20 years.

Bill Provisions

The bill, H.4568, includes several provisions that directly affect the operations of utility and energy companies in the state:

Offshore wind contract solicitations must begin by June 2017, with procurements every two years of at least 400 MWs each, until the total 1,600 MWs has been contracted. Contracts sufficient to achieve delivery of the specified amount of power must be executed by 2027.

Hydropower and land-based wind power contract solicitations must begin prior to April 2017 and be executed before December 2022. They must be a "cost effective mechanism for procuring low cost renewable energy on a long-term basis," as determined by the Massachusetts Department of Public Utilities.

The bill requires utilities to develop a plan to repair leaks in natural gas pipelines.

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