O F F I C E O F L E G I S L A T I V E R E S E A R C H
P U B L I C A C T S U M M A R Y
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PA 22-14—sSB 176
Energy and Technology Committee
AN ACT CONCERNING CLEAN ENERGY TARIFF PROGRAMS
SUMMARY: This act expands the Non-Residential Energy Solutions (NRES) and
the Shared Cleaner Energy Facilities (SCEF) programs (see BACKGROUND).
The act increases the yearly amount of capacity in megawatts (MW) available
for (1) zero-emissions NRES projects (e.g., solar facilities) from 50 to 100 MW and
(2) SCEF projects from 25 to 50 MW (§ 3). Existing law establishes a six-year
schedule for these programs and prior law capped the aggregate capacity of both
programs at 85 MW each year. The act correspondingly raises the aggregate cap
for NRES and SCEF projects from 85 to 160 MW in years two through six. Under
prior law, megawatts available under the programs for each year expired annually.
The act instead requires the available megawatts to roll over to the next program
year.
The act increases the eligible project size for these programs, from two to five
MW for NRES and from four to five MW for SCEF (§ 1). It also increases the
potential size of NRES projects by allowing commercial and industrial customers
to participate in the program using their entire rooftop space, exempting them from
a provision that generally limits project size based on the customer’s load (i.e.,
amount of the energy the customer uses) (§ 4).
For SCEF, the act increases the proportion of the program that must benefit
low-income customers (§ 2). It increases the amount of each SCEF facility’s total
capacity that must be sold, given, or provided to low-income customers from 10%
to 20%. It also increases the amount that must go to low- or moderate-income
customers or low-income service organizations (i.e., organizations assisting low-
income people) from 10% to 60%. Under prior law, these requirements were
separate, but under the act, the low-income requirement may be used to meet the
larger low-income, moderate-income, and service organization requirement. The
act also (1) defines “low-income” based on state median income, rather than area
median income, and (2) broadens the definition of “moderate-income.”
Lastly, the act requires the Office of Policy and Management (OPM) to study
how property taxes apply to commercial solar projects sized at 50 kilowatts or more
and report to the Energy and Technology and Planning and Development
committees by January 1, 2023 (§ 5).
EFFECTIVE DATE: October 1, 2022, except the study requirement is effective
upon passage.
LOW- AND MODERATE -INCOME CUSTOMERS FOR SCEF
REQUIREMENTS
Under prior law, “low-income” customers had incomes up to 80% of the area O L R P U B L I C A C T S U M M A R Y
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median income as defined by the U.S. Department of Housing and Urban
Development. The act instead defines “low-income” as up to 60% of the state
median income. By law, affordable housing facilities are also low-income
customers. The act correspondingly removes reference to an existing statutory
definition that is based on area median income.
Under prior law, moderate-income customers were those with incomes between
80% and 100% of area median income. The act broadens this definition to include
customers between 60% and 100% of area median income.
PROPERTY TAX STUDY
The act requires OPM to study how property taxes apply to commercial solar
generation projects with a nameplate capacity rating of at least 50 kilowatts. To
conduct the study, OPM must consult with the Connecticut Conference of
Municipalities, the Connecticut Council of Small Towns, and industry
representatives. The act requires OPM to report on the study to the Energy and
Technology and Planning and Development committees by January 1, 2023. The
report must:
1. summarize the current statutory framework for personal and real estate
property taxes on these projects and
2. recommend changes that would remove inconsistencies in these statutes and
allow for equitable property tax treatment of commercial solar generation
projects across the state.
BACKGROUND
NRES Program
The NRES program allows non-residential customers (e.g., commercial and
industrial customers) to participate in an annual solicitation conducted by
Eversource and United Illuminating in which selected projects enter into a 20-year
contract with the companies for energy and related products (e.g., renewable energy
credits (RECs)). To be eligible, a project must be a Class I renewable energy source
that (1) uses anaerobic digestion or has low emissions (e.g., fuel cells) or (2) has
zero emissions (e.g., solar facilities) (CGS § 16-244z(a)(2)(A) & (B)). The law has
a six-year schedule for the program, which is currently in its first year (i.e., 2022 is
Year 1).
SCEF Program
Generally, a shared clean energy facility allows customers to subscribe for
energy or RECs from a facility that is not on the customer’s premises. Under the
SCEF program, eligible facilities are Class I renewable energy sources (e.g., wind
or solar) served by Eversource or United Illuminating with at least two subscribers
in the same utility service territory as the facility (CGS § 16-244z(a)(2)(C)).
Eversource and United Illuminating conduct an annual solicitation using a O L R P U B L I C A C T S U M M A R Y
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competitive bidding procurement process and enter into 20-year contracts with
selected projects. The law establishes a six-year schedule for the program, which is
currently in its third year (i.e., 2020 was Year 1).