Creating A Greener Energy Future For the Commonwealth Procurement of Renewable Energy on Landfills January 19, 2010 Courtney Feeley Karp, Esq.

Creating A Greener Energy Future For the Commonwealth Disclaimer I intend to provide a general overview of the options that municipalities may avail themselves of to develop renewable energy facilities in their community. Please consult your counsel to determine your individual course of action. 2

Creating A Greener Energy Future For the Commonwealth First Question My municipality wants to do renewables, what do I do? Does the municipality want to construct, own, and operate the facility? Does the municipality want a 3 rd party to own and operate the facility but lease land and purchase power? Does the municipality want to just lease the land? 3

Creating A Greener Energy Future For the Commonwealth Things to Think About To help answer that question, municipalities should think about:  Renewable Energy Credits (RECs)  Solar RECS  Net metering credits  Tax credits – including ARRA related programs 4

Creating A Greener Energy Future For the Commonwealth RECs and SRECs Renewable Portfolio Standard If a municipality owns and operates the facility it will be able to use RECs/SRECs as additional revenue In a 3 rd party model, the energy contract should address which party takes ownership of the RECs SRECs represents a new program administered by DOER for new solar installations – please see for more details 5

Creating A Greener Energy Future For the Commonwealth Net Metering Allows eligible facilities to run meter backwards and accrue credits for that power from utility. Class I - up to 60kw Class II - 60-kw- 1 MW (solar, wind, farms) Class III – 1 -2 MW (solar, wind, farms) Municipalities have special treatment, above caps apply to unit not facility. Can apply credits to any other electric bills in service territory Utility has option of cutting a check for Class III 6

Creating A Greener Energy Future For the Commonwealth Tax Credits Federal investment and production tax credits (ITC and PTC) Not available to municipalities directly, but would be available in 3 rd party ownership model ARRA provides an up-front grant in lieu of such tax credits (30%) – construction must begin by December Bill pending in Congress to extend timeline. 7

Creating A Greener Energy Future For the Commonwealth What next? Taking into account these considerations, the municipality must answer the first question:  Own and operate  3 rd Party ownership  Land lease 8

Creating A Greener Energy Future For the Commonwealth Procurement Tool Box Chapter 30B – good and services  Energy exemption  Land lease Chapter 149 – public construction  Design build phases Chapter 25A (s. 11C &11I)  Energy Management Services 9

Creating A Greener Energy Future For the Commonwealth Chapter 30B Bread and butter procurement  Land lease under s. 16  (32) and (33) exemptions for energy and energy related services  Submit copies of contracts within 15 days of signing to DPU, DOER, and IG with a report on process used 10

Creating A Greener Energy Future For the Commonwealth Chapter 149 Only for use when municipality is constructing the renewable energy facility State’s public construction statute including separate design and build processes Need to think about existing load profile, generation capacity – does the municipality have enough load to utilize energy? Net meter? Need contract for RECs 11

Creating A Greener Energy Future For the Commonwealth Chapter 25A Two options – sections 11C and 11I 11C is an RFP process that allows municipalities to review energy management proposals based on price. 11I is an RFQ process that allows municipalities to review the qualifications of the bidders and conduct a non-price based review. Allow for one bid process for both design and build phases Need to think about how net metering and RECs are addressed by energy contract 12

Creating A Greener Energy Future For the Commonwealth Answering the Question Regardless of what path a municipality chooses, it is important to consider all the financial implications that impact the economics of the project Also important to assess municipality’s energy profile, its ability to finance a project, and long term financial benefits. Any answer represents a long term solution to the municipality's energy needs. 13

Creating A Greener Energy Future For the Commonwealth Green Communities Division As has been made clear throughout the day, the Green Communities Division is a tremendous resources to assist all municipalities that are struggling with questions about how to install renewables The Division to provide more comprehensive guidance on procurement in the coming months. 14

Creating A Greener Energy Future For the Commonwealth Contact Information For more information please contact Green Communities staff, or myself at or (617)