SPEED Goals & Incentives VEPP Inc. January 27, 2011

S.52 July 1, 2005 Added a new definition to V.S.A. 30 § 8002 Added a new definition to V.S.A. 30 § 8002 SPEED Resources – In-State renewable energy, coming into service after Dec. 31, 2004, whether or not “renewable energy credits” are attached

S.52 July 1, 2005 Soft Goals Soft Goals 1.Support the development of renewable energy1.Support the development of renewable energy 2. Provide an incentive for the State’s retail electricity providers to enter into long-term, stably priced renewable energy contracts2. Provide an incentive for the State’s retail electricity providers to enter into long-term, stably priced renewable energy contracts

S.52 July 1, 2005 Volume Goals Volume Goals Exceed total statewide [load] growth between January 1, 2005 and January 1, 2013

S.52 - SPEED Goal July 1, 2005

S.52 - Disincentive (6/1/2005) Law required Utilities to obtain SPEED Resources at: Law required Utilities to obtain SPEED Resources at: “... a specified margin below the hourly spot market” and “anticipated to be below the long-term market price....”. “... a specified margin below the hourly spot market” and “anticipated to be below the long-term market price....”. New renewable energy costs more than spot market price New renewable energy costs more than spot market price Nobody knew what the long term market price was going to be… Nobody knew what the long term market price was going to be…

What Happened to Load Growth?

Legislature Modified SPEED Goal S.209 (7/1/2008) Kept the SPEED Goal of meeting all statewide Load growth, and added Kept the SPEED Goal of meeting all statewide Load growth, and added SPEED At least 5% of 2005 total Statewide electric retail sales by July 1 st 2012 SPEED At least 5% of 2005 total Statewide electric retail sales by July 1 st 2012 Projects with CPGs can count towards the goal whether or not they are built, Projects with CPGs can count towards the goal whether or not they are built, Additional SPEED Goal of 20% total Statewide electric retail sales by July 1 st 2017 Additional SPEED Goal of 20% total Statewide electric retail sales by July 1 st 2017

New Minimum SPEED Goal

S.209 Creates Another Goal 7/1/ by % of energy consumed within the state produced from Renewable Resources by by % of energy consumed within the state produced from Renewable Resources by §580 of V.S.A. 10 (Title 10: Conservation and Development)

Incentives in S.209 (7/1/2008) in the case of projects of less than 1 MW “... allow a long term contract (further defined as 15 years or greater)... at a specified price determined by the Board to be adequate to promote SPEED resource development...” in the case of projects of less than 1 MW “... allow a long term contract (further defined as 15 years or greater)... at a specified price determined by the Board to be adequate to promote SPEED resource development...” in the case of projects greater than 1 MW “... the Board shall create a standard contract price, or set of maximum and minimum provisions or both, for qualifying SPEED resources....In setting the standard contract price... the Board shall consider the goal of developing qualified SPEED resources…” in the case of projects greater than 1 MW “... the Board shall create a standard contract price, or set of maximum and minimum provisions or both, for qualifying SPEED resources....In setting the standard contract price... the Board shall consider the goal of developing qualified SPEED resources…”

H.446 (5/27/2009) Creates SPEED Standard Offer Program Law mandates the availability of 50 mW of Purchase Power Agreements for SPEED projects 2.2 mW or less. Law mandates the availability of 50 mW of Purchase Power Agreements for SPEED projects 2.2 mW or less. Energy Pricing is determined using Feed-in-Tariff methodology. Energy Pricing is determined using Feed-in-Tariff methodology. Projects must be commissioned within 3 years of PPA signing. Projects must be commissioned within 3 years of PPA signing.

Current SPEED Goal Revisited

Keep Up the Good Work- a New SPEED Goal maybe coming !. The Legislature is currently considering a bill (H ) which includes a new SPEED Goal. 1/3 of state’s highest annual energy usage or, 6,000 GWH whichever is greater, by January 1, /3 of state’s highest annual energy usage or, 6,000 GWH whichever is greater, by January 1, Also, each utility must individually make incremental progress towards meeting this goal Also, each utility must individually make incremental progress towards meeting this goal