From: Andrew Bernstein <abernstein@kearsargeenergy.com>
Sent: Thursday, June 6, 2019 8:13 AM
To: RPS, DOER (ENE); Judge, Michael (ENE)
Cc: E W Tatelbaum
Subject: Comments on SREC Regulation Change
Dear Mike and team
As you know Kearsarge has developed over 70 MWs of Solar projects in the Commonwealth and have more in construction for SMART. We’ve have invested over $225 million in Massachusetts, because of the DOER’s commitment to the incentive programs and regulatory certainty of these projects that we had believed had existed until this April with the proposed changes to projects qualified in the SREC I programs.
Specifically, we are writing in opposition to the proposed changes to 225 CMR 14.00 that disqualifies electricity generation after the SREC I opt-in term from receiving auction-ineligible SRECs, and instead grants Class I RECs. Not only does this directly affect Kearsarge but it also could further destabilize the MA Class I Rec program which is important to a lot of our existing projects. Prices in MA Class I Recs have already fallen quite dramatically and it we see the values of projects with RECs declining.
Our first 5 projects (SREC I) we sold when we did not have sponsor capital to own them. Now we own and operate more than 73 MWs. However the first approximately 16.6 MWs from these projects, were sold in the early days of the program in 2011/2012 tied to a share of revenues. Our compensation is directly tied to the projects participating in the SREC market until the end of the SREC I program. We planned to reinvest this back into further projects as we have done now to have close to 100 MWs as one of the largest in state developers and owners of projects. We assumed that the post-opt-in-period SRECs would still qualify for SREC compliance, but would not be eligible for the Solar Credit Clearinghouse Auction. This is worth close to $2.5 million dollars of SRECs currently. As you know, our assumptions were tied to guidance from the DOER. For example, DOER’s Dec 2009 Webinar (LINK) and the Dec 2012 presentation (LINK) helped set these expectations.
This change will really undermine confidence in the MA incentive programs and may dramatically slow down investment and growth of solar in the State.
We strong request that DOER abandon the proposed changes, and to ensure calculation of the Solar Carve-out Minimum Standard includes these auction-ineligible SRECs.
Thank you for your consideration
Andrew J. Bernstein
Managing Partner
Kearsarge Energy LP
1200 Soldiers Field Road, Suite 202
Boston, MA 02134
abernstein@kearsargeenergy.com
T: (617) 393-4222
F: (617) 934-2082
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