by Jbs060609 g3 — June 10, 2009—Vermont legislators have passed House Bill 446, also known as the Vermont Energy Act of 2009, which will allow owners of small renewable energy facilities to sign long-term contracts for the sale of power produced by their facilities. The approach, commonly referred to as a “feed-in tariff,” is meant to encourage individuals and businesses to install their own grid-connected renewable energy system, according to an analysis by the U.S. Department of Energy’s (DOE) Office of Energy Efficiency and Renewable Energy (EERE).
The long-term contracts provided by such feed-in tariffs can make renewable energy systems a profitable investment, and the guaranteed income can help attract financing for such systems.
The new Vermont Energy Act will apply to renewable energy systems commissioned on or after September 30, 2009 that are up to 2.2 megawatts in capacity. It allows for power purchase contracts of 10 to 20 years in duration for most renewable energy projects, and up to 25 years in duration for solar energy projects. The act sets a statewide limit of 50 megawatts for such contracts, but that limit also includes any new, similar-sized renewable power facilities built by the state’s utilities.
For now, the act sets standard rates of 12 cents per kilowatt-hour (kWh) for a power plant fueled with methane from a landfill or agricultural operation, such as an anaerobic digester; 20 cents per kWh for wind turbines of 15 kilowatts or less; 30 cents per kWh for solar power; and the state’s average residential rate for biomass power plants not fueled with methane, wind power projects larger than 15 kilowatts, and hydropower facilities. However, the act allows the Vermont Public Service Board to adjust these “standard offer” rates, with the intent of allowing a rate of return on equity not less than the highest rate of return approved for investor-owned utilities in Vermont.
