Connecticut regulators on Wednesday morning approved a $1 billion renewable energy credit program put in place by the state legislature last year.
The Public Utilities Regulatory Authority created the Zero-emissions Renewable Energy Credit and Low-emissions Renewable Energy Credit initiatives - better known as ZRECs and LRECs - to help spur the installation of clean energy systems statewide.
"The program will deploy projects across the state at the lowest possible cost to ratepayers," said Dan Esty, commissioner of the Department of Energy & Environmental Protection. "This will add to our efforts to move us in the direction of the Governor's vision of cheaper, cleaner, and more reliable energy in Connecticut. We look forward to the results of the bidding process, when we will see which competitors were able to make their projects economical with the least amount of subsidy."
Under the ZREC and LREC programs, electric utilities United Illuminating and Connecticut Light & Power will pay the owners of clean energy systems for the power they produce for up to 15 years. ZREC-eligible installations include solar and wind, and LREC-eligible technologies include fuel cells and biomass.
The total amount of credits start off low at $8 million annually for ZRECs and $20 million for LRECs, but those grow each year where $1 billion is spent over the life of the program.
The Connecticut General Assembly passed an energy policy reform bill in June establishing this type of program. CL&P and UI filed for the creation of the program and its details in December.
The programs are similar to other renewable energy credit initiatives in other states - such as Massachusetts' SREC program for solar installation - but the Connecticut plan is more inclusive of all technologies, especially low-emissions ones.
ZRECs and LRECs are not only designed to increase the number of clean energy installations in Connecticut, but the legislature wanted a program that would make Connecticut a destination for the clean technology industry, where the products are researched, developed and manufactured here.