February 10, 2015

Malloy to propose $1B residential solar program

PHOTO | HBJ File
PHOTO | HBJ File
A crew from SolarCity installs panels on a home in Wethersfield.

Gov. Dannel P. Malloy will propose a residential solar credit program he hopes will attract $1 billion in private investment, he announced Tuesday.

As part of the legislative package he will introduce later this month, Malloy will propose a Solar Home Energy Renewable Credit program where owners of solar arrays on residential property can receive 15-year contracts from the state's utilities to sell the credits they receive by generating renewable power.

The SHREC program is modeled after the state's Zero-emissions/Low-emissions Renewable Energy Credit program (ZREC/LREC), where electric utilities Eversource Energy and United Illuminating award 15-year contracts to large, medium, and small solar, fuel cell, and hydro project to buy their renewable energy credits. The ZREC/LREC program is entering its fourth year and will award $1.02 billion in contracts by the time the program is complete in its sixth year.

The proposed SHREC program will build off the current Residential Solar Investment program, which provided government incentives to install solar at homes. That 2011 program has led to more than 8,000 installations of residential solar in Connecticut and attracted $175 million in low-interest and long-term financing from banks and credit unions.

Malloy estimated the SHREC program would attract closer to $1 billion in private investment in residential solar.

Malloy proposed the new program to combat the rising cost of meeting the state's Renewable Portfolio Standard. As Connecticut's RPS moves to have 20 percent of its electricity come from renewables by 2020, Malloy wants more of that renewable electricity generated in Connecticut – rather than imported from other states – and expects the new creative financing made possible by the SHREC will lower the costs of fulfilling that RPS goal.

Malloy estimated the cost of fulfilling the RPS would decrease by $68-168 million throughout the life of the SHREC program.

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