Electric suppliers pay for clean-energy shortage
More than half of the electricity suppliers operating in Connecticut will pay a combined $7.9 million for missing renewable-energy targets in 2014, the Public Utilities Regulatory Authority disclosed in a recent draft decision.
That's down from $38.1 million in 2013 and $38.9 million in 2012.
The majority of the so-called alternative compliance payments in 2014 — approximately $7.7 million — will go to Eversource and Avangrid, mainly to offset the cost of contracts under the state-mandated LREC and ZREC programs, which the legislature has said is a way to reduce costs for all ratepayers.
Also included in the $7.7 million is $533,000 for conservation and load management programs.
Meanwhile, the Connecticut Energy Efficiency Fund will receive $178,000.
The payments are a component of the state's renewable portfolio standard (RPS), which was created in 1998 and requires electricity suppliers — including third-party suppliers and the state's two regulated utilities — to obtain a minimum percentage of their retail energy from renewable sources.
Of the 46 suppliers operating in the state in 2014, 20 were found to be fully compliant with the RPS, according to PURA's draft decision.
The largest deficiency in renewable energy credits in 2014 continued to be in the “Class I” category, which includes solar, wind, fuel cells, geothermal, landfill methane gas, anaerobic digestion and other generation technologies. The penalty for Class I deficiencies is $55 per megawatt hour.
In 2014, suppliers were required to obtain 11 percent of their retail load from Class I sources. That percentage is scheduled to reach 20 percent by 2020.
The following companies will make the largest payments for the 2014 renewable energy credit deficiencies:
• Verde Energy USA, $2 million
• North American Power and Gas, $1.4 million
• Abest Power & Gas, $1.3 million
• Starion Energy, $1.2 million
— Matt Pilon
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