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<title>January 2006: Delaware, Rhode Island, New York and Massachusetts:
Renewable Portfolio Standard Update</title>
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<p align="left"><strong><small><font face="Arial">About The Author:</font></small></strong></p>
<p align="left"><font face="Arial" style="font-size: 9pt">Robert A. Olson is a partner in the law firm of
Brown, Olson & Gould, P.C. which maintains a nationwide practice in energy law,
public utility law and related commercial transactions.</font></p>
<p><small><font face="Arial"><font style="font-size: 9pt">He can be reached at:</font><br>
<br>
<b><font color="#0000FF">Brown, Olson & Gould, PC</font></b><br>
2 Delta Drive<br>
Suite 301<br>
Concord, NH 03301<br>
<a href="mailto:[email protected]">[email protected]</a><br>
(603) 225-9716<br>
<a href="mailto:[email protected]"></a></font></small></p>
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<p ALIGN="left"><b><u><br>
<br>
January 2006</u></b><font size="6"><b><br>
Delaware, Rhode Island, New York and Massachusetts:
Renewable Portfolio Standard Update<br>
</b></font><strong>by Robert Olson and
</strong><b>David J. Shulock</b><strong> -- Brown, Olson and Wilson, P.C.<br>
</strong><font face="Arial" size="2">(<em>originally published by PMA OnLine Magazine:
2006</em>/04/1)<br>
</font></p>
<p class="MsoNormal" style="text-autospace: none" align="left"><b>Delaware
and Rhode Island<br>
</b>On December 6, 2005, the Delaware Public Service Commission issued Order
No. 6793 proposing rules to implement that state’s renewable portfolio
standard (“RPS”) legislation. The deadline for filing written comments is
February 2, 2006, and the public hearing concerning the proposed rules is
scheduled for February 14, 2006.</p>
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<p class="MsoNormal" style="text-autospace: none" align="left">On November
30, 2005, the Rhode Island Public Utilities Commission announced the
adoption of “Rules and Regulations Governing the Implementation of a
Renewable Energy Standard.” These rules were filed with the Rhode Island
Secretary of State on December 8, 2005, and became effective on January 1,
2006. The Delaware legislation and the Rhode Island rules are described in
the October, 2005 Stateline article.</p>
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<p class="MsoNormal" style="text-autospace: none" align="left"><b>New York<br>
</b>On November 2, 2005, the New York Public Service Commission (the “NYPSC”)
issued an Order in case 03-E-0188 approving the request by the New York Farm
Bureau (the “NYFB”) for the inclusion of methane digester systems as
eligible technologies in the customer-sited tier of its RPS. The inclusion
of methane digester systems in the customer-sited tier will allow a large
number of small, family-run businesses in that state’s dairy farming
industry to participate in the RPS program.</p>
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<p class="MsoNormal" style="text-autospace: none" align="left"><b>
Massachusetts<br>
</b>On January 9, 2006, Massachusetts Division of Energy Resources (“DOER”)
issued its Annual RPS Compliance Report for 2004, the second year in which
retail electricity suppliers in Massachusetts had to comply with that
state’s Renewable Energy Portfolio Standard (“RPS”).</p>
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<p class="MsoNormal" style="text-autospace: none" align="left">Retail
electricity sales totaled about 50 million megawatt-hours (“MWh”) in 2004.
Under Massachusetts’ RPS, one and one half percent of the total retail sales
for 2004, about 750,954 MWh, had to come from new renewable generating
sources. Because of a shortfall in the availability of new renewable
generation in 2004, over one third or about 245,127MWh of the compliance
obligation was met through Alternative Compliance Payments (“ACPs”) at the
rate of $51.41 per MWh which added up to a cost of almost $14 million. In
addition, a large portion of the compliance obligation was met through the
RPS vintage waiver provision allowing retrofitted generators to sell their
electricity output under the RPS program.</p>
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<p class="MsoNormal" style="text-autospace: none" align="left">The projected
retail sales for 2005 are close to 51 million MWh. The 2005 RPS obligation
is two percent, or about 1,014,522 MWh, and DOER expects a comparable
shortfall for 2005 RPS compliance. However, DOER expects supply to improve
for 2006 and beyond due to new capacity becoming operational. According to
DOER, the sources of new renewable generation for 2005 continue to be
largely landfill gas and biomass. New York began participating in the
Massachusetts RPS market during 2004 with five additional plants qualifying
for participation in 2005. The output from biomass plants in Maine, which
qualify under the vintage waiver provision, are expected to increase
substantially. Rhode Island’s output will also increase substantially due to
the ability to tap the increasing supply of methane gas available at that
state’s large and growing Johnston Landfill. In addition, Vermont is
expected to have entered the Massachusetts RPS market in 2005 with one
landfill plant and a small anaerobic digester project. DOER believes that
New Hampshire and Connecticut may also show small increases in their output.</p>
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<p align="left"><font face="Arial">
<small>Robert A. Olson is a partner in the law firm of Brown, Olson &
Gould P.C.
which maintains a nationwide practice in energy law, public utility law and related
commercial transactions. He can be reached at:</small></font><p align="center">
<font face="Arial"><small><font color="#0000FF"><b>Brown, Olson & Gould, PC</b></font><br>
2 Delta Drive, Suite 301<br>
Concord, NH 03301 <br>
<br>
<a href="mailto:[email protected]">[email protected]</a> | (603) 225-9716<a href="mailto:[email protected]"></a></small></font>
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