Boston, MA – In 2017 we saw significant policy movement for solar on the local, state and federal levels. BlueWave Solar has worked with solar industry leadership to guide policy decisions and provide industry feedback on a regular basis. To keep you up-to-date on policy issues that affected the solar industry this year, BlueWave’s Managing Director for External Affairs – Mark Sylvia gives you the policy connection download.
This year we saw the development and promulgation of a much-anticipated new solar incentive program in Massachusetts. As we’ve reported in previous newsletters, the new Solar Massachusetts Renewable Target (SMART), a tariff based, declining block incentive program, will replace the successful Solar Renewable Energy Certificate (SREC) II program. The start date for SMART is anticipated to occur in late May or early June, 2018 based on the remaining steps in the implementation process.
These remaining steps include (1) a utility managed competitive procurement for solar projects that will set the base incentive rates for SMART and (2) a SMART tariff proceeding at the Department of Public Utilities (DPU), which among other things, will set program cost recovery mechanisms for utilities and will establish an alternative on-bill crediting mechanism separate from the current net metering structure. The results of the competitive procurement and corresponding base incentive rates are expected by mid-January 2018 and the DPU is expected to issue its order some time after final utility reply briefs are due on April 27, 2018. Based on feedback from the industry and those familiar with the tariff hearing process, the DPU order is anticipated in May or June 2018.
BlueWave has been a very active participant throughout the development and implementation process both directly and through supporting the Northeast Clean Energy Council (NECEC), Solar Energy Business Association of New England (SEBANE) and the Solar Energy Industry Association (SEIA) in efforts to ensure that SMART continues the growth and momentum of the solar industry in Massachusetts.
We appreciate the engagement of the Massachusetts Department of Energy Resources (DOER), the Massachusetts Department of Agricultural Resources (MDAR) and the Executive Office of Energy and Environmental Affairs throughout this year long process. Check back for more updates on SMART and other solar related policy issues.
Tax Cuts and Jobs Act – Impact on Solar
On December 22, 2017, President Trump signed the $1.5 trillion Tax Cuts and Jobs Act (TCJA) into law. Prior to the bill signing, the solar industry was working hard to lobby US House and Senate tax bill conference committee members to ensure that the Investment Tax Credit (ITC) extension remained unchanged and that the Base Erosion Anti-Abuse Tax (BEAT) previously added in the Senate tax bill was either removed or significantly amended. Due in part to those efforts, the final conference committee bill did not include changes to the ITC and amended BEAT. Had these provisions remained unchanged, it would have been a major blow to tax equity financing of solar and wind projects in the United States.
According to Greentech Media reporter Emma Foehringer Merchant in a story she wrote on December 20, 2017, “While the final tax bill left the Investment Tax Credit and the Production Tax Credit in place, the Base Erosion Anti-Abuse Tax (BEAT) provision made it through the final version. An amendment keeps 80 percent of the value of both the ITC and the PTC.”
Foehringer Merchant continued, “clean energy organizations and investors are now crunching the numbers to assess just how much the loss of 20 percent will impact tax equity investment. Tax lawyers seem optimistic that the market will bounce back.”
BlueWave did our part to let members of Congress in states where we offer our solar products know how BEAT, if left unchanged, would negatively impact tens of thousands of solar jobs and the millions of dollars in savings generated for customers across the United States.
Suniva Trade Case Update
On November 29, 2017, United States Trade Representative Robert Lighthizer asked the International Trade Commission to prepare a supplemental report to assist him in advising President Trump on the Suniva Trade Case. This request extends the deadline the President has for issuing a final decision from January 12, 2017 to January 26, 2017.
Concurrent with this request, the US Trade Representative’s Office held a public hearing on the ITC’s proposed remedies on December 6, 2017. Details about the hearing and US Trade Representative Lighthizer’s request for a supplemental report are included in articles by SEIA, Utility Dive and GreenTech Media – the links to these articles are below.
The President can, at any time, between now and January 26, 2017 render a final decision. BlueWave will continue to monitor the situation and share any significant updates in the news section of our website at www.bluewavesolar.com/news