November 12, 2021 Article

Municipalities Can Now Cut Electricity Costs Through Expansion of New Hampshire Group Net Metering

New Hampshire recently passed a law that allows municipalities to participate in renewable energy projects and save money, providing benefits municipalities can pass along to their taxpayers. The new law allows municipalities to offset their electric bills with up to five megawatts of renewable energy from a project located offsite, through a program called “group net metering”. Municipalities can participate in the expanded group net metering program by entering into contracts with renewable energy developers, under which the municipalities receive bill credits or payments for a share of a renewable energy project’s output.

What is group net metering and how does it work?

Group net metering is a metering and billing practice in which a group of customers is billed on the basis of their “net energy” over a billing period. Net energy is calculated as the difference between the kilowatt-hours the group consumes and the kilowatt-hours produced by the group’s generating facility (e.g., an offsite solar farm which may be owned by a renewable energy developer). In other words, the group’s share of the renewable project’s electric generation is used to offset the group’s energy usage. And the group can receive credit for any surplus energy it generates (i.e., if the generating facility generates more energy than the group consumes).

What has changed with the new legislation?

Renewable energy generating facilities participating in the program can be much larger than before. The new law allows facilities generating up to 5 MW of renewable energy to participate in the program (up from 1 MW), but only if they pair with customers who are local political subdivisions. This increase should ultimately make renewable energy more affordable to municipalities and other political subdivisions, because it is less expensive (on a per-watt basis) to build renewable energy facilities in one place than if a developer had to build multiple smaller facilities in separate locations to generate the same amount of energy, and because the new law creates opportunities for developers to serve municipal customers from more efficient larger projects.

Who can participate in group net metering?

A political subdivision or group of political subdivisions, who are all in the same utility franchise territory, can participate in the group net metering program by working with along with a municipal host. Political subdivisions include any city, town, county, school district, chartered public school, village district, school administrative unit, or any district or entity created for a special purpose administered or funded by any of these governmental units.

A municipal host is a customer generator who owns, operates, or purchases power from an electrical generating facility either powered by renewable energy or which employs a heat led combined heat and power system, with a total peak generating capacity of more than 1 MW and less than 5 MW, used to offset the electricity requirements of a participating political subdivision group. The municipal host must be located in the same municipality as all of the members of the group (for facilities that began operation after 1/1/21).

If you would like to learn more about group net metering opportunities, please contact Rue K. Toland. Preti Flaherty has extensive experience assisting municipalities in New England navigate and benefit substantial net metering laws, resulting in money saved and advancing renewable energy goals.