MONTPELIER — Vermont utility regulators are proposing new rules that will govern the installation and management of small, local electrical generation projects in the state for years to come.

The rules proposed by the Public Service Board would govern the installation and management of small power projects, such as residential rooftop solar panels up to solar projects that can cover about four acres of land, in which the owners are credited by their utilities for the power they produce in excess of what they use.

The proposal would ensure those who have already installed small projects can keep for 20 years the deals they made when planning their projects. They also encourage the installation of smaller solar projects on less desirable locations and they encourage producers to transfer the environmental attributes of the power to their utility, which would use them to help Vermont meet its renewable energy goals.

"This is really high stakes policymaking," said James Moore, the co-founder of the Waterbury-based Suncommon, Vermont's largest residential and community solar provider.

"Getting this right will allow the industry to continue to serve Vermonters for decades to come," said Moore, whose company specializes on rooftop and community solar projects. "Getting it wrong has the possibility of completely undermining everything that's been built over the last 15 years."


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Some say Vermont's proposed rules strike a needed balance between guaranteeing that the pricing structure of already built projects don't change while recognizing the future system has to be redrawn. Critics say the proposed rules shift the costs of those renewable projects to those customers who rely on traditional sources of electricity.

Two years ago, the Legislature passed a law setting a cap of 15 percent of a utility's peak load that can come from such small projects while at the same time ordering the board to develop rules that would govern the process after Jan. 1, 2017.

Many Vermont utilities have reached that cap. Moore said his company's business of putting solar panel on roofs and in community solar arrays has slowed considerably since many utilities hit the cap.

The board has begun the process of seeking formal approval for the rules to govern the process known as net metering. They are needed to govern how Vermont, which has set of goal of receiving 90 percent of its power from renewable sources by 2050, manages small power projects as part of that push for more renewable energy.

How to manage small power projects is being discussed across the country. As of December, 17 states were considering some version of new net metering rules.

"The structure proposed by the board ensures sustained growth and that net metered renewable energy will help reduce Vermont's carbon pollution and move us toward greater energy independence," said Jon Copans, the deputy commissioner of the Vermont Department of Public Service, which represents the state in utility issues.

In addition to grandfathering the rules governing existing projects, the rules change the way net metering customers are credited for the excess electricity they produce with smaller projects getting larger credits. The proposed rules will also allow for the regular updating of pricing.

Moore said the proposed rules "largely get it right."

But Christine Hallquist, the CEO of the Vermont Electric Cooperative, which hit the net metering cap last summer and isn't accepting new projects, says the current version of the rules shifts the costs of maintaining the electric grid onto its members who aren't involved in net metering.

"We're overpaying for solar, we're doing it by charging other customers, charging the customers who don't have solar to pay for the ones that have solar," said Hallquist, who noted an early draft of the rules contained a service fee for net metering customers that would eliminate what she sees as a cost shift. "That's clearly not sustainable."