National Grid parking lot solar array incentive in question amid rising costs

NATIONAL GRID RHODE ISLAND has proposed ending its solar carport adder, which offers extra payment to developers who build solar canopies on parking lots rather than forest or farmland. Pictured is one such project at the Public Utilities Commission office building in Warwick. / COURTESY R.I. OFFICE OF ENERGY RESOURCES

PROVIDENCE – With rising costs and uncertain benefits, National Grid Rhode Island wants to pull the plug on its financial incentives for developers who build solar canopies over parking lots.

The power company in its proposed 2022 Renewable Energy Growth Program called for ending its solar carport pilot program, which for the last two years has offered developers extra money for parking lot solar arrays in an attempt to shift projects away from forests and farmland.

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But environmental groups, including the R.I. Office of Energy Resources, don’t want to give up just yet, and are asking state regulators to require that National Grid to continue the program.

It’s up to the R.I. Public Utilities Commission to decide. The PUC is slated to hold a hearing on the proposed 2022 Renewable Energy Growth Program, including the solar carport adder, at 9:30 a.m. Thursday, though a decision is not expected until March.

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Commission members were critical last year of the solar carport incentive – although they approved it – questioning the returns on investment as well as its benefits to ratepayers beyond the property owners where projects were built. 

National Grid in its own cost-benefit analysis, submitted as part of this year’s plan, showed that the 6 megawatts worth of parking lot solar arrays that received the extra financial incentive in the last two years had some positives. But the price tag to build these solar arrays has escalated, and is expected to keep going up, suggesting that for most projects, the costs outweigh the benefits. In some cases, National Grid would have to increase its financial incentive by up to 140% to justify the cost hikes being paid by developers, according to its analysis.

And even then, the benefits are “highly uncertain when considered on a statewide basis,” the company stated. 

While National Grid called for ending the solar carport incentive, which has operated as a pilot program, environmental advocates defended it. 

The R.I. Energy Commissioner Nicholas Ucci and Laura  Bartsch, chairperson of the R.I. Distributed Generation Board, in a letter to the PUC described the incentive as an important part of meeting the state’s ambitious climate change goals, including the Act on Climate Law passed last year, Ucci and Bartsch said in the letter. 

The Northeast Clean Energy Council also sent a letter of support for continuing the carport program, signed by 16 other solar developers and environmental organizations. 

“Such approval will allow continued market development of this segment of the solar industry,” said Sean Burke, policy manager. 

And unlike other state incentives for renewable energy projects, such as the virtual net metering program, the solar carport adder does not have the “unintended consequence of triggering significant clearing of Rhode Island forests,” according to a joint letter from Sue Anderbois, climate and energy project manager for The Nature Conservancy and Priscilla De La Cruz, senior director of government affairs for Audubon Society of Rhode Island.

Several environmental groups in their letters also suggested National Grid would not have to increase the payment as drastically as the company suggested in order for developers to still derive some benefits. Indeed, the analysis conducted by National Grid’s own consultant laid out several scenarios and types of projects in which benefits would outweigh costs with even a minor boost to the current incentive rate of 5 cents per kilowatt-hour.

Ucci and Bartsch in their letter asked state regulators to let them work with National Grid to conduct more cost-benefit analysis and come up with a supplemental plan – which could be approved separately from the Renewable Energy Growth Program – for a 2022 solar carport incentive. 

It was unclear whether such a plan is being developed. A spokesman for OER said the agency could not comment on an open filing. 

National Grid did not immediately return inquiries for comment.

The commission’s virtual hearing on the Renewable Energy Growth program will be streamed on its website at 9:30 a.m. Thursday. It does not include public comment.

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