Tom Bell wanted to save money on his electric bill, but he also wanted to support renewables in Maine. His historic home in the tree-lined village of Yarmouth is not conducive to solar panels. His interest was therefore piqued in the summer of 2020, when he and hundreds of thousands of other Mainers received a solicitation from one of the many community solar farms on offer in Maine.
In August 2020, he signed a contract with Nexamp, a Boston-based solar developer working on approximately 30 community solar projects in Maine.
But two months ago, Bell received an intrusive follow-up email from Nexamp. He said construction on the solar farm he signed up for in Auburn has been delayed and is not expected to go into service until the end of 2022.
A landmark 2019 law intended to encourage and expand solar development in Maine has sparked an avalanche of project proposals. This in turn triggered extensive marketing campaigns to sign Mainers for power shares of the projects.
But now, thousands of Mainers who have already waited a year or so are learning that another year may pass before they can see any benefits. The reverse has somewhat dampened the sunny excitement that embodies community solar. It left people like Bell to decide whether to cancel their contracts, try to find new deals, or just wait.
âI am disappointed but patient,â said Bell, a former Portland Press Herald reporter recently. “I think it will be a good deal for me and for society to have more energy produced from solar.”
Bell’s patience is appreciated by Nexamp, which tries to manage expectations in an unpredictable environment.
âWe’re lucky because customers have understood what’s going on and what’s under and outside of our control,â said Allan Telio, Nexamp’s senior vice president for community solar. “On the other hand, I know they are disappointed and eager for projects to go live, to see their bills go down and to support the growth of clean energy in Maine.”
What is happening and why?
Many Mainers remember the uproar last winter, after Maine’s growing solar industry complained that Central Maine Power belatedly began telling solar farm developers that their projects were causing voltage-related issues at substations that, in some cases, might require multi-million dollar upgrades.
CMP pointed out that more than 600 projects were looking to connect to its distribution system and said the sudden demand caused an unprecedented blockage. Shortly thereafter, CMP said it found cheaper ways to manage the interconnections, but not before Governor Janet Mills asked the Public Utilities Commission to investigate. This review is ongoing, although the CMP and the solar industry are in settlement talks that may lead to a resolution.
The issues responsible for Nexamp’s delays, however, are slightly different and distinct from the CMP surge issues.
The problem centers on the impact on the region’s transport system, if several intermittent production solar farms are connected to an individual substation. Because it could threaten the stability of the system, ISO-New England, the region’s network operator, is requiring so-called cluster studies to determine what upgrades may be needed.
These cluster studies are time consuming and require limited engineering resources. The results could force developers to share millions of dollars in upgrade costs. In some cases, unexpected high costs would be likely to cancel projects.
âCluster studies have an impact on a significant portion of the industry,â said Kaitlin Kelly O’Neill, Northeast Regional Director of the Coalition for Community Solar Access. âThere are hundreds of projects awaiting completion of these studies.
O’Neill said Nexamp’s delays are more noticeable than those of some other companies as it develops, operates and markets its own projects. Other companies may develop farms and then sell them to operators or hire subscription and billing services.
Either way, O’Neill said, the uncertainty caused by delays and the need to communicate what’s going on to impatient customers present a public relations challenge for the burgeoning industry.
âCustomers expected to receive savings at some point,â she said. âNow that’s kicked out. “
“IT’S DIFFICULT TO ESTABLISH CONFIDENCE”
Subscriber-based community solar represents a new economic model in Maine.
There is no charge to subscribe. The length of contracts varies, from month to month to 20 years. Cancellation conditions also vary; many have no fees but require specific notice, such as 90 days.
Unlike a supplier in the competitive state electricity supply market, a community solar energy company applies a kilowatt-hour charge credit to the monthly utility bill.
Discounts in Maine range from 10% to 15%, depending on market competition and proprietary financial calculations. These discounts do not apply to flat charges on the bill, nor to distribution rates that utilities such as CMP and Versant charge for providing electricity over their wires.
Credit reduces the payment a customer owes to their electricity supplier. For the majority of Maine households and small businesses, this provider is Maine’s standard offering, the default procurement service, overseen by the PUC.
Based on the bids received at PUC this fall, the standard bid rates are due to skip over 80 percent next year for customers in the CMP and Versant Power service areas. The 10-15% savings for most community solar subscribers will stay the same, just applied at the higher rate.
But all of this is confusing for customers, many of whom still don’t remember that CMP and Versant are no longer producing electricity, or have trouble understanding where community solar power is.
âIt’s definitely not helpful,â said Alan Robertson, senior director of project development at BlueWave Solar, another developer active in Maine. âIt’s hard to build confidence in a new market. This does not build confidence in solar being the wave of the future, especially with residential customers. “
Delay leads to attrition, Robertson noted. People are selling houses. The tenants move out. People are losing interest and some are canceling contracts.
This is what Paul Hogan did. He had registered with Nexamp in September 2020, for his home in Kennebunkport.
âI wanted to help us get rid of carbon,â he said. âI have solar panels, but they are not producing enough for my needs. It seemed like a cost effective way to do it, with no risk to me. “
But after receiving a year overdue letter from Nexamp in October, Hogan canceled his contract.
Hogan had received offers from other companies; he knew other projects were underway. During the vote in the November election, he met with a marketer who was showcasing community solar projects from Syncarpha Solar of New York, which is developing 11 projects in Maine. He offered a 15 percent discount for a project in Augusta.
Hogan signed contracts with Syncarpha for his main house and a seasonal house in Bethel. The project was to be launched between October 1 and December 1. Despite an investigation earlier this week, he was unable to get an update on the status of the project.
THE BIGGEST PLAYERS ARE ALSO WAITING
Delays in cluster studies also affect larger clients, but they are used to longer time horizons.
BlueWave works on 21 solar farms in Maine, almost all of them for commercial or institutional clients. A subsidiary of BlueWave, Perch Energy, takes care of subscriptions and invoicing. They have contacted energy brokers who work with these large clients, such as the hospital chain MaineHealth. Nexamp is also building solar farms supported by MaineHealth contracts.
Taken together, said O’Neill, the delays should be viewed as growing pains that will take time to overcome. And they’re not unique to Maine, she said. Cluster studies have also pushed back solar projects in Massachusetts.
In Maine, utilities are responsible for carrying out the cluster studies, and the industry is working with CMP and Versant to set the timelines, O’Neill said.
âWe just want some certainty, so that we can tell people how long it’s going to take,â she said.