Print
Share page with AddThis

Power Supply Portfolio

Climate Law Compliance

The Climate Law is Massachusetts climate legislation which, for the first time, establishes compliance standards for Municipal Light Plants (MLPs). This legislation requires that the power sold by MLPs be sourced from resources that are 50% non-carbon by 2030, 75% non-carbon by 2040, and net-zero carbon by 2050. To be considered a non-carbon resource under the Climate Law, the associated energy certificates (renewable or non-carbon) must be retired by the utility. Sold certificates do not count toward Climate Law compliance. 

In the context of the Climate Law passage, RMLD revised its Policy 30 to ensure compliance and also minimize rate shock to RMLD customers. Specifically, RMLD will retire certificates up to the annualized line and sell certificates above the line. Least expensive certificates will be retired first. Certificate transactions will be published quarterly, and compliance reports submitted annually.

While the next compliance goal in the Climate Law is not until 2030 (50% non-carbon up from 20% non-carbon in 2020), the annualized line of % certificate requirements increases 3% per year, to minimize rate shock.

In addition, RMLD implemented a Renewable Choice option for customers who desire to have a higher portion of their power be associated with renewable resources. Customers can opt in to increase their portion of renewable energy by retiring more renewable energy certificates at an additional cost to their monthly bill. These additional funds will be used to retire, instead of sell, more renewable certificates (for example, MA Class 1) from the RMLD certificate portfolio.

compliane

Transaction by Source

Transaction by Source Outlook to 2035

DEFINITIONS

Mixed Sources – Contracts for non-specific power supply sources and real-time spot market purchases. These reflect the fuel mix of the New England grid and are assumed to be primarily carbon-emitting, such as natural gas. 

Solar and Wind Sources – Non-carbon emitting sources that are eligible for Renewable Energy Certificates.

Hydro and Nuclear Sources – Non-carbon emitting sources that are eligible for Non-Carbon Energy Certificates.

Certificate Management – RMLD sells higher value certificates to reduce power supply costs and then retires the balance. The cross-hatched portions of the charts above represent actual certificate sales in 2021 and planned certificate sales going forward.