PUC, municipalities debate S.50 net‑metering threshold, setbacks, REC rules and application fees

MONTPELIER — Witnesses from the Vermont Public Utility Commission and the Vermont League of Cities and Towns told the House Energy and Digital Infrastructure Committee on March 26 that S.50’s proposal to raise the registration threshold for ground‑mounted net‑metering systems from 15 kilowatts to 25 kilowatts advances streamlined permitting, but a Senate floor amendment on municipal setbacks creates conflicts the legislature should resolve.

Jake Mayeron (appeared as Jake Merry in committee record), hearing officer and deputy general counsel for the Public Utility Commission, described the Section 248 permitting framework and the PUC’s tiered net‑metering review. He said registration for roof mounts and very small ground arrays currently uses a short, largely paperwork review (15 calendar days) and that the PUC processed more than 2,300 net‑metering registrations in fiscal 2024.

Mayeron told the committee the commission has no objection to raising the registration size if the Legislature wants that policy, but he cautioned that a Senate floor amendment — which would allow municipal setback rules that apply to other development to constrain small solar projects — could conflict with 30 V.S.A. § 248(s), which presently provides statewide uniform setbacks (including a 0‑foot requirement for systems at or below 15 kW).

“The issue with that is… it may be in conflict and it would complicate our streamlined registration process,” Mayeron said, adding that the commission would likely need more detailed site plans and municipal notice if the PUC were required to determine compliance with local setbacks.

Municipal perspective

Representatives of the Vermont League of Cities and Towns said municipalities support faster permitting for small systems but asked lawmakers to preserve local planning and safety standards. Josh Hanford, director of intergovernmental relations at VLCT, and Samantha Sheehan, the league’s municipal policy specialist, told the committee that enhanced municipal energy plans (under Act 174/2016) give towns a formal role in siting by identifying suitable and unsuitable locations and by receiving “substantial deference” at Section 248 review. They said municipal setback rules serve public‑safety, fire‑access, stormwater and neighborhood‑compatibility goals.

“We support private property owners’ ability to put in solar panels,” Hanford said, but municipal officials want “clear language that they can apply fairly to all their residents.”

Other PUC concerns raised in testimony

- REC (renewable energy certificate) election changes: Mayeron and Anne Bishop, the PUC’s operations director, warned against allowing net‑metering customers to change whether they keep or convey environmental attributes (RECs) to the utility at any time. The commission currently requires customers to make a fixed election at registration; PUC staff proposed permitting only short‑term corrections (for example, filing errors) within 90 days of commissioning to avoid market volatility that could disrupt utilities’ long‑range portfolio planning.

- Municipal land‑record filing requirement: Bishop said the PUC is recommending removal of a statutory requirement that CPG holders record certificates in municipal land records and file proof with the commission. The requirement — originally intended to make approvals discoverable — now duplicates online PUC records and has produced a large compliance workload: Bishop said at the start of a recent compliance grace period the commission had 1,167 outstanding filings and, six months later, more than 700 remained outstanding.

- Application fees: Bishop also asked lawmakers to revisit application fee levels for net‑metering and Section 248 work. She said application fees collected from private applicants (registrations and small projects) still cover a very small share of the PUC’s staff costs: commission staff time on these matters totals roughly $1.3 million annually while net metering‑related application fee revenues were around $160,000 in FY24. The PUC proposed raising statutory fee amounts to better align cost causation with review workloads.

Committee discussion

Committee members asked whether municipal notice could be implemented as a checkbox or affidavit on registration forms, and whether towns lacking zoning would be affected differently than towns with bylaws. VLCT representatives said about 41 of Vermont’s 247 municipalities have zoning bylaws; many towns lack zoning and use town plans to guide development. Both sides agreed the policy question is manageable but requires careful legislative language to avoid altering the PUC’s streamlined process unintentionally.

No formal committee action was recorded during the testimony. Lawmakers signaled they will continue hearings and that clarifying amendments or compromise language could follow before any final legislative steps.

Quotes

- Jake Mayeron (PUC): “The commission doesn’t have an issue with that change. We would view that as the legislature giving the instruction to us…if that’s what this legislature wants to do.”

- Anne Bishop (PUC): “Tracking down 737 CPG holders and conducting individual proceedings to try and get these files made is a significant workload for an agency the size of the commission.”

- Josh Hanford (VLCT): “Local land use planning processes allow a community to envision and realize development that best leverages local resources and capacity, meets emerging needs and common goals, ensures equity and protects natural resources.”

Clarifying details (sourced to testimony)

- Current registration review: 15‑day PUC review window for net‑metering registrations (source: PUC testimony).

- FY24 volumes: PUC processed over 2,300 net‑metering registrations in FY24 and 214 ground‑mounted applications greater than 15 kW via the streamlined application pathway (source: PUC testimony).

- Compliance backlog: PUC reported 1,167 CPG holders out of compliance with municipal‑record filing at start of a recent grace period; roughly 700 remained noncompliant six months later (source: PUC testimony).

- Fee mismatch: Commission personnel costs on these application types estimated about $1.3 million annually; application fee revenues to the commission were about $160,000 in FY24 (source: PUC testimony).

Policy choices ahead

If the Legislature keeps S.50’s raised registration threshold but removes or narrows the Senate floor amendment on setbacks, the PUC would be able to continue the current expedited registration flow with minimal additional municipal notice. If the law grants municipalities the ability to apply their general development setbacks to small net‑metering systems, the PUC warned it would need to collect more detailed site information and give municipalities notice — changes that would slow the streamlined registration process that now supports thousands of small systems annually.

Ending

Lawmakers did not vote on S.50 or adopt any amendments during the hearing. The committee signaled it would continue to take testimony and consider compromise language, including possible minimum setbacks or an applicant checkbox/affidavit confirming municipal requirements have been checked, before advancing the bill.

Speakers