Public Service urges committee not to reauthorize standard-offer now; urges PUC-designed community solar alternative

The Department of Public Service told the Senate Natural Resources & Energy Committee that it does not recommend reauthorizing the state's reverse-auction standard-offer program at this time, and asked lawmakers to consider a Public Utility Commission-designed Renewable Energy for Communities program instead.

The department's witness, TJ Ford, director of regulated utility planning at the Public Service Department, said the standard-offer approach has pros — predictable solicitations and a public price signal — but also cons including long development timelines, administrative costs and locational risks that can shift costs among utilities. "We just revised the renewable energy standard last year ... we should let that play out a little bit and see how this goes," Ford said.

Ford told the committee the state's last standard-offer solicitation produced prices in the low 8'to'9 cents per kilowatt-hour range but warned those prices may not persist given industry and global changes since 2022. He said roughly 30 megawatts awarded in 2022 have not been built and cited supply-chain, transformer and inflation pressures that can prevent awarded projects from reaching construction.

Ford urged the committee to consider the department's Act 179 report and the department's recommendation to direct the PUC to design a Renewable Energy for Communities program. That proposal would require utilities to run periodic solicitations for projects that demonstrate community benefits and would include evaluation criteria such as who benefits, project location, community ownership and workforce outcomes. Under S.57 as introduced, Ford said, community solar was defined only as projects "owned or controlled by its members," a formulation he said may not prioritize frontline or low-income communities and would allocate about 2 megawatts per year to community solar.

Green Mountain Power's representative, Candice Morgan, told the committee utilities support community-benefit programs but are not supportive of extending the standard-offer program beyond current authorizations. "We're not at this time supportive of extending the standard offer beyond what's already been authorized," Morgan said, arguing utilities can better vet project viability and target locations where grid upgrades are not needed.

Conservation and clean-energy advocates offered a contrasting view. Dan Vigas, executive director of Vermont Conservation Voters, told the committee that standard-offer auctions historically produced low-cost offers and that a multi-year standard-offer allocation that includes community solar would provide a predictable pathway for community-owned projects. "Standard offer is the most affordable and cost efficient way, to build solar projects in Vermont," Vigas said.

Committee members asked department and utility witnesses to work through details on definitions, cost containment and how benefits would be directed to affordable housing and manufactured-home communities. No committee votes or formal actions on S.57 occurred during this hearing; witnesses cited pending bills (including H.289) and the department's January 15 Act 179 report as materials for the committee to review further.

For now the department's recommendation is to let the recently revised Renewable Energy Standard play out and to use a PUC-led process to design community-benefit solicitations that include explicit criteria for frontline communities and cost-containment mechanisms.