Anyone paying attention to Montana’s solar industry could have seen a clash between the state’s biggest solar facility and the state legislature coming a mile away.
After all, at the same time the state was signing an agreement to lease the 480-acre, 80 MW MT Sun Solar Farm – the state’s largest facility and its first on public lands – the Public Service Commission was being hauled before the Federal Energy Regulatory Commission (FERC) for violating federal law as it pertains to encouraging renewable-energy development.
Under the rules of the Public Utility Regulatory Policies Act OF 1978 (PURPA), utilities must buy power from independent power producers if it is below their cost of generation. At the request of the state’s utility NorthWestern Energy, the PUC illegally suspended the PURPA rules to protect the utility from solar competition.
Despite FERC eventually finding the PUC had violated federal law, some in the state legislature are still aiming to gut PURPA’s intended purpose. Senate Bill (SB 102) would shorten the terms of solar contracts to no more than 20 years and would not set a minimum contract length.
The sponsor of the bill, Sen. Tom Richmond originally wanted to limit the contract length to five years, but after the banking industry and solar advocates raised serious objections – namely that the bill’s provisions would provide insufficient time for investors to recoup their investment – the contract length was amended to 20 years.
Unsurprisingly, the bill would represent a setback for the MT Sun Solar Farm by forcing it to accept unsustainable contract lengths. What makes the restrictions even odder is that the solar farm, because it would sit on public land, would provide enormous tax revenues for the county and its school system.
According to Montana’s Department of Natural Resources and Conservation officials, the lease payments would be $124,800, and the county would collect more than $1 million a year.
Like its counterpart New Mexico, which last week exhibited a similar disconnect between its legislature and solar industry, Montana is encouraging and discouraging solar at the same time – creating uncertainty in an industry for whom stability is critical.
Update: This article was updated at 12:53 pm EST on 2/15/17 to reflect that it is the Montana Public Service Commission, not Public Utilities Commission.