Dalton Begins Negotiations for Solar Alternative Credits
DALTON, Mass. — The town has entered into preliminary negotiations for a solar alternative on-bill credit agreement with Citizens Enterprises Corp. under the Solar Massachusetts Renewable Target program.
If Citizens Energy signs up for the state program, Eversource is told that it can allocate credits to the certain list of customers that Citizens Energy anchors.
The Select Board expressed concerns regarding the agreement during its meeting on Monday night noting that there are too many unknowns.
Prior to making any decision Select Board chair Joe Diver requested the town conduct an internal review to determine the total impact value to the town and its residents.
The agreement offers a 20-year 215,000 kWh per year contract with a 15 percent fixed discount that could accumulate $48,000 a year of credit on its Eversouce bill, Citizens' Senior Director Emily Byrne said.
"With a 15 percent fixed discount, there would be no possible way the town will ever pay more for the credits that they would receive because the discount will be off the value of energy wherever that price may have risen or fallen," Byrne said.
The town currently has an electricity aggregation program that two-thirds of residents take part in. Starting in January the program is going to cost 13 cents per kilowatt hour.
The agreement between the town and Citizens will not affect this program. As long as the town receives an Eversouce bill, the monetary credits can be applied to the account and will be approved at Eversource's basic service rate, Byrne said.
The contract value is $215,000 in year one. Right now, Eversource's basic service rate, also referred to as the "alternative on bill credit rate," is 22.5 cents.
"So if you have 215,000 kWh multiplied by 22 1/2 cents, your total credits that the town would receive on their electric bills, because the credits come in dollar monetary format, would be $48,000," Byrne said.
"We would offer a 15 percent discount so citizens would then be owed by the town $41,000 for a savings of $7,000."
This project is a 3.5 megawatt DC project that is projected to be about 5 million kilowatt hours and is a low income community shared solar project.
"The low-income community shared solar model requires 50 percent of the benefit, energy uptake to be contracted to low income eligible ratepayers," Byrne said.
Eligible ratepayers need an R2 or R4 rate class on their Eversource bill to participate directly in Citizens’s program.
In the program, for 50 percent of the power they generate, they would be able to serve approximately 550 households.
Prior to starting construction, Citizens Energy will pay outstanding back taxes and has been in discussion with the town tax assessor and treasurer. It would also negotiate a payment in lieu of taxes with the town or through the assessed value of a personal property.
One concern raised is the lack of resident participation from Dalton residents because they have not yet seen Citizens' approach to getting residents to join, Diver said.
"There's a lot of unknown factors here to really figure out if we're gonna get true value for our residents," Diver said.
"I’m not questioning the financial value about the back taxes but … when I look at these types of contracts or agreements I’m looking at the 20 year term value and how we maximize that."
Citizens Energy is always looking for new customers. It has six operational Joe-4-Suns projects, one being in Western Mass, and can serve Dalton residents.
The board wanted to ensure that the benefits from the Solar Energy Project would help Western Mass. residents and not go to Eastern Mass. if not enough residents applied.
"The SMART program has recently shifted and allows for credits on Eversource to cross load zones …So Eversource eastern Massachusetts residents, low-income residents would take advantage of this project as well," Byrne said.
Citizens' Joe-4-Suns team will become involved later this year when they are a bit closer to understanding the project's construction schedule and when they will be in operation because they don’t want subscribers to sign up too far in advance, Byrne said.
"So our team will be looking to engage with the town of Dalton directly and different boards and agencies … we've done a lot of outreach for all of our existing projects that are operating and we'll perform the same outreach activities here in Dalton to encourage all local Dalton residents to sign up first," Byrne said
"Later this year when we're ready to start our marketing outreach campaigns, which we'll go over in much detail, how people can sign up, who can sign up, how you're eligible, what you need to do."
When the time comes they would get on the Select Board agenda and bring the Joe-4-Sun program director to answer questions specifically about the low income component to the project.
Diver said he does not want Citizens telling the town what the value is, but rather have an internal team look into what the energy savings means for the town, the taxes, the payoff, and the full financial picture.
Select Board Vice Chair Dan Esko agreed with this sentiment and also requested that the town review how the last three years of bills to see how it would be affected if they were in a program like this.
Citizens will not be providing the energy; that will be through Eversource. Citizens Energy applied for this project with Eversource two years ago.
In other news:
• The board approved the appointment of Lee Nunez as assessor effective July 1.
• Lee has been recommended by the principal assessor. He has been the assessor's clerk for some time and has been taking the education he needs according to Massachusetts state law to be named as an assessor.
• The board met for an executive session to review the town manager evaluation and compensation. The town manager's contract automatically renews if the board does not take action by May 4.
Following the session, the board decided not to take action and to allow the contract to renew.
The board will do another evaluation by the end of calendar year 2024 before considering entering into a negotiation for a multi-year contract.
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