A ray of (local) sunshine for manufacturers
Once upon a time, if you wanted to make things in North Central Massachusetts, you built your mill on a river, or dug a canal, and took advantage of a natural power source. Today, some local manufacturers still do something similar, using hydropower, solar or wind power on site, but, for the most part, plants have to buy their electricity off the grid.
That can be a problem, since the area has relatively high electricity rates, which can hurt factories' ability to compete globally, according to John Harden, economic development specialist at North Central Massachusetts Chamber of Commerce.
“The Northeast in general has some of the highest rates in the country,” he said.
Now the chamber has struck a deal that will allow some manufacturers to take advantage of locally produced energy, in a sort of roundabout fashion. A Rhode Island company that's building a solar power plant in Lunenburg will sell its net metering credits — essentially, payment from power company Unitil for solar power that's contributed to its system — to local businesses. Harden said several manufacturers have already signed on to buy the credits, which should generate a gross savings of about $80,000 a year, or between $3,000 and $6,000 per business once they're divided up.
Among those who have signed on is Fitchburg's Rocheleau Tool & Die Co., a fourth-generation family-owned machinery maker.
“Any time that there's a program available to be able to save some overhead, that's always a good thing,” said Lisa Rocheleau. “Energy is one of our big costs, so being able to save a fairly substantial amount percentagewise is going to be a great help.”
Enabled by change in state law
The net metering program is possible thanks to a 2008 change to state law that allowed relatively large renewable energy projects to sell their energy back to the grid, and also let the facilities sell their net metering credits. Other legal changes in 2010 and 2012 expanded the total amount of net metering projects permitted in the state.
David Milner, CEO of NuGen Capital Management, the company developing the solar project, said the plan is what's sometimes called “virtual net metering.” In contrast to actual net metering, where a company might have a renewable power source on site so that its meter runs backward or forward depending on whether it's using or producing more electricity, virtual net metering is used at a site that's used purely for production, with no significant demand for power. NuGen will get credit for each kilowatt hour of power delivered to the grid and will sell those credits to nearby power consumers at a 15-percent discount below prevailing retail rates, giving them an incentive to buy into the program.
Milner said the arrangement with the chamber is unusual for NuGen, which has about a dozen other solar projects either running or being developed in New Jersey and Massachusetts.
“It's actually really smart because basically they are pooling the demand of all their members,” he said. “The idea is, instead of having a lot of contracts with many separate entities, you can have a contract with one entity.”
NuGen took over two Lunenburg solar sites from other developers last year. The one it's working on with the chamber is the smaller of the two, a plant on Pleasant Street that will generate 1.1 to 1.2 megawatts of power. The other solar project, on Chase Road, is larger, at over 4 MW, and the town of Lunenburg will buy its net metering credits.
Town Manager Kerry Speidel said the projects have been “a long time in coming,” with permitting, Town Meeting approval for the net metering credits deal and the change in developers. But she said the town is pleased with the deal it's getting on electricity from the Chase Road project.
“We're looking forward to it,” she said.
Milner said neither the town nor the chamber businesses should have to wait too much longer. If winter weather doesn't slow construction too much, he said both plants should be up and running by April or May.
Read more
WBJ Web Partners
Most Recent
Most Recent
0 Comments