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In my northernmost New England state, folks have begun scrutinizing how electrical power is generated and distributed. It started when the biggest power company in the State of Maine decided it needed to build out the grid in order to supply power to energy-starved coastal areas. The idea is to feed power to areas in need from new and refurbished central power stations.

As these proposals by Maine's venerable Central Maine Power Company (CMP) unfold, an exciting alternative plan, one that could fundamentally change the way the State purchases electricity, is in the wind (pun intended). Called the Climate and Energy Planning Act of 2009, otherwise known as the Maine Renewable Energy Sources Act, the MRESA legislative proposal is crafted to reduce reliance on fossil fuels, especially imported oil.

Here's how it will work – if passed into law. MRESA would empower the State's utility commission to set the rates for renewable, locally-produced, electricity. The rates would be based on what alternative technology is used, and what the capacity of a given alternative electricity generator is. MRESA would then require that the power company purchase all of the clean energy, from each and every qualified renewable supplier.

The act would mandate a power company contract with all of the homegrown energy suppliers. This contract would bind the big power company and the little guys for a period of 20 years.

The way it works now, if a homeowner feeds home-generated electricity into the grid, the homeowner is given an energy credit. The credit is then applied to any energy that the user pulls from the grid in the future. Home-generated power plant owners never get paid directly for their power contribution. Worse, at the end of the year, even if the homeowner or small business owner supplied more power to the grid than was used in a home or on a business site – poof! – the credit vanishes.

No Electrical Catch-22

The MRESA proposal, on the other hand, is crafted to remove that regulatory green power Catch-22. It's a market-based approach to efficiently produce renewable energy, paying small-scale producers for the energy they add to the grid. The homeowner or small-scale producer actually makes money for producing power.

Right now, the legislation is targeting power primarily from solar systems. It turns out that Maine is at the same latitude as Spain. We enjoy abundant solar insolation (the amount of solar radiation incident on the surface of the earth) year round.

MRESA would also encompass wind power. Though Maine has an abundance of wind power, especially in the winter and offshore, the wind usually blows at inopportune times, and when peak demand is lowest. Nonetheless, if a private wind generator operator wanted to feed the grid, MRESA would ensure that he or she gets paid for the power produced.

MRESA extends to hydroelectric plants, too. There are quite a few small hydro plants on rivers in Maine. This may be a problem. There's also a political movement in the State to remove hydro plants from rivers so the rivers can be restored for Atlantic salmon and alewife migrations.
 
MRESA would also buy electrical energy recovered from municipal waste plants and landfills (the landfill covering the old dump here in town presently vents methane into the atmosphere). MRESA would also pay producers of electricity from biomass (but not wood) and tidal generators. Not incidentally, the US Environmental Protection Agency has a Landfill Methane Outreach Program. The EPA’s LMOP is a voluntary assistance and partnership program that promotes the use of landfill gas as a renewable energy source.

All of this comes at a time when electricity rates are skyrocketing. Moreover, producers of coal, oil, natural gas, and nuclear power are being subsidized. Did you realize that more than half of all government energy subsidies go to fossil fuel industries?

Under the MRESA alternative plan, if you invest in solar, wind, or other renewable technology, you could actually start a small business providing power to the grid. With the price set by MRESA, you could actually accurately predict how long it will take to pay off a loan needed to get your hands on the requisite hardware and do the installation.

Calculate Collector Size

Once you know your site's insolation level you can accurately calculate collector size and energy output. You could then negotiate a loan from an energy savvy local bank. All hands could rest easy, knowing what the payback period would be.

For the people of my State, this would mean paying local alternative power producers in-State, rather then sending our money to Nova Scotia (where the natural gas comes from), or (worse) to Saudi Arabia.

Speaking of overseas entities, this type of plan was set into place in Germany not too long ago. In short order, it resulted in the creation of almost 250,000 energy related jobs.

Every skeptical engineer knows there are tradeoffs in systems of every type, but the MRESA plan just seems so right, with few, if any, downsides.

Nonetheless, traditional power companies usually oppose MRESA-style schemes, calling them feed-in tariffs (the term comes from the German word Stromeinspeisungsgesetz, for electricity feeding-in law). Power companies claim feed-in tariffs lead to higher energy prices. A spokesman for Florida Power and Light, for example, recently went on the record, stating "any law that requires a utility to buy electricity at an artificially inflated price makes no economic sense."

In truth, the German feed-in tariff resulted in explosive renewable energy market growth. Over the past ten years the country has more than doubled its supply of electricity. Other European Union countries are following Germany's lead and, on this side of the pond, Ontario adopted a European-style feed-in tariff called the Standard Offer Contract.

Lots of privately-owned distributed power sources are obviously less risky than building big centralized power plants, especially in view of today's fossil fuel prices and the cost of the nuclear option. Taken as a whole, diversified distributed sources are more reliable, too.

As such, I'm hoping my State's legislature adopts the Climate and Energy Planning Act of 2009 (Sec. A-1. 38 MRSA c.3-C). It can't happen soon enough.  What’s happening where you live? Write me at amm at en-genius dot net, or post your comments on our blog.