More solar megawatts for Maine

Altus Power has expanded into its 25th market in the U.S., offering discounted renewable power with a newly completed 1.4 MW solar array in the Pine Tree State.

By Tony Kryzanowski

Consolidation within many essential industries is becoming a problem for consumers. It has made it so that a handful of companies can easily control, and perhaps manipulate, prices. The electricity market is near the top of that list where one or two companies often dominate within a specific geographic area.

Consumers in those markets often have no choice but to pay what are often higher prices compared to the national average. Maine is a good example of that.

Power rates are significantly higher in Maine compared to the national average primarily because the state does not produce a lot of its own power. A significant amount of locally-consumed power is generated elsewhere.

While rates are higher, overall consumption is lower compared to the national average. This raises an interesting question. Is consumption lower because rates are higher? Are Maine residents simply taking steps to make their power more affordable, like switching off the lights and turning down the thermostat, just to be able to afford their power bills?

This is where renewable power producers, given the current competitive nature of renewables compared to conventional power, can help. And solar power producers like Altus Power are seizing this opportunity and putting the buying power back where it belongs: into the hands of consumers.

“Our goal is to provide discounted clean energy across the country,” says Gregg Felton, Co-CEO and Co-founder of Altus Power. “To date, we’ve focused our projects in locations that tend to have high utility rates or local incentives that allow us to offer our customers a guaranteed discount to their utility rate.”

Headquartered in Stamford, Connecticut and founded in 2009, the company already owns and operates solar farms in 25 states. Maine was recently added to that list.

“Our model is to own, and operate, every installation we build or acquire,” says Felton. “We are focused on building long-term customer relationships and serving our customers with their growing needs, including storage and charging solutions.”

With the recent completion of their first solar installation in Maine—a 1.4 megawatt (MW) solar array installed in Kennebuc County—some Maine residents and businesses are beginning to experience discounted power costs compared to their current utility rates. Altus Power chose that location because Felton says it was physically conducive to solar development and there were a handful of small businesses that were interested in discounted clean energy.

Installing a solar array in the American Northeast where Maine is situated is no walk in the park. Felton acknowledges that developers must consider such issues as winter storms, snow cover and cold when designing and building these projects. The company has an in-house development team that works with a network of ‘channel partners’ to bring projects to fruition.

Altus Power describes these partners as local developers who have been a long-term source of both customers and sites for commercial-scale solar projects. The channel partner they worked with on this Maine project was REA Solar.

The project itself is equipped with bifacial modules installed on a ground-mounted, fixed-tilt racking system.

With the recent completion of the first Altus Power solar installation in Maine - a 1.4 megawatt (MW) solar array installed in Kennebuc County - some Maine residents and businesses are beginning to experience discounted power costs compared to their current utility rates.

“We have a number of long-term relationships with these types of developers, including REA, which brought us into this project,” says Felton.   

Among the company’s biggest challenges in constructing the project in Kennebuc County was continuing to conduct business in the COVID pandemic era.

“COVID, and specifically the Omicron variant, did contribute to the delay in securing local building permits and utility interconnection agreements,” Felton says. “All the local permitting offices were dealing with increased backlogs that they’re still working through due to the pandemic.”

He adds that since Altus Power relies on the utility grid to deliver its power, it had to wait for the utility to permit the project as well.

So how much higher are electricity prices in Maine? According to the Energy Information Administration (EIA), residents of Maine paid 43 percent more than the U.S. average in November 2022. The average bill was $133 per month in 2022, which was 33 percent higher compared to November 2021.

Given this scenario and with Altus Power’s focus on projects from 1 MW to 10 MW, Maine represented a good market expansion opportunity for the company, providing Maine residents with an alternative to installing solar power generation infrastructure on an individual basis, such as on a rooftop.

Felton says that in Maine, the company offers community solar directly to small commercial customers.

“Community solar provides businesses, homeowners and renters access to clean energy and savings without requiring the customer to provide roof space for the installation of solar panels,” he says. “Instead, customers can choose clean energy by subscribing to larger solar projects built on, in this case, unused land.”

He adds that the outcome in Maine—where customers are saving on power costs—is fairly common in jurisdictions in which they have developed solar projects.

“Quite frankly, we are able to offer discounted clean energy to customers because of the high utility rates with which we compete,” he says. “We make it as turnkey as possible for our customers. It’s a very easy sell: customers can reduce their carbon footprint while saving money.”

So, what changed recently to make Maine a potential investment target for Altus Power? The company is headquartered in nearby Connecticut. The short answer is, quite a lot.

Felton says that the rollout of its portfolio across the country is influenced by a variety of factors, including state programs, utility rates, local incentives, partners, pricing, etc., that support its investments into a market. Maine has recently taken a much more assertive legislative approach aimed at encouraging more renewable energy investment—and it’s working.

	Solar project developers like Altus Power must consider such issues as winter storms, snow cover and cold when designing and building projects in the northeast. The company has an in-house development team that works with a network of ‘channel partners’ to bring projects to fruition.

“Maine offers solar asset owners an incentive in the form of renewable energy credits (RECs),” says Felton. “These are valuable incentives that states offer to encourage companies like Altus to invest capital in the state and provide renewable energy solutions to local businesses, municipalities and residents.”

In 2019, the state also updated its renewable portfolio standard (RPS), aiming for 80 percent of electricity retail sales coming from renewable sources by 2030, and 100 percent renewable electricity by 2050.

“We strongly endorse this reform and it is definitely driving the attractiveness of renewable energy credits (RECs),” Felton says. “Ultimately, we expect these new standards to drive even more demand for our services.”

Maine has also made adjustments to its net energy billing (NEB) programs. One of the most significant changes is lifting the capacity cap on distributed generation resources eligible for NEB from 600 kWs to 5 MWs and removing any limit on the number of accounts or meters that can be associated with an eligible NEB project.

There is plenty of room for growth in solar power generation in the state, as solar represented only about three percent of in-state power generation in 2021. But that is growing, and quickly.

With just over 600 MW of production installed and ranked 32nd in the country in 2021, over $1 billion is expected to be invested in the state in renewables generally, and $540 million into solar power specifically, over the next five years, adding another 1.5 gigawatts of production. About 8,500 jobs are expected to be added as well. Altus Power has a number of additional projects in the pipeline to add to its Maine portfolio.
Felton says that lifting the capacity cap of distributed generation eligible for net energy billing is a positive step that Altus supports, although the company was already interested in making an investment in the state prior to this recent change.

“With the increased sizing of projects, there are significant economies of scale that can be delivered at a far lower cost to building, while also giving us access to a wider universe of customers to offer the savings,” he says.

Passage of the federal Inflation Reduction Act (IRA) is opening new doors, described as a ‘market expander’ for companies like Altus Power, and an opportunity to benefit both directly and indirectly because of the manufacturing incentives built in.

Altus Power is well-positioned to take full advantage of the domestic supply chain incentives written into the IRA, having signed a strategic partnership agreement with American-based solar module manufacturer, Heliene Inc, last year. According to the three-year strategic supply agreement, Altus Power will have the option to purchase up to 250 MW of high efficiency solar modules from Heliene, which provides the company with secure, reliable access to domestically manufactured, high performance solar modules for use in construction of solar generation projects across the U.S.

While stressing that Heliene is not its only solar module supplier, Felton says that the company believes that in the next few years, incentives built into the IRA will generate a domestic supply chain that will help drive down the costs of the materials needed to build its projects.

“In addition, the IRA incentives for low-to-moderate income households help to democratize access to solar,” he adds.

Q3 2023