Renewable Energy Standard

NOTE: H.B. 7413 enacted on June 2016 extends the state Renewable Energy Standard (RES) to 2035, which was previously set to expire at the end of 2019. The RES is set to increase by 1.5% annually, thereby requiring 38.5% of the total retail electricity be obtained from eligible renewable resources by 2035. 

Rhode Island's Renewable Energy Standard (RES), established in June 2004, requires the state's retail electricity providers -- including non-regulated power producers and distribution companies -- to supply 38.5% of their retail electricity sales from renewable resources by 2035. The requirement began at 3% by the end of 2007, and then increase of an additional 0.5% per year through 2010, an additional 1% per year from 2011 through 2014, and an additional 1.5% per year from 2015 through 2035. H.7413 enacted on June 2016 extended the RES to 2035, which was previously set to expire at the end of 2019. 

The Rhode Island Public Utilities Commission (PUC) has the authority to delay the planned annual increase if it determines that there is inadequate supply of renewable energy. Beginning 2019, and every five years thereafter the PUC will determine if there is adequate renewable energy supply to meet the increase in percentage requirement for the following year. If the PUC determines that there is an inadequate amount of renewable energy supply then the PUC can delay all or part of the percentage increase until the resource supply is determined to be adequate. 

In 2014, the PUC reviewed the adequacy of renewable energy suppliers to meet the increase in percentage requirement of RPS for 2015 and decided to delay the scheduled annual increase of 1.5%. For 2015, RES obligated entities were required to obtain 8.5% percentage (same as 2014) of electricity sold from eligible renewable resources. This order resulted in delay of all subsequent increase in RPS goals by one year, thus decreasing the original 2020 target of 16% to 14.5% by 2020, and consequently creating a target to 38.5% by 2035. This 38.5% target will remain in effect till 2035 and in each subsequent year, unless the Rhode Island Public Utilities Commission (PUC) determines that the standard is no longer necessary.

Eligible technologies:
Eligible renewable resources include:

• Direct solar radiation
• Wind
• Movement or the latent heat of the ocean
• The earth's heat
• Hydroelectric facilities up to 30 megawatts (MW) in capacity
• Biomass facilities using eligible biomass fuels and maintaining compliance with current air permits (eligible biomass fuels may be co-fired with fossil fuels, provided that only the renewable-energy portion of production from multi-fuel facilities will be considered eligible)
• Fuel cells using renewable resource

RES Targets by compliance year

Compliance:

For each obligated entity and in each compliance year, and for the purposes of meeting the RES, the amount of retail electricity sales derived from eligible renewable resources initially placed into commercial operation before December 31, 1997, may not exceed 2% of total retail electricity sales. Compliance with the RES may also be achieved through the purchase of New England Power Pool Generation Information System (NEPOOL-GIS) certificates or by making an alternative compliance payment of $64.02 per megawatt-hour (2012) to the state's Renewable Energy Development Fund. Voluntary green-power purchases may not be counted toward RES compliance. Annual compliance reports are available on the PUC web site shown above.

Long-term contracts:

A separate and distinct standard established in June 2009 ("Long-Term Contracting Standard for Renewable Energy") requires electric distribution companies to solicit proposals and enter into long-term contracts for capacity, energy and attributes from new renewable energy facilities. Electric distribution companies will be required to enter into long-term contracts for 90 MW in capacity by 2014, of which 3 MW must come from in-state solar facilities. Distribution companies will be required to meet the following annual benchmarks, provided acceptable, commercially reasonable proposals have been received:

• 22.5 MW contracted by 12/30/2010 (25% of the total required amount)
• 45 MW contracted by 12/30/2011 (50% of the total required amount)
• 67.5 MW contracted by 12/30/2012 (75% of the total required amount), and
• 90 MW contracted by 12/30/2013 (100% of the requirement).

Beginning of 2014, the electric distribution companies (EDCs) shall conduct solicitations until 100% of the minimum long term contract capacity is met, however if the contract price is above the forecasted market price of the renewable energy certificates and energy over the term of the contract then the EDCs may choose to acquire environmental attributes and energy instead of capacity contract.

Each long-term contract must be reviewed and approved by the PUC. All energy and capacity purchased must be sold immediately by the distribution company into the wholesale spot market. Or, with PUC approval, the distribution company may re-sell the energy and capacity to customers. The NEPOOL-GIS certificates purchased under the long-term contract must be sold through a competitive bid process, or with PUC approval, may be used to meet the distribution company's RES obligations.


* RES increases in 2011 and subsequent years are subject to the PUC's findings.