RMLD Board Votes to Sell Portion of REC's
RMLD will sell 40 percent of their RECs and retire 60 percent.
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The following was submitted by RMLD:
At its May 30 Board meeting, the Reading Municipal Light Department's (RMLD) Board of Commissioners voted to retire 60 percent and sell 40 percent of the Renewable Energy Certificates (RECs) from the output of the Swift River Hydroelectric facilities they have entitlement to in Massachusetts. The RMLD has been discussing the issue of the disposition of these RECs for the last six months.
RECs certify that energy is produced by a renewable energy generator (wind, solar, water, bio mass, etc.) and can be retired or sold by their owner. Subject to a Renewable Portfolio Standard (RPS) under Massachusetts Law, Investor Owned Utilities (IOUs) such as NSTAR, National Grid and Western Massachusetts Electric are required to purchase or acquire RECs as a percentage of their annual energy sales. The RPS does not apply to municipal utilities, therefore, the RMLD can sell their RECs to the REC market or choose to retire them.
As a result of the RMLD Board vote to sell 40 percent of the RECs, RMLD could receive an estimated return in excess of $300,000. This estimate depends on the REC market, which fluctuates daily. The other 60 percent of the RECs being retired represent about 1.6 percent of the RMLD's annual energy sales.
Chairman of the RMLD Board of Commissioners Philip Pacino, said, "I am pleased with the RMLD Board's decision to both sell a portion of the RECs and retire the remainder of the RECs. This vote gives the RMLD Board more time to create a Renewable Energy Policy that will guide the RMLD in future purchases of renewable energy."
Pacino added, “The Commission also voted to continue discussion on a Renewable Energy Policy that will cover all aspects from how much renewable energy should be in the power portfolio to what to do about the RECs.”
RMLD General Manager Vinnie Cameron said, "I think the action of the RMLD Board shows our customers that we are sensitive to their financial interests and also to the environmental responsibility we have as an electric utility."
Cameron went on to say, "I believe commentary from elected officials within the service territory regarding the REC issue, helped guide us in this direction.”
Fred Van Magness Sr.
10:25 am on Friday, June 1, 2012
Congratulations to the RMLD board for finally doing the correct thing. I've advocated that an all or nothing strategy in this regard just doesn't work for the rate payers. While I might have preferred a larger % of sale (I did not see the rationale for the 40% sale), this is indeed a very good first step and the board is to be commended for taking this action. What was missing from the story was the abrupt resignation of Mrs. Mary Ellen O'Neil from the RMLD board after she was just re-elected in March (less than 90 days ago) with the highest vote tally of the three candidates. Strange.......
John
11:07 am on Friday, June 1, 2012
Sounds to me that she didn't get her way so she picked up her bat and ball and went home...too bad, agree or disagree with her stances, she was very passionate for what she believed in. I for one am surprised by her immature behavior.
Karl Weld
11:36 am on Friday, June 1, 2012
Fred, it's my understanding that the bulk of the money ($300,000) "lived" in the 40% that are to be sold. The 60% that were retired had a value of $2,000. So the percentages are a little misleading. I thought the same thing and was corrected by a board member.
Fred Van Magness Sr.
1:06 pm on Friday, June 1, 2012
Karl, Thanks for the update and clarification. It now makes perfect sense. As I said, I did not see the meeting, so I had to go with just what I could read in various newspapers. This board has really acted in a very fiscally responsibly manner....just what a large group of ratepayers and government officials were asking them to do.
Karl Weld
1:12 pm on Friday, June 1, 2012
It may also explain the resignation. Retiring the RECs with the least value vs. selling those with the highest monetary value makes perfect sense given the very limited number of rate payers in the Green Choice program vs. the majority who just want the lowest rates possible.