Sell them? Or retire them? Renewable energy credits (RECs), that is. The selectmen discussed options Tuesday with Tony Capobianco, the town’s representative to the Citizens Advisory Board of the (RMLD). The decision could affect RMLD customers' rates.
The light department’s advisory board originally voted 4-1 to retire the RECs in the name of sustainability, Capobianco told the selectmen. But, based on a “backlash” to that vote, the board voted to reconsider the vote, he said, and to meet with governing boards in the four communities that the light department serves: Reading, North Reading, Lynnfield and Wilmington.
After “agonizing” over the issue, Capobianco said he voted to retire the RECs because he supports sustainable energy.
But “everyone” wants the light department to sell the credits, Capobianco said.
Capobianco met with the selectmen to get their opinions on the issue.
Energy companies earn the credits when they buy energy from green sources. Non-municipal energy companies must use a certain percentage of green energy, by government regulation. Companies can buy RECs to meet that requirement.
The value of the RMLD RECs, Capobianco said, is between $500,000 and $2 million this year – to customers, between $6 and $24 -- or 15 times that amount over a 15-year energy contract, Capobianco told Patch. The credits’ value varies over time, according to Tuesday’s discussion, based on several factors, including demand.
Municipal power companies are not required to consume green power, Capobianco said. He said he can foresee that rule changing.
RECs are created new every year, according to Town Manager Peter Hechenbleikner. “You don’t keep them like monopoly money.”
Sell at least some of the light department RECs, said several selectmen. Make the best decision for ratepayers, said Selectman James Bonazoli and Selectman John Arena.
But from the audience, Ron D’Addario urged the exact opposite course of action. Selling RECs to large utility companies means they can still burn coal, for example, to make energy, he said.
You can’t say you’re sustainable if you sell RECs, Capobianco said.
In the end, the selectmen agreed by consensus with several suggestions from Hechenbleikner. The sell or retire decision can be a hybrid of both. Decisions to sell or retire REC’s should be reviewed every year.
A member of the RMLD Board of Commissioners, Philip Pacino, has proposed a plan for RECs.
Let the percent of customers in the RMLD’s Green Choice program determine how many of the RMLD’s RECs are retired and not sold. Pacino hopes “at least 5 percent” of customers would initially join this program, he wrote in a letter included in the selectmen’s meeting information packet.
Some RECs should be sold, Pacino wrote. Money from the sale of those RECs should be “put aside” for renewable energy capital projects in the RMLD service district,”reducing the amount of energy consumed there. Such a change would require some adjustment in the way rates are set, he wrote, because proceeds from the sale of RECs “must go back into the fuel charge fund and thus cannot be directly allocated to a renewable energy capital projects fund.”
Enrollment in the green program is “not high,” Capobianco told Patch Wednesday -- between 400 and 500 of what he estimated to be 100,000 ratepayers.