Connecticut lawmakers are touting newly introduced legislation as a way to lower out-of-control power bills, but opponents say it could devastate the state’s renewable energy progress. Provisions of the complex, 80-page bill would scale back incentives for residential solar and make nuclear power eligible to earn renewable energy credits, directing essential funds away from other types of clean energy developments.
“It’s a direct attack on the growth of solar and wind in Connecticut, an attack on new resources that reduce pollution,” said Chris Phelps, state director of advocacy group Environment Connecticut.
Connecticut’s high electricity rates — its residential prices were the second highest in the country in February — have been the subject of much discussion among lawmakers this session. Many of these conversations have, explicitly or implicitly, revolved around the largely unfounded notion taking root across New England that clean energy programs are driving high prices.
That belief is the basis of some provisions in SB 1560, a sprawling piece of legislation introduced earlier this month by Democratic Sen. John Fonfara, chair of the Finance, Revenue, and Bonding Committee. Fonfara, who announced his plan accompanied by legislators from both sides of the aisle, claims the bill would create immediate savings for Connecticut consumers. At a hearing for the bill in mid-April, dozens of people and organizations testified, some in support of the lower costs the bill promises, many opposed to the dangers they say it poses to renewable energy.
The proposed legislation includes several sections that do not explicitly address clean energy. It calls for the creation of an in-state procurement authority to watch the power markets and, ideally, buy electricity at better prices. The bill would also eliminate the sales tax on electricity purchased by commercial and industrial users, and mandate an expansion of variable time-of-use rates, which nudge households to use less energy during high-demand times by raising the price of electricity.
Renewable energy advocates, however, are focused on three elements they claim would completely undermine state support for clean energy and energy-efficiency programs without creating any overall savings for the public.
Nuclear credits would undermine renewables
The first measure that worries advocates is a small wording change that would define existing nuclear power generation in the state — a category that includes only the Millstone Power Station — as a Class I renewable energy source. This designation would allow Millstone to sell renewable energy credits (RECs) as part of the state’s renewable portfolio standard.
Under the standard, utilities must buy RECs to offset a certain percentage of the power they sell. That proportion rises over time: This year, for example, Connecticut utilities must procure enough renewable energy to meet 30% of their power sales; next year, that bar jumps to 32%. By encouraging a market for renewable energy, this requirement lowers the emissions from Connecticut’s power supply. Plus, renewable energy developers can use revenue from selling RECs to finance new projects.
If Millstone were allowed to sell Class I RECs, it could do so at much lower prices than other clean energy sources because the nuclear plant is already built and running without this added financial support, said Francis Pullaro, president of renewable energy nonprofit RENEW Northeast. A flood of cheap credits from Millstone would lower the market price for RECs across the board. While utilities could pass those savings on to customers, advocates warn that REC prices would almost certainly drop so much that they no longer provide enough revenue to renewable energy developers to support new projects.
There would also be little need for solar or wind RECs in the market if Millstone were allowed to sell credits. In 2023, the plant generated 33% of the power consumed in Connecticut, while utilities only needed to meet 26% of their total energy sales with renewable energy. This dynamic could imperil existing renewable energy operations that count on REC revenue, and prevent new projects from penciling out, Pullaro said.
