Section 407-325-6 - LONGTERM CONTRACTINGA.Commission Authority. The Commission may direct investor-owned transmission and distribution utilities to enter into long-term contracts with program participants located within the service territory of the utility for energy, capacity or renewable energy credits. The contract may be for physical delivery of the products or may be a financial transaction.B.Participant Option. The program participant has the option to sell capacity or renewable energy credits to the transmission and distribution utility. A long-term contract under this section must include either all or a specified percentage of the energy output of the eligible renewable resource. In the event a program participant is not receiving value for capacity or renewable energy credits, the Commission may direct the program participant to transfer the capacity or renewable energy credits to the transmission and distribution utility if the Commission finds that the capacity or renewable energy credits is reasonably likely to have value for ratepayers without creating an undue administrative burden.C.Large Generators. For program participants with a generating capacity of one megawatt or more, the Commission shall conduct competitive solicitations for long-term contracts as specified in this sub-section.1.Periodic Solicitations. The Commission shall periodically conduct a competitive bid process for community-based renewable energy projects. To participate in the bid process, a program participant must be certified by the Commission pursuant to section 4 of this Chapter. The Commission shall not conduct bid processes if the applicable pilot program capacity limits specified in section 3 are reached or if there are no certified community-based renewable energy projects that are not already participating in the long-term contract program incentive pursuant to section 6 or the renewable energy credit multiplier program incentive pursuant to section 7. 2.Requests for Proposals; Standard Form Contracts. The Commission shall solicit bids for community-based renewable energy projects through the issuance of a request for proposals that contains all the standards, procedures and requirements for the bid solicitation process. The request for proposals shall contain a standard form contract. As part of the solicitation and selection process, the Commission may accept modifications to the standard form contracts. The Commission delegates to the Director of the Electricity and Gas Utility Industries the authority to develop and approve the requests for proposals and the standard contract, and to accept modifications to the standard form contract. The request for proposals shall, at a minimum, require that the proposals contain the proposed pricing terms, full project cost disclosure, expected revenue sources in addition to the long-term contract, and the Commission order certifying the project as a community-based renewable energy project pursuant to section 4 of this Chapter.3.Evaluation of Proposals; Bidder Negotiations. The Commission shall evaluate submitted proposals to determine compliance with the standards, procedures and requirements contained in the request for proposals. Following review of proposals, the Commission may engage in negotiations or discussions with bidders or a subset of bidders to clarify, refine or improve the proposals. At the direction of the Commission, the applicable transmission and distribution utility shall participate in bid evaluations or negotiations. The Commission may accept one or more of the proposals or none of the proposals based on its assessment of whether proposals meet the requirements of the request for proposals and this Chapter.4.Selection Criteria. The Commission will select proposals that are certified pursuant to section 4 of this Chapter, satisfy the requirements of the request for proposals of subsection C(2) and meet the cost containment provisions of subsection E. In considering the cost containment requirement, the Commission will take into account revenue the program participant will likely receive if capacity resource or renewable energy credits are not sold to the transmission and distribution utility. In the event the proposals exceed the applicable pilot program capacity limits, the Commission will select proposals that provide the lowest net cost to ratepayers over the term of the proposed contract.D.Small Generators. For program participants with an installed generating capacity of less than one megawatt, the Commission shall establish contract prices and terms as specified in this subsection.1.Contract Prices. Until changed by Commission order, the contract prices for small generators shall be as specified in this paragraph. a.Wind Power Installations. The contract price for wind power installations shall be10 cents per kilowatt-hour. Unless the Commission states otherwise by order, the price per kilowatt-hour in the contract may not vary.b.Solar Arrays and Installations. The contract price for solar arrays and installations shall be 10 cents per kilowatt-hour. Unless the Commission states otherwise by order, the price per kilowatt-hour in the contract may not vary.c.Hydroelectric Installations. The contract price for hydroelectric facilities shall be 10 cents per kilowatt-hour. Unless the Commission states otherwise by order, the price per kilowatt-hour in the contract may not vary.d.Other Renewable Resources. The Commission will establish prices for eligible renewable resources other than wind power installations and solar arrays and installations at the request of a community-based renewable energy generator that has been certified by the Commission pursuant to section 4 of this Chapter.2.Process. To obtain a long-term contract under this subsection, a program participant must provide to the applicable transmission and distribution utility a copy of its certification under section 4 of this Chapter and a statement as to contract term desired. The applicable transmission and distribution shall provide the program participant with a standard contract for execution. The Commission delegates to the Director of the Electricity and Gas Utility Industries the authority to develop and approve the standard form contract, and to accept modifications to the standard form contract. The transmission and distribution utility shall provide a copy of the executed long-term contract to the Commission.E.Cost Containment. The average price per kilowatt-hour within each contract year shall not exceed 10 cents and the cost of the contract will not exceed the cost of the project plus a reasonable rate of return on investment as determined by the Commission.F.Contract Term. A program participant may choose the contract term up to a maximum term of 20 years. A chosen contract term may not result in a violation of the cost containment provision in section 6(E) of this Chapter.G.Contract Termination. A contract entered into pursuant to this section shall terminate if the community-based renewable energy project is not in-service within three years of the execution of the contract or if the project ceases operation for a six-month period after the initial service date.H.Contract Administration. The transmission and distribution utility shall be responsible for administering contracts entered into pursuant to this section.I.Contract Payments. Contracts for capacity and energy entered into pursuant to this section must provide that payments will be made only after contracted amounts of capacity and associated energy have been provided.J.Commercial Reasonableness. Contracts entered into pursuant to this section shall be commercially reasonable and commit all parties to commercially reasonable behavior.K.Interconnection Requirements. A program participant must comply with all interconnection, safety and reliability requirements of the transmission and distribution utility applicable to the community-based renewable energy project.L.Disposition of Resources. At the direction of the Commission, investor-owned transmission and distribution utilities shall: 1. dispose of contracted resources through periodic auctions supervised by the Commission, which may occur in conjunction with solicitations for standard offer supply bids under Title 35-A, section 3212 or solicitations for green power bids under section 3212-A; or2. use the contracted resources to meet the supply requirements of Maine ratepayers; or3. take other action relative to contracted resources as determined by Commission rule or order.M.Cost Recovery. A transmission and distribution utility may recover in rates all prudent costs of contracts entered into under this section, including but not limited to any effects on the utility's costs of capital and costs of contract administration. A price differential existing at any time during the term of the contract between the contract price and the prevailing market price at which the energy is sold must be reflected in rates and may not be considered to be imprudent.N.Commission Notification. The program participant must notify the Commission of the in-service date of the community-based renewable energy project or if the project ceases or substantially reduces operation for a six month period after the initial in-service date.O.Consumer-Owned Transmission and Distribution Utilities. A consumer-owned transmission and distribution utility may, at the option of the utility, enter into long-term contracts with program participants located within the service territory of the utility for energy, capacity or renewable energy credits in accordance with this section.65- 407 C.M.R. ch. 325, § 6