Thermal Energy is Not 'Too Hot to Handle' for New Hampshire Politicians

New Hampshire is putting the heat on other U.S. states to start including thermal energy in their renewable portfolio standards. It has become the first state in the union to fully incorporate renewable thermal energy into its RPS requirements.

The RPS mechanism generally places an obligation on electricity utilities to produce a specified amount of their electricity from renewable energy sources. Renewable portfolio standards have been adopted by some 29 states and the District of Columbia to provide incentives to develop energy from “clean technology” such as wind, solar and biomass. 

With passage of NH Senate Bill 218, the New Hampshire legislature includes “useful thermal energy” in those requirements—defined as “renewable energy delivered from class I sources that can be metered and that is delivered in New Hampshire to an end user in the form of direct heat, steam, hot water, or other thermal form that is used for heating, cooling, humidity control, process use, or other valid thermal end use energy requirements and for which fuel or electricity would otherwise be consumed.”

Renewable Energy Certificates (RECs) will be worth up to $29 per megawatt hour (MWh) of useful thermal energy produced by qualified thermal projects

"This is an important step forward in efforts to gain equal consideration for thermal energy," said executive director, Joseph Seymour of the Biomass Thermal Energy Council, based in Washington, DC. "With little happening on energy policy in Washington, efforts must focus on state policy to achieve a more fuel and technology neutral incentive structure for renewable energy. New Hampshire has led the way in showing the nation that it is possible to enhance state RPS programs by adding thermal energy."

BTEC is a U.S. industry association representing the views of nearly 100 biomass feedstock producers, fuel refiners, appliance manufacturers, vendors, non-profits, and end users.

Examples of projects that will qualify are:

• Wood or wood pellet
• Boilers heating commercial or institutional buildings,
• Solar hot water arrays on hospital rooftops, and
• Geothermal heating and cooling systems for nursing homes or correctional facilities.

Residential, commercial and industrial applicants will be eligible to take advantage of the RECs. Qualified projects will be able to utilize the revenue from the sale of RECs to finance the often-high capital cost of these advanced renewable technologies—thus greatly reducing the payback time on initial investment.

The New Hampshire effort was spearheaded by New Hampshire Senate Majority Leader and former U.S. Congressman Jeb Bradley (R), a long-time energy policy expert. Governor John Lynch—who in 2006 publicly endorsed the national goal of 25 percent of all energy from renewable resources by 2025 and backed the passage of the RPS in 2007—worked with the New Hampshire Public Utilities Commission in support of the legislation. BTEC member company New England Wood Pellet of Jaffrey, NH developed the concept and led efforts to organize advocacy in support of the provision.

"Now is the time for other states to consider New Hampshire's leadership," said BTEC’s Seymour. "Thermal energy represents over one-third of all energy consumed in America. Energy policy that only focuses on electricity or transportation fuels ignores the tremendous economic and environmental benefits of displacing our dependence on fossil heating fuels with renewable energy."

Some eight states—Arizona, Iowa, Maryland, Massachusetts, North Carolina, Ohio, Virginia, and Wisconsin—have limited thermal provisions in their RPS programs, but they are generally narrowly restricted. Several states, including Massachusetts, Maryland, and Vermont, are considering expanding their RPS programs to include thermal energy.

The U.S. Energy Information Administration has estimated that the within the United States, the Northeast exports over $20 billion in consumer wealth annually, due to its regional dependence on imported heating oil.

With passage of the bill, the New Hampshire Public Utilities Commission will now undergo administrative rulemaking to implement the thermal provision. Thermal projects will not qualify for the new incentives until after January 1, 2013.

In related news, State Sen. Jeb Bradley filed for re-election in June for the state Senate in District 3, which includes all Carroll County communities as well as Milton, Middleton, and Waterville Valley. Since winning a special election in 2009, Bradley served two terms in the Senate and since 2010 served as majority leader. Although SB218, still awaits Lynch's signature, it is expected to protect nearly 500 jobs in the forest products industry and assist small hydroelectric facilities in New Hampshire. 

"I have enjoyed working with so many people in Concord to tackle large problems and focus on job growth and spending restraint," said Bradley. "I look forward to serving another two years in the Legislature and continue to work on these priorities.

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