In 2007 Governor John Lynch enacted New Hampshire’s renewable portfolio standard (RPS), which required state utilities to generate from renewable sources 23.8 percent of electricity sold to customers. Municipal utilities are exempt from the RPS.
Qualified renewable sources are divided into four classes. Class I sources include wind, geothermal, hydrogen-derived from biomass fuels, biogas, or landfill gas, ocean thermal, wave, current, or tidal energy, biogas or landfill gas, eligible biomass technologies meeting air emissions requirements, customer-sited solar water heating that displaces electricity, energy from upgraded Class III or IV sources.
Class II sources include solar from installed sources after January 1, 2006.
Class III sources include biomass with less than 25 megawatts (MW) capacity, and methane gas from sources installed prior to January 1, 2006.
Class IV sources include existing hydroelectric with less than 5 MW of capacity installed prior to January 1, 2006.
The law sets a graduated compliance schedule from 2008-2005. By 2025 utilities must meet the 16.3 percent of the overall mandate with Class I and Class II sources.
The New Hampshire Public Utilities Commission (PUC) established a renewable electricity certificate (REC) trading program for utilities to buy and sell RECs to meet the requirement. The PUC allows utilities to enter into long term contracts for RECs or RECs bundled with electricity to meet the RPS.
Utilities may pay an alternative compliance payment (ACP) to meet the RPS. The ACP schedule is $60.93 per megawatt hour (MWh) for Class I, $160.01 per MWh for Class II, $29.87 per MWh for Class III, and $29.87 per MWh for Class IV.
Utilities are authorized to recover “prudent” costs associated with complying with the mandate.
Source: Database for State Incentives for Renewables and Efficiency