Lawmakers are trying to find solutions to the mounting economic weight of energy costs on utility customers. To address this, the Maine Legislature revised its net energy billing (NEB) program for non-residential participants last year, but in the process, it halted the state’s community solar market.
Nautilus Solar built a community solar farm on a former sand quarry in North Berwick, Maine. Credit: Nautilus Solar
“There’s not a lot the legislature can do to change the price of natural gas, when that is changed by wars overseas,” said Kate Daniel, Northeast regional director for the Coalition for Community Solar Access. “Solar programs are something they can touch, and even through it’s not the driver of the bill, it makes them feel like they’re doing something.”
LD 1777 prohibits Maine utilities from accepting new community solar projects, reduces the utility payments generated from community arrays and, in an industry first, applies retroactive monthly fees on certain existing community solar projects.
The amended NEB began issuing charges to existing community solar projects enrolled in its kWh Credit Program on Jan. 1. Projects with a capacity between 1 and 3 MWAC are being charged $2.80/kWAC monthly; projects between 3 and 5 MWAC are being charged $6/kWAC monthly.
Community solar developers Nautilus Solar and Nexamp have both stated their companies will not be bringing new projects to Maine.
“Every region is going to need additional generation buildout in the next five years. Most of that is going to be clean energy,” said Jake Springer, East Coast policy director for Nexamp. “By imposing retroactive policy measures, at the very least you’re increasing the cost of capital, which will go up in reaction to increased risk. Or you’re dissuading additional development in the state when you need additional generation.”
Maine’s community solar history
In 2019, Maine became the 20th state in the country to enact a community solar program after Gov. Janet Mills mandated 250 MW of new community solar capacity. In the last seven years, community solar developers far exceeded that original goal.
Community solar projects allow customers without the room or funds for their own arrays to engage with renewables in an affordable way. Residents and businesses subscribe to a portion of the project’s capacity, and they earn renewable energy credits applied to their utility bills.
These shared arrays are long-term commitments, both for subscribers and the company managing the PV projects. They’re much more involved in terms of customer service, since there isn’t just one customer. Eric Lamora, VP of community solar with Nautilus Solar, said the company manages a community solar customer base of about 15,000 subscribers in Maine alone.
“It has a significant impact on the overall value of the portfolio. You significantly change the returns [and] the income expected to come from these projects,” he said. “These retroactive changes are very damaging. Not just obviously to us as an investor. The part that isn’t really being addressed this has a huge impact on Maine … In good faith, the investment community invested hundreds of millions of dollars in the market. Fast forward around seven years later when these projects are mostly built and completed, then this legislation comes out and that changes the original proposition put out by the state.”
The state claimed in a press release published by the Maine Office of the Public Advocate, a state body representing electricity customers, that the decision to alter NEB for community solar will save electricity customers $1.2 billion over 16 years.
“Maine’s community solar program needs reform precisely because it has been so successful,” wrote Heather Sanborn, Maine public advocate. “We set out to build 750 MW of solar, and instead we’ve built more than 1,600 MW. Now we need to make sure that solar power is delivered affordably to Mainers going forward.”
The release also claims that LD 1777 was drafted in collaboration with solar developers. Community solar companies didn’t characterize the process as collaborative.
The costs and pending litigation
This change to NEB has forced project owners to reassess the economics of their subscribed arrays. Brattle, a consulting firm, worked with developers to produce a report on how LD 1777 impacts the Maine community solar market.
A 7-MW community solar project covers brownfield land in Maine. Credit: Nautilus Solar
Co-authors Robert Mudge and Meten Celebi, principals with Brattle, reported that Maine community solar could see a loss of $525 million in revenue. The policy change could force existing projects into the wholesale energy market. But community solar project loans stipulate that these arrays remain in NEB, otherwise they would breach those agreements and risk funding loss.
Additionally, Brattle estimates that switching to the wholesale market, if even possible, compensates solar projects at a 63% reduction compared to NEB. Despite this, both Nautilus and Nexamp plan to maintain their existing solar projects in Maine.
“As long as there are Nexamp assets in Maine, we’ll continue to operate them,” Springer said. “But we don’t view the Maine market as a safe place for investment anymore. We’re not doing any additional community solar development there.”
Community solar developers have filed two separate lawsuits against the Maine Public Utilities Commission and its leaders. One is representing developers responsible for 111 community solar projects, totaling about 415 MW of capacity in Maine.
Plaintiffs filed a preliminary injunction to prevent these retroactive fees from activating at the start of the year, but that request was overturned. Deliberations in these lawsuits are still ongoing.
“We’re still exercising all of the rights that we can,” Lamora said. “For us, it is to try to mitigate some of the losses that we’re experiencing. Hopefully the state will realize that they’ve made a mistake here.”
The road ahead for Maine
Business can continue as usual for other forms of solar in Maine. But from 2022 through 2024, community solar accounted for most of the state’s new PV deployment. By the end of 2025, Maine has installed nearly 1.9 GW of solar across markets. In 2019, Gov. Mills signed legislation establishing state goals to use 80% renewable electricity by 2030, and 100% by 2040. The governor’s office reported that more than half of the state’s energy came from renewables in 2024.
The purpose of LD 1777 is curbing energy costs, which are rising due to inflation, trade tariffs and the strain of new data centers on the grid. The Maine Legislature is considering a bill to limit the development of new data centers in the state, but if passed wouldn’t go into effect until late 2027.
But community solar developers consider its immediate response to cost savings short-sighted — both for the community solar market and for Maine itself.
“The impact from climate change is real there. A huge part of the Maine economy is lobster fishing, and the waters are warming around the Maine coast,” Lamora said. “Mainers are very sensitive to the impact of climate change. They have really aggressive energy goals, but now the question is how they’re going to reach those goals.”
LD 1777 directs the Maine Department of Energy Resources to create a new community solar program for the state. However, there is no specified deadline for when this could happen.