Alan Curto practices in the areas of administrative and regulatory law. He has represented clients before administrative agencies including the State of Connecticut Departments of Transportation, Consumer Protection and Insurance. He has also practiced before the Department of Public Utility Control (now the Public Utilities Regulatory Authority; PURA) and the Connecticut Siting Council within PURA where he participated in matters including electricity deregulation, utility mergers, and the licensing and siting of utility facilities including 345kV transmission lines. He has also represented municipalities and individuals in judicial appeals of administrative decisions. Alan has also represented commercial and public entities in the negotiation of retail electric and gas supply purchase contracts. He has also represented clients before the Connecticut Siting Council on matters relating to the siting of new transmission lines.
Prior to entering law school, Alan was a practicing pharmacist and the owner of a successful pharmacy business. He continues to maintain his pharmacy license and follow current trends in the pharmacy and pharmaceutical industries.
He is a member of the Connecticut Bar Association's Utility Section. He is also on the Legislative Committee of the Connecticut Pharmaceutical Association and is a member of the Board of Directors of the Connecticut Pharmacists' Charitable Foundation.
Rooftop Solar Leases - Good Day Sunshine (Maybe)
New England Real Estate Journal, 03/08/2013
Property owners wishing to install a rooftop solar array without a large up-front cash outlay, have the option to lease rather than purchase the array. Under a typical solar lease, the property owner pays nothing up front and nothing for maintenance; the lessor installs and maintains the solar array without charge. The property owner as lessee, receives the benefit of the solar energy generated by the array in the form of lower electric utility bills, and is principally obligated by the lease only to make the periodic payments required thereunder.
While such a lease has potential benefits for both property owners wishing to go green and the environment, this result is not a given. Before entering into a long-term solar lease, there are many issues to consider.
How Realistic are the Assumed Energy Savings?
In the typical solar lease, the lease payments increase at a fixed percentage per year. Solar lessors justify these increases by predicting future electric savings based on historic utility rate increases. However, it is not clear whether electric bills will continue to increase at the rates they did so in the past. For example, here in the Northeast, past electric utility increases were largely driven by transmission congestion, utility recovery of generation stranded costs, and sudden spikes in the cost of fossil fuels. These factors have now been mitigated by lower-cost natural gas generation, new transmission, and lower demand for, and more efficient use of electricity. Therefore, the property owner should carefully evaluate the lease's assumptions about future electric savings, as compared to future lease payments.
Have Alternative Means to Lower Electric Costs been Considered?
One advertisement for a solar lease touts monthly electric savings of $140, against a lease payment of $110 monthly; i.e., the lessee's net monthly savings are $30.1 Property owners should evaluate whether it is possible to achieve the same (or greater) level of savings without entering into a solar lease. For example, can older appliances and other equipment be replaced by more energy - efficient analogues? Can smart thermostats or other energy efficiency measures be utilized? Many utilities offer free or low-cost energy audits, and many states offer grants and other assistance against the costs of such energy-savings measures. While such measures may not have the cachet of a rooftop solar array, they may well have an equal beneficial impact on the bottom line, without the obligations and uncertainty inherent in a long-term lease.
Additional Factors for Consideration; Conclusion
The above issues are only a sample of the factors to be considered before entering into a solar lease. There are many others, including issues not apparent initially but which can arise down the road, such as to whom the lessor may assign the lease, options as to extending or buying out the lease (and the implications of doing either), and whether the existence of the lease may complicate the sale of the subject property. In addition, there are financial incentives, including regulatory payments in the form of Renewable Energy Credits (REC's) and feed-in tariffs, as well as grants and low-cost loans, that could make the outright purchase of a solar array an attractive option to leasing the array, despite the higher initial cash outlay.
Finally (and this is true as to both leased or purchased solar arrays), there are technical issues including the selection of the optimal location for the array, how large an array to purchase or lease, and whether the array should track the sun. Although the seller or lessor may assist with these technical issues, it is best to seek advice from an entity whose conclusions may be safely assumed are free from any possible economic bias.
As should be clear from this brief discussion, there are many factors to consider when contemplating the lease of a solar array. Property owners would be well advised to seek both legal and technical assistance before making such a commitment. Doing so will help ensure that the transaction delivers the hoped-for benefits.
1 While this is a residential example, the principle applies to commercial installations as well.EV Technology and Regulatory System Needs to be Addressed before Conn. Fully Embraces EV Usage
New England Real Estate Journal, 07/16/2010
The Nissan Leaf and Chevy Volt will hit select car dealerships in late 2010, but will Connecticut be ready for them?
The Leaf and the Volt are the latest electric vehicles (EVs), and have been described by some as game-changing. The Leaf runs solely on electricity, while the Volt has a gas-powered generator, which recharges its battery after depletion. Although the Volt can use gas to create additional electricity, both vehicles are recharged by plugging into an electrical outlet. While most EV owners will recharge their EVs at home, EV owners will undoubtedly need to fill-up while away from home. In Connecticut, there are certain obstacles that must be overcome before EV owners will be able to fill-up at a local mall, work, or an apartment complex.
Under current Connecticut law, commercial properties may only be able to install EV charging stations after applying to the Department of Public Utility Control (DPUC) for permission, and maybe only without making a profit. Currently, submetering of electricity is allowed at recreational campgrounds, marina slips and other locations as approved by the DPUC, based upon the rationale that electricity use at those locations is seasonal, temporary, recreational and, thus, difficult to bill monthly. Further, the law allows property owners or operators to pass on to the consumer only the price the electric company charges them, thus preventing the owners or operators from profiting from the charging services. It also prevents them from reselling electricity (other than by permitted submetering), which may require an electric supplier license.
Based on the DPUC's stated rationale for the current submetering exceptions, it is unclear whether the DPUC will grant permission for submetering at all types of commercial real estate properties. At certain locations, such as shopping centers, the current rationale might support submetering, as electricity usage there would be temporary and difficult to bill monthly. Applying this rationale to other locations, such as offices, apartment complexes and parking garages would be more difficult. Use at offices and apartment complexes would not, for the most part, be seasonal, temporary, recreational or difficult to bill monthly. Likewise, usage at parking garages would be shared between EV owners who park daily and others who are only in town for meetings or weekends. This makes it difficult to predict whether the DPUC would grant permission for submetering at these locations under the current rationale.
In addition, since EV charging stations at shopping centers may generate or, at least, correlate, with increased profits, shopping center owners or operators may be willing to install the stations without profiting from the station itself. But what about a gas station or rest stop? The comparatively small food or beverage purchases that the charging station may generate might not be sufficient to justify the EV investment. Further, even if the EV investment would be justified, in order for a commercial real estate owner to profit from the EV charging station, they may need to be licensed as an electric supplier. A potential electric supplier must possess specific technical, financial and managerial capabilities before the DPUC will issue an electric supplier license, which are regulatory burdens few owners would want to assume. Furthermore, it is unclear whether the DPUC would deem EV charging station owners as appropriate entities for such licensure.
Allowing commercial real estate owners to profit from selling electricity to EV owners might defeat one of the prime benefits of EVs: potentially lower fuel cost. Currently, there are no regulations in place limiting the price per kWh of electricity the owner of an EV charging station may charge an EV owner to fill-up. EVs cost more to purchase than their gas-guzzling cousins, and without a limit on the cost of an electric fill-up, fuel cost might not be low enough to justify the higher EV price tag.
Connecticut Governor Jodi Rell created an Electric Vehicle Infrastructure Council to prepare Connecticut for a seamless transition into the EV market. The Council's final report is due September 1, 2010. But even after the report is issued some regulatory updates will need to be done to address the technical challenges of EVs and recharging.
While EVs might be ready for Connecticut, the current gap between EV technology and the regulatory system will need to be addressed before Connecticut can fully embrace EV usage.DPUC Proceeding Evaluates VRAD Cabinet Safety Issues and Rights of Adjoining Property Owners
New England Real Estate Journal, 01/01/2009
Many have noted the seemingly overnight proliferation of refrigerator-sized metal cabinets on utility poles in their neighborhoods. These VRAD cabinets (for Video Ready Access Device) were the subject of a recent Connecticut Department of Public Utility Control (DPUC) proceeding in its Docket 07-03-34, wherein the DPUC evaluated VRAD cabinet safety issues, as well as the rights of adjoining property owners with respect to these utility facilities. In its Decision in that proceeding dated September 29, 2008, the DPUC provided a mechanism for notice to adjoining property owners as to the installation of VRAD cabinets, an opportunity to comment on such installations and (perhaps most significantly) the ability to contest such installations.1
VRAD cabinets are part of an AT&T infrastructure upgrade which will permit it to offer a new suite of Internet Protocol (IP) services, including voice over IP (VoIP) and IP video. VRAD cabinets contain certain of the electronics needed to provide the new services. VRAD cabinets include a 220-volt electric power meter and a battery back-up; the cabinets can be mounted on utility poles or installed on concrete ground pads. The sizes of the cabinets vary, but both the utility pole and ground pad models can range up to approximately 4 feet in width and 5 feet in height.
The DPUC proceeding was instituted in response to a petition by certain Connecticut municipalities for an investigation concerning safety and siting issues of VRAD cabinets. Safety issues raised by the municipalities included the obstruction of motorists' vision, danger to pedestrians and bicyclists, and concerns regarding the cabinets' power supplies and back-up batteries. The municipalities requested that the DPUC require AT&T to comply with certain Connecticut statutory requirements concerning utility fixtures in public rights-of-way. The municipalities also requested that the DPUC study the feasibility of installing pole-mounted cabinets seven feet off the ground, so as to avoid line-of-sight issues and eliminate the possibility of collisions with pedestrians and bicyclists. Additionally, the municipalities requested that AT&T address graffiti removal, aesthetic factors and screening, in the manner mandated by other states' public utility authorities.
AT&T asserted in Docket 07-03-34 that the municipalities' safety concerns were unwarranted, and that it carefully considers a great many factors when determining the location of VRAD cabinets, including the avoidance of busy intersections and minimizing exposure to the elements.
With respect to the height issue, the DPUC concluded that it would not require AT&T to locate VRAD cabinets 7 feet off the ground, due to a lack of cabinet manufacturers' support for installations above 3 feet high, and because doing so would raise additional issues such as the need for additional pole bracing and difficulties concerning maintenance. As to issues such as graffiti and the screening of VRAD cabinets, the DPUC ordered AT&T to explore and adopt its best practices in other states to address these issues.
Possibly the most significant issues addressed by the DPUC in Docket 07-03-34, were those of notice and consent as to the placement of VRAD cabinets in public rights-of-way. The Decision directs AT&T to provide municipalities and adjoining landowners with advance notice of its plans to install new VRAD cabinets, including street addresses and the specific utility poles to be used. In addition, AT&T must give adjoining landowners thirty days to consent to the placement of VRAD cabinets, and must employ strategies such as screening and landscaping as a means to obtain consent. In cases where consent is not obtained and landowners object to the placement of VRAD cabinets, the DPUC will consider requests for removal. Objecting parties will have an opportunity to present evidence to the DPUC and offer argument as to why the installation should not go forward or (in cases where installations have already been made), why the offending VRAD cabinets should be removed. The DPUC will entertain requests for removal when landowners present evidence demonstrating that VRAD cabinet placement creates safety and/or other significant issues.
To summarize - the DPUC has provided adjoining landowners with a mechanism to contest the placement of and (in certain cases) to request removal of VRAD cabinets. While the breadth of the rights actually granted to landowners has yet to be determined (as of this writing, at least one post-Decision landowner complaint has been received by the DPUC concerning a VRAD installation); as a practical matter, the DPUC's action has given AT&T a strong incentive to address landowners' concerns ahead of time, so as to minimize adverse impacts of VRAD cabinets in neighborhoods possibly leading to the withholding of consent.
1 Factual matters contained in this article are as in the Decision. It is also noted that judicial appeals of the Decision are ongoing.
News & Events
H & S Announces New Partners and Counsel
The law firm of Halloran & Sage is pleased to announce that Alan Curto, Al DiVincentis and Brett Szczesny have been admitted as partners and Laura Pascale Zaino has been named counsel.
Alan is a member of the Administrative and Regulatory Group and graduated from the University of Connecticut School of Law in 1998. Al is a litigation attorney in the Construction Group and graduated from the University of Connecticut School of Law in 2000. Brett graduated from the Catholic University of America Columbus School of Law in 1997. Laura is a member of the Litigation Group. She graduated from the University of Connecticut School of Law in 1996.ALERT: Connecticut Legislation On Renewable Energy Resources
Connecticut Legislation On Renewable Energy Resources
Public Act 03-135, which amends Connecticut's Electric Restructuring Law, may result in significant benefits to owners of certain facilities that generate electricity from renewable energy sources.
By way of background, Connecticut's Electric Restructuring Law (enacted in 1998 as P.A. 98-28) designated certain generators of electricity utilizing renewable energy sources as Class I and Class II energy sources.1 P.A. 98-28 required competitive suppliers of retail electricity to include certain percentages of Class I and Class II energy in their electric supply portfolios. These Portfolio Standards were first imposed on July 1, 2001 and escalated annually after that date. These provisions were intended to create demand for electricity generated by Class I and Class II energy sources, thereby encouraging further development and construction of facilities utilizing such energy sources. However, because the overwhelming majority of Connecticut's end-user electric customers have continued to purchase electricity under so-called Standard Offers (and because the Standard Offers are exempt from the Portfolio Standards), to date there has been little demand in Connecticut for electricity from Class I and Class II energy sources. Thus, further development of such sources of electricity has not been encouraged to any significant extent to date as a result of P.A. 98-28. This state of affairs is about to change.
P.A. 03-135 made three significant changes to the Portfolio Standards requirements. First,
energy derived from . . . ocean thermal power, wave or tidal power, low-emission advanced renewable energy conversion technologies, [and] a run-of-the-river hydropower facility provided such facility has a generating capacity of not more than five megawatts, does not cause an appreciable change in the river flow, and began operation after the effective date of this section. . .
are now included in the category of Class I renewable energy sources.2 Second, the Portfolio Standards have been amended to require, on and after July 1, 2004, a relatively greater percentage of Class I energy sources (as compared to Class II energy sources) in electric supply portfolios. Third (and perhaps most significantly), electric utilities supplying Standard Offer service will be required, as of January 1, 2004, to comply with the Portfolio Standards. The combined effect of these changes will likely be a significant increase in the value of electricity derived from Class I energy sources.
This Alert is provided for informational and educational purposes only and is not intended as legal advice. This publication may be considered advertising under applicable state laws. 2003 Halloran & Sage.
1 Class I renewable energy sources included solar power, wind power, a fuel cell, methane gas from landfills, or a biomass facility. . . . Class II renewable energy sources included energy from a trash-to-energy facility, or a biomass facility that does not meet the criteria for a class I renewable energy source or a hydropower facility. . . . Conn. Gen. Stat 16-1(a)(26) and (27).
2 The effective date of this section of P.A. 03-135 was July 1, 2003.