S&P Global MarketIntelligence spoke with Maryland Public Service Commissioner Anne Hoskinsregarding opportunities and challenges as the state implements a communitysolar pilot program over the next three years.

The State of Marylandpublished the finalregulation that created the pilot program in the State Register on July 8.The regulation took effect on July 18 and regulates the development ofcommunity solar energy generating systems, or CSEGS. Unlike rooftop solar,these systems allow electric customers who do not or cannot own their own solarsystems to subscribe to a share of the power from solar systems located withintheir community.

Prior to joining thecommission, Hoskins had served as a senior vice president for public affairs atsustainability at Public ServiceEnterprise Group Inc., a litigator in the telecommunications sectorand a policy advisor to the New Jersey Governor's Office.

Hoskins, who wasappointed in 2013 under former governor Martin O'Malley, sat down for aninterview during the National Town Meeting held in Washington, D.C., on July11-13 by the non-profit research organization the Smart Electric Power Alliance.The following is an edited transcript of the conversation.

S&P Global MarketIntelligence: Your term as commissioner began in September 2013 and wassupposed to end this past June. Why did you have the commission extend yourterm through the end of July?

Anne Hoskins: My termdid end June 30, except the PSC extended it for another 30 days to July 31because I am on the board of the National Association of Regulatory UtilityCommissioners, or NARUC, and I am also chair of NARUC's International RelationsCommittee. So, I wanted to get to go to one more conference and do the things Ineed to do.

Do you have plansafter your term ends?

Not yet. I have been really trying to finish upstrong. I have been really engaged with community solar and we had a big ratecase with Baltimore Gas andElectric Co. I am going to teach a course at Princeton Universityin the fall, believe it or not, on community solar. It is actually a policyworkshop at Princeton's Woodrow Wilson School of Public and InternationalAffairs.

Now that theregulation for a community solar pilot program is published, who has to filethe compliance plans and relevant tariffs?

The utilities have 45 days from when the rule is effectiveto get the compliance plans in place. The plans are what will tell the folkswho want to do these community solar facilities how to apply. One of the issuesis going to be what happens if you get a deluge of [project applications]because there is a cap on the amount. Those are someof the things that we expect the utilities are going to identify in theirtariff. How are they going to handle that? How are they going to handle if theyget competing proposals? We were not prescriptive on every detail.This is a pilot so you want to see what kind of proposals are going to comeforward.

One thing we were the most prescriptive about is we want tomake sure is [this pilot] serves everybody. We had a strong set-aside for lowand moderate income, and we put the caps on the amount for each utility. Wewant to make sure all the participation did not go to one utility or utilityservice territory. We were also very careful onconsumer protection. Beyond that, I think it is really up to the solardevelopers out there and utilities to figure out and make this [program]successful.

Do you foresee thatthe PSC could revise the program category caps before the three years arefinished?

If you look at Section 20.62.02A (6), there is already aprocedure in there that if you end up with no takers in the first two yearsthat [the unused category capacity] can be allocated out. [T]his is reallysupposed to be a program that is supposed to do things in each of thosecategories.

My expectation is that there are going to be participantsthat seek out and do these other kinds of projects and not just theseutility-scale projects.

If it turns out that there is not the kind of participationin some of these other categories, I think thatwill be one of the issues that will be evaluated and will be called intoquestion.

What are thechallenges and opportunities you see for this pilot in terms of implementation?

First of all, I think one of the challenges is going to bejust getting the word out and making sure people are aware of this opportunity.I am hoping that we are going to see different types of community solarprojects in neighborhoods such as in Baltimore and not just the big,centralized projects out in the suburbs or rural areas.

I think the challenges and one of the important things forthese subscriber organizations, in particular, is to realize that [communitysolar development] is a regulated activity. We have consumer protection rulesand it is something that the commission is going to take very seriously interms of how the projects are explained to customers, how customers subscribeand the disclosures that are required.

We now have a complicated structure where people are goingto be sold portions of a project. The subscribers are going to need tounderstand what their rights are in that project and they are going to need toknow what they can do for recourse. So, I think it will be very important forthe companies that are going to step up and be CSEGS providers to also bethinking through not just how they are selling a project but how they arereally going to provide customer service. Looking forward, there is a lot ofdiscussion about, is this really a pilot? Should this be bigger or smaller? Weworked really hard to come up with a sufficiently sized initiative with anumber of the program categories. We have set the project review process in away that it will not be too burdensome or too prescriptive and would hopefullyentice lots of different participants to come to Maryland.