ORIGINAL REPORTING: Organizing California’s Distributed Energy Efforts
Herding cats: California PUC President Picker on the new DER Action Plan; A new regulatory roadmap aims to guide the power sector into the distributed energy future, but is everyone along for the ride?
Herman K. Trabish, Feb. 21, 2017 (Utility Dive)
Editor’s note: California PUC Chair Michael Picker’s noble effort to organize the state’s distributed energy policies did not get adequate attention because it was released just as stakeholders were focusing on the opening of the IRP process.
The growth of distributed energy resources (DERs) presents challenges to electric utilities, from reliability to grid planning and rate design. And no state has done more to adapt utility regulation to those challenges than California. The California Public Utilities Commission opened its first regulatory proceeding on DERs in 1998. Since then, the CPUC has led the nation in pushing utilities to plan for DER growth, operate their systems with more distributed resources, and share data with third-party providers. But California’s DER proceedings have evolved into a tangled web of dockets, difficult and resource-intensive for stakeholders to follow. The seven-page DER Action Plan is intended by CPUC President Michael Picker to untangle it.
The plan covers three key areas: rates and tariffs; DERs on the distribution system; and DERs in wholesale markets. If regulators can devise the right markets and rules, the payoffs could be huge. By 2020, DER could deliver $1.4 billion per year or more to California in net societal benefits, according to SolarCity calculations using an Electric Power Research Institute methodology and rate case data from Pacific Gas and Electric. Many of the distributed energy rules under consideration in California are the product of legislation, the Action Plan notes, including mandates for the reform of utility distribution system planning, investment, and operations to include “time- and location-variant” rates to support DERs. Senate Bill 350, a 2015 law that codified the state’s 50% renewable energy mandate, specifically requires an integrated resource plan (IRP) process (R.16-02-007). That process is outside the Action Plan’s scope, but is the “capstone” of it, according to Picker…” click here for more