ORIGINAL REPORTING: Illinois Energy Reform Shaping New Utility Uses Of Solar
Illinois energy reform set to shape new solar business models for utilities; Rate-based returns on distributed resources could allow utilities to displace traditional investments and drive a community solar boom.
Herman K. Trabish, Sept. 13, 2017 (Utility Dive)
Editor’s note: Since this story ran, ComEd and other Illinois utilities have moved ahead with implementation of the new law and upped their grid modernization ambitions.
Commonwealth Edison, the power provider for Chicago, has long talked about becoming the utility of the future. How it and Illinois power players implement last year’s sweeping energy reform could go a long way to realizing that goal. ComEd helped design the Future Energy Jobs Act (FEJA), which includes supports for in-state nuclear plants and renewable energy. The law’s backers say it could boost Illinois solar capacity from 74 MW to 3,000 MW by 2030 and add 1,350 MW of wind to the state's 2016 total of 4,026 MW. ComEd and other stakeholders say the most significant changes in the law involve utility revenues. It allows them to make money from solar and energy efficiency investments in the same way they do from poles and wires investments.
The FEJA allocates $140 million per year for the purchase of renewable energy credits (RECs) to support new solar and wind projects, according to to a recent report from the Smart Electric Power Alliance (SEPA) and ScottMadden, “DERs Are Coming and Illinois Is Ready for Them.” More importantly, the law allows utilities to treat rebates to rooftop and community solar owners and for energy efficiency expenditures as “virtual regulatory assets,” SEPA reported. The expenditures can be rate-based and earn guaranteed return, potentially allowing them to displace traditional utility investments in grid and generation infrastructure. The act’s comprehensive community solar framework also provides front-loaded REC contracts for subscribers that, along with the rate based rebates, could drive a community solar boom in Illinois… click here for more
NO QUICK NEWS