ORIGINAL REPORTING: The Cost Of The Cost Of Grid Modernization
Is the third pillar of electricity delivery preventing the building of the first two? Grid modernization is being delayed while utilities and stakeholders debate the price tag
Herman K. Trabish, Feb. 13, 2018 (Utility Dive)
Editor’s note: Investments in grid modernization continue to grow.
Utilities’ pursuit of a modern grid to maintain the reliability and safety pillars of electricity delivery has raised a lot of questions about the third pillar — affordability. But the need for modern tools to manage distributed energy resources (DER) like customer-sited solar, behind-the-meter battery storage, and electric vehicles imposes costs on utilities that some regulators, lawmakers and policymakers are concerned could drive up electricity rates. The result is an increasing number of legislative and regulatory grid modernization actions aimed at identifying what is necessary to serve the coming power sector transformation. Grid modernization got a lot of attention last year. According to the 2017 review of grid modernization policy by the North Carolina Clean Energy Technology Center (NCCETC), 288 grid modernization policy actions were proposed, pending or enacted in 39 states.
The most common type of state actions, by far, were those that focused on the deployment of advanced metering infrastructure (AMI) and battery energy storage. Those are two of the 2017 trends identified in NCCETC’s 50 States of Grid Modernization report. But deployment of those technologies, while foundational to an updated grid, only begins to prepare distribution systems for the coming power sector transformation. Bigger advances, including the newest energy system management tools, are being held back by 2017’s other policy actions requiring more deliberation and fact-finding. Utilities’ proposals to more fully prepare their grids to deliver 21st century technologies are being met with questions about completeness and cost. Utilities are being asked to address these questions in comprehensive, public utility commission-led cost-benefit analyses and studies. The outcome to date appears to be an increased, but still incomplete, understanding of what is needed to build a 21st century grid… click here for more