NewEnergyNews: Planning Tomorrow’s Grid

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    Monday, May 18, 2020

    Planning Tomorrow’s Grid

    The 50 States of Grid Modernization: Q1 2020

    April 2020 (North Carolina Clean Energy Technology Center)

    Executive Summary

    WHAT IS GRID MODERNIZATION?

    Grid modernization is a broad term, lacking a universally accepted definition. In this report, the authors use the term grid modernization broadly to refer to actions making the electricity system more resilient, responsive, and interactive. Specifically, in this report grid modernization includes legislative and regulatory actions addressing: (1) smart grid and advanced metering infrastructure, (2) utility business model reform, (3) regulatory reform, (4) utility rate reform, (5) energy storage, (6) microgrids, and (7) demand response…

    Q1 2020 GRID MODERNIZATION ACTION

    In the first quarter of 2020, 47 states plus DC took a total of 446 policy and deployment actions related to grid modernization, utility business model and rate reform, energy storage, microgrids, and demand response. Table 1 provides a summary of state and utility actions on these topics. Of the 446 actions catalogued, the most common were related to policies (130), planning and market access (70), and deployment (67).

    TOP 5 GRID MODERNIZATION DEVELOPMENTS OF Q1 2020

    Five of the quarter’s top policy developments are highlighted below.

    Energy Storage Targets Adopted in Nevada and Virginia

    Nevada and Virginia became the sixth and seventh states, respectively to adopt energy storage targets during Q1 2020. The Public Utilities Commission of Nevada approved a target of 1,000 MW of energy storage by 2030, with interim targets beginning in 2020.The Virginia General Assembly adopted a target of 3,100 MW of energy storage by December 31, 2035, with 2,700 MW of this required for Dominion Energy and 400 MW required for Appalachian Power.

    DC Public Service Commission Issues Major Grid Modernization Order

    The DC Public Service Commission issued a decision in the district’s grid modernization proceeding in January 2020, which takes several steps to forward the state’s grid modernization efforts. The order approves a distribution system planning and non-wires alternative stakeholder process, the development of a data sharing web portal, the creation of a rate design working group, the establishment of a microgrid proceeding, and more.

    Virginia Regulators Issue Decision on Dominion Energy’s Grid Transformation Plan

    The Virginia Corporation Commission issued an order on Dominion Energy’s Phase IB Grid Transformation Plan in March 2020. The decision approves the utility’s proposed investments in cybersecurity, stakeholder engagement and customer education, a customer information platform, smart electric vehicle charging, and a hosting capacity analysis, but rejected investments in advanced metering infrastructure, self-healing grid, and certain components of grid hardening.

    New Mexico Lawmakers Enact Grid Modernization Roadmap Bill

    In February 2020, the New Mexico Legislature enacted H.B. 233, which directs the Energy, Minerals, and Natural Resources Department to develop a grid modernization roadmap for the state. The legislation also establishes a grid modernization grant program for public entities and authorizes public utilities to file applications for grid modernization projects, including investments, incentives, rate design, and education.

    Delaware Public Service Commission Adopts Distribution System Planning Rules

    The Delaware Public Service Commission adopted distribution system planning rules in February 2020, following a collaborative effort that began in 2018. The rules require electric distribution companies to file 10-year Long Range Distribution Plans including potential distribution system performance issues and solutions, as well as 3-year Infrastructure, Safety, and Reliability Plans including proposed capital spending.

    MOST ACTIVE STATES AND SUBTOPICS OF Q1

    2020 The most common types of actions across the country related to energy storage deployment (41), data access policies (32), utility business model reforms (31), distribution system planning (30), and rules related to advanced metering infrastructure opt-out (29). In Q1 2020, grid modernization activity increased by 13% over Q1 2019 and 72% over Q1 2018.

    The states taking the greatest number of actions related to grid modernization in Q1 2020 can be seen in Figure 4. New York, California, Massachusetts, and Minnesota saw the most action during the quarter, followed by Virginia, New Hampshire, Colorado, Michigan, and New Jersey. Overall, 47 states, plus DC, took actions related to grid modernization in Q1 2020

    TOP GRID MODERNIZATION TRENDS OF Q1

    2020 State Regulators Developing Energy Storage Interconnection Rules

    A number of states are considering revisions to interconnection rules to include specific standards applicable to energy storage systems. Maryland regulators approved revised interconnection rules in March 2020, which include evaluation of energy storage projects based on net system capacity and proposed use. In Wisconsin, parties filed an energy storage interconnection supplement, and Colorado regulators are considering interconnection rule updates that include standards specific to storage. In November 2019, the Arizona Corporation Commission adopted distributed generation interconnection rules including energy storage provisions. Other states addressing energy storage interconnection rules include Connecticut, Massachusetts, Ohio, and Vermont.

    States Considering Mechanisms to Encourage Microgrid Development

    Although microgrids are widely viewed as a valuable element of grid modernization, barriers to the development of microgrids currently exist in many states. A number of states are considering different ways to address these barriers and to encourage greater microgrid development. Lawmakers in states such as Minnesota and New Hampshire are considering studies that would evaluate the potential of microgrids and how to advance microgrid development. Regulators in California and Hawaii are in the process of developing tariffs governing microgrid interconnection and compensation. Meanwhile, legislation under consideration in Maine and Michigan would establish exceptions to certain utility franchise and regulation rules to enable the development of microgrids by non-utilities. Other states, including California and New Jersey, are considering grant programs for microgrids.

    Proposed Grid Modernization Legislation Focusing on Energy Storage

    State lawmakers considered more than 215 bills related to grid modernization topics during Q1 2020, with the majority of these bills including provisions related to energy storage. Common topics addressed by proposed legislation include energy storage incentive programs (grants, rebates, property tax incentives, sales tax incentives, etc.), studies, and deployment targets.

    As of late April 2020, state legislators had enacted 13 grid modernization bills. Legislation enacted in Washington authorizes energy storage as a qualified improvement for commercial Property Assessed Clean Energy (PACE) financing. Lawmakers enacted several bills in Virginia, which include the creation of an energy storage target and a task force to study bulk energy storage resources. Bills related to energy storage remain under consideration in a number of states, including Massachusetts, New Hampshire, and New Jersey. Other major topics of 2020 proposed legislation include microgrids and advanced metering infrastructure opt-out and data access rules.

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