NewEnergyNews: Monday Study – The Debates Over Building A Modern Grid Go On


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  • FRIDAY WORLD, January 14:
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    Monday, August 09, 2021

    Monday Study – The Debates Over Building A Modern Grid Go On

    The 50 States of Grid Modernization: Q2 2021

    July 28, 2021 (North Carolina Clean Energy Technology Center [NCCETC])


    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.

    Actions Included

    This report focuses on cataloguing and describing important proposed and adopted policy changes related to grid modernization and distributed energy resources, excluding policies specifically intended to support only solar technologies. While some areas of overlap exist, actions related to distributed solar policy and rate design are tracked separately in the 50 States of Solar report series…

    …[T]his report considers an “action” to be a relevant (1) legislative bill that has been introduced or (2) a regulatory docket, utility rate case, or rulemaking proceeding. Only statewide actions and those related to investor-owned utilities are included…

    Studies and Investigations

    Legislative or regulatory-led efforts to study energy storage, grid modernization, utility business model reform, or alternative rate designs, e.g., through a regulatory docket or a cost-benefit analysis.

    Planning and Market Access

    Changes to utility planning processes, including integrated resource planning, distribution system planning, and evaluation of non-wires alternatives, as well as changes to state and wholesale market regulations enabling market access.

    Utility Business Model and Rate Reform

    Proposed or adopted changes to utility regulation and rate design, including performancebased ratemaking, decoupling, time-varying rates, and residential demand charges.

    Grid Modernization Policies

    New state policy proposals or changes to existing policies related to grid modernization, including energy storage targets, energy storage compensation rules, interconnection standards, and customer data access policies.

    Financial Incentives for Energy Storage and Advanced Grid Technologies

    New statewide incentives or changes to existing incentives for energy storage, microgrids, and other modern grid technologies.

    Deployment of Advanced Grid Technologies

    Utility-initiated requests, as well as proposed legislation, to implement demand response programs or to deploy advanced metering infrastructure, smart grid technologies, microgrids, or energy storage.

    Actions Excluded

    This report excludes utility proposals for grid investments that do not include any specific grid modernization component, as outlined above, as well as specific projects that have already received legislative or regulatory approval… p> Executive Summary


    In the second quarter of 2021, 47 states plus DC took a total of 551 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 551 actions catalogued, the most common were related to policies (136), deployment (105), and financial incentives (85).


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

    Connecticut and Maine Lawmakers Adopt Energy Storage Targets

    State legislators in both Connecticut and Maine enacted bills adopting energy storage targets during Q2 2021. Connecticut’s legislation establishes a deployment target of 1,000 MW of storage by December 31, 2030, while Maine’s legislation sets a target of 400 MW by December 31, 2030. Both bills authorize the development of programs, such as rates and incentives, to help achieve these goals.

    Nevada Legislators Direct Transmission Providers to Join an RTO by 2030

    The Nevada Legislature enacted a bill directing transmission providers in the state to join a Regional Transmission Organization (RTO) by January 1, 2030. The bill also establishes the Regional Transmission Coordination Task Force to advise on the costs and benefits of joining an RTO, as well as policies that will accommodate entrance into an RTO and site transmission facilities that are necessary to achieve the state’s clean energy and economic development goals.

    California Regulators Prepare to Modernize the Grid for a High-DER Future

    In June 2021, the California Public Utilities Commission opened a proceeding to modernize the electric grid to prepare for a high number of distributed energy resources (DERs). The proceeding will be focused on integrating DERs while ensuring affordable rates. Three tracks are currently being addressed: distribution system operator roles and utility or aggregator business models, evolving the distribution resource planning frameworks into a more holistic process, and grid modernization investments for the near and medium terms.

    Hawaii Public Utilities Commission Approves Microgrid Services Tariff

    Hawaii regulators approved a microgrid services tariff in May 2021, which will enable customers to participate in or develop microgrids. The tariff defines two types of microgrids: customer microgrids, where only customer infrastructure is used to supply electricity needs during emergencies, and hybrid microgrids, where both customer and utility infrastructure may be used to supply electricity during an emergency.

    Dominion Energy Files Phase II Distribution Grid Transformation Plan

    In Virginia, Dominion Energy filed its Phase II Distribution Grid Transformation Plan in June 2021. The plan includes deployment of AMI, intelligent grid devices, distribution automation, a DER management system, voltage optimization, a customer information platform, and more. The total proposed investment is $669.4 million capital costs and $109.5 million in operations and maintenance costs…


    States and Utilities Examining Electricity Market Reform

    While the Federal Energy Regulatory Commission considers reforms to wholesale market rules, a growing number of states are examining their current membership in a wholesale market or exploring options to join or create a wholesale market. One notable proposal is the Southeast Energy Exchange Market, put forward by a number of southeastern utilities. Meanwhile, a study committee in South Carolina is reviewing electricity market reform measures, and a bill introduced in North Carolina would direct the Utilities Commission to study wholesale market reforms. In Colorado, a recently enacted bill requires electric cooperatives to participate in organized wholesale markets, while legislation enacted in Nevada requires transmission providers in the state to join a regional transmission organization (RTO). Mississippi regulators are also evaluating Entergy’s membership in MISO, and the Missouri Public Service Commission is reviewing the costs and benefits of RTO membership.

    Lawmakers Expanding Financing Options for Customer-Sited Technologies

    State lawmakers in several states took steps to expand financing options for customer-sited energy technologies, and particularly energy storage, during the quarter. Property Assessed Clean Energy (PACE) financing is one approach that was common among state lawmakers, with Maine, Nevada, and Tennessee enacting legislation making energy storage eligible for PACE financing programs. New Jersey legislation passed by the Assembly and Senate would also make energy storage systems and microgrids eligible improvements under the state’s PACE financing rules. Maine legislators also established the Maine Clean Energy and Sustainability Accelerator that will provide financing for projects reducing greenhouse gas emissions, including energy storage, microgrid, and smart grid projects.

    States Considering Ownership of Energy Storage and Microgrids

    Some states are considering issues related to the ownership of energy storage systems and microgrids. In response to a proposal from Central Maine Power to own a battery storage system, regulators directed the utility and intervenors to consider alternative ownership models. Also in Maine, state lawmakers enacted a bill authorizing entities to construct, maintain, and operate microgrids without being classified as a public utility. In Texas, state legislators considered several bills that would allow transmission and distribution utilities to own and operate battery storage facilities under certain circumstances. Texas lawmakers enacted one bill that allows transmission and distribution utilities to lease and operate storage systems for the purpose of restoring power to customers in a widespread outage. In Colorado, legislators enacted a bill creating the Colorado Electric Transmission Authority, which would be permitted to install and operate storage projects.


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