March snow turns to April showers, which leads to May flowers, right? This March, snow may be slowing some of us down in the Northeast and Mid-Atlantic, but that is not the case for policy developments. Public utility commissions and state legislatures are in full swing with an ample amount of advances since the last policy tracker.
The commission has been busy in New York. Take a look at these recently-issued orders related to Reforming the Energy Vision (REV):
Order on Distributed System Implementation Plan (DSIP) Filings (Case 16-M-0411)
The DSIPs are used to implement improved planning and operations of the Distributed System Platform. This order is a deliverable under the Guidance Order for the DSIP filings. The joint utilities have filed their utility-specific non-wires alternative (NWA) implementation matrices, in accordance with the Supplemental DSIP after the utilities developed a common framework for broader NWA procurement. The commission requests each utility to submit a file describing how the non-wires suitability criteria will be applied to current capital plans, as well as a file with proposed building energy management and benchmarking data standards for the commission’s consideration. By December 31, 2018 each utility is also required to submit a file show it has deployed energy storage projects that are operating at no fewer than two separate distribution substation or feeders.
Order Directing Modifications to the Joint Utilities' Proposed Interconnection Earning Adjustment Mechanism (EAM) Framework (Case 14-M0101 and 16-M-0429)
EAM offers utilities diverse, balanced financial incentives, allowing the commission and stakeholders to provide guidance focused on meeting the demands of the electric grid and the REV outcomes. On September 2, 2016 the joint utilities filed a common interconnection survey process and proposed EAM to appraise distributed generation applications over 50kW. This order requests modifications to the proposed framework.
Order approving the Phase One Implementation Plan of the Clean Energy Standard
The proposed plan is consistent with the New York state goal to have 50 percent of the electricity procured by renewable sources by 2030 as part of a strategy to reduce statewide greenhouse gas emissions by 40 percent by 2030. The Energy Efficiency Coalition sent a letter to Chair Audrey Zibelman of the Public Service Commission, filed under the Clean Energy Standard docket, encouraging the commission establish a clear plan and regulatory framework to spur investment in all cost-effective energy efficiency either by issuing an order based on the DSIPs proceedings, or by including the framework for energy efficiency as a broader aspect of the DSIPs.
Order on Value of Distributed Energy Rate Structure
As component of REV, the rate structure will credit solar projects for communities, commercial, and industrial customers according to the benefits they provide. Benefits include energy value, avoided carbon, other environmental benefits, capacity value, and distribution value.
In addition to these developments at the commission, NYSERDA released the Clean Energy Fund Investment Plan: Communities Chapter. This chapter provides grants, direct technical support, tools and resources, and recognition to local governments that demonstrate leadership in the area of clean energy. New York ISO released a five-year roadmap for dispatching distributed energy resource (DER). This roadmap aligns with REV, which aims to integrate DER into the wholesale market. The roadmap includes granular pricing, Integrating DER, metering policies, and pilot programs. The utilities have also been active. Each utility filed a Smart Home Rate demonstration project. NYSEG/RGE also filed a petition for full-scale deployment of AMI and to establish an AMI surcharge to recover the costs.
On March 18, 2016 the Rhode Island Public Utility Commission opened Docket 4600 to develop a report that will guide the Public Utility Commission’s review of National Grid’s rate structure in future proceedings. The Rhode Island 4600 working group has released the draft report on the cost-effectiveness framework to the commission (RI 4600 Report 3-9-17 Draft). The purpose of the report is to provide a clear framework of costs and benefits for diverse resources, programs, and rate designs that will improve consistency across programs. The report also provides recommendations for rate design principles. The cost-effectiveness framework was finalized in early February.
National Grid has launched a commercial demand response program for Rhode Island and Massachusetts. The pilot offers financial incentives to qualified participating businesses to reduce electricity consumption during peak demand. National Grid is offering $35/kwh for curtailment, which illustrates how costly times during peak demand can be.
In other news, HB5369 was released. The bill, Energize Rhode Island: Clean Energy Investment And Carbon Pricing Act of 2017- as introduced, would impose a fee of $15/ton of CO2 released, to be collected at the first point of sale within the state. This bill would establish the Clean Energy and Jobs fund, to be used to distribute a dividend to each resident or employer, and invest in renewable energy programs, climate resiliency, energy efficiency, and energy conservation. A similar bill was introduced in 2016, but failed to pass.
The Maryland legislature is working diligently on the EmPOWER bill, An Act Concerning Energy Efficiency Programs- Calculations of Program Savings and Consideration of Cost-Effectiveness. The House passed HB 514 and the Senate passed SB 184. Now the bills move to conference committee to determine the language set forth in the final version. Signing this bill into law will extend the EmPOWER energy efficiency program. As written, the Public Service Commission would require utilities to reduce overall “weather-normalized” electricity consumption by at least two percent per year. If this bill is signed into law, Maryland will be the first state in the region to mandate a specific savings goal in place of all cost-effectiveness that allows the commission to decide what the target should be.
There has also been some action around the EmPOWER semi-annual hearings, regulators declined to adopt performance incentives or penalties for the EmPOWER program, as it was suggested by the previous Exelon-PHI merger settlement agreement order, but suggest they may do so in the next round of semi-annual hearings. The commission has issued an order setting up the next comment date and hearings regarding the Empower semi-annual plans. What is significant about this is that on the last day of the hearings (May 25, 2017), pursuant to Order No. 88007, the commission will host a public technical conference for stakeholders and other interested parties to discuss the development of future energy efficiency programs in preparation for the 2018-2020 EmPOWER Maryland Program Cycle.
The Alternative Ratemaking docket had been quiet for some time, until recently when the commission issued an order seeking comments regarding the appropriate alternative ratemaking mechanisms that will be most beneficial for electric, natural gas, and water/wastewater industries, while ensuring consumer protection. Importantly, the commission is seeking answers to whether or not it should proceed with adopting policy statements that will identify guidelines for preferred alternative rate methodologies for each utility type. Current law may prohibit certain alternative rate methodologies and legislative changes may become necessary, but the commission may attempt to proceed under the current law. On another note, the Technical Reference Manual (TRM) annual update order and 2016 TRM update are posted on the commission’s website.
The House introduced H410, An act relating to adding products to Vermont's energy efficiency standards for appliances and equipment. This bill would amend the Vermont energy efficiency standards for appliances and equipment to include “high CRI" linear fluorescent lamps; deep dimming fluorescent ballasts; faucets, urinals, and water closets; portable electric spas; commercial hot food holding cabinets; and water dispensers.
The Connecticut Energy Efficiency Board voted and approved the 2017 Plan Update savings goals, cost-effectiveness, budget changes, and Performance Management Incentive. The Department of Energy and Environmental Protection issued the final Grid-Side Enhancement Determination, and rejects Eversource and United Illuminating energy storage proposals due to the lack of cost-benefit analyses. DEEP encourages UI and Eversource to revise their storage proposals to respond to DEEP’s concerns and submit the proposal directly to the Public Utility Regulatory Authority (PURA).
The House introduced HB317, Prohibiting the public utilities commission from increasing the system benefits charge without legislative approval. As introduced, this bill prohibits the Public Utility Commission from increasing the systems benefit charge without legislative approval. As introduced, funding for customer-based energy efficiency cannot exceed 10 percent of a utility’s total annual system benefits charge funds.
At the most recent Energy Efficiency Advisory Council meeting the utilities provided updates on their residential and C&I demand response demonstration projects. Consultants to the council also provided updates and milestones on peak demand reduction. In addition, as stated above for Rhode Island, National Grid has launched a commercial demand response program for Massachusetts and Rhode Island.
ISO-New England released an analysis of the Department of Environmental Protection’s proposed rule that would cap emissions from MA generators (310 CMR 7.74: Reducing Greenhouse Gas Emissions From Electricity Generating Facilities). The analysis concludes that in-state emission caps proposed by DEP may increase aggregate regional GHG emissions, as well as associated costs, because generation would be shifted out of state to less efficient, dirtier generators.