Distributed Energy Resources

Report notes utilities eyeing comprehensive DER programs

Utilities are increasingly considering distributed energy resource programs that are not technology-specific, but rather focus on more comprehensive, whole-building solutions, the N.C. Clean Energy Technology Center said in a report released on Nov. 1.

The third quarter 2018 edition of the center’s “The 50 States of Grid Modernization” report noted that PSE&G New Jersey proposed a new smart homes pilot program and a Non-Wires Alternatives Pilot Program that offer incentives for customers to adopt a variety of DERs, including battery storage, demand response, energy efficiency, electric vehicles, smart appliances, and distributed generation.

In Mississippi, Entergy proposed a new Smart Energy Services program, through which the utility would directly offer customers a variety of DERs.

“The vast majority of utility programs remain technology-specific, but these new proposals signal growing attention to broader solutions,” the report said.

Meanwhile, while grid modernization activity slowed overall in the third quarter of 2018, due to the majority of state legislatures being out of session, deployment activity increased during the quarter.

According to the report, six utilities filed new proposals to deploy advanced metering infrastructure and various smart grid technologies for a total investment of approximately $2.36 billion. Several of these proposals include investments in traditional grid technologies aimed at improving reliability, in addition to newer grid technologies. Four of these six utility proposals also include requests for new riders to recover grid modernization project costs.

Other deployment proposals filed during the quarter related to energy storage, with PSE&G New Jersey requesting approval for a $179 million investment in storage projects, to be recovered through a new technology innovation charge.

A total of 50 requests were under consideration during the quarter, amounting to over $7 billion in investment.

The report also said a growing number of states are examining performance-based regulation, with a wide variety of performance incentive metrics under consideration. In the third quarter of 2018, regulators approved performance incentives for National Grid in two of its service territories, based on capacity savings (Rhode Island) and electric vehicle charging site development (Massachusetts).

Rhode Island regulators are also considering performance incentives related to storage capacity, beneficial electrification, and interconnection.

Public Service Company of Oklahoma proposed performance incentive mechanisms in the third quarter that are based on reliability indices, customer satisfaction, public safety, economic development activities, and grid modernization (executing the utility’s grid modernization plan on time and within a certain cost cap).

The report found that 39 states and the District of Columbia took actions related to grid modernization during the third quarter of 2018, with the greatest number of actions relating to energy storage deployment (25), advanced metering infrastructure rules (22), grid modernization investigations (19), smart grid deployment (18), and distribution system planning (17).

A total of 276 grid modernization actions were taken during the quarter, representing a 50% increase over third quarter 2017. New York, California and New Jersey took the greatest number of actions during the quarter, followed by Massachusetts, Arizona, Michigan and Minnesota.

The report's executive summary is available here.