Maine explores non-transmission alternatives coordinator

Should Maine designate an entity to coordinate the development of lower-cost alternatives to new electric transmission lines?  The Maine Public Utilities Commission has opened an inquiry to obtain comments on the role of a non-transmission alternative (NTA) coordinator and the parameters for procuring the services of an NTA coordinator.

Modern society counts on electric utilities and power plants to supply consumers with electricity.  As consumer needs and plant economics change over time, utilities have traditionally looked to new infrastructure like transmission lines to meet new needs.  But in some cases, transmission development may not be the cheapest or best way to meet consumer needs; rather, "non-transmission alternatives" such as distributed generation, energy efficiency or microgrids may be able to achieve the same ends for a lower total cost.

Grid modernization -- and the tools needed to manage the process efficiently -- can be controversial.  By order dated May 11, 2015, the Maine Public Utilities Commission declined to designate a "Smart Grid Coordinator" to provide a broad array of services to the state, on the grounds that that the record before it did not support a finding that designate a coordinator to provide all these services was in the public interest.

But the Commission indicated interest in designating someone to provide the services of marketing, implementing, and possibly operating non-transmission alternatives.  To that end, the Commission found "there is the potential for benefits from an entity that has the relevant expertise and a commercial interest in the successful development and implementation of NTAs" -- provided that the entity can deliver its services in a way that provides value to ratepayers.

By a June 30 Notice of Inquiry, the Commission initiated the next phase of its exploration of designating an NTA coordinator.  The Commission requested comment on issues it had previously identified in its May 11 order as requiring further factual development to enable the Commission to determine whether it is in the public interest to designate an NTA coordinator:

1. What duties should be included in the scope of services offered by an NTA coordinator?
2. Should T&D utilities be allowed to bid on an NTA RFP and if so should such services be provided through an affiliate? 
3. If an RFP were seeking proposals for having a non-utility entity operate an NTA in a manner consistent with reliability and cyber security standards, how would the incremental costs to operate the NTA be determined?
4. What type of pricing structures should be considered in developing the RFP?
5. What factors should be considered in bid evaluation?
6. What should be the term of the NTA coordinator contract?
7. What entities should be the counterparties to the contract?
8. What enforcement mechanisms should be included in the contract?
9. What type/amount of financial security should be required?

The Commission also invited comment on any other issues relevant to its consideration of designating an NTA coordinator.  The Commission requests that comments be filed by July 21, 2015.  After comments are received, Commission staff will schedule a meeting to discuss the comments and discuss next steps in the development of a request for proposals.