VT considers standard offer program changes

Thursday, January 4, 2018

Vermont utility regulators are reviewing the effectiveness of a program which awards contracts to renewable energy providers for the sale of power to Vermont’s electric distribution utilities. The Vermont Public Utility Commission says its review of the state's standard-offer program could lead to changes to how it selects projects.

Vermont law establishes a standard-offer program for reasons including providing “support and incentives to locate renewable energy plants of small and moderate size in a manner that is distributed across the State’s electric grid, including locating such plants in areas that will provide benefit to the operation and management of that grid through such means as reducing line losses and addressing transmission and distribution constraints." The statute empowers the Commission to select resources for participation in the standard-offer program, and to set prices paid to standard-offer resources, “with a goal of ensuring timely development at the lowest feasible cost."

Between 2013 and 2017, the Commission (under its former name Vermont Public Service Board) conducted annual requests for proposals for distributed energy projects through the standard-offer program. Under its current market-based approach established in 2013, the Commission sets minimum requirements for responsive proposals and selects the lowest-priced eligible proposals in several technology categories.

But as the Commission noted in its December 29, 2017 order opening a proceeding to review the effectiveness of the standard-offer program, "The field of distributed generation in Vermont has evolved significantly since 2013, when the Commission first announced many of the requirements of the standard-offer RFP process." For example, the order notes "significant deployment of net-metered photovoltaic systems and other photovoltaic systems." The Commission says, "some areas of the state have experienced such significant growth in photovoltaic systems that portions of the distribution grid cannot accommodate additional generation resources without investments in additional infrastructure."

In this context, the Commission opened a proceeding "to generally assess the effectiveness of the current RFP process and the criteria that the Commission uses to award standard-offer contracts." In its order opening the proceeding, the Commission articulated a series of questions addressing project selection criteria and possible integration of energy storage systems.

The Commission requested comments by February 2, 2018, and stated its expectation "that any improvements to the standard-offer program developed in this proceeding would not take effect until the 2019 RFP, or later."

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