NY energy storage bill would launch program

The New York legislature has unanimously passed a bill establishing an energy storage deployment program.  The bill, S. 5190, aims to promote the installation of energy storage systems.  The bill now awaits Governor Andrew Cuomo's signature, before it can take effect.

New York is in the midst of major shifts in its energy policy.  Governor Cuomo's "Reforming the Energy Vision" or REV process aims to build a clean, more resilient, and affordable energy system for all New Yorkers.  As part of that process, last year, the Public Service Commission adopted a Clean Energy Standard which requires 50% of New York’s electricity to be generated by renewable sources by 2030, and provides support for 3 nuclear power plants considered at risk of closing.  Meanwhile, the state is also reforming the way energy service companies, or retail electric suppliers, market their services.

In adopting renewable energy procurement mandates as part of the Clean Energy Standard in 2016, the Commission also considered creating specific mandates for energy storage.  As noted in the order adopting the Clean Energy Standard, "Storage is a critically important component of the energy system that is both distributed and increasingly reliant on intermittent resources. Unlike other resources, the load shifting and fast response capabilities of various forms of storage resources allow them to provide simultaneous value as an energy and reliability resource. Storage can also provide value to the distribution based retail and bulk power markets... In short, it is without question that modern markets must sufficiently and accurately value storage as a vehicle to design and optimize network planning and operations."

But in that order, the Commission concluded that "as a reliability support and system optimizing resource, storage is not properly characterized as a standalone renewable energy resource under the CES. That being said, if the various mechanisms that the Commission is pursuing to ensure storage takes it rightful place as a critical resource for the modern grid prove insufficient, this topic will be revisited."

S. 5190 would change New York's position, by requiring that the Commission establish 2030 targets for the installation of qualified energy storage systems.  It defines a qualified system as technology using mechanical, chemical, or thermal processes to absorb, store, and dispatch energy generated from renewable resources or mechanical processes.  The bill's official justification statement cites the increased use of intermittent renewable energy sources, such as solar and wind, in an effort to combat climate change, and the efficiency of using energy storage systems to solve issues relating to changes in how energy supply and demand align in time.

Three other states -- Massachusetts, California, and Oregon -- have adopted energy storage procurement policies, and the Federal Energy Regulatory Commission is exploring how electric storage resources can be integrated into wholesale and regulated markets.

Montana to study customer-generator costs, benefits

Montana utility regulators are preparing to study the costs and benefits of distributed solar energy projects and other customer-generators.  The results could reshape the way net-metered customers are charged for electric service, including the creation of a separate service classification and rates for customer-generators.

Earlier this year, the Montana legislature enacted House Bill 219, a law requiring utility NorthWestern Corp. to "conduct a study of the costs and benefits of customer-generators," for submission to the state Public Service Commission to inform future ratemaking.  The law allowed the Commission to establish "minimum information requirements" for inclusion in the study.

On June 16, 2017, the Commission posted a Notice of Opportunity to Comment on potential benefit and cost elements and study questions.  That notice identified categories of potential benefits including avoided energy costs, avoided capacity costs, avoided transmission and distribution capacity costs, avoided system losses, avoided renewable portfolio standard compliance costs, avoided environmental compliance costs, market price suppression effects, avoided risk, avoided grid support services costs, avoided outages costs, and non-energy benefits.  It also identified categories of potential costs, including reduced revenue, administrative costs, interconnection, integration, and cost shifts in production, transmission, and distribution.

The Commission's notice also posed a series of questions relevant to cost-benefit studies, including:

• What, if any, assumptions regarding the adoption rate of solar or other net metering technologies should the Commission specify?
• What, if any, time frame for calculating benefits and costs should the Commission specify (e.g., 10 years, 20 years, etc.)?
• What, if any, assumptions regarding utility rates should the Commission specify (e.g., rate of increase, changes in rate design (time-of-use, other))?
• What, if any, methodology for cost-effectiveness tests should the Commission specify (e.g., standard practice manual or the Cost Benefit Framework developed by the Electric Power Research Institute)?
• What cost-effectiveness perspective(s) should the Commission require be evaluated (e.g., societal, utility/program administrator, ratepayer, participant)?
• Should the Commission specify the generating resource avoided by net-metered systems?  If so, what generating unit should be used?
• Should the Commission specify a particular locational attribute that counts as either a benefit or cost adder/subtractor?
• What, if any, other compensation approaches in addition to net metering should be assessed in the study NorthWestern is required to conduct?

The Commission invited interested persons to submit written comments addressing the potential benefit and cost elements and study questions identified above no later than July 7, 2017.  It also directed the utility to provide information on the scale and scope of data it has collected, or intends to collect, regarding variations in the usage profiles of customer-generators compared to other customers in the same rate class.

NY considers ESCO reforms

New York utility regulators have launched consideration of reforms to how retail electricity suppliers called energy service companies or ESCOs operate in that state.  A December 2, 2016 notice issued by the New York Department of Public Service describes a history of "substantial overcharges and deceptive practices by the ESCO industry harming New York consumers," and establishes a process to "push ahead with reforms to ensure that ESCOs provide useful, value-added, economical services to New York consumers."  New York's ESCO reform process will play out in conjunction with other state initiatives, such as the Reforming the Energy Vision program.

As described in the Notice of Evidentiary and Collaborative Tracks and Deadline for Initial Testimony and Exhibits, the New York Public Service Commission initially opened up the energy services market to retail competition "to spur innovation in the creation of value-added products, particularly energy efficiency services that regulated rates may not provide, and to create commodity price competition that would result in efficiencies."  The notice summarizes the regulatory philosophies driving the historic decision to separate monopoly services (transmission and distribution) from competitive services (energy commodity), and the expectation that robust competitive markets would yield societal benefits.

But based on its "considerable experience with the offering of retail service to mass market customers by ESCOs," in 2014 the Commission determined "that the retail markets serving mass-market customers are not providing sufficient competition or innovation to properly serve consumers."  In the Commission's view, its subsequent efforts to realign the retail market have not succeeded: "customer abuses and overcharging persist, and there has been little innovation, particularly in the provision of energy efficiency and energy management services.  Commodity price differentiation has not worked, and the market for differentiated services is immature or non-existent."

For these reasons, on December 2, 2016, the Commission gave public notice that it "continues to examine measures that must be taken to ensure that these customers receive valuable services and pay just and reasonable rates for commodity and other services."  Among the measures identified for consideration by the Commission are:

• whether ESCOs should be completely prohibited from serving their current products to mass-market customers;
• whether the regulatory regime, rules and Uniform  Business Practices (UBP) applicable to ESCOs need to be modified to implement such a prohibition, to provide sufficient additional guidance as to acceptable rates and practices of ESCOs, or to create enforcement mechanisms to deter customer abuses and overcharging, including whether the Commission decision not to subject ESCOs to Article 4 of the Public Service Law should be revisited; and
• whether new ESCO rules and products can be developed that would provide sufficient real value to mass-market customers such that new products could be provided to them by ESCOs in the future in a manner that would ensure just and reasonable rates.

To pursue these efforts, the Commission established two procedural tracks.  An evidentiary track will consider the first two bullets listed above, while a "collaborative" track will focus on the third bullet. 

The Commission has previously described ESCO reforms as supportive of New York's Reforming the Energy Vision initiative, a comprehensive revisioning of the state's electricity sector.  In a February 2016 order, the Commission noted, "Development of markets in which vendors offer innovative services of value to consumers, and in which consumers can participate with confidence, is critically important to the success of the Reforming the Energy Vision (REV) initiative. Retail energy markets focused on commodity-only products, and in which ESCOs do not meet expectations of many customers, will thwart these objectives."

Initial pre-filed testimony and exhibits for the Track I evidentiary case on ESCO reforms are due on or before April 7, 2017.

July 27, 2010 - NY improves net metering for businesses; PGE develops rooftop solar in Oregon

Today I open with another photo shot on a Maine island: this time one of the wind towers on Vinalhaven run by the Fox Islands Wind project.  At 4.5 MW of installed capacity, Fox Islands Wind touts itself as the largest community wind-power facility on the East Coast of the United States.  My colleague Drew Landry snapped this shot when he was on Vinalhaven celebrating the project's ribbon cutting in November 2009.



The state of New York's Public Service Commission has adopted a revised set of rules governing net metering of distributed solar and wind generation at non-residential customers' sites.  These rules will make it easier for non-residential customers to site larger distributed generation behind their meters.  Until recently, a non-residential customer's solar or wind electric generating equipment was limited in capacity to the lesser of 2 MW or the customer's highest historic peak usage during the previous 12 months.  In practice, this meant that consumers demanding less than 2 MW of on-peak usage could not fully benefit from net metering opportunities, as their sales to the grid were capped at their own historic peak demand.  Once the revised rules take effect, New York businesses will be able to sell up to 2 MW to the grid.  For more information, see NY PSC Case Numbers 10-E-0133, 10-E-0134, 10-E-0135, 10-E-0136, 10-E-0137, or 10-E-013.

In the Pacific Northwest, Portland General Electric has installed the largest rooftop solar project in the region.  PGE is a fully integrated electric utility that serves more than 817,000 residential, commercial and industrial customers in Oregon.  Its project, spread atop the roofs of seven ProLogis distribution warehouses, covers 673,000 square feet and is rated at 2.4 MW.  Cost?  $14 million, $2.3 million of which is coming through incentives from the Energy Trust of Oregon. This project brings PGE to a total portfolio of 14.3 megawatts of solar capacity.  This portfolio includes more than 10.7 megawatts of customer-owned solar projects supported through PGE's net metering program, as well as a 104-kilowatt solar highway demonstration project with the Oregon Department of Transportation.  Oregon has recently adopted the "Solar Payment Option program", an incentive-based pilot program anticipated to bring another 17.5 megawatts of customer-owned solar projects online within the next 5 years.

It is hay harvest time in Maine, and farmers report that the season's good growing conditions have led to a very good harvest.

Also in Maine, utility Central Maine Power has acquired the final Army Corps permit it needs to build its $1.4 billion Maine Power Reliability Program transmission upgrade.