Advanced Energy Perspectives

NARUC’s Guide to Rate Design and the Way Forward

Posted by Coley Girouard and Hannah Polikov

Sep 13, 2016 11:53:19 AM

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The growth in distributed energy resources (DER) is enabling consumers to take charge of their energy use, while providing new tools for a more affordable, reliable, and clean grid. But the increased adoption of DER has not come without controversy. Rate design issues, from net metering to fixed-charge fees and everything in between, are popping up with increasing frequency across the country. We at Advanced Energy Economy (AEE) have been at the forefront of these conversations in a variety of different arenas—most recently leading a collaborative discussion with utilities and other key stakeholders in New England around rate design for a DER future, and our ongoing involvement in New York as part of the Reforming the Energy Vision (REV) proceeding, most recently focusing on Value of DER/Successor to Net Energy Metering discussions—grappling with these issues and convening stakeholders to establish a dialogue on the best way forward. Our affiliate, AEE Institute, also convened public utility commissioners at forums in the Midwest and Mid-Atlantic regions to discuss distribution system planning to modernize the electricity grid.

Last November, the National Association of Regulatory Utility Commissioners (NARUC) jumped into the ring and created a Staff Subcommittee on Rate Design to address  the challenges inherent in a rapidly changing electricity system. The first order of business, as stated by NARUC President Travis Kavulla, was to develop a manual to assist jurisdictions in navigating the challenges, considerations, and policy developments related to the increase in DER on the grid. Following an initial round of comments, which AEE participated in, to inform the subcommittee on what to include in the manual, NARUC issued a draft manual on DER Compensation on July 21 and convened a town hall meeting two days later, during the Summer NARUC meeting in Nashville, to receive public input. On September 2, AEE submitted comments on the draft manual, applauding NARUC and President Kavulla for developing a solid first draft, while encouraging them to make additional improvements before the final version is released in November.

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Topics: PUCs

Do Demand Charges Make Sense for Residential Customers?

Posted by Coley Girouard

Jun 21, 2016 4:30:00 PM

This post was originally published on SmartGridNews. Read it in full by clicking here.

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The rise in customer-sited distributed generation (DG) and the success of energy efficiency (EE) programs in reducing load growth have brought rate design to the fore as utilities look for ways to ensure cost recovery and reduce risk. The large uptick in fixed charge proposals has continued as a result, but now a new trend toward a more sophisticated rate design has emerged - demand charges. Demand charges, the argument goes, are intended to better align revenue collection with cost and provide a strong incentive for customers to reduce their peak consumption. But do they really make sense for residential customers?

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Topics: State Policy Update, PUCs

Distribution Planning in a Distributed Energy Future

Posted by Coley Girouard

Apr 28, 2016 6:55:47 PM

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Rapid improvements in advanced energy technologies, increased customer adoption of distributed energy resources (DER), and changing public policy goals are driving change in our electric grid. Utilities historically have not taken DER - such as solar PV, demand response, energy efficiency, energy storage, or electric vehicles (EVs) - into consideration in their resource planning. The result is a business-as-usual resource plan, as if no DER were deployed. Cost savings in utility distribution system spending may be going unrealized because of excess capacity or because of investments in equipment for grid services that could be provided by DER at a lower cost. Getting utilities to consider DER in competition with traditional investments can lead to a more flexible, reliable, resilient, and clean grid, all while saving money for customers. The question is: how to do it?

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Topics: PUCs

As Ground Zero in Net Metering Debate, Nevada Stands Out

Posted by Coley Girouard

Mar 31, 2016 5:28:44 PM

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In recent months, Nevada has been the epicenter of the net metering debate nationally. The dispute came to a head on December 23, when the Public Utilities Commission of Nevada (PUCN) approved a new two-part net metering tariff that slashed the existing retail rate and tacked on a higher fixed charge, phased in over four years. The new net metering rules applied not only to new solar customers but existing ones as well. On February 12, the PUCN revised the order, extending the rate phase-in period from four to 12 years, but again without grandfathering existing solar owners. It seemed a watershed moment in the growing conflict over distributed generation connected to the grid - and for the rooftop solar industry that supplies it. But it is far from the last word.

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Topics: PUCs

Top 10 Public Utility Commission Issues to Watch in 2016

Posted by Coley Girouard

Feb 4, 2016 5:11:16 PM

In this post, we look at 10 key issues before state public utility commissions (PUCs) this year, from comprehensive energy storage to rate design and utility mergers. For access to PUC dockets referenced in this column in all 50 states, along with state legislative activity, sign up for a free trial of AEE’s PowerSuite. The trial includes a free subscription to DocketDigest, our bi-weekly newsletter focused on the latest PUC advanced energy dockets.

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1. California Dreamin’

California is currently immersed in a variety of proceedings focused on topics ranging from distribution planning to rate design to energy storage. Arguably the two most consequential proceedings are on Distribution Resource Plan (DRP) - focused on how utilities can value distributed energy resources (DER) - and Integrated Demand-Side Resource (IDER) - focused on how best to source DER needed by utilities and to consider the issue of localized incentives.

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Topics: PUCs

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Advanced Energy Perspectives is AEE's blog presenting news, analysis, and commentary on creating an advanced energy economy. Join the conversation!

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