Contested regulatory proceedings are the foundation of the utility business in the U.S.
Utilities, power providers and advocates all engage regulators with public comments and testimony, hoping to persuade them on a pending rate case, generation investment or grid upgrade.
It's the model that built the largest machine on the planet — the North American electric grid. But sometimes, the public nature of the regulatory process can impede negotiations among utility stakeholders.
Particularly after a contentious ruling or market disruption, media scrutiny and disclosure rules on regulatory issues can mean opposing sides have little direct communication on how to solve an issue.
In those cases, moving negotiations to an outside setting, such as settlement meetings convened by an independent party, has helped some utility stakeholders reach broad compromises.
In Nevada, after a 2015 net metering decision ignited a political firestorm between solar developers and utility NV Energy, Republican Gov. Brian Sandoval convened a New Energy Task force that hammered out a long term solar compensation deal the next year.
In Colorado, Xcel Energy and 26 renewable energy interests also struck a far-reaching compromise that year on a rate case, a large-scale utility solar program and the regular review of the state’s renewable energy plan.
In that case, early negotiations involved "a lot of distrust" between utilities and renewable energy interests who "sometimes attribute bad intentions where there may not be," one working group participant said at the time. But by the end, parties were able to trade concessions across three regulatory dockets and prove that "reaching a solution that meets diverse stakeholders' interests does not have to be as polarizing as it has been in other states."
Similar forums helped New York stakeholders agree to a long-term value-of-solar plan in 2016. And last year, Arizona stakeholders ended years of regulatory battles over rooftop solar compensation through outside stakeholder meetings.
For five years, one energy nonprofit has been recreating those outside policymaking “safe spaces” for utility stakeholders across the country.
Each spring, the Rocky Mountain Institute, a Denver-based nonprofit, invites about a dozen teams of local energy stakeholders to negotiate issues ranging from market design to long term renewable energy plans and local microgrid projects.
Past projects include early planning behind New York's Reforming the Energy Vision (REV) proceeding, the development of the first distributed storage tariff for San Diego Gas & Electric's service territory, and negotiations between Duke Energy and local stakeholders to identify alternatives to a controversial gas plant near Asheville, N.C.
Earlier this month, RMI invited Utility Dive to its fifth e-Lab Accelerator Conference in Sundance, Utah, where 12 teams from around the U.S. spent four days working through a variety of power sector projects and plans. Taken together, the projects represent a snapshot of some of the most innovative utility industry thinking across the U.S.
Utility Dive was granted access to report on the outlines of each team's plan, most of which are still in the early stages. In order to ensure privacy of the policymaking forum, eLab rules stipulate that media could not directly quote participants without their consent.
One of the higher-profile groups at e-Lab this year involved Illinois utility ComEd, the state's consumer advocate the Citizens Utility Board (CUB) and environmental advocates like the Natural Resources Defense Council. The team aimed to build on the Future Energy Jobs Act, a 2016 law based on a stakeholder compromise that bailed out Illinois' nuclear plants and "fixed" the state's renewable energy mandate.
The Illinois team devised four broad policy goals for future legislation:
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Power sector decarbonization
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100% renewables
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Community development and equity
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Beneficial electrification of other sectors.
The goal, participants said, is to "transform the regulatory compact" to embrace those policy goals, likely through more performance-based standards. The final model, they said, will focus on "delivering on commitments made to the community as opposed to a simple cost-of-service model."
Though still early in the planning stages, negotiations could result in legislation similar to what passed last month in Hawaii, where a new law mandates performance-based regulation, aiming to "break the link" between utility revenues and capital expenditures.
The Minnesota electric vehicle readiness team faced one central issue, team members said: "We don't have proof that EV options are preferred [to other cars] and that investments in infrastructure can move our market."
The team, led by the Center for Energy and Environment, featured utility Xcel Energy and local stakeholders. They aim to develop an EV-ready community at Rice Creek Commons, a mixed-use development planned north of Minneapolis.
The idea, participants said, is to prove that providing EV charging infrastructure to multifamily buildings can increase adoption of the vehicles. The community could also include more novel options like EV car sharing and electric bikes and scooters to get around the development.
"We wanted to create an EV ready environment so we can look for learnings that will help Minnesota make incremental investments that will increase adoption of EVs," one team member said. That, they hope, "will provide proof so we can make investments [in EV infrastructure] that can help increase adoption."
West Oakland Renewable Power (WORP)
The WORP project brought together local energy activists with utility Pacific Gas & Electric and the Environmental Defense Fund to design a project proposal for an industrial-scale solar facility at or near the Port of Oakland.
The intent is to design a project that uses local equity investment and includes community benefits like bill offsets and load management capabilities, participants said.
After discussions with the utility and port, the team decided to take a dual approach, responding to an open Request for Offers from PG&E for solar capacity while also considering a behind-the-meter solar facility that would use the port as an offtaker. The team said it will design the proposals for each situation in the coming months.
The U.S. Green Building Council's Grid Optimal Initiative aims to build on its well known LEED rating system, used across the country to denote the energy efficiency of buildings.
The new Grid Optimal plan will combine LEED's approach with some of the elements of USGBC's new PEER rating system for power sector infrastructure, designing a new rating systems to "define buildings as grid citizens."
Once complete, the new system will include ratings for DER integration options on buildings as well as their ability to shift load and have their energy resources dispatched by a utility or grid operator. The idea, team members said, is to create a framework that treats "buildings as batteries" — valuing their ability to control their power consumption and dispatch to benefit the grid.
Overcoming Barriers to Renter Equity
The Energy Foundation, Interstate Renewable Energy Council and a handful of other nonprofits convened to help spread new energy technologies to renters, who are often unable to access them today.
The goal of the group, participants said, was to "empower low income renters to navigate time-of-use rates and particularly to help them mitigate potential negative impacts and optimize the opportunity" to save money.
Equity group envisions a "one-stop shop" for customers to learn about TOU rates, ways to save and how to access other programs. But they need funding and partners to get off the ground.
Los Angeles Preferred Resource Pilot
The preferred resources group's primary focus is finding alternatives to repowering old natural gas plants owned by the Los Angeles Department of Water and Power (LADWP).
Representatives from the utility, health group PSE Healthy Energy and local activists sought to identify renewable and distributed solutions that can meet the community's energy needs without exacerbating air quality issues or carbon emissions.
Participants also aimed to deploy resources in a way that "hits health, equity, resilience, environmental and grid goals," employing local community members and including low income residents and renters in energy solutions.
Juneau, Alaska, gets nearly 100% of its electricity from low-carbon hydro generation, but more than 80% of its heating demand is served by petroleum.
A group of utility, government and nonprofit employees from Alaska wants to change that, creating new programs that can help customers access lower-carbon heating options, like heat pumps.
City lawmakers in Juneau recently approved a plan to get 80% of Juneau's overall energy usage from renewables by 2045, necessitating a drawdown in petroleum heating. Stakeholders say they will continue to work with the utilities to deliver on the goal.
Southern Co. Non-Wires Alternatives
Southern Co, the mammoth utility that covers most of Georgia, Mississippi and Alabama, is often regarded as a more traditional utility, but it sees opportunity in non-wires alternatives (NWAs) — meeting power system needs through distributed resources and efficiency, rather than a traditional utility upgrade like a transmission line.
Representatives from the utility and environmental groups aimed to help Southern design new business practices to identify and site NWAs, including making the topic a priority internally at the company.
Southern is accustomed to following regulatory mandates, participants explained, but the rise of distributed energy is presenting it with a "customer tech revolution," which amounts to an "indirect mandate" from consumers.
Members of the group worked to identify key players at Southern who could enhance NWA analysis. Their hope is to mount an internal campaign in the coming months to "elevate" that indirect mandate to the level of attention that legal and regulatory directives receive.
Military Energy Resilience Catalyst (MERC)
The goal of MERC, which brought together energy experts from the Army, Navy and Air Force, is to ensure "energy is not the issue" when completing a mission.
The initiative aims to increase the efficiency and resilience of U.S. military installations. The Department of Defense is the world's largest energy consumer, the group noted, so identifying renewable solutions to the military's energy needs can help prevent supply disruption and have a meaningful environmental impact.
The Air Force already has an operating MERC initiative, and the program is set this year to be expanded to the other military branches. Participants will put together a searchable database on military energy projects, facilitate workshops with industry and hold a MERC Summit that brings together teams from each branch.
Strategically Growing New Mexico Renewables
New Mexico sits in one of the sunniest places in the U.S., but the state has lagged behind the nation's leaders in siting renewables. PNM, the state's largest utility, only gets about 15% of its power from wind and solar.
A group of PNM leaders and clean energy advocates hope to change that, working to design a long-term plan to grow renewable energy by leveraging PNM's integrated resource plan, which guides its investments.
The relationship between PNM and renewable energy interests in New Mexico is marked with antipathy, and participants said the two sides had to work to find common ground during the week in Sundance. By the end, both had agreed to form a "team of the willing" back in New Mexico that would work to "remove barriers to promote renewable energy growth."
That group, they hope, will help participants cut through the controversy of pending regulatory dockets and design longer term plans that can increase clean energy.
North Minneapolis Microgrid Project
The second Minnesota group brought together Minneapolis policymakers, Xcel energy, community groups and a state regulator to further develop plans for the North Minneapolis Microgrid Project, planned for the low income Plymouth Ave. corridor in the city.
Planners envision a community microgrid, including a local high school, meal preparation facilities and a renewable energy jobs training center for residents. Powered by onsite renewables and batteries, the goal is for the microgrid to provide economic development for the neighborhood as well as a resilient source of power for residents in an emergency.
The North Minneapolis project could be one of the closest to completion. Renewable Energy Partners, the local project developer, has already finalized plans for a 1 MW community solar project on the high school and begun developing the green jobs training center at a nearby warehouse. Xcel Energy has signed a letter of support for the project, and planners are currently reaching out to nearby residents and businesses to site more distributed solar.
Portland General Electric's grid planners recently came to an uncomfortable conclusion: To meet its energy and climate goals through 2040, roughly 25% of the utility's load will need to be "flexible," or able to modulate its power consumption at the utility's request.
That represents a level of demand-side management not seen anywhere today in the power sector. So PGE decided to see how far it could push the envelope, designing a Demand Response Test Bed pilot that will test how to scale up such programs.
Working with consumers and DR providers, PGE is targeting the load on three substations, testing to see how much demand response and flexibility it can attain from customers. In a second phase, the utility may also provide customers with new demand-side products like EVs and home batteries to consumers to test how they affect usage. Once complete, PGE plans to apply lessons from the pilot to system-wide demand management programs.
The Virtual Power Plant group took aim at the ongoing natural gas boom in the United States, aiming to design portfolios of DERs, load management and efficiency measures that can persuade utilities and cities not to invest in new gas generators.
There are currently more than 160 GW of gas generation planned in the U.S., participants said, and building all of that could lock in unsustainable levels of carbon pollution. Instead, team members from utilities, environmental groups and DER providers aimed to define the attributes necessary in a VPP portfolio, such as ramping, frequency response and storage duration.
The VPP group, as with many of the e-Lab teams, hopes to have plans for a pilot project settled in the coming months.
