Dive Brief:
- The Washington Utilities and Transportation Commission on Tuesday conditionally approved the first clean energy implementation plan filed by Puget Sound Energy, the state’s largest utility, putting it on the path to having 63% of its electricity sales come from clean sources by 2025.
- However, regulators raised concerns with the utility’s plan, based on what they described as a failure to describe specific actions it intends to take over the next four years. They opted not to reject the plan, noting that the utility could address these gaps in future filings.
- The UTC’s approval of the clean energy implementation plan is “a major milestone in our clean energy transition,” PSE President and CEO Mary Kipp said in a statement. The utility plans to launch a set of demand response programs in 2023, with an eye to reduce energy demand during peak periods on the grid.
Dive Insight:
In 2019, Washington lawmakers passed the Clean Energy Transformation Act, which requires the state’s electric supply to be carbon-free by 2045. In addition, the law requires the state’s electric utilities to file four-year clean energy implementation plans with the UTC, outlining strategies to reach this goal. Pacific Power, Avista and PSE filed plans with the commission in 2021, and regulators approved Avista’s plan in June 2022. Pacific Power’s plan is still being assessed.
PSE’s plan includes an interim target for the utility to meet 63% of retail load with renewable, carbon-free resources by 2025 – up from 33% in 2020.
Regulators approved PSE’s 80 MW target for distributed energy resources. However, the commission raised concerns about the lack of specific actions included in the plan, stating that the illustrative DER preferred portfolio outlined by the utility appears to be hypothetical. The agency has directed the utility to work with advisory groups to propose an updated DER selection process that is, among other things, “transparent, technology neutral and robust in its comparison of DER programs,” the order stated.
PSE’s plan proposed a total demand response target of 23.7 MW from 2022 through 2025. Regulators have instructed the utility to increase that target to include all cost-effective bids it received in a recent request for proposals, to be submitted to the commission within 60 days.
PSE is reviewing the commission’s order and has already begun work on a 2023 update to the plan – required by CETA – that will address the conditions laid out by the regulators, it said in the statement.
“[O]ne of the main issues we had with the plan was that it didn’t really offer what the commission refers to as specific actions that the utility will take. So while it had some of the key elements around renewable energy targets, energy efficiency targets, it didn’t get into details about the specific resources and programs that the company was planning to implement,” Lauren McCloy, policy director with the NW Energy Coalition, said.
While PSE’s 2025 target seemed aggressive but reasonable when the plan was filed, “that was all before the passage of the Inflation Reduction Act,” McCloy said.
“We expect that target to be much higher in the next clean energy implementation plan, just based on those resource costs coming down,” she added.
More broadly, the commission’s order is important because it establishes some precedents on key questions that have been lingering since CETA passed, McCloy said – questions around the level of specificity that regulators expect to see in the clean energy plans, for example.
In addition, the commission’s requirement that 30% of the benefits of the plan be designated to vulnerable populations in highly impacted communities is an important precedent, she added.
Looking forward, one priority for the state will be considering how to better integrate various regulatory planning processes, including the integrated resource plans, clean energy implementation plans, transportation electrification plans and others, according to McCloy.
With a more strategic integration of these planning requirements, “the public can more effectively participate, and the commission can review [the plans] in a more timely way and the utilities can get the guidance they need in order to do this transformation,” in the clean energy space, she added.
