Advanced Energy Perspectives

In 2014, state public utility commissions grappled with issues ranging from grid modernization to energy efficiency rollbacks, with some of the proceedings continuing into next year. In this year-end post, we look back at the top 10 issues on commission dockets this year - and get ready for a busy 2015. Note: some links in this post reference documents in DocketDash, BillBoard or PowerPortal, applications in AEE's new energy policy software platform, PowerSuite. Click here and sign up for a free 14-day trial of PowerSuite.

1. New York Boldly Undertakes Comprehensive Utility Reform

The New York Public Service Commission opened a groundbreaking proceeding, Reforming the Energy Vision (REV) in April 2014, which aims to address key barriers to the deployment of distributed energy resources through a significant redesign of utility planning processes, electricity market structures, and rate design. The rest of the country is watching closely, as the outcome of REV could help define the future of utility business models in many states.

AEE and its state and regional partners, Alliance for Clean Energy New York and the New England Clean Energy Council, have filed formal comments in the REV proceeding and, via the AEE Institute, published a report outlining a comprehensive approach to benefit-cost analysis for distributed energy resources needed to make REV successful.

We are now a little over four months into the landmark regulatory proceeding in New York State called “Reforming the Energy Vision,” or REV. With REV, the New York Public Service Commission (PSC) is seeking to fundamentally transform the way the state’s electric distribution utilities are regulated and how they do business – changing the way electricity is generated, bought and sold in New York. The REV proceeding is arguably the most comprehensive yet to tackle what is variously known as “Utility of the Future,” “Utility 2.0,” or as we at AEE call it, the “21st Century Electricity System.” (Users of PowerSuite can track and collaborate on this vital regulatory proceeding here.) Whatever you call it, the idea is to create a high-performing electricity system that runs on advanced energy. With the release of a new straw proposal on August 22, the PSC is moving the vision toward reality.

At regulated utilities across the United States, energy efficiency efforts are driving down energy usage and saving money for ratepayers. The Consortium for Energy Efficiency estimated that utilities spent $4.5 billion on these programs in 2011, resulting in residential electricity savings of over 14 TWh per year, equivalent to the consumption of 1.25 million U.S. homes. These savings have been achieved primarily by providing incentives for one-time technology investments, such as more efficient appliances or better windows, lighting and HVAC systems. But technology is not the only way to save energy.

As electric vehicles (EVs) start to take hold in the marketplace, one obstacle to wider acceptance remains: range anxiety. That’s the concern that your electric car might run out of juice before reaching your destination – or the nearest charging station. To compete on par with gasoline-powered vehicles, whose drivers’ range anxiety is relieved by gas stations located on street corners, in service areas, and by highway exits, EVs will need a similar infrastructure of charging stations – at home, on the road, and at workplaces.

Recent and ongoing regulatory proceedings on net metering highlight the role of state Public Utility Commissions (PUCs) in setting the terms of advanced energy growth in the United States. 

Net metering — which is offered in over 40 states — requires utilities to credit households and businesses that install small distributed generation systems (such as solar, wind, biogas, fuel cells, small hydro, combined heat and power, and others) for the surplus electricity that they generate. Despite variation in policy design between states, net metering is credited with accelerating the deployment of distributed generation (DG), particularly residential solar photovoltaic (PV) systems. While the incentive level and certain policy design elements (such as caps on total net-metered capacity within a state or utility service territory) are usually set by statute, other key components are determined by PUCs in regulatory proceedings, typically involving extensive stakeholder comment.