The Smart Electric Power Alliance (SEPA) and ScottMadden have released a summary of the differing approaches California and New York are taking toward regulatory policies and technical issues related to the integration of distributed energy resources (DERs) onto the grid. The report, “Distributed Energy Resources Integration: Policy, Technical, and Regulatory Perspectives from New York and California,” is a summary of thousands of pages of regulatory filings in both states, allowing readers to quickly understand the areas of overlap and divergence in the goals and execution of energy system reform in each state.
The report is also the latest publication generated by SEPA’s 51st State Initiative — a collaborative platform across the power sector to discuss the future of the electric industry. Designed as an alternative to the contentious debates surrounding market and rate reform occurring in many jurisdictions, the initiative creates an ongoing forum for experts and industry leaders to sound out, and provide feedback on directions and innovation to support energy sector evolution.
The centerpiece of change in New York has been the state’s Reforming the Energy Vision (REV) proceedings, which are aimed at creating a path to utility business model transformation and DER “market animation.” While actual DER penetration in New York has been minimal to date as compared to California, REV reflects the Public Service Commission’s view that “if we build it, they will come,” with a focus on creating the infrastructure and incentives to build DER deployment.
In California, the approach to change is driven aggressive renewable portfolio standards and solar rebates, which have led to high levels of rooftop solar adoption and penetration in some areas. This has triggered operational and planning challenges for utilities and required a more piece-by-piece problem solving approach. Importantly, California is taking a step-by-step approach through a series of legislative and regulatory actions that address discrete issues presented by DERs. The approach here is to focus on on piloting key changes before finalizing rate reforms or other changes to utility business models.
“As market transformation and grid modernization spread across the United States — in varying state initiatives and approaches — California and New York have been out ahead, setting the pace and conceptual frameworks for others,” said SEPA President and CEO Julia Hamm. “As part of our 51st State Initiative, this report provides a concise summary of the thought leadership these states are producing. Our hope is that it will serve as a springboard for further collaboration among all industry stakeholders as they forge solutions customized for their particular markets.”
“New York and California are leading the country in their development of policy and in tackling the technical challenges of integrating DERs,” said Cristin Lyons, partner and grid transformation practice leader at ScottMadden. “This paper provides an overview of the specific actions these two states are taking that we hope will be informative for other regions that are poised to face the same issues.”
Download “Distributed Energy Resources Integration: Policy, Technical, and Regulatory Perspectives from New York and California” here.
News item from SEPA