The Interstate Renewable Energy Council has released a timely report addressing the many issues of managing infrastructure of a modern electric grid.
In recent years, new technologies have emerged on the consumer side of the electric system, including distributed energy resources (DER) such as distributed generation, energy efficiency, electric vehicles, energy storage and demand response technologies, among others. These technologies are allowing growing numbers of energy consumers to decrease their electricity demand, act as energy producers and otherwise manage their energy usage. At the same time, the public has become increasingly concerned about the environmental impacts of electricity generation, especially in contribution to climate change, and negative air and water impacts. Consumers and regulators are also looking for ways to improve the resiliency of the electric system during severe weather event, which are becoming more common as a result of climate change.
Multiple compounding factors have spurred national movement toward a more modern electricity grid, one that enables a cleaner energy future. A thought-leading report released today by the Interstate Renewable Energy Council (IREC) offers a unique look at easing that transition, and offers five insightful approaches for state utility regulators who, ultimately, will facilitate this transition through the rules and regulations that govern the electricity system and electric utilities.
According to IREC, a not-for-profit working to accelerate access to safe, affordable clean energy for more than 30 years, a modern grid will allow for increases in the amount of clean energy produced and universal consumer access, including through distributed generation, for example on-site solar or wind power. It must also include integrated resource planning, two-way flow of energy and information, and increased reliability, security and resiliency, according to IREC.
“As states, utilities and regulators face new demands on an aging electricity system and regulatory framework, there is a strong rationale for updating the ‘regulatory compact’ – the theoretical concept that underlies the laws, regulations and rules that govern the electricity system and the utilities that power it,” said lead author Erica Schroeder McConnell in the press announcement. “The process and results will allow more innovative ideas to flourish, while accommodating technological innovation and modern policy goals.”
Blackouts or power outages have many understanding the demand for an updated electric grid.
“The relative ease of transition for utilities and the electricity grid to a more distributed and clean energy future will depend largely on proactive and meaningful regulatory reforms,” said IREC Regulatory Director Sara Baldwin Auck.
New technologies have emerged on the customer side of the electric system, including distributed energy resources (DER), which are allowing growing numbers of energy consumers to decrease their electricity demand, to act as energy producers, and otherwise manage their energy usage.
IREC’s programs and policies benefit energy consumers, policymakers, utilities and the clean energy industry.
“Along with the physical system, the regulatory compact must evolve to accommodate new public priorities, changing consumer interests, economic and environmental risks, and transformative technologies,” says IREC President/CEO Jane Weissman. “By reevaluating and reconsidering their approach, regulators can help ensure a smooth transition to a new, more modern grid and can help define the role for electric utilities in this new era.”
The report lists five approaches that must be considered by regulators:
- Cost Recovery
- Rate Design
- Utility Strategic Planning
- Access to Data
- Grid Access
“The issues discussed here are merely a subset of the varied forces currently affecting the electricity system and industry,” said Baldwin Auck. “Also putting pressure on the traditional regulatory compact, and utility regulation and business models, are restructuring and competitive wholesale markets, and policies that support carbon reduction and promote renewable energy more broadly.”
Photo credit: High-voltage power transmission towers via Shutterstock
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