Washington Enacts Law Requiring Electric Utilities to Plan for Distributed Energy Future

Democratic Governor Jay Inslee signed legislation on April 30 setting forth requirements that Washington’s electric utilities must accomplish in their distributed energy resources planning processes. The move comes on the heels of a measure approved by the legislature last month requiring the state’s electricity supply to be carbon-neutral by 2030 and 100 percent carbon-free by 2045.

The legislature finds that the proliferation of distributed solar is transforming the relationships between utilities and their retail customers. A robust planning strategy is expected to help utilities better understand the interdependence between customer-sited and capacity resources, quantify customer values that are not included in volumetric rates, and defer or avoid capital expenditures.

The law requires utilities to identify data gaps that impair planning and upgrades, propose tariffs to fairly compensate customers for the value of their systems, and incorporate distributed resources in their long-term resource plans. Utilities must provide a 10-year plan for distribution system investments and an analysis of nonwires alternatives for major transmission and distribution projects. The legislature will conduct an initial review by Jan. 1, 2023, and commence a four-year review from 2026 to examine utilities’ progress in meeting the goals set forth in the policy.