The California Independent System Operator (CAISO) Board of Governors has approved reactive power requirements for non-synchronous generators, such as solar PV, wind, and battery storage, in order to maintain grid reliability. The requirements will increase the scope and diversity of energy resources participating in CAISO markets.
Massachusetts H. 4568 (An Act to promote energy diversity) will shape the state’s energy future with an ambitious offshore wind energy target and lead to energy storage procurement targets with opportunities for utilities to own energy storage. The policy will likely provide a much-needed impetus for the U.S. offshore wind industry and also help other industries, such as solar companies that offer solar-plus-storage products.
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Massachusetts H. 4568 (An Act to promote energy diversity) will shape the state’s energy future with an ambitious offshore wind energy target and lead to energy storage procurement targets with opportunities for utilities to own energy storage.
The advent of innovative technologies, new supplies, and changing relationships between utilities, regulators, and consumers is continuing to encourage the utility business model to evolve.
As the one-way electric grid evolves into an intelligent, two-way platform, ISOs and RTOs are tasked with balancing the impacts of the changing energy landscape together with public policy actions set at both federal and state levels. While ISOs can employ innovative market designs that can help state policies achieve their goals, challenges arise when policymakers impose conditions on the markets that cannot be priced. These challenges are further amplified when policymakers within a single market footprint take different actions that potentially contradict each other. EnerKnol’s Primer on Electricity Markets highlights these major driving changes in the wholesale markets, and more.
On May 12, 2016, New York Governor Andrew M. Cuomo announced several new NY Green Bank transactions to fund solar installations and energy efficiency initiatives. With its evolving Green Bank, New York now joins Connecticut, which established first U.S. Green Bank, in leading the way to facilitate low-cost financing for clean energy by leveraging private capital. The success of Connecticut and New York’s green banks shows that public-private partnerships can outshine direct subsidies to clean energy and efficiency projects. As long as funding streams are available, green banks can amplify the impact of private investments and open additional sources of funds.
On May 19, 2016, the New York State Public Service Commission (NY PSC) issued an order adopting a framework for a ratemaking and utility revenue model under the Reforming the Energy Vision (REV) initiative (Case 14-M-0101). The Order is a major step forward in providing a framework for utilities to generate revenue as distributed system platform (DSP) providers under REV. Utilities will be required to develop retail markets for DER, such as solar, geothermal, wind, fuel cells, combined heat and power, battery storage, energy efficiency, and other advanced energy services.
On May 13, 2016, the New York State Energy Research and Development Authority (NYSERDA) announced its partnership with the Department of Energy's (DOE) Better Buildings Combined Heat and Power Resiliency Accelerator to foster combined heat and power (CHP) technologies for improved efficiency and enhanced resiliency. Multi-strategy initiatives such as the Better Buildings and Energy Data Accelerators, working in partnership with state and local governments, will have direct impact on utility Demand Side Management Portfolios, and the outcomes of state policies, such as those set in New York, could set precedent in other regions.
Illinois HB 6576 (Energy and Environmental Security Act), introduced on May 10, aims to support the hard-hit coal industry in the state by incentivizing clean coal generation. In a similar vein, the Next Generation Energy Plan, a comprehensive energy policy unveiled on May 5, includes provisions to support Exelon’s ailing nuclear power plants in Illinois. The implications from the Illinois bills --trying to influence market outcomes through out-of-market means -- will not only be relevant to coal and nuclear power in the state, but also for the debate over out-of-market versus market-based policy options in other RTOs and ISOs
On April 19, 2015, the U.S. Supreme Court ruled that a Maryland program to subsidize the participation of a new power plant in the wholesale energy market infringed on the Federal Energy Regulatory Commission’s (FERC) exclusive jurisdiction over wholesale electricity rates. The Court limited its ruling to the contractual structure of the Maryland program and specified that states may promote generation through other measures that do not intrude on FERC authority. FERC-state jurisdictional overlap will continue to grow as the energy landscape further evolves to incorporate new generation portfolios and comply with environmental mandates.
On March 29, 2016, Utah signed into law the Sustainable Transportation and Energy Plan Act (SB 115), which establishes utility investments in battery storage, electric vehicle infrastructure, and several clean energy programs. The new law seeks to boost energy storage solutions to improve the reliability and cost-efficiency of the electric grid, and joins a list of states enacting similar measures, including California, New York, and Texas. New regulatory measures at the state level will expand opportunities for emerging storage technologies, such as lithium-ion batteries, flywheels, and sodium-sulfur battery systems, to provide better operational flexibility and faster response.
On March 25, 2016, the Department of Energy (DOE) announced its decision to participate in the development of the Plains & Eastern transmission project, a 705-mile direct current transmission line, which would deliver approximately 4,000 MW of wind power from the Oklahoma and Texas Panhandle regions to the Mid-South and Southeast. The decision marks the first time that the DOE has used congressional authority under the 2005 Energy Policy Act that allows the Department to bypass state approval by directly partaking in a major interstate infrastructure project. Should the project succeed, many others could follow, boosting the development of renewable energy in the wind and solar regions in the upper Great Plains, Rocky Mountains, and Southwest desert.