APPA News

By Paul Ciampoli
APPA News Director
Posted on August 3, 2018

Among the top grid modernization trends seen in the second quarter of this year were states moving toward more holistic utility planning processes and state utility regulators considering advanced metering infrastructure (AMI) opt-out fee proposals, according to a new report from the N.C. Clean Energy Technology Center.

The report, “50 States of Grid Modernization,” was released on Aug. 1. The quarterly series provides insights on state regulatory and legislative discussions and actions on grid modernization, utility business model and rate reforms, energy storage, microgrids and demand response.

With respect to second quarter trends, the report said that several states are working toward integrating utility planning processes to create more holistic planning methods with an increased focus on distributed energy resources.

The report notes that in Hawaii, a proceeding investigating integrated grid planning is currently underway, while draft rules under consideration in Missouri would incorporate DERs into utility resource planning, as well as transmission and distribution system analyses.

In Washington State, draft distribution system planning rules establish a “cross-functional” planning approach that would plan for system needs through investments in generation, DERs, and infrastructure investments.


AMI opt-out fees

The report also notes that in the second quarter, state regulators considered at least eight AMI opt-out fee proposals put forward by utilities.

The proposed fees included one-time charges of up to $150 and monthly fees of up to $25.89.

“Notably, one proposal, from Interstate Power and Light in Iowa, requires customers opting out of AMI installation to provide manual meter readings to the utility each month,” the report said.

Meanwhile, at least five states considered legislation during the quarter that would prohibit utilities from charging additional fees to customers opting out of AMI installation.

Multiple states, including Iowa, Kansas, and Washington, have opened regulatory proceedings to investigate AMI opt-out policies, the report said.


Ratemaking treatment for grid investments

Another top grid modernization trend in the second quarter was utilities seeking special ratemaking treatment for grid investments.

“While cost has been a major issue surrounding utility-proposed grid modernization investments, cost recovery mechanisms are also proving to be of significant importance and contention,” the report said. “Several utilities are requesting special ratemaking treatment, including new riders, for costs associated with large grid investment packages.”


42 states, District of Columbia took grid modernization action in Q2

The report said that 42 states and the District of Columbia took actions related to grid modernization during the second quarter of 2018, with the greatest number of actions relating to advanced metering infrastructure rules, energy storage deployment, utility business model reforms, data access and grid modernization investigations.

A total of 302 grid modernization actions were taken during the quarter, “representing an explosive increase in state activity in the first half of 2018,” the N.C. Clean Energy Technology Center said.

New York, California and Massachusetts took the greatest number of actions during the quarter, followed by Hawaii, Minnesota and New Jersey.


Solar report

On July 25, the N.C. Clean Energy Technology Center released its second quarter 2018 edition of “The 50 States of Solar.”

This quarterly series provides insights on state regulatory and legislative discussions and actions on distributed solar policy, with a focus on net metering, distributed solar valuation, community solar, residential fixed charges, residential demand and solar charges, third-party ownership, and utility-led rooftop solar programs.

The report found that 42 states and the District of Columbia took some type of distributed solar policy action during the second quarter, with the greatest number of actions relating to residential fixed charge or minimum bill increases, net metering policies and community solar policies.

A total of 148 distributed solar policy actions were taken during the quarter, with the greatest number of actions taken in California, Arizona, New York, Virginia and Massachusetts.

The report identified three trends in solar policy activity taken in the second quarter: (1) states working to increase low-income customer participation in community solar programs, (2) state legislatures considering bills effectively undoing or amending regulatory decisions, and (3) regulators approving residential fixed charge reductions.

Regulators in three states approved residential fixed charge decreases in the second quarter, a notable departure from previous quarters that represents an area to watch, the N.C. Clean Energy Technology Center said.

Additional information on the reports is available at the center’s website.