The word “pathway” is defined as a way of achieving a specified result; a course of action.
Those who work in the electric sector already know all about the monumental changes that are affecting our industry. This is not another article telling you that change is coming and that renewables, regulations and customers are driving a transformation that is unprecedented in the history of the electric grid.
The resounding “ask” from the industry is not just to identify these challenges, but to help define a course of action.
Smart Electric Power Alliance (SEPA) is a non-profit organization that has championed providing objective information that focus on results and facilitating a community of peers to share successes. That trend continues in 2019 – SEPA has established four pathways to equip the industry as it makes educated decisions regarding clean energy, distributed energy resources (DERs) and grid modernization.
More utilities are interconnecting solar and storage across the United States in greater numbers than ever before. DERs and large-scale renewables are playing an increased role in the U.S. power sector, whether it be for individual consumer value as behind-the-meter resources, utility integrated virtual power plants or non-wires alternatives. Regardless of scale, proliferation of these technologies is challenging legacy utility processes and requiring a greater focus on new grid management tools and methodologies. There is also a growing push to evolve the traditional integrated resource planning (IRP) process into one that factors in changes to the distribution system and the use of DERs.
SEPA is focusing on five areas to bring about a flexible grid that can accommodate new clean resources, whether centralized or decentralized, without degrading reliability.
- Battery Storage Applications - This includes interconnection processes for both utility-scale and behind the meter applications.
- Enhanced Grid Planning - SEPA along with our members are evaluating best practices for system and distribution level planning (DRPs/IRPs).
- Technology and Interoperability Standards - The SEPA community just released Distributed Energy Resource Management System (DERMS) Requirements Version 2.0 to help simplify the procurement process for electric utilities and other stakeholders seeking to implement DERMS.
- Advanced Microgrids -The goal is to develop a planning framework around the role of advanced microgrids as individual consumer and system assets. Much of this work expands on SEPA’s involvement with the D.C. Public Service Commission’s MEDSIS Initiative,
- Valuation of DER in Resilience - This is about helping our members understand the value and capabilities of DER in resilience applications.
The end goal is a flexible, coordinated grid that can handle two-way flow of energy and DERs without sacrificing reliability or impacting cost.
To be successful, utilities cannot look at grid integration as a “silver bullet” that will happen in isolation. SEPA has defined three other distinct, yet closely interconnected pathways critical to accelerating the energy transition in 2019 and beyond.
- Utility Business Models - The goal is for utilities to have sustainable business models that facilitate and support a carbon-free energy future. The pace of technological change, customer needs for expanded choice, environmental performance, innovation and a growing adoption of DERs are putting pressure on the financial sustainability of many utilities. As consumer and societal needs move away from dependence on utility capital expenditures, the industry needs to determine where business processes, revenue streams and capabilities will need to change.
- Regulatory Innovation - State regulatory processes need to help enable timely and effective deployment of technologies, partnerships and business models that reduce carbon emissions. Just as the utility business model has been largely unchanged over the past 100 years, regulation has only marginally shifted to adapt to the new dynamics of electricity markets and changing societal and customer expectations. In many cases, promising technologies are already outdated by the time they get through the approval process. Regulators have an unenviable task to find ways to adapt to these changes while still balancing innovation and risk. SEPA hopes to evolve regulatory utility processes by convening key stakeholders to define current challenges and develop comprehensive solutions through innovation and collaboration.
- Electrification of Transportation - Electric vehicles (EV) have the potential to be a significant load growth opportunity for utilities as EV penetration increases across the country. Additionally, managed charging technologies are allowing utilities to use EVs to flatten load demand. Utilities have an opportunity to strategically leverage EVs as a valuable grid asset with the ability to absorb more renewable energy and provide load reductions during peak hours. SEPA is working at the forefront to bring utilities, regulators and the transportation industry together to remove any barriers to growth and uncover new opportunities that will propel the industry forward.
The electric power utility is in the midst of a monumental transformation. By focusing on transforming challenges into new opportunities, the broader energy transition is serving as a catalyst for increased collaboration and partnerships between utilities, regulators, clean technology developers and all those in the electricity value chain.