Rhode Island moves forward with Power Sector Transformation

Rhode Island has not been a major destination for solar. The state reports that it has only installed 50 MW of solar to date, and as much of this was installed over the last year solar met a paltry 0.04% of the state’e electricity demand in 2016 – far less than the 1.4% in the United States as a whole.

However, the administration of Governor Gina Raimondo has big plans for the nation’s smallest state. Under Raimondo Rhode Island has already installed the first offshore wind farm in North America, and has set a target to more than quadruple clean energy deployment to reach 1 GW of renewable energy by the year 2020 – a capacity higher than the state’s peak demand on most days.

As a critical part of its clean energy efforts, the Raimondo Administration is also launching an initiative to redesign Rhode Island’s grid for the 21st century. The Power Sector Transformation (PST) initiative seeks to redesign the state’s grid to move from a 20th century centralized system to one based on two-way flows of electricity, including reform of utility business models.

The specific details of how such an effort will work are inherently complicated, and there are many paths that can be taken to achieve these goals. However, the PST’s Phase One Report, released last week, shows a plan that looks much like New York’s Reforming the Energy Vision (REV) process.

PST envisions a shift in utility incentives away from being able to earn a return on capital investments towards a “pay for performance” model, including incentives for system efficiency, distributed energy resources, and customer and network support. According to the interagency report, there will also be opportunities for utilities to earn revenue from new streams.

The report also calls for a wide roll-out of advanced meters, and a plan for how the capabilities of these meters can be accessed by third parties. This includes calling on the state’s sole utility, National Grid, to develop a plan for “establishing seamless customer and third-party access to data”.

In conversations with pv magazine staff, Rhode Island regulators have noted that smart meters and they data that they can provide will be a central point for the system transformation which is envisioned.

Additionally, RI Power Sector Transformation calls on state regulators and policymakers to develop a strategy to compensate the value of distributed resources based on their location and benefits to the distribution system.

All three of these approaches mirror similar actions in REV. And while PST also emphasizes other goals such as controlling cost and enabling greater customer choice, like REV and other grid modernization initiatives facilitating the integration of higher levels of renewable energy is one of the main aims.

In both processes the devil will be in the details of implementation. The Phase One report notes that “transforming the power sector will not occur overnight” and notes that the report provides a “starting point” for what is describes as “substantial change”.

Implementation will be spread across several regulatory dockets, however the report notes that National Grid’s distribution rate case filing, which is expected on December 2017 “represents a strategic opportunity to modernize the utility business model, deploy advanced meters, enhance distribution system planning, and pursue beneficial electrification.”