The Maine Governor’s Energy Office has announced it will not contract for the design of a distribution system operator (DSO) in the state. Instead, the office is inviting comments to inform its work to achieve the state legislature’s goals related to grid planning, infrastructure and management.
As ordered by the state legislature, the energy office obtained an initial study to evaluate whether a DSO could be established in Maine, and could be designed to achieve lower electricity costs, improved system reliability, accelerated achievement of the state’s climate goals, and growth of distributed energy resources (DERs).
Maine has a renewable portfolio standard of 80% by 2030, as well as greenhouse gas reduction targets.
The state legislature tasked the Governor’s Energy Office with reviewing the initial feasibility study and deciding whether to proceed with a second study to propose a design for a DSO. The law specified that any DSO design could not include acquisition or ownership of transmission or distribution utility assets.
The energy office has released the draft initial study along with a determination that pursuing the design of a DSO “is premature,” and that it will not do so. The office also invited comments, which the office will use alongside the initial study to inform future analysis to support achievement of the state’s goals.
The office said the draft feasibility study made clear that designing and implementing a DSO would require significant investment of resources as well as collaboration, beyond what was contemplated by the state legislature, among a wide range of stakeholders in order to achieve the desired outcomes.
The office added that the draft study made clear that the functions and roles that could be met by a DSO could also be met without a DSO, and that the study did not show that a DSO is “unequivocally the preferred entity” to perform such roles.
The office previously said that no U.S. jurisdiction has a DSO. An executive of Strategen Consulting, which prepared the initial study, said in June that DSOs are used in parts of the United Kingdom, Australia, Germany, France and Ontario, Canada.
Strategen’s draft feasibility study describes the “core functional capabilities” required for a DSO to manage the state’s energy transition: improved operational visibility, “flexible connection” of DERs, bottom-up resource planning, and “coordinated market mechanisms.”
The draft study concluded that the core DSO functions specified in the state law, “if implemented along the lines described herein, can provide a practical answer” to maximizing the benefits of DERs in advancing the state’s goals.
Drawing an example from the United Kingdom, the study said that a DSO in the UK, “coupled with DER integration,” yielded the equivalent of $250 million in benefits “during 2023/24.”
Strategen will discuss the draft study in a webinar hosted by the Maine Governor’s Energy Office on November 26.
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