Illinois launches major utility reform study
Illinois regulators have approved an ambitious, 18-month study to determine new technologies, business models, and regulatory regimes that will help transform the state’s electric grid into one that is more flexible and allows for greater customer choice.
The effort, called NextGrid, is reminiscent of other utility reform initiatives, including New York’s Reforming the Energy Vision strategy. The NextGrid study will be led by an outside facilitator and will result in a report in late 2018 that will include “tangible recommendations” to the Illinois Corporation Commission (ICC) and the Illinois General Assembly. Utilities, communities, academics, environmental groups, and consumer groups are invited to participate in the NextGrid process.
“[T]he advent of distributed generation and storage, demand response and energy efficiency, interconnected smart devices and appliances, microgrids, electric vehicles, the use of big data and analytics, environmental objectives, and a host of new technologies, products, services—spurring the development of entirely new energy markets—is challenging existing network design, capability, and regulatory policy,” said an ICC statement announcing NextGrid.
The NextGrid effort comes on the heels of the passage of the Future Energy Jobs Act, which was passed late last year and expands funding for renewable energy deployment and efficiency programs in Illinois, along with providing much-needed subsidies for two of the state’s struggling nuclear plants.
“Some of the key elements the Commission will be looking at over the next several years in the wake of the Future Energy Jobs Act are the factors of where on the grid different energy assets create value, when during the day and the year those assets create value, and how they create value to support reliability and efficiency,” said Andrew Barbeau, a consultant retained by the Environmental Defense Fund to work on smart grid issues, to Midwest Energy News. “These are complex questions with no easy answers.”
The ICC says the initiative will include deploying advanced technologies such as rooftop solar, electric vehicles, and energy storage at scale, thanks in part to the passage of the Illinois Future Energy Job Act. The study will seek to identify and investigate factors influencing the evolution of the energy industry and provide information on potential challenges and help inform the decisions of policymakers.
“Illinois has a long history of progressive leadership in energy policy,” ICC Chairman Brien J. Sheahan said. “Like the 1997 Electric Service Customer Choice and Rate Relief Law, the 2011 Energy Infrastructure Modernization Act, and the 2016 Future Energy Jobs Act, NextGrid holds the promise to further Illinois’ leadership in the new energy economy. We need to support innovation by utilities that builds on our strengths, creates value for consumers, and contributes to growth and development.”
Utilities, regulators, consumer groups and other stakeholders have long been in agreement on the need for major reform of utility business models and on the need to upgrade the electricity grid. This month, researchers with MIT Energy Initiative published a report proposing regulators establish a framework to integrate a cost-effective combination of centralized generation, conventional network assets, and emerging distributed resources.
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