NEWS IN THE WORLD OF POWER AND INTEGRATED BUILDING SYSTEMS
ELECTRICALCONTRACTOR | SEP. 16 | WWW.ECMAG.COM
New NARUC Manual’s Impact on Distributed
Energy Resources Compensation
> IN JULY, the National Association of
Regulatory Utility Commissioners
(NARUC) convened a town hall meeting
for interested parties to begin to provide
input on its draft “Manual on Distributed
Energy Resources (DER) Compensation.”
NARUC is a nonprofit organization
whose members are governmental agencies
engaged in the regulation of utilities and carriers in
the states and territories of the United States.
The final manual, scheduled for release in November 2016,
could influence how regulators across the country design rates,
and how the U.S. electricity sector evolves.
The draft manual is the result of a November 2015 resolution
adopted by NARUC to create a staff subcommittee on rate
design, to provide a forum for state commissioners to address
rate-design challenges, with a focus on recognizing the
increasing importance of rate design issues in state policy.
According to Travis Kavulla, president of NARUC and a
Montana Public Service Commission commissioner, it is rare
for NARUC to issue a manual at all. It is also the first time that
NARUC has written a manual specifically on DER, and the first
time it has sought input from outside parties.
“In the past, NARUC hasn’t taken this kind of feedback,” he
said. “We just tasked our experts with writing a manual. But we
realize this is a subject of some contention and wanted to give
people an opportunity try to frame the issue and frame particular
methodologies for our benefit.
“Once complete, the manual will be a practical tool to help
state regulators manage the complicated issues associated
with rate design for distributed energy,” Kavulla said.
For NARUC’s purposes, DER consists of solar photovoltaic,
wind, combined heat and power (CHP), energy storage,
demand response, electric vehicles, microgrids and energy
efficiency. However, the main focus of the manual will be net-metered solar.
The draft manual is organized into five main sections. Section
1 describes the basic rate design process and how DER affects
that process. Section 2 defines DER and its relevance for states.
Section 3 identifies the challenges and questions raised by the
details of rate design and compensation. Section 4 outlines a
variety of DER compensation methodologies. Section 5 provides
a description of advanced technologies that may assist regulators
and utilities in planning and monitoring DER developments.
According to the draft manual, it is important to value
both positive and negative factors for each of the categories
of costs/benefits in order to ensure neutrality. This method
attempts to recognize potential benefits to the grid, other
customers or society.
Next-Generation Battery Market Charging Up
> FOR RENEWABLES AND ENERGY
efficiency, effective storage technologies
are a key ingredient to their continued
success. For its part, the battery industry
is keeping up. According to a recent study
by the firm Navigant Research, the market
for next-generation battery technology is
ready for growth.
The study, “Next-Generation Advanced
Batteries,” was released in June. It looks
at several classes of next-generation, precommercial advanced battery chemistries
that could challenge existing technologies
for dominance in the field.
The report acknowledges that lithium
ion (Li-ion) is the primary chemistry used
today for transportation and grid-tied
storage applications. However, there will
be limitations to Li-ion over time. The
report concludes that other chemistries—
The report examines two segments
within the grid-tied energy-storage
market. The first encompasses behind-
the-customer utility meter (behind-
the-meter, or BTM) distributed energy
storage. The second encompasses
storage needs in front of the utility side
of the customer meter (in-front-of-the-
meter, or FTM) on the transmission and
The report envisions that both the
BTM and FTM segments will increasingly
require batteries capable of both short
duration (less than one hour) power-focused performance and long-duration
(3-plus hour) energy performance.
This will be a key driver in the battery-
chemistry market. The chemistry that
can deliver the best performance for both
durations at the lowest cost will have an
advantage in the market.
Navigant projects the market for
new chemistries to increase from 30. 2
megawatt-hours in 2019 to greater than
6. 5 gigawatt-hours annually in 2025.
Revenue is expected to reach $9.2 million
in 2019 and rise to $1.4 billion in 2025.