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SEPA’s 51st State: A virtual ‘atlas’ for energy system transition

By K Kaufmann

The evolution of the U.S. energy system now underway has never been — and, in all likelihood, will never be — a one-size-fits-all proposition.

The future distributed grid, integrating solar and other clean energy technologies, is emerging across energy markets that vary by region, and must incorporate electricity rates and policies that are set by individual states or, in some cases, individual cities.

This need for a set of regional “road maps” for change is a main driver for the second phase of the Solar Electric Power Association’s (SEPA’s) 51st State Initiative. The project is aimed at creating a virtual “atlas” of such plans that energy stakeholders across the country can draw on and adapt to local market and policy landscapes.

Final 51st State3

To date, more than 30 individuals and groups have signed up as potential participants and many are working on road maps for a March 9 deadline, according to  John Sterling, SEPA’s Senior Director of Research and Advisory Services, who helped start the initiative in 2014 and has guided its development.

“There are a lot of markets where folks are looking for ideas or waiting for others to figure out the answers so that they can move forward, and that has its upsides and its limitations,” Sterling said.

Read the SEPA-NREL report on “The Flexible Solar Utility” here.

“The early movers are coming up with new market designs and transaction structures, but they may not be replicable,” he said. “Urban areas with dense populations and high demand patterns have different needs and may come up with very different plans than more rural areas with fewer people per square mile and less concentrated demand.”

Similarly, areas with traditional, investor-owned utilities will approach change differently than cities or regions served by a municipal utility or electric cooperative, Sterling said.

Bruce Nordman, a research scientist at the Lawrence Berkeley National Laboratory in Berkeley, California, sees a possible technological fix for these market variables in minimizing “complexity at the meter interface so there’s as little information passing across that as possible. The more complex you make that interface, the more expensive it becomes — and more likely to be tied into a specific business model.”

Such streamlined designs would allow for universal technologies — for example, plug-and-play rooftop solar — which, in turn could help to overcome regional limitations, said Nordman, who is hoping to participate in Phase II as part of a team not affiliated with the Berkeley Lab. SEPA is working with him to find a group that will be a good match..

At the other end of the spectrum, Janos Kakuk, Principal Manager of Strategic Planning at Southern California Edison, said SEPA’s call for road maps resonated with the investor-owned utility’s efforts to monitor and stay ahead of changes in the industry.

“We really see that these changes are not temporary — customer choice and technology,” Kakuk said. “Customers would like to be much more engaged, they would like to take advantage of the technology which enables these changes.”

While Edison’s paper is still being developed, Kakuk said it likely would be based on a market structure similar to California’s but would be comprehensive and not “utility-focused.” A major focus would be on solutions that provide benefits for all energy industry stakeholders — customers, utilities, the solar industry and society as a whole — he said.

Expanding the conversation

Providing replicable, but adaptable models for energy system transition has been at the heart of the 51st State Initiative since its inception. Launched in the fall of 2014, the project’s first phase asked participants to envision a clean, affordable and reliable energy system — with a robust solar market — from the ground up, as if for a hypothetical 51st state with no established market structures or regulations.

“At the time, we were looking for a way to go beyond some of the divisive debates that were occurring at the state level around net metering and rate reform — to see if we could find some commonalities that would lead to more collaborative solutions,” Sterling said.

That challenge drew more than a dozen proposals, ranging from plans for incremental change in today’s system, to visions of essential paradigm shifts in how electricity is generated and consumed. It also sparked a desire for more detailed plans with clear steps for getting from today’s markets to the envisioned futures — a gap that, in turn, became the impetus for Phase II’s call for road maps.

51st State Continuum
Table 1: The continuum of change in 51st State Phase I proposals.

To draw an even broader range of potential participants and ideas, the guidelines for Phase II leave the starting and end points for market restructuring to the individual teams or organizations designing the road maps. What is more critical, Sterling said, is that each road map address specific issues — such as rate design and utility business models — and set up tentative timelines and checkpoints for incremental change.

Individuals and groups can still submit a road map for the March 9 deadline, even if they did not file a notice of intent to participate last year.

David Hill, Director of Distributed Resources and a policy fellow at the nonprofit Vermont Energy Investment Corporation (VEIC), says his organization is already working on energy system transition strategies for his state that are well aligned with the 51st State framework. Vermont has a successful rooftop solar market — already hitting a net metering cap of 15 percent of each utility’s peak load for the prior year — and has set a 90-percent renewable energy goal for 2050, including not only electricity, but transportation and heating fuels as well.

VEIC is studying what further changes in technology, regulation and utility business models will be needed to create an “advanced solar economy” in Vermont, with an interim goal of 20 percent of the state’s electricity generated by solar by 2025, he said.

“It can be done but it means that you’re going to have (solar) located and planned and invested in, in a different way than the utility system has done in the past,” Hill said.

Sharing this work through the 51st State “will be a very good mechanism for disseminating some of the results, and it will help us in some of our thinking,” he said. “We’re working with progressive organizations and people who understand that what’s happening now is transitional; but a lot of the time, the focus ends up being just in Vermont. We can start to put what we’re doing in a broader context.”

The resulting road maps from VEIC, Edison and others will be shared online and discussed at SEPA’s second 51st State Summit, set for April 14 in Denver. SEPA is also planning a series of subsequent 51st State workshops, with details still to be finalized.

The 51st State Summit will be part of SEPA’s Utility Solar Conference. Find out more here.

Sterling hopes for proposals in which “very different approaches may have some very similar steps. So whether you agree or disagree with where an individual road map is going, you might say, ‘Yeah, but we agree that you need advanced meters; we agree that we need to try an alternative rate design.’

“Let’s find the points of agreement, so we can all at least start with some least-regret strategies,” he said.

“There are a lot of options that need to be on the table and considered,” Hill agreed. “It’s probably beyond the scope of any one study to do it all and say, ‘We’ve got the answer.’ You want to expand the conversation.”

K Kaufmann is Communications Manager at SEPA. She can be reached at [email protected].