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Grid Modernization, Utility Reform, and Rate Restructuring

MCLI Recommendation: “State PUCs should restructure rates away from the traditional cost-of-service model.”

LPDD Recommendation: “State PUCs should participate in negotiations concerning the restructuring of utilities away from vertically integrated, investor-owned monopolies focused on selling more kWh to alternative models such as community-owned energy systems or energy service companies decoupling generation from distribution and creating new mandates for working with independent generators.”

See also: community solar and virtual net metering examples, listed under “Ownership Models."

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34 resources

Example Public Utilities

MI Power Grid Proceeding

MI Power Grid is a focused, multi-year stakeholder initiative at the Michigan PUC to maximize the benefits of the transition to clean, distributed energy resources for Michigan residents and businesse...
Example States and State Governments

Massachusetts Gas Transition Order

In December 2023, the Massachusetts Department of Public Utilities issued an order to move utilities away from natural gas. The regulatory strategy prohibits gas utilities from charging customers for ...
Example States and State Governments

Connecticut’s Law Banning Ratepayer Funding for Political Activity

Connecticut’s SB 7 prohibits utilities from using money from customers’ bills to pay for political activities, including lobbying and trade association dues. Utilities are required to file annual disc...
Example States and State Governments

Nevada’s SB 300 (2019)

Nevada’s Senate Bill 300 (2019) directs state regulators to explore an alternative ratemaking process — including performance incentives, decoupling mechanisms, and earnings-sharing mechanisms — that ...
Resource Public Utilities

RAP reports on Utility Reform and Integrated Planning

The Regulatory Assistance Project has prepared a report, Leading Utility Regulatory Reform, highlighting key elements of a successful reform process (including scoping, creative process elements, stak...
Example Public Utilities

Ohio’s PowerForward Collaborative

Ohio’s PowerForward Collaborative is an overarching grid modernization group led by PUCO staff. The Collaborative functions as an interactive forum to monitor and facilitate the evolution of a marketp...
Example States and State Governments

Connecticut’s HB 7006 (2020)

This 2020 legislation requires Connecticut’s Public Utilities Regulatory Authority (PURA) to investigate and develop a framework for implementing performance-based regulation for each electric distrib...
Example States and State Governments

Washington’s SB 5116

Washington’s 2019 SB 5116 grants the Utilities and Transportation Commission (UTC) the authority to shift utilities from a return-on-capital business model to a performance-based model. Rather than pr...
Example Public Utilities

Hawaii Performance-Based Regulation and Integrated Grid Planning proceedings

On April 18, 2018, the Public Utilities Commission of Hawaii (PUC) opened a Performance-Based Regulation proceeding to investigate the economic and policy issues associated with performance-based regu...
Example Public Utilities

New York’s Proactive Grid Planning Proceeding

In August, 2024, the New York State Public Service Commission commenced a proceeding to evaluate new energy loads from transportation and building electrification to proactively identify and develop f...
Example States and State Governments

Michigan Resolution to Study DER Integration

Michigan Senate Resolution 0143 (2020) encourages the Michigan Public Service Commission to study reliability, interconnection, and related grid integration issues related to distributed energy resour...
Resource States and State Governments

NCSL Report, Modernizing the Electric Grid: State Role and Policy Options

This 2019 report from the National Conference of State Legislatures was designed to assist state lawmakers in their efforts to gain an understanding of the many components of grid modernization. It al...
Example Public Utilities

Hawaii Proceeding To Investigate Distributed Energy Resource Policies

On September 24, 2019, Hawaii’s PUC opened proceeding 2019-0323 to investigate the technical, economic, and policy issues associated with DER as they pertain specifically to Hawaiian Electric Company ...
Example Public Utilities

Connecticut’s Framework for an Equitable Modern Grid

In 2019, Connecticut’s Public Utility Regulatory Authority approved the framework for a plan to modernize the electric grid. PURA outlined its vision for the next several years, including a framework ...
Example States and State Governments

Oregon Senate Bill 978

Senate Bill 978 created an open investigation into multiple aspects of the regulatory structure, including rate design, revenue regulation, grid modernization, integrated resource planning, and others...
Example States and State Governments

Colorado’s Investigation of Performance-Based Ratemaking Proceeding

On December 5, 2019, the Public Utilities Commission of Colorado opened the Investigation of Performance-Based Ratemaking Proceeding (19M-0661EG) in order to gather information and explore performance...
Resource Public Utilities

RMI’s Performance Incentive Mechanism Database

Performance Incentives Mechanisms (PIMs) are an evolving tool in the utility regulator’s toolkit, whereby regulators may link utility earnings to achieving certain system or social goals, such as incr...
Resource States and State Governments

MIT Report, The Future of the Electric Grid

MIT’s 2020 study, The Future of the Electric Grid, aims to provide a comprehensive, objective portrait of the U.S. electric grid and the challenges and opportunities it is likely to face over the next...
Resource States and State Governments

Illinois’ Climate and Equitable Jobs Act

This 900-page energy and climate bill, passed in September 2021, covers a variety of subject areas, listed below: On electricity: The bill raises the renewable portfolio standard to require 40 percent...
Example States and State Governments

Minnesota Performance-Based Regulation proceeding

Minnesota legislation (Stat. 216B.16) allowed the PUC to “initiate a proceeding to determine a set of performance measures that can be used to assess a utility operating under a multiyear rate plan.” ...
Resource Public Utilities

AWEA database on Integrated Resource Planning efforts

The American Wind Energy Association maintains a members-only database of Integrated Resource Planning efforts across the country in order to track what utilities and jurisdictions may be looking to a...
Example States and State Governments

Michigan Resolution on Studying Rate Design Options

Michigan’s Senate Resolution 0142 (2020) encourages the Michigan Public Service Commission to undertake a study into alternative and innovative rate design options for Michigan’s electric customers. T...
Resource Public Utilities

Report, Opportunities for Integrating Electric and Gas Planning

To successfully electrify traditionally gas-powered sectors, Public Utility Commissions should consider integrating the planning process of public gas and electric utilities, according to a January 20...
Example States and State Governments

New Mexico’s Energy Grid Modernization Roadmap (HB 233)

The Energy Grid Modernization Roadmap (HB 233) directs the Energy, Minerals and Natural Resources Department to develop a strategic plan for energy grid modernization and to establish a competitive gr...
Example States and State Governments

Colorado’s Grid Modernization Legislation

In May, 2024, Colorado passed grid modernization legislation that will require utilities serving 500,000 customers or more (that is, Xcel Energy) to upgrade their distribution systems to support the s...
Example Public Utilities

PJM’s Grid of the Future Report

In May 2022, the PJM Interconnection released a roadmap for handling the various changes affecting its system, including the retirement of fossil-fueled generation, growth in renewable energy and stor...
Example Public Utilities

New York’s Reforming the Energy Vision proceeding

The Reforming the Energy Vision proceeding in New York is a comprehensive effort to change how utilities perform system planning, what financial incentives they face, how they make use of distributed ...
Example Public Utilities

Massachusetts DER Planning Proceeding

October 22, 2020, the Massachusetts Department of Public Utilities (DPU) initiated this proceeding to investigate utility distributed energy resource planning and the assignment and recovery of costs ...
Example Public Utilities

California Integrated Distributed Energy Resources proceeding

California’s Integrated Distributed Energy Resources proceeding included a competitive solicitation incentive pilot and a utility regulatory incentive mechanism pilot which will facilitate the deploym...
Example Local Governments

DC’s MEDSIS proceeding

The District commenced a Modernizing the Energy Delivery System for Increased Sustainability (MEDSIS) in 2015, which, in Phase 2, considered separate tracks related to data and information access and ...
Example States and State Governments

Virginia’s Grid Transformation and Security Act (2018)

Virginia’s Grid Transformation and Security Act of 2018 aims to return money to utility customers, unwind an existing rate freeze, reform the oversight process for electric utilities, and establish a ...
Resource Public Utilities

RAP report, Electric Cost Allocation for a New Era

RAP’s 2020 manual focuses on cost allocation practices for electric utilities in the United States and their implications, acknowledging that charting a new path on cost allocation is an important par...
Resource States and State Governments

Connecticut’s Performance-Based Regulation Order

In April 2023, the Connecticut Public Utilities Regulatory Authority (PURA) issued a Final Decision as part of its investigation into a Performance-Based Regulation (PBR) framework for the state’s ele...
Example States and State Governments

Rhode Island’s Power Sector Transformation proceeding

In 2017, Rhode Island’s governor requested the PUC embark on a Power Sector Transformation proceeding. The PUC responded with a Phase One report later that year identifying work to be done developing ...