New York opened its “Reforming the Energy Vision” (REV) proceeding earlier this year to re-examine the utility business model. As part of this proceeding, state regulators will also look into removing market barriers preventing greater deployment of distributed energy resources (DER), which are smaller-scale clean energy resources, such as energy efficiency, energy storage, and local, on-site generation.
In recent years, DERs have made great strides due to market reforms, advanced technologies, and declining costs. Despite these advances, DERs serve less than 1% of national electricity demand as the existing utility business model and regulatory policies still favor traditional electricity distribution from a centralized grid.
Though the REV proceeding is in its early stages, the Department of Public Service Staff (Staff) has provided guidance recommendations for eliminating these market barriers. Using the Staff’s filings, EDF has drafted a white paper that compiles a Top 20 list of the changes required before we will see greater use of DERs. If adopted, these recommendations would result in a sea change for incorporating DERs into New York’s electric system and would provide a template for other states to follow. Read More
Clean energy finance is thriving in New York State. This week, Governor Cuomo announced the New York Green Bank’s first set of deals, totaling an impressive $800 million in clean energy investments across the state. The projects funded by this investment will yield an impressive annual reduction of 575,000 tons of carbon dioxide emissions, roughly equivalent to removing 120,000 cars from the road or planting 15 million trees per year. This move helps cement New York’s role as a leading state in the clean energy economy.
By offering attractive interest rates and other incentives to stimulate interest from the private sector, green banks encourage investment in clean energy projects that may otherwise have difficulty obtaining private financing. Ideally, these initial deals then set the stage for an active and self-sustaining market in renewable energy and energy efficiency finance.
And the NY Green Bank is starting off swinging: its initial investment of $200 million catalyzed $600 million more in investment from prominent financial institutions, such as Bank of America Merrill Lynch and Deutsche Bank. Read More
New York’s “Reforming the Energy Vision” (REV) proceeding aims to reform the state’s long-standing electricity system to lay the groundwork for a cleaner and more efficient grid that allows for more customer choice and competition from third-party energy services companies. Forming the centerpiece of this 21st-century vision is a platform that would smoothly integrate innovative energy services and solutions into the existing grid, allowing them to compete on equal footing with electricity from centralized power plants.
Currently, the electric industry comprises three functions: generation, transmission, and distribution. Generation refers to making electricity, traditionally from large, centralized power plants. Transmission refers to sending that electricity along high-voltage wires to substations closer to electricity customers. Distribution refers to delivering the power from the substations to homes and businesses. In its recent straw proposal, the Department of Public Service Staff (Staff) recommends splitting the distribution function into two parts, one performing the traditional delivery service and the other serving as the Distribution System Platform Provider (DSP), to grant equal priority to energy solutions that are not centralized, such as on-site, distributed generation and energy efficiency. Read More
Source: designmilk flickr
New York is re-examining the way energy is regulated, priced, and distributed in the state in order to emerge with a 21st century business model. This change will deliver on a broad range of objectives, including increased customer value and environmental benefits, among others. However, achieving greater system efficiency could lead to the most impactful outcomes for customers, the environment, and society as a whole. Not only does increasing system efficiency have the potential to significantly reduce costs, energy use, and carbon emissions, it also makes the customer an integral part of the solution to meeting our future energy needs.
Electric utilities are tasked with meeting consumer demand for electricity at all times and, until now, have done so primarily by installing additional infrastructure on the electric grid whenever needed. While this has resulted in a fairly-reliable way to meet our energy needs, it has and continues to be extremely expensive and inefficient given the evolution in how energy is used today. Read More
The New York Public Service Commission (Commission) has embarked on the landmark Reforming Energy Vision (REV) proceeding to design a new business model for electric utilities. Today’s business model allows utilities to earn revenues based on how much money they spend to supply and deliver electricity. Under the new model, utilities will earn revenues based on the value of services they deliver to customers and the environment.
Currently, utilities dominate the electricity service market, limiting customer access to the full range of products and services otherwise available in a truly open market. One focus of the proceeding is to remove the barriers preventing third parties, such as retail electric suppliers, solar energy companies, or smart meter providers, from fully participating in the energy market. Allowing full participation by third parties would lead to increased innovation and fuel the development of new products and services. Read More
As we’ve mentioned before, New York is changing how it evaluates and compensates electric utilities. One goal of this change is increased consumer engagement, which makes customers allies in the development of a more reliable, resilient, and ‘smart’ electric grid.
Many customers have begun taking advantage of new energy technologies and their falling prices by turning to community microgrids, installing on-site distributed generation, like rooftop solar, or investing in more efficient appliances, among other actions. Advances in telecommunications and information systems have also created new opportunities for energy services we could not have imagined just a few years ago. For example, innovative tools like demand response allow third parties or utilities to turn off pre-approved appliances – like swimming pool pumps and air conditioners – remotely when the power grid is stressed and needs a quick reduction in energy demand. Read More