How states can deliver real equity in grid planning – not just check the box

By Aashney Shah, EDF Legal Intern, Clean Energy Transition

“Electricity is the new price of eggs.” That line, from a recent New York Times article on rising electric bills and data center growth, captures the political moment with startling clarity. Consumers want solutions. While states have been exploring a wide range of actions to address affordability and equity, policymakers still face a core question: How can we ensure that the biggest benefits reach the communities that need them most?

As equity mandates rise, delivery is the real test

States have begun to codify such distributional mandates for energy. To name just a few, Illinois’ Climate and Equitable Jobs Act requires that “at least 40% of the benefits” of grid modernization and clean energy should go towards Equity Investment Eligible Communities;” New York’s Climate Leadership and Community Protection Act requires at least 35 percent, with a goal of 40 percent, of the overall benefits of investments related to clean energy and energy efficiency programs be directed to disadvantaged communities, and Washington’s Healthy Environment for All Act requires agencies to direct “40% of all grants and expenditures that create environmental benefits to vulnerable populations and overburdened communities.”

While many of these states are developing new electric grid plans, the numerical guidelines may be helpful. However, the task is complicated by the fact that many “benefits” are unquantifiable. The answer thus requires more than funding tallies or box-checking exercises. Instead, it requires modern, credible equity analysis grounded in community expertise and rigorous methods that measure real outcomes. Here’s how states can build grid plans that actually deliver:

1. Use a four-part equity framework to score benefits more accurately

Illinois’ 2024 refiled plans highlighted a critical flaw in traditional approaches: utilities relied on binary scoring – a simple yes/no – when evaluating qualitative benefits. Regulators required a more rigorous method, noting that a simple “yes/no” hides meaningful differences in benefit levels and fails to show exactly how investments meet the 40% benefit requirement for Equity Investment Eligible Communities (EIECs). A stronger approach, which contributed to a straw proposal that the Commission ultimately approved, evaluates investments across four established equity dimensions:

• Recognitional equity: acknowledging historical and social context
• Procedural equity: ensuring inclusive participation
• Distributive equity: sharing benefits and burdens fairly
• Restorative equity: repairing past harms and supporting long-term sustainability

Scoring measures across these four dimensions creates accountability and clarity; something binary scoring simply cannot achieve.

2. Start with authentic, ongoing community engagement

Research consistently shows that utilities cannot achieve equitable outcomes without two-way, long-term engagement with communities. Effective engagement builds trust, improves social acceptance, and helps ensure solutions reflect real needs. A comprehensive review of 51 equity-focused energy projects found that community engagement efforts that are context-specific are more likely to lead to more equitable energy outcomes, which requires approaches that reflect the diverse perspectives of the communities impacted.

Utilities should identify the engagement process behind each proposed measure and show how it informs the project and its equity analysis. Simply treating spending as a proxy for community benefit may deepen mistrust. Meaningful engagement which shifts the focus to quantitative and qualitative impacts on the community are more likely to be accepted through strengthening trust, especially in communities who have long been excluded from decision-making.  

Distributional Equity Analysis provides a practical model by embedding community input into equity metrics, program design, and investment prioritization. California’s Microgrid Incentive Program utilized this approach to generate equity “scores” through stakeholder workshops, enabling transparent evaluation of whether projects met legislative goals.

3. Apply quantitative tools that capture real community impacts

Various proven, practical tools have been developed that quantify equity impacts more accurately than simply cost totals and participation numbers:

• Equity indices: Three new community-level indices – Community Energy Financial Index (affordability), Community Energy Sustainability Index (sustainability) and Community Energy Resiliency Index (resilience) – can help measure whether grid investments advance various benefits mandates. The Community Energy Sustainability Index is especially powerful, using GHG intensity (or the total GHG emissions relative to the quantity of electricity produced or consumed) to assess both short- and long-term environmental impacts at the community level.
• Regression-based scenario analysis: This approach tests whether equity policies actually expand access by comparing an “equity scenario” to a baseline. Evidence shows targeted incentives drive greater participation among low-income and environmental justice communities.
• Optimization modeling: Optimization tools identify the most effective mix of investments under real-world budget constraints, and in furtherance of a specific goal through community dimensions that reflect community needs, climate goals and distributional impacts. By aligning affordability, reliability, climate goals and equity priorities, these models can help utilities maximize benefits, minimize disconnections, and respond directly to regulatory objectives.

Together, these tools allow regulators to pursue equity using empirical measurements, not theoretical projections, increasing the chances that communities experience noticeable improvements to their quality of life because of these efforts.

4. Use community solar as a model for quantifiable, equitable outcomes

Community solar offers one of the clearest examples of how programs can deliver measurable, equitable benefits when designed intentionally. Studies show that community solar participants earn significantly less, are more likely to rent, and are more likely to identify as people of color or Hispanic than rooftop solar adopters. In Illinois, policy accounted for 38% of the income gap reduction between non-participants and community solar subscribers, proving that program design – not just market forces – expands access.

Community solar also delivers meaningful bill savings, increases resilience and reliability, and can be more profitable under equity-enhancing policies. This reinforces a simple truth: deployment numbers alone cannot show whether benefits reach EIEC communities. Qualitative, equity-driven factors must be considered as well.

5. Measure energy burden outcomes – not just spending

Funding levels rarely reflect whether high-burden households actually see relief. That’s why researchers recommend tracking avoided burden (real dollar reductions in bills) and avoided need (burden reductions specifically for high-need customers). Metrics like operational and targeting effectiveness help utilities determine whether programs truly reduce energy insecurity. This shift from inputs to outcomes is essential for credible equity analysis and can help to address the root cause of inequities.

6. Pair distributed equity analysis with benefit-cost analysis

Benefit-Cost Analysis results alone only demonstrate the average impact on customers and do not disaggregate the costs and benefits to understand how they are distributed amongst various populations. Pairing DEAs, as described above, with BCAs allows regulators and utilities to provide a more complete picture of the program’s impacts.

By utilizing DEAs to develop context, identify priority populations, develop metrics, and apply such metrics to priority populations, pairing the results of DEAs provides more robust BCA results. This can be achieved by utilizing the BCA to understand the benefits and burdens of certain interventions of the average customer while utilizing the DEA to show how the benefits and burdens impact priority populations differently.

Building grid plans that deliver measurable equity

As states develop the next generation of grid plans, they have a powerful opportunity to move from check-the-box equity to real, measurable equity outcomes. By strengthening engagement, adopting multidimensional assessment frameworks, and using rigorous quantitative tools, utilities and regulators can ensure that grid investments deliver cleaner energy, lower bills, and greater resilience for the communities that need it most.

EDF will continue working with partners across states to refine these methods and support implementation. The moment demands solutions that work and equity analysis that proves it.