Microgrid Bill that Clarifies Utility & Operator Roles Approved by Maine House

April 9, 2020
Microgrid operators are spared being designated as utilities, and utilities gain the abililty to own microgrids under a microgrid bill that won House approval in Maine.

The Maine House has approved a microgrid bill that would open the state to microgrid development and clarify utility and operator roles.

L.D. 13, passed by the House on a 85-54 vote in mid-March, directs the Maine Public Utilities Commission to approve microgrid proposals of up to 25 MW if they are in the public interest.

The bill originally had a 10-MW cap on the size of potential microgrids, but Mt. Desert Island is considering setting up a microgrid and the Joint Standing Committee on Energy, Utilities and Technology decided to increase the cap to match the island’s needs, according to Rep. Seth Berry, one of the panel’s chairs.

Maine technically allows microgrids, but under current law it is easier to form a utility to provide microgrid services than to simply establish a microgrid, Berry said in an interview.

“It’s not possible to set up a true microgrid,” Berry said. “The minute you need poles and wires to deliver power between customers, then you’re acting as a utility.”

To deal with that issue, the bill declares that microgrid operators would not be deemed public utilities under Maine statute.

Criteria for regulatory review

The bill sets criteria the PUC must use when reviewing microgrids proposals, including that they meet Maine’s renewable portfolio standard requirements and that they are in the service territory of a utility with at least 50,000 customers.

Also, anyone proposing a microgrid must have the financial and technical capacity to build and operate one, according to the bill. The microgrid must be shown not to hurt grid reliability.

There must also be a contractual relationship between the microgrid operator and consumers within the area to be served by the proposed microgrid.

In a key change, the bill was amended to remove language barring investor-owned utilities and their affiliates from owning and operating microgrids.

When reviewing proposed projects, the PUC may consider possible ratepayer effects, positive or negative, benefits from increased resilience or reliability of the electric grid, economic development benefits or “any other factors” the commission considers necessary to promote the public interest, according to the bill

Microgrid bill grew out of veto

The legislation grew out of an earlier microgrid bill that was successfully vetoed twice by former Gov. Paul LePage, a Republican. It was developed through a stakeholder process.

However, in a major shift since then, Maine now has a Democratic governor and Legislature.

Berry said he hoped microgrids could improve Maine’s overall grid reliability and resilience. Parts of coastal Maine see regular power outages because of winter storms.

“We are optimistic this will be a significant contribution to the resilience of our grid,” Berry said, noting that reliability is especially important as the state is trying to electrify its heating and cooling and transportation sectors to reduce greenhouse gas emissions

Emera Maine, the only utility to offer testimony on the bill, was neither for it nor against, but raised concerns that non-utilities would be able to provide utility service.

An ENMAX subsidiary, Emera wanted the bill to be amended so that utilities could own participate in microgrids, according to the testimony. The utility has been exploring microgrid development.

Non-wires alternatives likely

The microgrid bill would likely support the use of “non-transmission alternatives” (also known as non-wires alternatives) that can more cheaply resolve grid issues instead of building power lines, according to the Sierra Club

“Creating a microgrid provides a municipality with the ability to generate its own electricity thereby reducing the need for the infrastructure required to carry power from distant generation sources,” the environmental group said.

After clearing the House, LD 13 was added to a list of bills that were carried over for any special session held later this year. The current session ended in March, but it is possible Gov. Janet Mills will call the Legislature back into session later this year to deal with fallout from the new coronavirus outbreak and to deal with legislation that was carried over, according to Berry.

If the microgrid bill dies this year, it will be reintroduced in January and, because it has been well vetted, would likely move quickly, according to Berry. “We understand the issue well,” he said.

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About the Author

Ethan Howland

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