California Regulators Open Proceeding to Boost Microgrid Development

Oct. 3, 2019
California regulators are looking at ways to boost microgrid development, possibly through a microgrid tariff, as part of newly opened proceeding.

California regulators are looking at ways to boost microgrid development, possibly through a microgrid tariff, as part of newly opened proceeding.

The Public Utilities Commission (PUC) initiated the rulemaking in response to a state law enacted last year (SB 1339) that requires steps be taken to facilitate microgrids and reduce barriers to their deployment.

The commission seeks stakeholder input on how to shape the proceeding, which will focus on programs, rules and rates, including possible microgrid tariffs — a form of financial incentive still nascent in concept also being explored by Hawaii. Further along in the process, Hawaii’s PUC has called for Hawaiian Electric to deliver a draft tariff by March 30.

The California PUC memo notes that microgrids create reliability and energy management advantages for customers, and may also aid California in reaching various policy goals — such as reducing greenhouse gases and adjusting to climate change.

In addition, microgrids could help protect “the health, safety, and lives of California residents during catastrophic events, such as wildfires, floods, earthquakes, extreme weather, or cyber-attacks,” says the memo (Rulemaking 19-09-009).

Microgrids for those facing wildfire power shutoffs

To that end, the PUC said it may consider pilot microgrid programs to benefit communities likely to be affected by public safety power shut offs — intentional power outages imposed by utilities when there is a threat of wildfire. Pacific Gas & Electric has warned that the newly instituted program could result in shutoffs that last for days and occur several times a year.

California regulators also asked stakeholders to comment on:

  • Possible microgrid service standards to meet state and local permitting requirements
  • Methods to reduce barriers for microgrid deployment that do not shift costs between ratepayers
  • Guidelines for impact studies needed for microgrids to connect to the electric grid
  • Assurance that rates and tariffs do not compensate a customer for the use of diesel backup or natural gas generation, except in limited circumstances
  • Codification of standards and codes to meet requirements of utilities and the California Independent System Operator
  • A standard for direct current (DC) metering to streamline interconnection and lower its costs for DC microgrids
  • Assurance that actions by the committee do not discourage or prohibit utility microgrids

The deadline for comment is within 30 days of the memo’s release, which was September 19. The commission plans to hold a pre-hearing conference in the last quarter of the year, issue a ruling for public comment in third quarter 2020, and finalize a decision in the last quarter of 2020.

California has taken action on other fronts, as well, to boost microgrids, including rounds of grants issued by the California Energy Commission.

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About the Author

Elisa Wood | Editor-in-Chief

Elisa Wood is an award-winning writer and editor who specializes in the energy industry. She is chief editor and co-founder of Microgrid Knowledge and serves as co-host of the publication’s popular conference series. She also co-founded RealEnergyWriters.com, where she continues to lead a team of energy writers who produce content for energy companies and advocacy organizations.

She has been writing about energy for more than two decades and is published widely. Her work can be found in prominent energy business journals as well as mainstream publications. She has been quoted by NPR, the Wall Street Journal and other notable media outlets.

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