STATES REGULATIONS

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On May 18, CAISO approved its draft transmission plan that showcases a more proactive and strategic approach to transmission planning. The plan identifies 45 projects for system extension and upgrades over the next 10 years, with an estimated cost of US$7.3 billion. CAISO has designed the projects to support the over 40 GW of new resource development identified by the CPUC so the state can meet their clean energy goals. This year’s planning approach centers on identifying designated geographic zones that make economic sense for additional transmission, enabling deliverability and access to resource adequacy contracts.CAISO will give priority to interconnection queue requests located within these zones. CAISO affirms that the transmission projects enable critical resource development, such as 17 GW of solar across the state, as well as access to co-located storage projects and standalone storage closer to major load centers.

In late May 2023, the California Senate Budget Committee proposed a US$400 million investment in the Budget and Fiscal Review to bolster the newly formed community solar and storage program. Assembly Bill 2316 was passed last year, establishing the process for a community solar program. The CPUC is designing the program requirements and we expect additional guidance this summer. The funding is said to be a much-needed investment and will make California more competitive for securing funding from the ‘Solar for all’ US$7 billion federal fund.

In May, Southern California Edison (SCE) began testing a residential incentive program that aims to have 2,400 homes installed with batteries for a total of 12.2 MW. The New Home Energy Storage Pilot is meant to team batteries with Title 24’s building standards that mandate solar panels for new homes. The incentive would go directly to the building developer rather than the homeowner for the upfront cost for batteries paired with solar in SCE’s service territory. Other program requirements include the project meeting the same criteria outlined in California’s SGIP. For the homeowner, these systems would be classified under NEM 3.0, which is much more beneficial for solar paired with storage. Additionally, the homeowner can immediately use the backup power source and have the cost rolled into regular house payments.

HECO, Hawaiian Electric Company, finalized its Integrated Grid Plan that outlines steps the company will take to achieve 100% renewable resources by 2045. In its plan, HECO will add 3.7 GW of hybrid solar, energy storage and firm renewables (geothermal, renewable hydrogen, biomass or biofuels) by 2030, of which 1,259 MW are slated for battery storage. HECO is evaluating bids from 1,340 MW of renewable procurements issued in early 2023, which are included in the new plan.

Dominion Energy Virginia has received approval from the Virginia State Corporation Commission

(SCC) to add one storage and multiple solar projects to their existing fleet. We anticipate

construction to be complete by 2025 for all projects. Dominion will own and operate nine solar

projects and one standalone storage pilot for 500 MW and 16 MW, respectively.

Additionally, SCC approved multiple other solar project PPAs owned by independent operators

totaling more than 300 MW. Virginia has been increasing solar deployments steadily, which

presents an opportunity for battery storage to take advantage of the increased volatility.

The 16 MW Shands Storage will provide additional operational experience with battery storage

systems, which Dominion states is “critical” for the company to reach its 2700 MW storage goal

by 2035, as outlined by the VCEA.

Maryland became the 10th state to establish a goal for energy storage procurement through HB 910, which was voted on in April 2023. The bill sets a goal of 750 MW of battery storage by 2027, an additional 750 MW through 2030 and a further 1.5 GW through 2033. The legislation considers multiple technology sources, such as battery, thermal, VPPs and hydrogen-based storage, and will offer incentives regardless of size or operational purpose. This bill will enable Maryland to achieve carbon neutrality by 2045 and reduce GHG emissions by 61% by 2031. It requires the Public Service Commission to establish the Maryland Energy Storage Program, to be implemented by July 1, 2025.

In April 2023, the Oregon PUC (OPUC) released a straw proposal for interim solarplus-storage rates for qualifying facilities with a capacity of up to 3 MW. OPUC intends for the interim rates to create a pathway for new QFs to capture capacity value as soon as possible during OPUC’s investigation into UM 2000. Capacity compensation will be paid at US$/MWh for delivery during a four-hour daily ‘premium peak’,which is set by the utility and coincides with the greatest loss of load probability. In May 2023, the Commission approved the staff’s proposal. Utilities can now file their solar-plus-storage rates for review, and in September of 2023, the interim rates will be brought to the OPUC for approval.

On April 14, Black Hills Energy applied to the Colorado PUC, proposing a new onsite net

metering tariff for residential, commercial and industrial customers. Eligible technologies would include solar and renewable energy storage, among others. The customer would own RECs but they have the option to sell to the utility if their facility is under 1 MW. The tariff would not offer credits for energy exported to the grid. Instead, customer-generated energy would offset their bill up to US$0, and any excess energy would be ‘banked’ and rolled over.

In late May, the Minnesota legislature passed what is being called a “historic” US$80 million investment in solar and energy storage incentive programs. Highlights of the bill include multiple solar projects on schools, public buildings and others, microgrid research, grants to improve interconnection timelines, US$7 million for the state’s first energy storage incentive program for onsite storage systems and US$250,000 for a study to determine the amount of energy storage required to achieve the state’s new 100% carbon-free standard.

Senate Bill 166 passed the Senate in March, adding language to the New Hampshire statutes to make interconnection procedures for grid access for distributed solar and storage consistent with existing state energy policy, such that non-discriminatory open access is provided and promoted. Distributed storage facilities are those less than 5 MW in size that are not connected to the wholesale electricity market within ISO-NE. Additionally, the PUC is required to adopt rules or approve tariffs clarifying policy for the installation, interconnection and use of energy storage systems by customers of utilities. The purpose of this bill is to encourage the development and market selection of costeffective DERs that will, in turn, achieve lower costs and greater price stability.

As part of a joint general rate case application filed on April 25, Evergy Kansas Metro and Evergy Kansas Central proposed a new residential storage pilot in addition to changes to the utilities’ TOU rates, demand rates, and other such rate modifications. The new residential battery energy storage pilot would install up to 100 battery energy storage systems at residential sites in both utility territories. This pilot is geared towards allowing Evergy to evaluate the ability of the BESS to provide demand response, minimize grid impacts and exports to the grid, provide savings if customers are on a TOU rate, and manage EV charging and backup power. Evergy would install, own, operate and maintain the system through 2026. At the end of 2026, the customer would have the option to have Evergy remove the battery, purchase the battery at a depreciated value and be removed from the pilot or receive ownership of the battery while still allowing Evergy to access the battery’s dispatch for the

system’s remaining useful life. The systems would include a smart home energy control system that could be programmed with a TOU or demand rate schedule. The batteries would charge during off-peak periods and discharge during peak-rate periods.

Like many other states, North Carolina recently reformed its net metering policy. The North Carolina Utilities Commission (NCUC) approved the revised net metering tariffs for Duke Energy Carolinas (DEC) and Duke Energy Progress (DEP) in March, with some modifications. Time-of-use (TOU) or critical peak pricing (CPP) rate schedules will become mandatory for new customers in 2027. Studies show the new rate schedules will result in a loss of customer savings when installing solar, which could be mitigated if paired with storage. Consequently, NCUC has directed Duke to establish a pilot program to incentivize storage with solar installations. The incentive amount is yet to be determined by Duke. However, it is known that Duke will only offer the pilot program to all-electric customers who install solar for the first time with a battery, which will likely reduce the program’s impact and potential. Additionally, North Carolina is a rather nascent market for solar-plusstorage. It has not experienced severe weather-induced grid reliability issues like other states, making storage an easier sell.

In May 2023, Green Mountain Power applied for its Resilient Neighborhood Innovative Pilot, which will

launch the first all-electric neighborhood in South Burlington. Green Mountain Power will equip the community with underground wires for resiliency, as well as solar-plus-storage and level 2 EV charging stations for each home. Storage will consist of a Powerwall battery system owned by the company and leased to customers through a resilience package at US$75 or US$85 per month for 10 years and then US$20 per month for the rest of the program’s duration (25 years). This pilot will comprise 25 homes, with an additional 60 batteries for storage installed, at an expected system capital cost of about US$620,000 for all fully installed battery systems.