February 2022 News from NESP

FEBRUARY 14, 2022 – We are excited to share our first quarterly newsletter of the year on topics related to benefit-cost analysis (BCA) of distributed energy resources, where and how the National Standard Practice Manual is being used, and what’s in store for 2022. Happy reading! As always, please reach out with any questions or thoughts.

— Julie Michals & Natalie Fortman

In This Issue

-- What's in Store for 2022?

-- States Using the NSPM

-- Energy Equity in BCA

-- BCA in Distribution System Planning

-- Thank You for Your Feedback

-- Events and Webinars

What's in Store for 2022?

This year is off to a busy start! New publications are coming soon, we are providing technical assistance to states applying the NSPM, and we’re gearing up to expand the NSPM to address key topics including guidance on accounting for energy equity.

Maryland

The Maryland Public Service Commission accepted a consensus Statewide EV BCA Methodology, recommending a Maryland EV Jurisdiction Specific Test (MD-EV JST) developed using the NSPM. Meanwhile, stakeholders in the EmPOWER Maryland Future Program Working Group (FPWG) are developing an updated cost-effectiveness test for energy efficiency programs using the NSPM, and the Commission opened Case No. 967 4 to explore a “Unified BCA” methodology across all DERs.

Washington, D.C.

The District of Columbia completed its BCA Framework working group process in Docket GD-2019-04 to propose a new cost-effectiveness test using the NSPM as part of its efforts to implement the District’s 2019 Clean Energy Act and the Commission’s Power Path DC Order. The commission staff submitted a final report to the commission for approval, reflecting a majority consensus of the working group.

Washington

The Utilities & Transportation Commission (UTC) opened Docket UE-210804 in November 2021 to develop a new cost-effectiveness test that aligns with the state's Clean Energy Transformation Act (CETA) utilizing the NSPM principles and framework. Stakeholders filed comments in response to the Notice of Opportunity to File Written Comments in the docket.

Other State Updates and NSPM References

Oregon (Docket UM-2141): In the Oregon Public Utilities Commission Staff Report on Portland General Electric’s (PGE) Flexible Load Multi-Year Plan, Staff comment (pg. 15) that they are encouraged by PGE’s work on developing a cost-effectiveness tool based on NSPM guidance to analyze non-wires solutions in distribution system planning (see PGE’s Plan, Chapter 7). Staff invites PGE to share their findings and recommendations as soon as practicable. The Commission adopted Staff’s recommendation in Order 22-023. Meanwhile, E4TheFuture and Synapse Energy Economics will be presenting on the NSPM process to the DSP Stakeholder Meeting on February 17, 2022.

Kentucky (Docket 2021-00393): In January, the Kentucky Public Service Commission adopted principles for establishing new net metering rates that align with the NSPM (see Order in Kentucky Power Rate Case 2020-00174, pgs. 21-24). More recently, in data requests by the Kentucky Resources Council (on behalf of Joint Intervenors) regarding the Joint IRP of Louisville Gas and Electric and Kentucky Utilities, the Council points to the NSPM as a framework for BCA for DERs and as guidance on addressing multiple DERs and rate impacts (pg. 5).

Colorado (Decision C21-0549): Last fall, the Colorado Department of Regulatory Agencies set forth rules regulating electric utilities in distribution system planning, stating that the NSPM framework should be considered in non-wire alternatives (NWA) cost-benefit analysis (see Rule 3535, pg. 30). See how Colorado is likely to increase investments in DERs through DSP.

See All NSPM References and Map

Energy Equity in BCA

In our June 2021 newsletter, we posed the question “How do we account for energy equity in BCA?” We’ve since collaborated with organizations to develop an initial conceptual framework providing guidance on how and where energy equity fits within BCA.

Commissions are increasingly interested in understanding the relevance and consistency of BCA across different regulatory contexts—programs, procurement, pricing and planning.

For example, the Michigan PSC staff held a Distribution System Planning Session on 11/3/21. As part of its Docket U-20147, a goal was to share information on using a consistent BCA framework to inform utility distribution system investment decisions. Speakers at the technical session included John Shenot (Regulatory Assistance Project), Julie Michals (E4TheFuture), and Tim Woolf (Synapse Energy Economics). The session was facilitated by Danielle Sass-Byrnett (NARUC Center of Policy Innovation) with Joe Eto (LBNL) presenting on the ICE calculator to measure reliability impacts.

More about BCA in the context of distribution system and integrated resource planning is addressed Greg Ehrendreich’s (MEEA) blog (January 2022) highlighting how the NSPM can be applied to regulatory contexts including IRP and DSP.

Thank You for Your Feedback!

Thank you to those who responded to our stakeholder survey in October. Your feedback indicated NESP’s work is highly valuable and provided key considerations for our future work. Highlights:

Of 70+ respondents, the vast majority (96%) were familiar with the NSPM for DERs and have referenced or used the NSPM in some capacity.
All respondents who were familiar with the NSPM reported that it is valuable to their work and to the industry.
Strong interest was expressed for potential new NESP products such as technical assistance for state agencies on BCA, general training on BCA for DERs, and examples of states applying the NSPM.

Based on feedback, we aim to bring more resources to support BCA practices in the industry. If you did not receive the survey but would like to provide feedback, please contact us at [email protected].

Events and Webinars

Upcoming Events:

August 21-27, 2022: ACEEE Summer Study on Energy Efficiency in Buildings Accounting for Equity in Benefit Cost Analysis. Natalie Fortman and Julie Michals, E4TheFuture. More information here. Stay tuned for registration information.

NESP Resources

NSPM for DERs

Database of Screening Practices

E4TheFuture serves as coordinator of the National Energy Screening Project, and manages its publications.

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