- Industry: Energy & Utilities
By: Julien Le Mouroux and Jamie Mize
What is the GMI?
The Grid Modernization Index, hosted by the GridWise Alliance and Clean Edge, ranks the fifty states on three criteria to evaluate their electrical infrastructure and grid reliability. By scoring each state on policy, customer engagement, and grid operations, GMI provides an interesting perspective on how regulatory policy impacts utility investments for grid enhancements and technology adaptation to provide customers with a responsive and reliable power system.
Massachusetts and California provide a distinct viewpoint and comparison of how grid modernization has evolved across the country in regards to state policies and utility investments aimed at improving system reliability.
In March the Massachusetts Department of Public Utilities (DPU) called on the state’s three electric distribution companies (EDCs)—Eversource, National Grid, and Unitil—to propose how they plan to modernize their electric grid. Two of the key action items included proposals from the EDCs on how the state can incorporate distributed resources into the current energy portfolio while improving grid reliability. Our own research demonstrates that communication and understanding is essential for proper integration of DERs to electric grid options. As these proceedings continue in Massachusetts, more opportunities will be created to enhance the electric grid as new technologies (such as AMI) become available and used to their full potential.
California occupies the top GMI spot, brought about in part by regulatory and policy achievements as well as high scores in customer engagement. Assembly Bill No. 327 has prompted major investor owned utilities (IOUs) to submit distributed resource plans (DRPs) and valuation methodologies outlining how the utility will assess distributed energy resources (DERs) as distribution grid assets. As discussed in “New Regulatory Paradigm Needed Now to Support Distributed Energy Resources”, California exercises a different methodology for promoting DERs and utility reform. In order to make use of DER functionality, California is the process of deploying new technologies to achieve its state’s clean energy goals.
While California and Massachusetts exhibit different pathways to achieve the similar goals, other states like New York and Illinois have continued their momentum with distribution grid investments for interconnection for improved reliability. It is also evident that collaborative thinking and action by regulators and utilities is essential for states to effectively achieve grid modernization and enhanced system reliability. New York’s REV initiative has advanced metering functionality proposals from its utilities, and Illinois’ smart grid laws have encouraged utilities to leverage platform economics and energy efficiency programs to ensure reliable and clean power to its customers.
Additionally, the District of Columbia’s PSC has initiated proceedings to identify and integrate policies to modernize and enhance DC’s current energy delivery system. MEDSIS (Modernizing the Energy Delivery System for Increased Sustainability) is currently engaged in stakeholder workshops to discuss how regulation and policy can assist in grid modernization and power reliability.
The GMI is a valuable tool for comparing states and their respective approaches to modernizing and facilitating grid operations and reliability. No two states are the same as their energy capacity, regulatory structure, utility business models, and market forces all vary. Taking into account the perspectives of the regulator, the utility, and the customer requires a discerning eye to understand the intricacies involved with each state’s policy and the implications therein. Energy innovation goes hand in hand with grid modernization, and each state forges a unique pathway to achieving its goals by adapting new processes to provide customers with an efficient and reliable power system.