Microgrid Summit 2016 Proceedings

The day began with a panel featuring some of the nation’s leaders in designing, building and operating highly sophisticated microgrids. Panelists included Ted Borer, Princeton University; Jim Lodge, NRG Energy; Bob Manning, Harvard University; Frank Norcross, Related Companies; Ken Packard, Massachusetts Institute of Technology; and Russell Thompson, Duke University. This well-rounded panel discussed the resilience provided by microgrids, including the ability to “island” from the grid and to “blackstart” without assistance from grid electricity – key capabilities that, for example, kept the lights on for the Princeton University campus during Superstorm Sandy in 2012.

As the day progressed, one prominent theme emerged: As the microgrid industry continues to expand, new regulatory paradigms will be needed to better balance the needs of various stakeholders. The primary challenges are not technical, operational or even financial but more related to evolving tariff structures and market regulations that will enable end users to enjoy the enhanced efficiency and resiliency of microgrids while not undermining industry fundamentals.

During this segment, participants discussed how grid-integrated microgrids can actively benefit the local and regional electricity grid by supplementing baseload capacity, by peak shaving during times of high demand and by actively supporting the local and regional power grid as balancing capacity and grid support. A virtual brain trust of panelists included Eric Ackerman, Edison Electric Institute; Baird Brown, Drinker, Biddle & Reath; Jim Reilly, Reilly Associates; Joe Sullivan, Concord Engineering; Michael Webster, ICETEC; and moderator Christopher Berendt, Drinker, Biddle & Reath. The panel discussed the positive potential of the microgrid-utility relationship and what can be done to leverage the benefits of coordinated planning to integrate microgrids with the public grid. Eric Ackerman stressed the importance of communication between the two parties. “Microgrid developers need to be part of the utility planning process,” he said.

Working as partners, instead of competitors, will help the electric utilities and microgrid operators exploit the unique benefits of microgrid capabilities for all stakeholders, including customers, utilities and the grid.

There are tools under development to help with assessment and to enable both utilities and regulators to evaluate the operational advantages of locating microgrids within the regional or local power grid. The MRC is working with Lawrence Berkeley National Laboratory to develop an advanced computer model that can model, evaluate and value microgrid services to the distribution grid.

This panel, moderated by Rob Thornton, IDEA, consisted of Christopher Berendt, Drinker Biddle & Reath; Jorge Camacho, District of Columbia Public Service Commission; Shalom Flank, The Microgrid Architect; and Edward Yim, Washington, D.C., Department of Energy & Environment.

The local government, private developers and numerous agencies in the District of Columbia have been actively collaborating for the past many years on planning and policy development for microgrid deployment. While some may feel that regulatory shift is not happening fast enough, given the many complexities of the microgrid-utility relationship, Edward Yim emphasized, “We shouldn’t lose sight of simple microgrids that we already have rules for.”

Jorge Camacho pointed out that we have metrics for penalizing poor utility performance, but what are needed are metrics for measuring and rewarding efficiency and good performance. “People are moving into the district, but electricity demand is going down,” he said. ”We need a way to measure and reward efficiency improvements.”

Microgrid developers and utilities aren’t the only ones feeling the strain of a complex grid and aging regulatory structure. The regulatory landscape is evolving in response to the integration of more distributed energy resources. Public utility commissions are grappling with ratemaking issues, integrated planning and emerging business models for regulated utilities and other participants. They are seeking a better understanding of microgrid business models and want to know how to value integrated resources and develop effective and reasonable tariffs that support continued investment in the grid without forestalling innovation and decarbonization. This is a complex, three-level chess board and will require the involvement of many voices to sort through competing interests. It is critical that the microgrid industry contribute to the conversation.

Moderated by Baird Brown, panelists Betty Anne Kane, D.C. Public Utilities Commission; Upendra Chivukula, New Jersey Board of Public Utilities; and Bob Burns, Arizona Corporation Commission; discussed the issues they face in balancing multiple constituencies. Panelists likened their roles to that of an orchestra maestro who oversees the timing and coordination of various instruments and players but who as a symphony conductor does not physically produce the music. A variety of opinions emerged as to the respective role of the local or regional electric utility or the regulator as the primary gatekeeper.

The event concluded with a roundtable discussion featuring prominent industry leaders Christopher Berendt, Drinker, Biddle & Reath; Chris Bleuher, Schneider Electric; Baird Brown, Drinker Biddle & Reath; David Musto, Thermo Systems; Tom Nyquist, Princeton University; and Joe Sullivan, Concord Engineering. This final segment incorporated a series of audience participation questions to help assess regulatory and policy priorities for the months and year ahead. Panelists shared insights on near-term federal, state and local policy and regulatory objectives as part of a strategic vision for microgrid industry acceleration, reflecting on the important issues.

Panelists noted that regulatory change is never easy in the energy sector but that the pace of technology deployment is not likely to slow down; and as more end users experience the advantages of microgrids, the shift to more distributed energy resources will likely accelerate. The strong majority of attendees indicated support for more collective action by a representative industry association to advance market growth.

Before adjourning for a networking reception for all attendees and exhibitors, IDEA and MRC were pleased to announce plans for the 2017 Microgrid Summit in conjunction with Microgrid Knowledge to take place next Nov. 6-8 in Boston. Based on the success of the 2016 summit in Washington, D.C., we anticipate an active year ahead and a rising tide for all boats.