Storage: Jurisdictional conflicts and state options
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PERSPECTIVE Storage: Jurisdictional conflicts and state options
Nancy Lange, Chair of the Minnesota Public Utilities Commission, Minneapolis, Minnesota, USA Ted Thomas, Chair of the Arkansas Public Service Commission, Little Rock, Arkansas, USA Address all correspondence to Ted Thomas at [email protected] (Received 10 August 2018; accepted 2 May 2019)
ABSTRACT State policymakers and regulators should consider how to respond to the emergence of new storage technologies while observing the regulatory and legal proceedings that will draw the line between state and federal jurisdiction over matters related to storage. The emergence of new energy storage is challenging traditional jurisdictional lines and giving state policy makers new things to consider. This article discusses conflicts in jurisdiction and offers options for policy makers to consider with regard to storage technologies. Keywords: storage; sustainability; environmentally protective
DISCUSSION POINTS • Should states be allowed to decide whether electric storage resources in their state are permitted to participate in the Regional Transmission Organization (RTO)/Independent System Operator (ISO) markets through the electric storage resource participation model? • Having clear information about the distribution system capabilities and deficiencies will enable identification of strategic use of a storage system. • States that expect benefits from the Federal Energy Regulatory Commission (FERC) storage order should participate in the Midcontinent Independent System Operator (MISO) process so that functionality that assists storage deployment can be prioritized. • Public Utilities Commissions are urged to begin updating their interconnection standards so that as penetration levels of distributed energy resources (DERs) grow, there are no unnecessary roadblocks created by outdated technical and policy requirements.
Jurisdiction New technologies challenge the traditional state/federal jurisdictional divide, and storage is no exception. The Federal Power Act applies “to the transmission of electric energy in interstate commerce and to the sale of electric energy at wholesale in interstate commerce….”1 A wholesale sale is a
sale for resale. The Federal Energy Regulatory Commission (FERC) found that “the sale of electric energy from the grid that is used to charge electric storage resources for later resale into the energy or ancillary service markets constitutes a sale for resale.”2 With exception to Hawaii, Alaska, and the ERCOT portion of Texas, the United States Supreme Court states that all sales of electricity are included in interstate commerce because “electricity that enters the grid immediately becomes part of a vast pool of energy that is constantly moving in interstate commerce.”3 This law was initially stated by the court in Federal Power Comm. v. Florida Power & Light Co., 404 U.S. 453 (1972), in which the court upheld an FPC finding regarding the flow of electrons as part of interstate commerce, noting that the FPC (now FERC) finding
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