2023 -- H 5850

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LC000670

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2023

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A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- 2023 ENERGY STORAGE ACT

     

     Introduced By: Representatives Handy, and McNamara

     Date Introduced: March 01, 2023

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

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     SECTION 1. Title 39 of the General Laws entitled "PUBLIC UTILITIES AND

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CARRIERS" is hereby amended by adding thereto the following chapter:

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CHAPTER 33

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2023 ENERGY STORAGE ACT

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     39-33-1. Energy storage target.

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     It shall be the policy of the State of Rhode Island to meet the following energy storage

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deployment goals:

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     (1) One hundred fifty megawatts (150 MW) by December 31, 2027; and

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     (2) Five hundred megawatts (500 MW) by December 31, 2033.

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     39-33-2. Energy storage compensation program.

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     (a) On or before July 1, 2024, the office of energy resources shall initiate a process to

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develop one or more programs, and associated funding mechanisms, for electric energy storage

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resources connected to the electric distribution system, including the incorporation of electric

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energy storage into existing programs. The office of energy resources shall develop:

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     (1) One or more programs for the residential class of electric customers;

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     (2) One or more programs for commercial and industrial classes of electric customers; and

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     (3) A program for energy storage systems connected to the distribution system in front of

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the meter and not located at a customer premises.

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     (b) In undertaking the actions described in subsection (a) of this section, the office shall

 

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consider one or more programs to incentivize the deployment of energy storage technologies

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connected to the electric distribution system that most effectively leverage the value of such

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technologies to achieve objectives including, but not limited to:

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     (1) Providing positive net present value to all ratepayers, or a subset of ratepayers paying

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for the benefits that accrue to that subset of ratepayers;

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     (2) Providing multiple types of benefits to the electric grid, including, but not limited to,

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customer, local, or community resilience, ancillary services, leveling out peaks in electricity use or

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that support the deployment of other distributed energy resources;

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     (3) Fostering the sustained, orderly development of a state-based energy storage industry;

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and

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     (4) Maximizing the value from the participation of energy storage systems in capacity

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markets. The office of energy resources shall include consideration of all energy storage

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configurations that are connected to the distribution system, including systems connected in front

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of the meter and not located at a customer premises.

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     (c) The office of energy resources may select the electric distribution company, a third

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party it deems appropriate, or any combination thereof, to implement one or more programs for

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electric energy storage resources connected to the electric distribution system.

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     (d) The office of energy resources shall file the proposed program with the public utilities

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commission for review and supervision. The public utilities commission shall issue a final decision

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on the proposed program within one hundred twenty (120) days of the filing by the office of energy

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resources.

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     39-33-3. Energy storage rate design.

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     (a) The electric distribution company shall complete and file with the public utilities

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commission a cost-of-service study for energy storage systems connected to the distribution system

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in front of the meter not later than March 31, 2024. On or before July 31, 2024, the electric

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distribution company shall file with the public utilities commission electric rate tariffs to apply to

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energy storage systems interconnected and providing retail service to their distribution system. The

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filing shall include at least one rate tariff that is applicable to front of the meter energy storage. The

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tariff shall not include costs that are otherwise recouped via project sponsor-funded interconnection

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upgrades or otherwise paid directly by the project sponsor, and shall include rates designed to

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reflect cost causation and ensure that energy storage systems are incentivized to charge and

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discharge at times that benefit the system.

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     SECTION 2. Chapter 39-26.1 of the General Laws entitled "Long-Term Contracting

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Standard for Renewable Energy" is hereby amended by adding thereto the following section:

 

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     39-26.1-10. Energy storage procurement.

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     (a) The electric distribution company shall issue and, subject to review and approval of the

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commission, select a reasonable, open, and competitive method of soliciting proposals from third

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parties for energy storage projects connected to the transmission or distribution system in front of

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the meter, including, but not limited to, long-duration energy storage projects, that would achieve

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the goals in chapter 33 of title 39.

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     (b) The solicitation method shall be informed by a request for information on potential

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contract structures between electric distribution companies and third-party operators of energy

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storage projects, and products or services that may be procured.

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     (c) The solicitation process shall permit a reasonable amount of negotiating discretion for

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the parties to engage in arms-length negotiations over final contract terms.

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     (d) Each contract entered into pursuant to this section shall contain a condition that it shall

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not be effective without commission review and approval.

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     (e) Any agreement entered into pursuant to this section shall be subject to review and

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approval by the public utilities commission, which review shall be completed not later than one

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hundred twenty (120) days after the date on which such agreement is filed with the authority. The

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commission shall approve any such agreement if it determines that:

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     (1) The contract is commercially reasonable as defined in § 39-31-3;

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     (2) The requirements for the solicitation have been met;

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     (3) The contract is consistent with the state's greenhouse gas reduction targets; and

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     (4) The contract is consistent with the purposes of this chapter and contributes to the

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achievement of the energy storage goals established in § 39-33-1.

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     (f) The net costs of any such agreement, including costs incurred by the electric distribution

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companies under the agreement and reasonable costs incurred by the electric distribution

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companies in connection with the agreement, shall be recovered through a fully reconciling

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component of electric rates for all customers of electric distribution companies. Any net revenues

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from the sale of products purchased in accordance with long-term contracts entered into pursuant

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to this section shall be credited to customers through the same fully reconciling rate component for

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all customers of the contracting electric distribution company.

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     SECTION 3. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- 2023 ENERGY STORAGE ACT

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     This act would require the office of energy resources to initiate the process of developing

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one or more programs, and associated funding mechanisms, for electric energy storage resources

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connected to the electric distribution system, including the incorporation of electric energy storage

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into existing programs.

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     This act would take effect upon passage.

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