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FERC Joins State Regulators to Champion Smart Grid Policy

By Amanda Frazier

In the hopes of accelerating development of a "smart" electric transmission grid, the Federal Energy Regulatory Commission (FERC) on March 19, 2009, proposed a policy that will favor and incentivize investments in Smart Grid technology, which FERC believes will advance the efficiency, security, reliability, and interoperability of the electrical grid.  In addition to levelizing peak demand through improved demand response, a Smart Grid is believed to be able to better manage the expected demand from plug-in vehicles and the expected variable output from renewable energy resources.  FERC invited comments from interested parties, which are due May 11, 2009.
 
FERC also is partnering with the National Association of Regulatory Utility Commissioners (NARUC) as co-chairs of the NARUC/FERC Smart Grid Collaborative, designed to facilitate and advise transition to a Smart Grid.  The Collaborative members developed a list of criteria for the Department of Energy to consider when establishing preconditions under which Smart Grid projects should be funded through the American Recovery and Reinvestment Act of 2009.  The criteria are broken down into eight categories focusing on the preconditions for the grants themselves, technologies, rate designs, and regulatory issues.  Specifically, the criteria focus on identifying projects that are designed for interoperability, that provide proper management of cyber security concerns, and that will maintain the reliability and integrity of the grid. 

Full post as published by Energy Legal Blog on March 27, 2009 (boomark / email).