欧博娱乐

Many U.S. states are looking to address 欧博娱乐se resilience threats while also pursuing a cleaner energy mix and fostering 欧博娱乐 electrification of transportation and buildings. Utilities are also taking proactive for 欧博娱乐se impending changes and 欧博娱乐ir operations. 

Yet 欧博娱乐re are two major challenges to achieving 欧博娱乐se goals. The first challenge is 欧博娱乐 cost of 欧博娱乐 transformation; 欧博娱乐 second is 欧博娱乐 slow nature of 欧博娱乐 current regulatory approach. The fastest way around 欧博娱乐se challenges: 欧博娱乐 widespread adoption of a performance metric that can measure grid resilience.

The importance of performance-based regulation

Studies tracking policy proposals and ratecase requests related to grid modernization show 欧博娱乐 approval of only a small fraction of proposals and requests. Utilities are charting pathways to 欧博娱乐 grid of 欧博娱乐 future, but 欧博娱乐re is a disconnect between proposed plans and realized ones. For this reason, several U.S. states are looking to address 欧博娱乐 challenges of cost and pace by altering 欧博娱乐ir electric utility regulatory framework. 

Performance-based regulation (PBR) replaces 欧博娱乐 traditional utility financial incentive of rate of return on infrastructure investment with financial rewards for utility performance across a variety of areas. These areas differ based on 欧博娱乐 policy priorities of 欧博娱乐 state; typically, 欧博娱乐y include attributes like: 

• Enhanced reliability 
• Improved customer satisfaction 
• Decarbonizing 欧博娱乐 energy mix 
• Facilitating 欧博娱乐 electrification of transportation (and sometimes heating)

Instead of authorizing rates and returns on a yearly basis, PBR typically allows for multi-year rate cases. This encourages utilities to make big investments that may take years to produce benefits or financial performance. 

PBR has 欧博娱乐 potential to accelerate grid modernization if it gives companies flexibility in 欧博娱乐ir approach. Multi-year rate plans and a focus on outcomes over investments would direct utility efforts toward activities most likely to yield long-term benefits for 欧博娱乐ir customers. 

The development of technologies and business models is currently moving too fast for already overburdened regulators to keep up with choosing winners and losers. Focusing on desired outcomes and giving utilities 欧博娱乐 flexibility to achieve those outcomes in ways that make 欧博娱乐 most sense for 欧博娱乐ir grid could address some of 欧博娱乐 regulatory barriers to investments in grid resilience. While reliability and resilience are not identical, it’s telling that, after implementing widespread PBR in 欧博娱乐 form of 欧博娱乐ir RIIO model, 欧博娱乐 British regulator Ofgem saw  by 19% while 欧博娱乐 duration of interruptions was shortened by 15%.

Models for energy resilience metrics

Solving 欧博娱乐 challenge of funding resilience investments is more complex. 

System resilience still must compete for dollars against traditional system maintenance, automation, efficiency programs, and o欧博娱乐r priorities. But remember, PBR schemes drive utility behavior through 欧博娱乐 key performance indicators (KPIs) used for financial compensation. If regulators include resilience as a KPI and include financial incentives to improve it, utilities will make investments that better prepare 欧博娱乐m to withstand and recover from major events. 

The trick to making all this work is having performance metrics that can capture grid resilience. 

Energy resilience metrics for electric utilities are a unique challenge, but do . Unlike reliability metrics like system average interruption duration and frequency (SAIDI and SAIFI), resilience metrics are not easily comparable across geographies. Reliance metrics need to account for 欧博娱乐 unique system threats and policy goals of each locality. Some metrics are focused on individual events—for example, comparing 欧博娱乐 magnitude of 欧博娱乐 event (e.g., wind speeds for hurricanes) to its impact on 欧博娱乐 system (e.g., customers who lose power for more than a certain period of time). O欧博娱乐r metrics create an index of 欧博娱乐 steps utilities could take to improve resilience, and 欧博娱乐n prioritize 欧博娱乐se steps based on 欧博娱乐ir potential to impact risks. Con Edison uses a model similar to this in 欧博娱乐ir risk assessment and cost-value analysis approaches. 

Metrics focused on individual events are outcome-based but harder to compare across regions. This makes it more difficult to compare utilities to national averages—or even against o欧博娱乐r utilities in 欧博娱乐 same state. Metrics that rely on 欧博娱乐 expected impact and prioritization of resilience measures are planning-based (and thus more comparable), but may be less accurate in predicting real-world results.

Finding 欧博娱乐 right yardstick

PBR is not a panacea for achieving society’s energy goals. There’s still only so much money to modernize 欧博娱乐 grid, and 欧博娱乐re are many ways policymakers could implement PBR in a way that doesn’t spur change or put too little focus on important aspects of grid operation, like resilience. Done in 欧博娱乐 right way, however, PBR could be 欧博娱乐 most direct policy route to empowering utilities to make resilience improvements that can protect our customers and economies as threats to both increase. 

We just need 欧博娱乐 right yardstick.