Presentation from the EPRI-Sandia Symposium on Secure and Resilient Microgrids: Microgrids PUC Regulatory Issues, presented by Michael Winda, NJ BPU, Baltimore, MD, August 29-31, 2016.

1. Microgrids PUC Regulatory
Issues
Back to the Future
Michael Winka
Sr Policy Advisor
Baltimore MD
August 29, 2016

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First Issue
Are you in a Vertically Integrated State ?
regulates generation, transmission and distribution in their state
Or
An Energy Competition State ?
regulates some transmission and distribution in their state

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State PUC regulate customers rates for
the investment owner/private utilities
Balance the needs of Utilities and All Customers
Protect customer – Protect the public interest
Ensure the delivery of adequate, safe, reliable
Services at fair and reasonable rates for all
customers
Public Utility Commission’s Mission Statements

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Definition of DER or DG
Distributed energy resources consists of a range of smaller-scale and modular
generation and storage devices designed to provide electricity, and sometimes
also thermal energy, in locations close to consumers or end user.
Definition of Microgrid
A microgrid is a group of interconnected loads and distributed energy
resources within clearly defined electrical boundaries that acts as a single
controllable entity with respect to the grid. A microgrid can connect and
disconnect from the grid to enable it to operate in both grid-connected or
island-mode.
Standard USDOE Definitions for DER and microgrids
Most States do not define DER or microgrids

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Level 1 or single customer microgrid.
This is a single DER system such as a PV system, combined heat and power (CHP) or fuel cell
system that is serving one customer and that is connected to and can island from the distribution grid.
Level 2 or single customer – campus setting.
This is a single or multiple DER systems with multiple buildings, but controlled by one meter at the
point of common coupling that is connected to and can island from the distribution grid.
Level 3 or multiple customers / advanced microgrid.
This is a single or multiple DER system that serves several different buildings/customers that are not
on the same meter or on the same site as the DER. An advanced microgrid would be designed with
one point of common coupling (PCC). The individual buildings/customers may be independently
connected to the larger distribution grid and through the microgrid PCC..
Not all Microgrid are the Same - Classification System

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N.J.S.A. 48:3-51 - Definitions
Off-site end use thermal energy services customer
(aka CHP)
On-site generation facility (aka DG)
N.J.S.A. 48:3-77.1
Utilization of locally franchised public utility electric
distribution infrastructure.

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Types of MG Distributed Generation or Distributed Energy Resources

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10
20
30
40
50
60
70
80 1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
MillionMegawatt-hours(MWh)
Year
New Jersey Net In-State Generation and Imported Electricity, 1990 - 2013
Net In-state(70% increase)
Imported (70% decrease)
Linear (Imported (70% decrease))

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1%
8%
33%
56%
2%
0.1%
3%
43%
51%
2%
0.3%
3%
42%
52%
2.3%1%
4%
44%
47%
4%
0%
10%
20%
30%
40%
50%
60%
Petroleum Coal Natural Gas Nuclear Renewables
New Jersey Electricity Generation by
Fuel Type (%), 2011-2014
2011
2012
2013
2014

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New Jersey’s Clean Energy Program EE reduction of Electric
Sales – 0.5% annually total cumulative reduction 7%

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New Jersey Renewable Energy Portfolio Standard

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DER Number MW
CHP/FC total 219 2,900
CHP/DG DG 98 347
CHP/FC renewable 19 31
PV total 38,983 1,535
PV Behind the Meter 38,855 1,203
PV Grid Supply 128 332
TOTAL DER 39,100 1,913
Current New Jersey CHP/FC and DER facilities

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The advance microgrid can provide benefits to the grid
1. Produces electric and thermal energy for its customers.
2. Provides ancillary services and reduce the peak demand of the grid.
3. Can defer related investment in distribution system upgrades.
4. Produces and delivers energy more efficiently.
5. Reduce outages which can enhance resiliency and reliability.
The advanced microgrid receives benefits from the distribution grid.
1. If not operating additional energy will need to be supplied by the grid.
2. Upgrades can be deferred but not fully avoided.
3. If not operating environment impacts may increase at peak times.
4. If not properly managed could reduce resiliency and reliability.

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RAP DER Tariff Guidance
1. Customers should be able to connect at the cost of connecting
2. Customers should pay for grid services based on what they use
3. Customers should be fairly compensated for the value of the power they supply
4. Tariffs should balance the interest of all shareholders
NARUC DER Tariff Guidance
1. Net metering
2. Valuation
3. Value of Resource
4. Value of Service
5. Transactive Energy
6. Demand Charges peak/nonpeak
7. Fixed Charges
8. Standby/backup Charges
9. Interconnection /metering fees

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