by Jeff St. John
March 29, 2019

Back in 2017, the Public Utilities Commission of Ohio launched the PowerForward initiative, an open-ended consideration of policies aimed at giving utility customers access to an "innovative marketplace" to turn their energy management and distributed energy resource investment decisions into an integral part of the distribution grid. 

PowerForward is in some ways like an early-stage version of New York state’s Reforming the Energy Vision initiative or California’s Integration of Distributed Energy Resources proceeding, as well as similar efforts underway in Hawaii, Nevada, Minnesota and Massachusetts. Like these, PowerForward is seeking to combine customer-utility data sharing from the smart meters deployed across much of the state, and some way to recognize the costs and benefits to the grid of customer-sited DERs, from rooftop solar and plug-in electric vehicles to backup generators and commercial-industrial microgrids. 

But unlike most of the states undertaking this kind of regulatory overhaul, Ohio’s policy is not tied to renewable energy or carbon reduction. That’s partly because Ohio’s Republican-controlled legislature has been fighting for years to roll back the state’s current 12.5-percent-by-2027 renewable portfolio standard, which is already among the least aggressive state targets in the country, providing little incentive for Public Utilities Commission of Ohio (PUCO) commissioners appointed by Republican governors to push pro-renewables policies. 

“We're not trying to shove any particular product or service down anybody's throats in the state of Ohio,” Asim Haque, the former PUCO chairman who championed PowerForward, told the audience at last year’s Verge conference in Oakland, Calif. “We're trying to create the type of marketplace that allows for innovation to organically arise and be delivered to customers if customers choose it.”

PowerForward is also different in being focused exclusively on the distribution system, where PUCO has exclusive jurisdiction under Ohio’s deregulated energy market structure, rather than on the transmission and generation system, which is largely under the purview of mid-Atlantic grid operator PJM and rules set by the Federal Energy Regulatory Commission. 

In fact, Haque — who left PUCO to join grid operator PJM this month — launched PowerForward in part to shift PUCO’s focus away from generation-level issues, like Ohio utility FirstEnergy’s attempts at regulatory relief for its now-bankrupt coal fleet, and toward grid modernization, where it had a willing partner in both FirstEnergy and the state’s other major investor-owned utility, AEP Ohio. 

AEP has made hundreds of millions of dollars of investments into the core technologies that make a vision like PowerForward’s possible, such as smart meters, distribution automation, back-office data integration, and other pieces of its federal stimulus-backed smart grid rollout. Another stimulus-funded advanced metering infrastructure (AMI) rollout by Duke Energy in its Cincinnati-centered Ohio service area recently won PUCO approval to upgrade the system, and FirstEnergy and Dayton Electric Light & Power, the state’s remaining IOUs, have pending applications before the agency. 

But as we’ve been covering at Squared, state regulators have been denying some multibillion-dollar utility AMI and grid modernization investment proposals, primarily on concerns over costs to ratepayers, pushback against traditional grid infrastructure projects being classified as grid modernization, and lack of clarity on how they will maximize the value of their technology and capital investments over the long term.

Working out the plans for data-sharing and distribution planning 

As Matt Schilling, deputy director of public affairs at PUCO, said in an interview this week, “our utilities want to do this. They were filing applications with us before we started PowerForward.” Amid this flood of grid modernization proposals, “we want to make sure we’re not approving things that are not in the public interest.” That’s the reason for PowerForward’s customer focus, he said — "everything the commission does and approves here has to demonstrate how it enhances the customer experience. The commission is not interested in approving utility projects for investment’s sake.”

But at the same time, “we don’t want to see a well-thought-out utility plan that the commission, out of a lack of information or fear, denies,” he said — a risk if the commission fails to educate itself on the technologies and economics of the distributed energy vision it’s asking its utilities to adhere to. “That would be a missed opportunity.” 

This sets the stage for PowerForward’s next stage of development: putting together the industry-stakeholder process to turn this vision into a workable reality. Earlier this month, PUCO announced that it’s working with EnerNex, the Knoxville, Tenn.-based electric power industry engineering and consulting group, to advise and facilitate two key working groups for this next stage — the Data & Modern Grid Workgroup (DWG) and the Distribution System Planning Workgroup (PWG). 

While the two working groups are focused on different aspects of the PowerForward vision, they overlap quite a bit in terms of the technologies and use cases they’ll be working with, Ron Chebra, EnerNex vice president of grid modernization, said in last week’s interview. In simple terms, the DWG is focused on making smart meter data available to customers, the state’s competitive retail energy service providers and other third parties, while the PWG will take on the challenge of an “integrated distribution system planning process,” from hosting capacity and interconnection standards, to creating opportunities for customers to participate in non-wires alternatives to traditional grid investments. 

Data-sharing challenges at the customer, retailer and third-party levels 

Right now, the DWG is taking the lead, with its first meeting on March 5 focused on giving participants a chance to share their key data needs, concerns and aspirations, including the distribution utility perspective from AEP Ohio, data-access proposals from retail energy providers Direct Energy and IGS, and consumer data-access requirements proposed by the Environmental Defense FundEnerNex presented a detailed overview of the technical challenges of integrating smart meter data across multiple parties and platforms, as well as how different jurisdictions such as Texas, California, Illinois and the U.K. have handled their AMI data-sharing challenges. 

At its core, Chebra said, the question being asked of the DWG is, “How do we extract value for all parties and all stakeholders from the data that smart meters provide?” This discussion may begin with the existing challenges with Ohio’s AMI data-sharing infrastructure, such as how utilities share data with the roughly 1,100 providers of competitive retail energy service (CRES) that serve just over half of the state’s utility customers. 

This system has its flaws from the CRES point of view. As laid out in Direct Energy’s presentation, Ohio’s AMI data-sharing arrangements aren’t nearly as well thought-out as those set up in Texas, the country’s biggest competitive energy market, where the state created a central portal for all its distribution utilities to share AMI data with customers and retailers. Of course, Ohio’s utilities aren’t nearly as far along in their smart meter rollouts — but creating a centralized data platform for when they do arrive at near-full deployment is one of the key options being considered by the DWG. 

But the DWG’s purview is “more than just a modernization of the metering process,” Chebra said. “It’s an opportunity to provide information that people can act upon, either overtly or automatically,” or by enabling data to inform the actions of people and machines, respectively. 

On this front, the DWG will be looking at the Green Button standards, including Green Button Connect My Data, which allows for continuous and automated data exchange between utilities and customer-approved third parties such as energy retailers, demand response providers, DER aggregators, or other types of customer-centric energy offerings, he said. 

Another key technology for discussion is IEEE 2030.5, also called Smart Energy Profile 2.0, the modern replacement for the ill-fated SEP 1.0 technology embedded in the first generation of U.S. smart meter deployments. While the workgroup will be considering how IEEE 2030.5 can serve as a gateway between smart meters and home energy devices, they’ll also be looking at how it could integrate with the devices and platforms being rolled out by Amazon, Google, and other smart home ecosystem providers, he said — “the opportunity here is much broader than it might have been a couple of years ago.” 

Distribution system planning with DERs at the forefront 

As for the PWG, its first session was held this week, starting with what Rick Wornat, director of energy business consulting at EnerNex, described as a base-level education for stakeholders on Ohio’s current distribution system planning process. This included presentations from AEP Ohio and Duke Energy Ohio on their current distribution systems, as well as an EnerNex presentation on the challenges of applying traditional distribution planning processes to a grid with increasing levels of DERs and customer energy autonomy. 

Over the coming six months, the group will work its way through the key mechanisms and technologies involved in distribution planning, such as hosting capacity analysis, interconnection standards and functionalities for advanced inverters. It will also explore various approaches to non-wires alternatives — a term of art for the variety of programs aimed at replacing the need for traditional poles, wires and transformers-style grid infrastructure investments with DERs that can meet the same needs. 

As with the DWG, the PWG will also be focused on customer involvement in these processes, in terms of creating the portals and platforms to communicate “key market and distribution grid planning information to customers.” The end result of these efforts is likely to be a significant reworking of the way Ohio's utilities engage in distribution grid investment and planning to build DERs in from the ground up. 

The workgroup will gain access to more detailed data next month, when the state’s distribution utilities are set to submit Grid Architecture Status reports to PUCO. Wornat described these documents as something akin to an “executive summary” of each utility’s distribution system infrastructure and planning processes, as well as its capability to support more integrated distribution planning processes. 

Ohio has a handful of projects that might fit the description of a modern-day non-wires alternative such as the multipurpose solar-battery complex built by solar developer Half Moon Ventures, energy storage technology vendor S&C Electric, and the municipal utility of Minster, Ohio. 

It also has an emerging test bed in the form of Smart City Columbus, the program being funded by a $40 million Department of Transportation grant to develop a “model for connected cities of the future,” along with a $10 million grant from Microsoft co-founder Paul Allen’s Vulcan Inc. to “focus on decarbonization of the energy and transportation sectors.” AEP Ohio is bringing its own ratepayer-funded investments to the Columbus Smart City project, including PUCO’s approval last year of a plan to spend $10 million on EV charging infrastructure and $10.5 million to pursue microgrid projects with third parties. 

Both the DWG and the PWG will be working over the coming year to deliver recommendations to PUCO on real-world regulatory actions it could take in pursuit of these grid modernization goals. "We wanted there to be open, transparent conversation," PUCO's Schilling said. "The commission intentionally pursued PowerForward in a way that’s not in a regulatory docket, to encourage that frank and open discussion." But at the end of the DWG and PWG processes, "these workgroups are going to be filing reports that the commission will rely on on the future," he said.