Proposed rules for future electric system investments risk imposing unnecessary costs on customers, OPC tells regulators
BALTIMORE – Proposed rules for improving the process of planning investments needed to deliver electricity to homes and buildings fall short of what’s needed to benefit customers and meet legislative goals, the Office of People’s Counsel said in comments filed this week with the Maryland Public Service Commission.
The draft rules—issued in part to respond to planning requirements set in 2022 and 2023 legislation—represent incremental progress, OPC said, but they risk missing significant opportunities to meet State goals and avoid imposing unnecessary costs on customers. Without better rules, including requirements for sufficient oversight, utilities may submit incomplete or opaque plans that lock in increased customer rates for decades.
“Without stronger rules now, Maryland risks binding itself to an electric distribution grid that is less reliable, fails to take advantage of cost-saving technologies, and cannot meet State policy goals,” said Maryland People’s Counsel David S. Lapp. “It is utility customers that will bear the consequences of failing to adopt more robust and integrated electric system planning rules.”
OPC’s comments point to a range of flaws and gaps in the proposed rules. For example, the term “non-wires alternative”—a reference to using innovative technologies to mitigate the need for investments in traditional technologies such as power lines and substations and that can save customers significant costs—appears only once in the draft rules, buried in a clause that invites utilities to disregard it. Additionally, there are insufficient requirements for forecasting distributed energy resources like solar and storage that are an important part of a cost-effective energy future. The draft rules also do not require utilities to report on whether projects they proposed were completed or altered after approval, or why.
OPC’s comments suggest changes to the draft rules and propose additional rules to support an electric system planning process that aligns with the public interest and ensures that all households have reliable and affordable electric service. OPC’s recommendations include:
- Requiring Commission approval of electric utility distribution plans to ensure alignment with the public interest and legislative mandates. Without Commission approval, there is no check to ensure that utilities produce reasonable plans that meet statutory and regulatory requirements.
- Ensuring that utilities’ distribution plans consider other Commission-directed efforts to plan the energy future—including battery energy storage, utility-built electric vehicle infrastructure, and energy efficiency—to take into account all relevant technologies and avoid unnecessary expenditures.
- Requiring utilities to track and report on projects using defined metrics—including whether planned projects were constructed, delayed, or altered, and the reasons why—to ensure accountability for the investments utilities propose and the costs they incur.
- Mandating specific forecasting requirements for distributed energy resources such as storage, local solar, and energy efficiency, so that utilities accurately model the grid’s future and avoid overbuilding.
- Detailing a standardized set of baseline information that utilities must file with their system plans to support transparency on how the utility modeled future needs and enable broader participation in the planning process.
“The Commission faces a narrow window to shape how billions of dollars in grid investments are planned, evaluated, and deployed,” Lapp said. “Once those plans are filed under a weak framework, the State will have little ability to course-correct before long-lived infrastructure—and its costs—are locked in for decades to come. Maryland is out of time for half-measures.”
The Maryland Office of People’s Counsel is an independent state agency that represents Maryland’s residential consumers of electric, natural gas, telecommunications, private water and certain transportation matters before the Public Service Commission, federal regulatory agencies and the courts.
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