E9-14990. Energy Efficiency and Smart Grid Standards

AGENCY:

Tennessee Valley Authority.

ACTION:

Notice of consideration of energy efficiency and Smart Grid standards

SUMMARY:

By a Notice in the Federal Register (73 FR 76736, December 16, 2008), the Tennessee Valley Authority (TVA) initially requested comments on certain standards that TVA is considering adopting for itself and the distributors of TVA power pertaining to certain energy efficiency and Smart Grid standards. The standards being considered are Integrated Resource Planning, Rate Design Modifications to Promote Energy Efficiency Investments, Consideration of Smart Grid Investments, and Smart Grid Information listed in section 111(d) of the Public Utility Regulatory Policies Act of 1978 (Pub. L. 95-617) as amended by the Energy Independence and Security Act of 2007 (Pub. L. 110-140). TVA staff has developed a report that reviews each standard and makes a preliminary recommendation with respect to each standard. TVA has posted the report on the TVA Web site (http://www.tva.com/​purpa). The standards will be considered on the basis of their effect on conservation of energy, efficient use of facilities and resources, equity among electric consumers, and the objectives of the Tennessee Valley Authority Act. As part of the process of considering the standards, comments are requested from the public on the TVA staff report. TVA is also extending the comment period on the standards themselves, which are set out below.

DATES:

All comments on the TVA staff report and these standards must be received by July 27, 2009. Written comments may be mailed to: Veenita Bisaria, Tennessee Valley Authority, 400 W. Summit Hill Drive, WT3D-K, Knoxville, TN 37902, [phone]. Comments may also be submitted via the Web, at http://www.tva.com/​purpa.

FOR FURTHER INFORMATION CONTACT:

Veenita Bisaria, Tennessee Valley Authority (contact information above).

SUPPLEMENTARY INFORMATION:

On the standards being considered, the Public Utility Regulatory Policies Act of 1978 (Pub. L. 95-617) as amended by the Energy Independence and Security Act of 2007 (Pub. L. 110-140) requires that TVA consider these standards. Accordingly, data, views, and comments are requested from the public on the four standards set out below, as well as on the TVA staff report. Comments on variations in any of the standards, as well as views for or against their adoption are welcome. These standards are being presented in order to obtain the public's views on the need and desirability of such standards. Determinations on the appropriateness of the standards will be made by the TVA Board of Directors for TVA and the distributors of TVA power.

Standards: The standards upon which comments are requested about which a determination will be made are:

(1) Integrated Resource Planning.—

Each electric utility shall—

(A) Integrate energy efficiency resources into utility, State, and regional plans; and

(B) Adopt policies establishing cost-effective energy efficiency as a priority resource.

(2) Rate Design Modifications to Promote Energy Efficiency Investments.—

(A) In General.—The rates allowed to be charged by any electric utility shall—

(i) Align utility incentives with the delivery of cost-effective energy efficiency; and

(ii) Promote energy efficiency investments.

(B) Policy Options.—In complying with subparagraph (A), each State regulatory authority and each non-regulated utility shall consider—

(i) Removing the throughput incentive and other regulatory and management disincentives to energy efficiency;

(ii) Providing utility incentives for the successful management of energy efficiency programs;

(iii) Including the impact on adoption of energy efficiency as one of the goals of retail rate design, recognizing that energy efficiency must be balanced with other objectives;

(iv) Adopting rate designs that encourage energy efficiency for each customer class;

(v) Allowing timely recovery of energy efficiency-related costs; and

(vi) Offering home energy audits, offering demand response programs, publicizing the financial and environmental benefits associated with making home energy efficiency improvements, and educating homeowners about all existing Federal and State incentives, including the availability of low-cost loans, that make energy efficiency improvements more affordable.

(3) Consideration of Smart Grid Investments.—

(A) In General.—Each State shall consider requiring that, prior to undertaking investments in nonadvanced grid technologies, an electric utility of the State demonstrate to the State that the electric utility considered an investment in a qualified smart grid system based on appropriate factors, including—

(i) Total costs;

(ii) Cost-effectiveness;

(iii) Improved reliability;

(iv) Security;

(v) System performance; and

(vi) Societal benefit.

(B) Rate Recovery.—Each State shall consider authorizing each electric utility of the State to recover from ratepayers any capital, operating expenditure, or other costs of the electric utility relating to the deployment of a qualified smart grid system, including a reasonable rate of return on the capital expenditures of the electric utility for the deployment of the qualified smart grid system.

(C) Obsolete Equipment.—Each State shall consider authorizing any electric utility or other party of the State to deploy a qualified smart grid system to recover in a timely manner the remaining book-value costs of any equipment rendered obsolete by the deployment of the qualified smart grid system, based on the remaining depreciable life of the obsolete equipment.

(4) Smart Grid Information.—

(A) Standard.—All electricity purchasers shall be provided direct access, in written or electronic machine-readable form as appropriate, to information from their electricity provider as provided in subparagraph (B).

(B) Information.—Information provided under this section, to the extent practicable, shall include:

(i) Prices.—Purchasers and other interested persons shall be provided with information on (I) time-based electricity prices in the wholesale electricity market; and (II) time-based electricity retail prices or rates that are available to the purchasers.

(ii) Usage.—Purchasers shall be provided with the number of electricity units, expressed in kwh, purchased by them.

(iii) Intervals and projections.—Updates of information on prices and usage shall be offered on not less than a daily basis, shall include hourly price and use information, where available, and shall include a day-ahead projection of such price information to the extent available.

(iv) Sources.—Purchasers and other interested persons shall be provided annually with written information on the sources of the power provided by the utility, to the extent it can be determined, by type of generation, including greenhouse gas emissions associated with each type of generation, for intervals during which such information is available on a cost-effective basis.

(C) Access.—Purchasers shall be able to access their own information at any time through the Internet and on other means of communication elected by that utility for Smart Grid applications. Other interested persons shall be able to access information not specific to any purchaser through the Internet. Information specific to any purchaser shall be provided solely to that purchaser.

Procedures: Written data, views, and comments on the standards and the TVA staff report are requested from the public. All material relating to the standards or TVA staff report must be received by 5 p.m. EST on July 27, 2009. All materials received by TVA before this designated time will be considered by TVA. The TVA staff report, and comments on the report concerning the standards, will also be made part of the official record. In order to assist interested consumers in preparing written data, views, and comments for the record, TVA operates a Web site (http://www.tva.com/​purpa) on which interested parties can be informed about the standards set out in this notice and on which interested parties can access the TVA staff report and submit comments and materials on the standards or the report. The official record will consist of the TVA staff report and all comments and materials submitted electronically and all written materials submitted within the time set forth above. A summary of the record will be prepared by TVA staff and will be transmitted to the TVA Board of Directors along with the complete record. The record will be used by the Board in making the determinations required by section 111(d) of the Public Utility Regulatory Policies Act of 1978 (Pub. L. 95-617) as amended by the Energy Independence and Security Act of 2007 (Pub. L. 110-140) and in fulfilling its obligation under the Tennessee Valley Authority Act. Individual copies of the record will be available to the public at cost of reproduction. Copies will also be kept on file for public inspection at the following locations: Tennessee Valley Authority, 400 W. Summit Hill Drive, WT3D-K, Knoxville, TN 37902, and on the Web at http://www.tva.com/​purpa.

Dated: June 19, 2009.

Maureen H. Dunn,

Executive Vice President and General Counsel.