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A10354 Summary:

BILL NOA10354B
 
SAME ASNo Same As
 
SPONSORKelles
 
COSPNSRGallagher, Shimsky, Levenberg, Simon, Dinowitz, Burdick, Shrestha, Otis
 
MLTSPNSR
 
Add Art 12 §§240 - 244, Pub Serv L
 
Establishes the New York State grid reliability and energy affordability transition (GREAT) act; establishes the virtual power plant program to help reduce energy costs and grid reliability risks; provides incentives to participants for supporting the grid by investing in distributed energy resources and reducing net energy costs.
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A10354 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                        10354--B
 
                   IN ASSEMBLY
 
                                    February 26, 2026
                                       ___________
 
        Introduced  by  M.  of  A. KELLES, GALLAGHER, SHIMSKY, LEVENBERG, SIMON,
          DINOWITZ, BURDICK, SHRESTHA, OTIS -- read once  and  referred  to  the
          Committee  on  Energy  --  committee discharged, bill amended, ordered
          reprinted as amended and recommitted to said committee -- reported and
          referred to the Committee on Ways and Means --  committee  discharged,
          bill  amended,  ordered  reprinted  as amended and recommitted to said
          committee
 
        AN ACT to amend the public service law, in relation to establishing  the
          New  York  State  grid reliability and energy affordability transition
          act
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  This act shall be known and may be cited as the "New York
     2  State grid reliability and energy affordability transition (GREAT) act".
     3    § 2. Legislative findings and declarations. The legislature finds  and
     4  declares that:
     5    1.  New  Yorkers  face  rising energy costs and grid reliability risks
     6  driven by extreme weather, aging infrastructure, and use  of  expensive,
     7  polluting fossil fuel plants to meet peak demand.
     8    2.  A virtual power plant is a coordinated network of energy resources
     9  like batteries, electric vehicles, and smart thermostats working togeth-
    10  er to help meet the needs of the electric grid. During periods  of  peak
    11  demand  for  electricity, virtual power plants can reduce demand, supply
    12  electricity, and  provide  other  essential  grid  services,  preventing
    13  blackouts  and lessening the need for costly upgrades to utility infras-
    14  tructure.
    15    3. Virtual power plants can lower electric bills  for  all  ratepayers
    16  and reduce emissions of greenhouse gases and other air pollutants, espe-
    17  cially  from aging "peaker plants" in disadvantaged communities. Virtual
    18  power plants also pay participating families and businesses for support-
    19  ing the grid, enabling and encouraging them  to  invest  in  distributed
    20  energy  resources  and  reduce their net energy costs. This can help the
    21  state advance its clean energy goals and give customers tools to  better
    22  manage their energy bills.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD14809-09-6

        A. 10354--B                         2
 
     1    4. Current market rules, complex energy program structures, and inade-
     2  quate  compensation  to  participants are preventing New York from using
     3  virtual power plants at the scale they are capable of, leaving  a  great
     4  potential  source  of  grid  reliability, ratepayer savings and customer
     5  benefits untapped.
     6    5.  Through  the  Reforming  the  Energy Vision initiative, the Public
     7  Service Commission has taken  important  steps  toward  modernizing  New
     8  York's  energy  system,  encouraging  utilities to work proactively with
     9  customers and third-party providers to start the integration of distrib-
    10  uted energy resources into system planning and operations  in  order  to
    11  lower  system  costs,  reduce  emissions, meet clean energy targets, and
    12  advance other public policy goals.  Through  this  act  the  legislature
    13  provides  comprehensive  guidance  to strengthen, accelerate, and codify
    14  those efforts, giving the Commission clear statutory direction to expand
    15  distributed energy markets by enhancing existing utility  programs,  and
    16  providing  new  program  opportunities.  This  act  further  directs the
    17  Commission to reduce program  barriers  and  maximize  the  benefits  of
    18  virtual power plants.
    19    6.  The  policy  of  New  York State shall therefore be to establish a
    20  statewide virtual power plant program to promote greater use of distrib-
    21  uted energy resources to support a cleaner, more affordable,  resilient,
    22  and reliable electric grid.
    23    §  3.  The public service law is amended by adding a new article 12 to
    24  read as follows:
    25                                 ARTICLE 12
    26                         VIRTUAL POWER PLANT PROGRAM
    27  Section 240. Definitions.
    28          241. Virtual power plant program.
    29          242. Cost recovery.
    30          243. Program targets and performance incentive mechanisms.
    31          244. Reporting.
    32    § 240. Definitions. Where used in this article, the  following  terms,
    33  unless  the  context  otherwise requires, shall have the following mean-
    34  ings:
    35    1. "Aggregator" means a person or entity, other than a utility or  its
    36  affiliate,  that  enrolls and manages customer participation in a utili-
    37  ty's virtual power plant program. An aggregator shall not be  considered
    38  an electric corporation by virtue of its participation in the program.
    39    2. "Battery" means a commercially available non-electric vehicle ener-
    40  gy storage system utilizing mechanical, chemical or thermal processes to
    41  absorb  energy  generated at one period of time, store such energy for a
    42  period of time, and discharge it for use at a later time.
    43    3. "Battery rider" means the section  of  a  utility's  virtual  power
    44  plant program tariff that specifies the terms and conditions for battery
    45  resource participation.
    46    4.  "Capacity  value"  refers  to the value from reducing energy usage
    47  during the most energy-intensive days of the year.
    48    5. "Demand reduction  value"  means  the  monetary  value  of  avoided
    49  distribution system costs.
    50    6.  "Demand  response" means actions taken by a customer to reduce the
    51  amount of electric load supplied by a utility, including through reduced
    52  customer consumption or the use of  controllable  water  heaters,  smart
    53  thermostats and other non-battery technologies.
    54    7.  "Direct  participant" means a customer that enrolls in the virtual
    55  power plant program directly with a utility rather than via an  aggrega-
    56  tor.

        A. 10354--B                         3
 
     1    8. "Disadvantaged community" means a community identified as disadvan-
     2  taged pursuant to the criteria set forth in section 75-0111 of the envi-
     3  ronmental conservation law.
     4    9. "Distributed energy resource" means batteries, non-battery technol-
     5  ogies,  and  electric  vehicles that are capable of reducing or shifting
     6  customer load supplied by a  utility,  generating  electricity,  storing
     7  electricity,  discharging electricity to supply customer energy needs or
     8  exporting electricity to the grid.
     9    10. "Electric vehicle" means a car, truck, bus or  other  mobile  unit
    10  that utilizes electric power stored in an onboard battery for propulsion
    11  along with the associated equipment utilized to charge the battery.
    12    11.  "Electric vehicle rider" means the section of a utility's virtual
    13  power plant program tariff that specifies the terms and  conditions  for
    14  electric vehicle resource participation.
    15    12.  "Eligible  customer" means an active residential electric service
    16  account holder of a utility with an eligible device.
    17    13. "Eligible device" means customer or third-party-owned  distributed
    18  energy  resources that meet the requirements for participation specified
    19  in the relevant virtual power plant program rider.
    20    14. "Grid-edge distributed energy management system"  means  a  third-
    21  party software platform capable of communicating, optimizing and facili-
    22  tating   the   participation   of  behind-the-meter  distributed  energy
    23  resources to provide grid services.
    24    15. "Grid event" means a condition on an electric system  in  response
    25  to  which  a  utility calls upon a virtual power plant to provide a grid
    26  service.
    27    16. "Grid service" means those services identified in paragraph (a) of
    28  subdivision one of section two hundred forty-one of this article.
    29    17. "Locational system relief  value"  means  the  monetary  value  of
    30  avoided distribution costs in specific geographic locations.
    31    18.  "Low-to-moderate  income customer" means a utility account holder
    32  for a household with an income of up to  eighty  percent  of  the  state
    33  median income or area median income, whichever is greater.
    34    19.  "Non-battery technology" means demand response and customer-sited
    35  devices, including but not limited to smart thermostats, water  heaters,
    36  and  other  devices that can be controlled to reduce or otherwise modify
    37  customer energy consumption.
    38    20. "Non-battery rider" means the section of a utility's virtual power
    39  plant program tariff that specifies the terms and  conditions  for  non-
    40  battery resource participation.
    41    21. "Participant" means an aggregator or a direct participant.
    42    22. "Performance payment" means the compensation received by a partic-
    43  ipant  for  the  amount of grid service delivered or deemed delivered by
    44  the customer, device or aggregator during the applicable grid  event  or
    45  grid events.
    46    23.  "Program rider" means one or more of the following: (a) a battery
    47  rider; (b) a non-battery rider; (c) an electric vehicle  rider;  or  (d)
    48  any other virtual power plant program rider approved by the commission.
    49    24.  "Small commercial customer" means a non-residential customer of a
    50  utility with an onsite behind-the-meter distributed energy resource with
    51  a rated capacity of seven hundred fifty kilowatts of alternating current
    52  or lower.
    53    25. "System peak load reduction"  means  a  reduction  in  electricity
    54  demand  or  the  amount  of electricity supplied by a utility during the
    55  highest use periods of the day.

        A. 10354--B                         4
 
     1    26. "Utility" means an electric corporation as defined in section  two
     2  of this chapter.
     3    27. "Utilization factor" means a system or device's capacity used at a
     4  particular  time as a percentage of the system or device's total capaci-
     5  ty.
     6    28. "Value of distributed energy resources" means a structured  frame-
     7  work   for  determining  the  component  values  of  distributed  energy
     8  resources established by the commission.
     9    29. "Virtual power plant" means an aggregation of  distributed  energy
    10  resources operated in coordination to provide one or more grid services.
    11    30. "Virtual power plant program tariff" or "tariff" means the commis-
    12  sion  approved standardized terms and conditions, including formal pric-
    13  ing schedules and operating rules,  governing  aggregator  and  customer
    14  participation and utility operation of the virtual power plant program.
    15    § 241. Virtual power plant program. 1. No later than ninety days after
    16  the  effective  date  of  this article, each utility shall file with the
    17  commission a virtual power plant  program  proposal  including  standard
    18  terms  and  conditions  for participation and compensation in accordance
    19  with the requirements of this  article.  Each  utility  shall  post  its
    20  proposal  in  a  conspicuous and easily accessible place on its website.
    21  The commission shall provide public notice of each  utility's  proposal,
    22  and  provide  opportunity  for  the  public  and  parties to the case to
    23  comment for a period of not less than sixty days, and provide such other
    24  opportunity for public input as the commission  determines  appropriate.
    25  The commission shall conduct at least two public hearings on each utili-
    26  ty's proposal following the public comment period. Public hearings shall
    27  be  held  within  the utility's service territory, at least one of which
    28  shall be held in a disadvantaged community within  such  territory,  and
    29  shall  offer  video  participation and any other measures the commission
    30  deems appropriate to ensure accessibility. Within ninety days of a util-
    31  ity filing its proposal, the commission shall,  after  consideration  of
    32  all  public  and party comments, approve, or approve with modifications,
    33  the virtual power plant program. Within thirty days of final approval by
    34  the commission, the utility shall file a  virtual  power  plant  program
    35  tariff proposal with the commission for program implementation. No later
    36  than  forty-five  days  after  a  utility  files  a tariff proposal, the
    37  commission shall approve, or approve  with  modification,  the  proposed
    38  tariff  for  immediate  implementation.  Upon such approval, the utility
    39  shall update its website with the final  approved  program  and  provide
    40  additional  customer  education  materials and such other content as the
    41  commission may direct or approve on  its  website.  Such  materials  and
    42  other  content  shall be distributed through bill inserts and such other
    43  means deemed appropriate by the commission to sufficiently educate rate-
    44  payers of the program's existence, benefits, and how to participate.
    45    (a) The program filed pursuant to this  subdivision  shall  include  a
    46  battery  rider and a non-battery rider, and may include a separate elec-
    47  tric vehicle rider for eligible customers  to  enroll  eligible  devices
    48  into  the applicable rider for their respective technologies. Each rider
    49  shall independently, at a minimum, provide a system peak load  reduction
    50  service  offering,  and  may  provide additional grid service offerings,
    51  including, but not limited to:
    52    (i) clean peak service to reduce reliance on  fossil  fuel  generation
    53  during peak demand periods;
    54    (ii)   congestion   relief,  system  utilization  factor  improvement,
    55  location  specific  demand  reduction,  and  other   location   specific
    56  services;

        A. 10354--B                         5
 
     1    (iii) avoidance or deferral of need to construct new or upgrade exist-
     2  ing components of the distribution system;
     3    (iv)  ancillary services, including but not limited to voltage support
     4  and frequency regulation; and
     5    (v) such other grid services as the commission may direct or otherwise
     6  deem are in the public interest.
     7    (b) The program filed pursuant to this subdivision shall provide oper-
     8  ating parameters and related terms for each grid service  offered  under
     9  each  technology specific rider, which may be incorporated into existing
    10  programs for residential customers or as new programs for  such  custom-
    11  ers, and which shall include:
    12    (i)  the  minimum  and  maximum numbers of grid events the utility may
    13  call;
    14    (ii) the months of the year that grid events may occur;
    15    (iii) days of the week that grid events may occur;
    16    (iv) times of day that grid events may occur;
    17    (v) maximum duration of grid events;
    18    (vi) day-ahead notification of grid events, along with ability to call
    19  events on a day-of basis for grid services or grid events that  are  not
    20  or cannot be forecasted on a day-ahead basis;
    21    (vii) a list of eligible devices; and
    22    (viii)  customer  protections  for  direct  participants and customers
    23  participating through an aggregator; and
    24    (ix) such other provisions as the commission may direct  or  otherwise
    25  deem appropriate.
    26    (c) If a utility does not include an electric vehicle rider as part of
    27  the  utility's initial filing pursuant to this subdivision, such utility
    28  shall file for commission approval of such rider no later than two years
    29  after the effective date of this article.
    30    (i) The electric vehicle rider shall, at a minimum:
    31    (1) offer opportunities for program  participants  to  provide  system
    32  peak  load reduction services. The rider may also offer opportunities to
    33  provide additional grid services identified in  paragraph  (a)  of  this
    34  subdivision.
    35    (2)  address the parameters identified in paragraph (b) of this subdi-
    36  vision for each grid service offering.
    37    (3) be posted by the utility in a conspicuous  and  easily  accessible
    38  place on the utility's website.
    39    (ii)  The  commission  shall  provide  public notice of each utility's
    40  electric vehicle rider proposal, if  not  part  of  the  initial  filing
    41  pursuant to this subdivision.  The provisions and timeframes for commis-
    42  sion  approvals and for implementation provided in paragraph (a) of this
    43  subdivision shall apply to the electric vehicle rider, except  that  the
    44  public hearing requirement shall be waived.
    45    (d)  On  an  annual  basis on such date as directed by the commission,
    46  each utility shall file a report identifying any grid service listed  in
    47  paragraph (b) of this subdivision that is not included as a grid service
    48  offering  for  any  rider  then in effect. Each report shall discuss any
    49  grid conditions, technology constraints or other circumstances  prevent-
    50  ing  the  utility from including such grid service offerings and provide
    51  an assessment of what conditions or circumstances would need  to  be  in
    52  place  to  incorporate  such  offerings  in  the respective riders. Such
    53  reports shall be subject to comment by the parties to the rider and  the
    54  public.    The  commission may direct utilities to submit for commission
    55  approval additional grid service offerings under one or more  riders  as
    56  the commission deems appropriate.

        A. 10354--B                         6
 
     1    2. The virtual power plant program, inclusive of the respective riders
     2  filed  pursuant  to  subdivision  one of this section, shall include the
     3  following additional terms and conditions:
     4    (a)  Provisions  for  the  participation of aggregators, including the
     5  ability to directly enroll, unenroll and otherwise manage their  custom-
     6  ers'  participation,  receive  dispatch  instructions and other communi-
     7  cations from the utility, receive program  payments  directly  from  the
     8  utility, and other customer protections determined by the commission.
     9    (b)  Provisions for direct participant customers to enroll and partic-
    10  ipate through the utility, disenroll from the program  without  penalty,
    11  receive  dispatch  signals  and  other  communications from the utility,
    12  deliver performance measurement and verification data  to  the  utility,
    13  and receive program payments directly from the utility.
    14    (c)  Provisions  for  device eligibility which shall allow for partic-
    15  ipation of new and existing distributed energy resources on  a  non-dis-
    16  criminatory basis.
    17    (d) Program participation compensation through performance payments as
    18  follows:
    19    (i)  The  commission  shall  approve performance payment rates for the
    20  system peak load reduction service in the form of a dollar per  kilowatt
    21  value that is no lower than the sum of the capacity value and the demand
    22  reduction  value using the most recent information for such value compo-
    23  nents as provided  in  the  commission's  value  of  distributed  energy
    24  resources proceeding, or any successor proceeding, for each utility.
    25    (ii)  Where  applicable,  the  commission  shall  approve  performance
    26  payment rates for resources located in areas designated as a  locational
    27  system  relief  value area in the form of a dollar per kilowatt value no
    28  lower than the locational system relief  value  using  the  most  recent
    29  information  provided  in  the  commission's value of distributed energy
    30  resources proceeding, or any successor proceeding.
    31    (iii) For a period of no less than four years from the effective  date
    32  of  this  article, the demand reduction value component for establishing
    33  the system peak load reduction service performance payment rate shall be
    34  calculated based on the system-wide average  of  a  utility's  long-run,
    35  non-zero  marginal  cost  of  service, inclusive of all substation areas
    36  with non-zero costs.
    37    (iv) For a period of no less than four years from the  effective  date
    38  of this article, the locational system relief value component for estab-
    39  lishing  the system peak load reduction service performance payment rate
    40  shall be calculated based on a single level of locational system  relief
    41  value for each utility, reflecting the threshold level at which a utili-
    42  ty's  costs  are significantly higher than costs on average on a system-
    43  wide basis.  The locational system relief value shall relate to no  less
    44  than  ten  percent  of  a  company's service areas for no less than five
    45  years from the effective date of this article.
    46    (v) For a period of no less than four years from the effective date of
    47  this article, the capacity value for establishing the system  peak  load
    48  reduction  service  performance  payment rate shall be calculated as the
    49  average market clearing price across the utility territory for the prior
    50  calendar year. After such four-year period, the commission may  continue
    51  to  use this method or adopt an alternative methodology to calculate the
    52  capacity value component.
    53    (vi) The commission shall utilize the demand  reduction  value,  loca-
    54  tional  system relief value, and other values calculated pursuant to the
    55  commission's value of distributed energy resources  proceeding,  or  any
    56  successor proceeding, and such other related valuation considerations to

        A. 10354--B                         7
 
     1  establish performance payment rates, or such other compensation rates as
     2  the  commission determines appropriate, for other grid service offerings
     3  approved under the program other than the system peak reduction service,
     4  provided that such rates reflect fair value for the service provided.
     5    (vii) Participants shall receive the performance payment rate approved
     6  for  a  grid  service that is applicable at the time of enrollment for a
     7  period of five years. After such five-year  period,  a  participant  may
     8  reenroll in the program at the then applicable rate for subsequent five-
     9  year terms.
    10    (viii)  Participants  shall  be  eligible  to  provide  multiple  grid
    11  services under multiple technology riders and receive  compensation  for
    12  each  grid  service  pursuant to each rider; provided, however, that the
    13  grid value delivered under one service is incremental to  that  provided
    14  under another service.
    15    (ix)  Customers  shall have the option to receive performance payments
    16  directly or to assign such payments to a third-party.
    17    (x) Performance payments shall be made by a utility to the  applicable
    18  customer or third-party designated by the customer no less than once per
    19  year,  but may be made more frequently, as approved by the commission. A
    20  utility shall provide performance payments in the form  of  a  check  or
    21  electronic  transfer  of  funds,  such  as  direct  deposit or other ACH
    22  payment. The  utility  may  provide  customers  the  option  to  receive
    23  performance payments as a direct bill credit, but shall not require such
    24  payments to be issued in such manner.
    25    (xi)  The  commission  shall  periodically  review performance payment
    26  rates in relation to a utility's performance in  achieving  the  partic-
    27  ipation  targets  established in section two hundred forty-three of this
    28  article.  The commission may increase the performance payment  rates  as
    29  it determines appropriate to achieve the participation targets.
    30    (e) Provisions to measure device performance, where:
    31    (i)  Battery  performance  shall be measured directly at the inverter;
    32  and
    33    (ii) Non-battery and electric vehicle technology  performance  may  be
    34  measured  directly  at the device or through such other methodologies as
    35  the commission may approve.
    36    (f) Performance payment compensation calculations  and  methodologies,
    37  where:
    38    (i)  System  peak  load  reduction  service  and  locational  services
    39  provided under a battery rider shall be compensated based on the  appli-
    40  cable  performance  payment  rate  multiplied  by  the  average  battery
    41  performance as measured at the inverter  during  grid  events  over  the
    42  course  of  the  applicable measurement period. The commission may adopt
    43  the same or alternative  methodologies  to  calculate  compensation  for
    44  other  grid  services  offered  under  a battery rider as the commission
    45  deems appropriate.
    46    (ii) The commission shall provide methodologies to  calculate  compen-
    47  sation  for grid services offered under non-battery and electric vehicle
    48  riders taking into account the ability to directly  measure  performance
    49  from  the respective eligible technologies, costs of facilitating direct
    50  measurement, and related considerations.
    51    (g) A utility shall not assess penalties on customers  or  aggregators
    52  under  this  program; provided, however, that the commission may approve
    53  reasonable mechanisms to disenroll participants for  continued  non-per-
    54  formance.

        A. 10354--B                         8
 
     1    (h)  Provisions allowing customers to co-participate in other programs
     2  and provide multiple grid services  across  riders  within  the  virtual
     3  power plant program, where:
     4    (i)  Customers  may  co-participate  in  the  net  metering,  value of
     5  distributed energy resources, and any other  applicable  interconnection
     6  tariff  approved  by the commission. Net metering customers shall not be
     7  required to transition to a value of  distributed  energy  resources  or
     8  other  non-net  metering  interconnection  tariff  to participate in the
     9  program.
    10    (ii) Customers may co-participate in one or more  program  riders  and
    11  provide  multiple grid services within each rider. Customers may partic-
    12  ipate in other grid service programs outside  the  virtual  power  plant
    13  program,  including wholesale market programs where otherwise permitted,
    14  so long as such value is distinct from that provided under  the  virtual
    15  power plant program.
    16    (i) Notwithstanding the provisions of subdivision one of this section,
    17  each  utility  shall  update the participation rules for battery storage
    18  resources to participate in the direct load control program approved  by
    19  the  commission  in  the  commission  proceeding to develop dynamic load
    20  management programs, or any successor proceeding. Such revisions to  the
    21  direct  load control program shall be made to comply with the directives
    22  set forth in this subdivision as applicable to batteries in time  to  be
    23  effective for the two thousand twenty-seven program year. Such revisions
    24  to  the  direct  load  control  programs  may  occur through the process
    25  currently administered by the commission to review and  approve  changes
    26  proposed  by  each utility in its annual dynamic load management program
    27  report filed in the commission's  proceeding  to  develop  dynamic  load
    28  management programs, or as the commission may otherwise direct.
    29    3.  The  following  additional  terms shall apply to the virtual power
    30  plant program:
    31    (a) Participating aggregators shall:  (i)  make  customer  performance
    32  data and related customer specific information available to the customer
    33  upon  request  for visibility into device performance under the program;
    34  (ii) provide a clear and prominently displayed statement on the applica-
    35  tion form and customer portal that such information  is  available  upon
    36  request  and  disclosing that the operation, power consumption, or power
    37  discharge of the customer's enrolled devices may be  remotely  adjusted,
    38  curtailed,  or  dispatched by the aggregator during grid events, subject
    39  to the customer's right to physically or digitally override such adjust-
    40  ments; (iii) include reasonable terms and conditions  for  customers  to
    41  disenroll  from  the  program  without penalty; (iv) not sell, trade, or
    42  otherwise provide customer data related to participation  in  a  virtual
    43  power  plant  program, except as authorized by this article, and without
    44  the written consent of such customer; and (v)  establish  robust  proce-
    45  dures and practices to protect customer data.
    46    (b)  The  commission  shall  adopt  other  reasonable requirements for
    47  participation consistent with this subdivision; provided, however,  that
    48  collateral  or  other  financial  commitments from aggregators or direct
    49  participants shall not be required as a condition for participation.
    50    (c) Utility-owned distributed energy resources shall not  be  eligible
    51  to  participate in the program. Utilities and utility affiliates may not
    52  be aggregators.
    53    (d) Utilities shall  provide  non-discriminatory  access  to  customer
    54  data,  hosting  capacity  data,  and  other grid data to facilitate: (i)
    55  program enrollment; (ii) identification of grid support needs; and (iii)
    56  other program participation considerations  for  customers,  distributed

        A. 10354--B                         9
 
     1  energy resource developers and aggregators. No later than one year after
     2  the effective date of this article the commission shall promulgate rules
     3  allowing customers timely data sharing and third-party access, as neces-
     4  sary, to grid data.
     5    (e)  Utilities may, upon review by and with the consent of the commis-
     6  sion, engage third-party grid-edge distributed energy  resource  manage-
     7  ment  system  providers  for  program  administration  and other program
     8  support, such as facilitating the participation of aggregators  and  the
     9  enrollment and participation of direct participants.
    10    (f) Each electric corporation shall take all necessary steps to facil-
    11  itate  and  streamline  the  processes  required for virtual power plant
    12  participation. Such efforts shall include, but not be limited to, reduc-
    13  ing administrative barriers and  transaction  costs  for  virtual  power
    14  plant  participants  and adopting standardized processes to simplify and
    15  ensure timely: (i) interconnection;  (ii)  data  sharing  and  automated
    16  system  integration  with  third-party aggregators; (iii) administrative
    17  and logistical coordination for mass-market enrollment; (iv) performance
    18  verification and payment settlement; and (v) such other measures as  the
    19  commission may direct.
    20    (g)  (i)  Prior  to enrollment with an aggregator, each customer shall
    21  receive information in plain language,  which  shall  include:  (1)  the
    22  rights of customers under the program; (2) how to disenroll or temporar-
    23  ily  suspend  participation  in the program; and (3) examples of when an
    24  aggregator may control the customer's device to provide the grid service
    25  to the utility under the program.
    26    (ii) Such information shall also be made available on the department's
    27  website as well as each participating utility's website.
    28    § 242. Cost recovery. 1.  Utilities  may  recover  prudently  incurred
    29  costs to facilitate administration and implementation of a virtual power
    30  plant program established pursuant to this article, as determined by the
    31  commission,  including  but  not limited to grid-edge distributed energy
    32  resource management system provider and other  service  contract  costs,
    33  operations  and  maintenance expenses, information technology costs, and
    34  such other costs, expenses and investments the commission  finds  neces-
    35  sary and prudent for the development and implementation of the program.
    36    2.  Utilities may recover the cost of program payments made to partic-
    37  ipants through cost recovery mechanisms approved by the commission.
    38    § 243. Program targets and performance  incentive  mechanisms.  1.  No
    39  later  than  one  year  after  the  effective  date of this article, the
    40  commission shall, after  notice  and  opportunity  for  public  comment,
    41  establish  system  peak load reduction targets and performance incentive
    42  mechanisms for a virtual power plant program for each utility and  guid-
    43  ance  to  ensure  robust  initial  participant  engagement and growth of
    44  virtual power plant programs. Each such target shall: (a) be established
    45  for a minimum period of ten years; (b) include increasing annual  bench-
    46  marks;  and (c) be structured as a percentage of a utility system's peak
    47  demand to ensure the program scales dynamically with load growth.
    48    2. The commission shall adopt  performance  incentive  mechanisms  for
    49  achieving  or  exceeding  the  targets  established for each year of the
    50  performance period. The commission may include as part of  the  perform-
    51  ance incentive mechanism: (a) performance metrics; (b) publicly-accessi-
    52  ble data dashboards, scorecards, and other tracking tools; (c) financial
    53  incentives  and  financial  penalties  for  failure  to meet performance
    54  targets; and (d) such other mechanisms appropriate to track  performance
    55  and  create  financial  incentive  structures to motivate the utility to
    56  achieve performance targets.

        A. 10354--B                        10
 
     1    3. The commission shall develop program  performance  incentive  mech-
     2  anisms for additional grid services as the commission deems appropriate.
     3    4.  The  commission  shall design the virtual power plant program in a
     4  manner to provide substantial benefits  for  disadvantaged  communities,
     5  which  shall  include consideration of proposals to deploy virtual power
     6  plants in order to reduce the usage of combustion-powered peaking facil-
     7  ities located in or near disadvantaged communities; for low or  moderate
     8  income  end-use consumers; and for maximum consumer cost reductions at a
     9  reasonable cost.
    10    § 244. Reporting. Each utility shall file an annual report at  a  date
    11  determined by the commission that shall include, at minimum:
    12    1. the total participants enrolled in each virtual power plant program
    13  rider  broken out by technology type, customer class, and aggregator vs.
    14  direct participants for each grid service offered in the prior  calendar
    15  year;
    16    2.  estimated  cost  reductions as a result of the virtual power plant
    17  program and how such reductions are reflected in customer bill savings;
    18    3. recommendations to increase  participation  in  the  virtual  power
    19  plant program; and
    20    4. such other information as the commission may require.
    21    § 4. This act shall take effect immediately.
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