Sec. 5. Smart Grid peak demand reduction goals
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Not later than 1 year after the date of enactment of this section, each load-serving entity, or, at the option of the State, each State with respect to load-serving entities that the State regulates, shall determine and publish peak demand reduction goals for any load-serving entities that have an applicable baseline in excess of 250 megawatts. The Commission, in consultation with the Secretary and the Administrator, shall develop and publish, after an opportunity for public comment, but not later than 180 days after the date of enactment of this section, a methodology to provide for adjustments or normalization to a load-serving entity’s applicable baseline over time to reflect changes in the number of customers served, weather conditions, general economic conditions, and any other appropriate factors external to peak demand management, as determined by the Commission.
The Commission shall support load-serving entities (including any load-serving entities with an applicable baseline of less than 250 megawatts that volunteer to participate) in determining their applicable baselines and in developing their peak demand reduction goals. The Secretary, in consultation with the Commission, the Administrator, and the North American Electric Reliability Corporation, shall develop a system and rules for measurement and verification of demand reductions.
Peak demand reduction goals may be established for an individual load-serving entity, or, at the determination of a State, tribal, or regional entity, by that State, tribal, or regional entity for a larger region that shares a common system peak demand and for which peak demand reduction measures would offer regional benefit. A State or regional entity establishing peak demand reduction goals shall cooperate, as necessary and appropriate, with the Commission, the Secretary, State regulatory commissions, State energy offices, the North American Electric Reliability Corporation, and other relevant authorities.
In determining the applicable peak demand reduction goals— States and other jurisdictional entities may utilize the results of the 2009 National Assessment of Demand Response Potential, as authorized by section 571 of the National Energy Conservation Policy Act ( 42 U.S.C. 8279 ); and the relative economics of peak demand reduction and generation required to meet peak demand shall be evaluated in a neutral and objective manner. The applicable peak demand reduction goals shall provide that— load-serving entities will reduce or mitigate peak demand by a minimum percentage amount from the applicable baseline to a lower peak demand during calendar year 2015; load-serving entities will reduce or mitigate peak demand by a minimum percentage greater amount from the applicable baseline to a lower peak demand during calendar year 2018; and the minimum percentage reductions established as peak demand reduction goals shall be the maximum reductions that are realistically achievable with an aggressive effort to deploy Smart Grid and peak demand reduction technologies and methods, including those listed in subsection (d).
Each load-serving entity shall prepare a peak demand reduction plan that demonstrates its ability to meet each applicable goal by any or a combination of the following options: Direct reduction in megawatts of peak demand through— energy efficiency measures (including efficient transmission wire technologies which significantly reduce line loss compared to traditional wire technology) with reliable and continued application during peak demand periods; or use of a Smart Grid. Demonstration that an amount of megawatts equal to a stated portion of the applicable goal is contractually committed to be available for peak reduction through one or more of the following:
Megawatts enrolled in demand response programs. Megawatts subject to the ability of a load-serving entity to call on demand response programs, smart appliances, smart electricity or energy storage devices, distributed generation resources on the entity’s customers’ premises, or other measures directly capable of actively, controllably, reliably, and dynamically reducing peak demand ( dynamic peak management control ). Megawatts available from distributed dynamic electricity or energy storage under agreement with the owner of that storage.
Megawatts committed from dispatchable distributed generation demonstrated to be reliable under peak period conditions and in compliance with air quality regulations. Megawatts available from smart appliances and equipment with Smart Grid capability available for direct control by the utility through agreement with the customer owning the appliances or equipment or with a third party pursuant to such agreements. Megawatts from a demonstrated and assured minimum of distributed solar electric generation capacity in instances where peak period and peak demand conditions are directly related to solar radiation and accompanying heat.
If any of the methods listed in subparagraph (C), (D), or
(E)of paragraph
(2)are relied upon to meet its peak demand reduction goals, the load-serving entity must demonstrate this capability by operating a test during the applicable calendar year. Nothing in this section shall require the publication in peak demand reduction goals or in any peak demand reduction plan of any information that is confidential for competitive or other reasons or that identifies individual customers. Nothing in this section diminishes or supersedes any authority of a State or political subdivision of a State to adopt or enforce any law or regulation respecting peak demand management, demand response, distributed energy storage, use of distributed generation, or the regulation of load-serving entities. The Commission, in consultation with States and Indian tribes having such peak demand management, demand response, and distributed energy storage programs, shall to the extent practicable, facilitate coordination between the Federal program and such State and tribal programs. The Commission may, for good cause, grant relief to load-serving entities from the requirements of this section. Except as provided in subsections
(e)and (f), no law or regulation shall relieve any person of any requirement otherwise applicable under this section. The Commission shall, not later than 1 year after the date of enactment of this Act, establish a public Web site where the Commission shall provide information and data demonstrating compliance by States, Indian tribes, regional entities, and load-serving entities with this section, including the success of load-serving entities in meeting applicable peak demand reduction goals. The Commission shall, by April 1 of each year beginning in 2015, provide a report to Congress on compliance with this section and success in meeting applicable peak demand reduction goals and, as appropriate, shall make recommendations as to how to increase peak demand reduction efforts. The Commission shall note in each such report any State, political subdivision of a State, or load-serving entity that has failed to comply with this section, or is not a part of any region or group of load-serving entities serving a region that has complied with this section. The Commission shall have and exercise the authority to take reasonable steps to modify the process of establishing peak demand reduction goals and to accept adjustments to them as appropriate when sought by load-serving entities. The Secretary may make grants to States and to other entities with responsibilities to be carried out under the Act to offset any documented costs of carrying out such responsibilities to the extent such costs are deemed burdensome or extraordinary by the Secretary. There are authorized to be appropriated such sums as may be necessary to the Commission, the Secretary, and the Administrator to carry out the provisions of this Act.
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Sec. 5
Smart Grid peak demand reduction goals
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