Bill Text: MS SB2436 | 2023 | Regular Session | Introduced


Bill Title: Microgrid and Grid Resiliency Act; create.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Failed) 2023-01-31 - Died In Committee [SB2436 Detail]

Download: Mississippi-2023-SB2436-Introduced.html

MISSISSIPPI LEGISLATURE

2023 Regular Session

To: Energy

By: Senator(s) Harkins

Senate Bill 2436

AN ACT TO ENACT THE MICROGRID AND GRID RESILIENCY ACT; AND FOR RELATED PURPOSES.

     BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:

     SECTION 1.  Definitions.  (1)  This act shall be known and may be cited as the "Microgrid and Grid Resiliency Act."

     (2)  For the purposes of this act, the following words and phrases shall have the meanings ascribed in this section unless the context clearly indicates otherwise:

          (a)  "Microgrid" means a local energy grid with control capability, energy generation, a specific service boundary and the full ability to distribute power to its customers, which energy grid can be connected or disconnected from and operate in tandem with or independently from the traditional grid and can be operated with or without the coordination of the local utility power provider.

          (b)  "Microgrid zone" means an area of designated land, the minimum size of which will be set at one hundred (100) acres within a single county, for which some statutory and regulatory exemptions shall be available.

          (c)  "Community Level Microgrid" means an area of residential zoning seeking to secure their energy through local generation for which the minimum size shall be set by the Public Service Commission.

          (d)  "Demand Response" means a change in the power consumption of a microgrid to help ensure that demand for power is met on the grid during peak demand.

          (e)  "Secondary Frequency Response" means the response to a signal from grid operators to protect the grid during unplanned changes in frequency that are attributed to sudden and unpredictable decreases in supply.  Secondary Frequency Response (SFR) can also apply when there are sudden decreases in supply or increases in supply, such as when a power asset goes offline or when demand spike due to unpredictable weather patterns.

          (f)  "Primary Frequency Response" means an automatic or instantaneous response to protect the grid during unplanned changes in frequency attributable to sudden and unpredictable decreases in supply.  Primary Frequency Response (PFR) can also apply when there are sudden decreases or increases in supply, such as when a power asset goes offline or when demand spikes due to unpredictable weather patterns.

          (g)  "Microgrid operator" means any individual, business, co-op, utility or firm who manages the operations of the microgrid.

          (h)  "Grid Operator" means a utility, Public Service Commission, midcontinent independent system operator, independent transmission system operator, or any entity that is responsible for managing the stability of the grin in a given area or region.

     SECTION 2.  Designation of land for microgrid zones

     (1)  The board of supervisors in each county in this state may petition the Public Service Commission to designate no more than three (3) areas of unincorporated land within the county constituting no less than one hundred (100) continuous acres as a microgrid zone.  The designated land shall not include any part of a municipality or land outside the boundaries of the county.  A petition may be filed under this subsection to modify as well as create a microgrid zone.  The county board of supervisors may also petition the Secretary of State to lower the minimum size to ensure that each county has the ability to participate in the creation of a microgrid zone.

     (2)  Prior to petitioning the Public Service Commission under subsection (1) of this section, the board of supervisors shall hold at least one (1) public hearing with notice of the time and place of the hearing given by publication in a newspaper of general circulation in the county at least once and no less than fourteen (14) days before the date of the hearing.

     (3)  The Public Service Commission shall provide the Secretary of State with an analysis of the potential impact the microgrid zone may have on retail customers outside of the zone and nonparticipating retail customers within the zone and any other information required by rule promulgated by the Secretary of State.

     (4)  The Secretary of State may consider the analysis provided under subsection (3) of this section and any other factors it deems relevant in determining whether to approve a petition submitted pursuant to this section.  The Secretary of State shall not approve a petition that does not meet the requirements of subsection (1) of this section but may otherwise approve or deny a petition at its discretion.

     SECTION 3.  Application and Approval for Microgrids

     (1)  The Public Service Commission shall oversee individual microgrids built within and outside the microgrid zone.

     (2)  When applying for approval of a microgrid, the commission shall review the application to determine if the microgrid can meet a threshold for approval which will cover:

          (a)  The microgrid's ability to reasonably improve the local utility's electrical efficiency, resilience, reliability and security once it has connected to the grid; and

          (b)  The microgrid's ability to perform demand response and frequency response once connected to the grid.

     SECTION 4.  Regulatory exemptions; limitations.

     (1)  Microgrid operators within the microgrid zone upon the point of grid connection must be willing to provide up to twenty percent (20%) of their generation in a demand response program in order to ensure grid stability.

          (a)  All electricity provided from the microgrid zone back to the grid or public utility for demand response shall be provided at a regular rate of return consistent with local power pricing set by the Public Service Commission.

          (b)  Grid operators shall provide at least thirty (30) minutes of advance warning to microgrid operators within microgrid zones for usage of up to five percent (5%) of the microgrid's operating capacity.

          (c)  Grid operators shall give at least one hundred twenty (120) minutes of warning to microgrid operators for any usage over five percent (5%) and up to twenty percent (20%) of the microgrid's supply capacity

     (2)  Microgrid operators within the microgrid zone upon the point of grid connection shall participate in a secondary frequency response in order to ensure grid stability.

          (a)  All electricity provided from the microgrid zone back to the grid or public utility for secondary frequency response shall be provided at current wholesale power pricing and be no less than a regular rate of return set by the Public Service Commission.

          (b)  All power sold back to the grid for secondary frequency response shall receive fair and just compensation as put forth by FERC Order 755.

          (c)  Grid operators shall give at least thirty (30) second of advanced warning to microgrid operators for usage of up to five percent (5%) of the microgrid's operating capacity for the purpose of secondary frequency response and an additional thirty (30) seconds of advanced warning for each additional five percent (5%).

          (d)  Grid operators may give advanced warning for up to twenty percent (20%) of the microgrid's capacity for the purpose of secondary frequency response if the grid operator gives the microgrid at least five (5) minutes of advanced warning.

     (3)  Microgrids shall sustain the response for at least fifteen (15) minutes or until the utility recalls deployment, whichever occurs first, and a resource must be reset and made available for the next event within fifteen (15) minutes after deployment is ended.

     (4)  Microgrid operators within the microgrid zone upon the point of grid connection may, but are not required to, participate in a primary frequency response in order to ensure grid stability.

          (a)  All electricity provided from the microgrid and microgrid zone back to the grid or public utility for primary frequency response shall have its price negotiated between the utility purchasing power from the microgrid and the microgrid operator.

          (b)  Primary frequency response must be deployed within fifteen (15) cycles after grid frequency reaches the trigger threshold to qualify for this program.

     (4)  Except as otherwise provided in this section, the provisions of this title with respect to Public Service Commission rate regulation shall not apply to rates charged for the sale of electricity to a customer who:

          (a)  Consumes the electricity within a microgrid zone;

          (b)  Consumes the electricity for commercial or industrial use; and

          (c)  Is not purchasing the electricity to replace electrical service capacity that existed prior to the establishment of the microgrid zone.

     (5)  Except as otherwise provided in this section, the provisions of this title that prohibit the sale of electricity outside a specified service territory shall not apply to sales to a customer within a microgrid zone who meets the requirements of subsection (d) of this section.

     (6)  Nothing in this section shall be construed as reducing, modifying, eliminating or otherwise altering any applicable requirement of federal law or any local, state, or federal tax that may be imposed.

     (7)  Any public utility providing service under this section shall not recover costs associated with that service through rates imposed on retail customers outside of or not participating in the exemptions provided by a microgrid zone.

     (8)  Service provided by a public utility under this section shall not adversely affect the service provided to other retail customers not participating in the microgrid zone.

     (9)  The Public Service Commission shall regulate rates charged for the use of transmission lines transmitting electricity generated outside of a microgrid to the deregulated industrial zone through transmission lines otherwise regulated by the Public Service Commission by setting a rate that ensures other retail customers not receiving the benefits of any exemption under this section are not disproportionately paying joint and common costs of transmission.

     (10)  Microgrid developers shall apply for a grid interconnection before they begin the development of the microgrid but are not required to wait for approval before building out their operations.

          (a)  Microgrid operators who do not receive approval for their grid interconnect may continue operating up until the point at which they receive approval and may continue operating if their request is denied.

          (b)  If utilities are unwilling or incapable of funding the grid interconnection, microgrid operators may fund the connection at which point the microgrid operator will be exempt from any cost to maintain their connection.

     (11)  The Public Service Commission shall be responsible for implementing and providing programs which enable communities to apply for and operate a community level microgrid.  Community level microgrids shall be held to the same standards set forth for microgrids.

     SECTION 5.  Composition; powers generally.

     The Secretary of State shall consider all petitions pursuant to this act.

     SECTION 6.  This act shall not apply to contracts for utility services existing prior to July 1, 2023 for community level microgrids unless otherwise determined by the Public Service Commission.

     SECTION 7.  The Secretary of State and the Public Service Commission shall promulgate any rules necessary to implement this act on or before July 1, 2023.

     SECTION 8.  Sections 1 through 7 of this act shall be codified as a new chapter in Title 77, Mississippi Code of 1972.

     SECTION 9.  This act shall take effect and be in force from and after July 1, 2023, and shall stand repealed on June 30, 2023.

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