Illinois Utility’s Smart Grid Struggle Underscores Need For Clear Policies, Vermont Law School Study Shows
November 1, 2012
SOUTH ROYALTON, Vt. -- A clash over Commonwealth Edison Co.'s plan to modernize its electrical grid underscores the need for clear cost recovery policies for utilities nationwide if the smart's grid's reliability and environmental benefits are to be realized, a new Vermont Law School study suggests.
"While ComEd has successfully implemented a smart grid pilot and subsequently developed a full scale, smart grid implementation plan consistent with Illinois law, the ongoing controversy between the Illinois Commerce Commission, ComEd and the Illinois Legislature on cost recovery threatens further progress," Jones said. "As states such as California and Vermont have demonstrated, clear state policies will speed smart grid implementation. In Illinois, uncertainty over state cost recovery policy is delaying the benefits for ComEd customers and the environment."
Jones said ComEd's struggle to clarify cost recovery policy for its smart grid pilot programs have been dramatic and public, significantly impacting the perception of the company and the benefits of smart grid investments with both the Illinois news media and the public it serves.
"The utility has faced significant challenges in reaching a balanced cost recovery approach that ComEd, state regulators, the Illinois Legislature and the courts could all accept," Jones said. "ComEd's experience suggests that something as far-ranging in impact as smart grid deployment requires a solid policy foundation based on clear policy leadership from state legislators and regulators. When cost recovery is uncertain and subject to expensive regulatory lag, utilities may observe ComEd's experience and decide against making the types of investments required to achieve the full benefits of the smart grid."
Vermont Law is studying the legal, policy and regulatory hurdles to upgrading the U.S. electric system with smart grid technology, including case studies of six organizations across the country to recommend best practices that can be replicated nationwide: Commonwealth Edison, Central Vermont Public Service Company, Pecan Street Project, Sacramento Municipal Utility District, Salt River Project and San Diego Gas and Electric.
CONTACT: John Cramer, Associate Director of Media Relations, Vermont Law School
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