Pennsylvania utilities would compete for energy storage

The Public Utility Commission would assign storage targets to covered electric distribution companies and require competitive procurement. The requirements would apply to electric distribution companies with at least 600,000 customers. The commission would assign shares based partly on each company's service load and peak demand. The commission may adjust a company's share if storage systems or bids are not commercially available. It may set a procurement cap if it finds one serves the public interest. The commission must approve contracts only after finding they serve the public interest, are cost-effective, and followed a fair, unbiased process. The commission would assign company targets within 60 days after this section takes effect. The statewide target is due by July 1, 2033.

Utilities would meet staged storage targets, use specified bid standards, and arrange for independent monitoring. The targets cover storage connected to transmission lines and local distribution lines. The overall goal includes at least 2,000 megawatts of short-duration storage and 1,000 megawatts of long-duration storage. Utilities would choose the lowest responsible bidder based on factors including customer cost, reliability, and project viability. Bid reviews would prioritize qualified bidders showing fair wages, U.S.-sourced supplies, or investment in Pennsylvania manufacturing or assembly workers. An independent evaluator would monitor each bidding process and report on it. Proprietary information would remain confidential. Contracts would require a plan to take systems apart and recycle or reuse qualifying parts. By July 31, 2028, utilities would procure 500 megawatts of transmission-connected and 100 megawatts of distribution-connected short-duration storage. More transmission-connected short-duration storage is due in 2029 and 2030; remaining capacity is due by July 31, 2033.

Covered utilities could recover certain storage costs through customer rates. These rules would apply to covered electric distribution companies procuring transmission-connected storage or owning distribution-connected storage under an agreement. The commission would determine which transmission-connected storage costs are reasonable and prudent. Lost utility revenue from lower demand or avoided infrastructure costs could not be recovered through this rate adjustment. A utility's ownership of distribution-connected storage could enter its rate base only with commission approval. Utilities could own no more than half of the distribution-connected systems procured under this section and none of the transmission-connected systems.