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A BILL to direct the State Corporation Commission to convene a work group to evaluate and assess electric load flexibility protocols for high electric demand customers; report.
Be it enacted by the General Assembly of Virginia:
1.
§ 1.
The State Corporation Commission
(the Commission)
shall convene a work group to evaluate and assess the opportunities, benefits, barriers, and regulatory frameworks for implementing
electric
load flexibility protoc
ols for
high
electric
demand
customers
.
The work group shall include State Corporation Commission staff, Commission on Electric
Utility Regulation staff, and representatives from the Office of the Attorney General, the Department of Energy, the Department of Environmental Quality, electric utili
ties
, including electric cooperatives
,
high
electric
demand
customers, clean or advanced energy business associations, environmental advocacy groups, environmental justice organizations, and consumer advocates, as well as any other stakeholders
as determined by the Commission.
For the purposes of this act, "high electric demand customer" means
any customer within an electric utility's existing or proposed classification of service for high electric demand customers and a
ny other retail or industrial electric service customer with an average electric demand of greater than 50 megawatts
.
The work group shall complete an evaluation of regulatory frameworks and develop recommendations
that can be implemented under the Commission's existing regulatory authority, legislative and policy recommendations, and improvements
for
current or proposed electric load flexibility protocols
, such as
electric load curtailment policies
,
and demand response
management
programs by electric utilities to improve efficiency, functionality, and participation by high electric demand customers.
R
ecommendations of the work group related to
electric load curtailment policies
shall be implemented in
any
applicable
evaluation of an electric load curtailment policy
conducted by the Commission
and in any related regulations promulgated by the Commission until 2030
.
In evaluating regulatory frameworks, the work group shall consider grid reliability, mitigating the risk of stranded assets, ensuring fairness and reasonableness for current and future
retail
electric service customers, and support
ing
the Commonwealth's c
lean and renewable energy goals. The work group shall provide an analysis of the current regulatory framework
s
in the Commonwealth regarding
high
electric
demand
customers, including any incentives and penalties
for
such
customers
associated with
participat
ion
in e
lectric
load flexibility protocols
, such as
electric load curtailment
policies
,
and utilize existing demand response
management
programs by electric utilit
ies
, including electric cooperativ
es,
or the regional transmission entity.
The work group shall
also
evaluate regulatory frameworks and examples of imp
lementation in other states and jurisdictions of e
lectric
load flexibility protocols
designed to accommodate electric service to
high electric demand
customers, which may include procurement or development of new clean energy generating resources and energy storage resources.
In
developing recommendations
, the work group shall
assess
(
i
) participation requirements for existing demand response
management
programs, including parameters such as
minimum and maximums on percentage of time or the number of hours per year of
electric
load reduction, the duration
and frequency
of such load reduction periods
, notification procedures, and any applicable penalties for noncompliance; (
ii
) the feasibility of physical and digital technologies
, including energy storage resources and backup generation resources,
to assist with load flexibility and
demand response management, as well as any regulatory measures
recommended
to incentivize the use of such technologies
,
ensure reliability and security of the electric grid
,
and
mitigate
any impacts of such technologies
on public health
; (
iii
)
the necessary scope for demand response management programs to
appropriately respond to stress and emergency events of the electric grid, including the efficacy of mandatory versus voluntary demand response management programs
in achieving demand response management targets; (
iv)
the feasibility of participation for different types of
high
electric
demand
customers, including data centers, as defined in
subdivision
A 43 of §
58.1-3506
of the Code of Virginia; (
v
)
opportunities for beneficial use of waste heat from data centers; (vi)
environmental considerations such as impacts on air quality, water quality and usage, and noise
and the application of such considerations in
incentivizing
load flexibility and demand response management; (
v
i
i
) any app
licable incentives and compensation methods for
high
electric demand customers
that participate in load flexibility protocols or demand response management programs
based on such customers' level of participation in such protocols or programs and
e
valuations of impacts on the electric grid based on such customers
'
geographic location
s; (
v
ii
i
) options
for high electric demand
customers to fund or construct infrastructure upgrades for transmission and distribution assets
that serve
such
customers
; and (
ix
) the feasibility and structure of financial investments from data centers directed toward the development of
load flexibility protocols, including virtual power plants, and demand response management programs designed to benefit communities that neighbor data centers and low-
income residential households.
The work group shall
submit a
report
of
its
evaluation
and recommendations to the
State Corporation Commission,
Commission on Electric Utility Regulation, House Committee on Labor and Commerce, and Senate Committee on Commerce and Labor by November 1, 2026.