Assessing the Resource Adequacy and Community Impacts of an Evolving Grid: Considerations for State Regulators
As U.S. power systems continue to decarbonize, state regulators must be able to broadly assess the cost and reliability implications of proposed fossil retirements and the corresponding resources that are coming online to replace them. Specifically, regulators must evaluate whether proposed infrastructure investments are sufficient to ensure the long-term reliability of the system, while also protecting rate payers by ensuring that such investments are necessary and not excessive. Broadly speaking, this objective is typically framed in terms of maintaining long-term resource adequacy at the lowest cost, while also ensuring that other social and/or environmental objectives are satisfied. System planners currently have a host of sophisticated analytical tools at their disposal to evaluate the cost-benefit trade-offs of different approaches to ensuring resource adequacy. However, most of these tools and associated metrics were designed with traditional power systems in mind. Over the past decade, it has become increasingly clear that the metrics and models that have reliably assessed resource adequacy in systems dominated by large thermal and hydropower resources will be insufficient for systems with significant contributions from emerging technologies such as wind, solar and storage. Therefore, in recent years many new metrics and modeling approaches have been developed, and are increasingly being implemented, to meet the needs of the clean energy transition.