Recommendation 3.1: Congress should instruct DOE to create a joint task force that includes FERC, NERC, E-ISAC and representatives from the electric industry, to develop recommendations and identify any new legislative authority that is needed so that the industry and its regulators can understand in a timely manner why a significant physical and/or cyber disruption occurred in the electric power grid. Some mechanisms and institutional capabilities, similar to the data-collection and investigative function held and carried out by the NTSB for accident investigations, are needed to provide legal authority to independent investigators to gain access to pertinent data needed to reconstruct the disruption, analyze the data, and deliver reports with lessons learned in a timely manner after the disruption has occurred. (See Recommendation 6.4 for other tasks that would be assigned to this joint task force.)
Recommendation 3.2: Congress should build off of the example it set in the electric power system when it established in the Energy Policy Act of 2005 an Electric Reliability Organization with responsibility to set and enforce reliability standards for the electric industry, and authorize FERC to designate a central entity to establish standards for and otherwise oversee the reliability of the nation’s natural gas delivery system. Congress should also authorize FERC to require greater transparency and reporting of conditions occurring on the natural gas delivery system to allow for better situational awareness as to the operational circumstances needed to help support electric-system reliability.
Recommendation 3.3: Regarding Transmission Siting: in light of the fundamental ways in which interstate commerce is enabled by the high-voltage, multi-state transmission networks in the Eastern and Western Interconnections of the United States and in which transitions in the nation’s electric system to increase reliance on remote renewable resources, Congress and the states should support the evolution of planning for and siting of regional transmission facilities in the United States, while recognizing that some developments at the grid edge may partly mitigate the need for new transmission.
Congress should enact legislation to:
- Establish that the United States has a National Transmission Policy to rely on the high-voltage transmission system to support energy diversity, energy security, and the nation’s equitable transitions to lower carbon energy economy,
- Direct FERC to require transmission companies and regional transmission organizations to analyze and plan for all of the following objectives: electric system reliability; efficient dispatch of the bulk power electric system, taking into account economics, environment, and equity; and economical opportunities to expand the interstate electric system to open up access to and development of renewable resources and to connect these regions with areas of high electricity demand.
- Assign to FERC the responsibility to designate any new National Interest Electric Transmission Corridors, in ways that are consistent with the goals of the National Transmission Policy.
- Authorize FERC to issue certificates of public need and convenience for interstate transmission lines in a designated National Interest Electric Transmission Corridor, with need determinations reflecting consideration of non-wires alternatives, expanding the capacity of existing transmission rights of way, state policies, community and state impacts, cost, reliability, the location of renewable and other resources to support climate-mitigation objectives. Any such approved certificate should broadly allocate the costs of transmission enhancements designed to expand regional energy systems in support of decarbonizing the electric system.
- Direct DOE to provide support for technical assistance and planning grants to states, communities, and tribes to enable meaningful participation in regional transmission planning and siting activities.
There is an urgency to reform regional transmission planning and siting processes, given that in general the process of planning, development, permitting, financing, and construction is lengthy. In any event, and pending action by Congress as recommended above, FERC should update its current transmission planning and cost-allocation rules to ensure that they appropriately take into account the drivers of change in the existing industry and the nation’s needs for appropriate transmission investment, deployment, and cost recovery.
Recommendation 3.4: In recognition of the changes underway in the electric industry, when Congress and state legislatures enact new policies and incentives to stimulate and/or encourage investment in nascent clean-energy or the early phases of deployment of new advanced grid technologies, legislatures should design such policies and incentives so that they phase out on predictable schedules as the penetration of such technologies increases over time.
Recommendation 3.5: The decentralization of supply and other transformations of the electric power system could have large impacts on access, costs, benefits, and other qualities of grid service. For this reason, local regulatory bodies—organized by the National Association of Regulatory Utility Commissioners (NARUC) in partnership with DOE—should accelerate and deepen their evaluations of new rate structures and other policies with an eye to how a transforming grid will affect issues of equity. This testing and evaluation should occur on a regular basis, employ techniques grounded in behavioral social science, and lead to an evolution of best practices that address possible inequitable or adverse outcomes. For decision makers at publicly owned utilities, APPA and NRECA should also provide assistance in accelerating such evaluations.
Recommendation 3.6: With support from Congress and state legislatures, DOE, state energy research organizations, and foundations should provide support for social science research and regulatory/policy analysis designed to identify and assess alternative models for regulation, innovation and industry structure in the retail/distribution segment of the electric system. Such research and analysis efforts should also address opportunities and mechanisms to allow for flexible demand and the value of doing so for electric system performance, cost, and emissions. Such research and analysis should also focus on the development and assessment of metrics to measure how infrastructure investment decisions and authorized actions would affect carbon emissions. Such work should involve and be informed by industry, researchers at universities, think tanks and/or the national labs, and/or other institutions with research programs in the following fields (as well as others): energy economics, behavioral economics, public policy analysis, law, finance, and utility regulation.
Recommendation 3.7: DOE should expand its program of providing seed grants to support innovative state programs on making business model and/or restructuring reforms in the retail/distribution segment of the electric industry that: (a) allow for and expand opportunities for the safe and secure adoption of innovative technologies, business models, and market designs; and (b) encourage the adoption of best practices.
Recommendation 3.8: The states, through the energy and utility regulation committees of their legislatures as well as through their regulatory agencies, should adopt and/or strengthen policies that support the ability of investor-owned utilities and other parties to innovate on business model issues, ratemaking, and rate design. For publicly owned utilities, the national organizations (i.e., NRECA, APPA, LPPA) and DOE should help fund and/or develop innovative ways for these utilities to operate their distribution systems so that these utilities can leverage the benefits and other implications of new rapidly evolving technology.
Recommendation 3.9: Industry and regulatory groups and government agencies (e.g., NARUC, NASEO, EEI, APPA, NRECA, LPPC, DOE, and others) should collaborate work to collect and share information on best practices and lessons learned from efforts across the country to promote change and regulatory innovation at the distribution level. DOE should establish and curate a central repository of efforts and lessons learned from across the country to facilitate access to examples of regulatory innovations at the distribution level in collaboration with states, industry, trade groups, and other stakeholders. DOE could accomplish the development and operations of such a repository within a DOE program office or could support a third party (e.g., a national laboratory or a university) to carry out this work.
Recommendation 3.10: Congress should expand funding for loans, loan guarantees, and grants to provide equivalent opportunities for investment in local utility infrastructure development for publicly owned utilities (e.g., municipal electric utilities, cooperative utilities, tribal utility authorities, and special-purpose utility districts), because they do not have access to incentives provided through tax credits to investor-owned utilities and other developers.
Recommendation 3.11: State regulators, in conjunction with local electric-industry market participants and grid operators, should accelerate their investigations into what changes in industry structure, security, rate design, and other pricing approaches, and market design are needed to align with significant deployment of DER and to address equity issues in energy access and clean energy. Because these issues are complicated and need to take into consideration various technical and legal requirements for operating a dynamic system on the local grid, the governing boards of publicly owned utilities and the regulators in states that anticipate significant adoption of DER should place a high priority on exploring and stress-testing emerging approaches and making decisions that will inform market participants about the timing and character of changes in retail industry structure, prices, and market design.
Recommendation 4.1: In light of the increasing dispersion in the sources of innovation in the sector, DOE should periodically issue a request for proposals from non-DOE affiliated entities to conduct an independent assessment that “takes the pulse” of the global and U.S. innovation systems that are relevant to the electric power sector. Such pulse-taking efforts should look widely at diverse sources of innovation both domestic and international. It should also assess the track record of various efforts to steer innovation, and varied policy and market incentives and barriers to adoption of innovations.
Recommendation 4.2: In light of the globalization of the electric equipment supply industry, and with it the globalization of much of the innovative activity in the industry, the US needs to develop better regulatory tools and capabilities for dealing with imported equipment and cross-border ownership of firms producing critical equipment. DOE should consult with the National Security Council and explore whether there is need for more extensive cross-department collaboration including the Departments of Commerce and State to set standards for imported equipment and cross-border investments, along with implementation of those standards. Any effort in this area will need to establish a few standards for control over imported equipment along with incentives for advancing US manufacturing where it is essential to have these capabilities in US industry. An effective control program should begin with a narrow list of critical technologies for which U.S. (or US-oriented) manufacturing and control over supply chains is established. For a small number of critical technologies, such as high voltage transformers and grid protection and control systems, the US must maintain the capacity to innovate and manufacture on its own territory.
Recommendation 4.3: Because today the large potential for benefits from international collaboration in the domain of pre-competitive energy research and technology development is not being tapped effectively, the United States should devise strategies to support and encourage such collaborations, while remaining mindful of national differences in attitudes toward intellectual property and technology policy. The White House should establish an interagency process under which the Departments of State, Homeland Security, Commerce and Energy review all arrangements that limit such international research collaborations and make prudent reforms to allow for greater pre-competitive researcher interactions between U.S. scholars and researchers in other countries.
Recommendation 4.4: Achieving greater deployment of advanced electrical technologies will require states to implement regulatory reforms that allow utilities to recover the costs of larger R&D budgets alongside other forms of regulatory approval that encourage more adoption of new technologies. In addition, in a few states that provide direct funding for technology demonstration programs, state policy makers should expand those programs and ensure reliable long-term provision of funds. These programs can be models for other state-based innovation funding, especially where they put attention on the need not just for larger spending but also stronger incentives for adoption of new technologies, including those coming from outside the regulated sector.
Recommendation 4.5: Government support for key electricity research initiatives such as grid modernization and development of technology necessary for deep decarbonization should be sustained for sufficient periods of time to enable new areas of discovery. Congress should appropriate multi-year (minimum of 5-year) funding streams for proposed initiatives in key areas of national interest such as those identified, and DOE should implement long-term funding for projects that demonstrate alignment with critical national needs, technical success, potential net economic benefits, and cost-shared funding where appropriate. Such programs should follow best practices that include ensuring that DOE program managers have the knowledge and authority to oversee projects effectively and efficiently and clear criteria to govern advancement of projects.
Recommendation 4.6: Greater deployment of advanced electrical technology is essential and will require expanded support for DOE-backed demonstration projects, including through loan programs and support for industrial consortia that deploy critical technologies. Such expanded support should follow best practices in the implementation of technology demonstration and deployment programs. Programs should be designed for rapid learning (and course corrections where needed) and periodic assessment of the overall portfolio for its performance. Proposals for funded projects should include a clear articulation of how a demonstration could be commercialized including a budget for such activities—so that a larger fraction of successful demonstration projects lead to wider deployment.
Recommendation 4.7: Given the structural, technological, economic, and operational changes underway in so many regions of the U.S. electric industry, it will be important for the federal government to fund and support research and analysis to help mitigate operational and planning uncertainties. DOE should sponsor research that will enhance the temporal flexibility of net electricity demand and enhance other services vital to grid reliability through pricing or other mechanisms. This will be important for supporting the entry of resources and services that can meet states’ and consumers’ desires for low-carbon electricity supply.
Recommendation 4.8: In order to meet the challenge of serving all Americans with safe, clean, affordable, reliable and resilient electric power in a rapidly changing environment, while building a stronger U.S. industrial base that can advance those goals, Congress should increase substantially the overall level of support for RD&D on the production, delivery and use of electric power. Increasing such support too rapidly would lead to inefficiency and waste. This sets an upper bound on the rate and amount of increase. Over the next decade, support for basic science that is broadly related to electric power should be doubled, and support for applied development and demonstration related to electric power should be tripled.
Recommendation 4.9: The increase in government funding identified in recommendation 4.8 should include areas that have traditionally been neglected yet are vitally important to the future of the electric power system. Those include research to support planning, design, operation and control of grid systems as they face new challenges such as deep decarbonization and the need for resiliency against natural, manmade and cyber hazards. The consortium and multi-year approach of the Grid Modernization Initiative is a good model but must be funded reliably. Other traditionally neglected areas of research include the social science needed to inform policy and technology development.
Recommendation 5.1: To meet the challenge of dramatically lowering U.S. CO2 emissions, DOE, EPRI, universities, and industry should focus on developing: generation technologies with zero direct CO2 emissions, low-carbon technologies with high dispatchability and fast ramping capabilities, storage systems for multi-hour, multi-day and seasonal time-shifting; and power electronics to enable real-time control of the grid.
Recommendation 5.2: The United States has lost ground in the manufacturing of conventional grid-scale power control technologies (e.g. HVDC and FACTS) and is deploying very little of these advanced solutions. Developments in rapidly-growing technologies, such as PV, wind, EV, and energy storage, suggest a new paradigm may be rapidly emerging which is more modular, distributed and edge-intelligent, and which may be able to compete with and outperform the existing grid paradigm in terms of sustainability, reliability, resilience, and affordability. A rapidly changing paradigm for electrical power and the grid offer a unique opportunity for U.S. research and manufacturing to reclaim their global lead in this critical area. DOE, EPRI, other domestic and international research organizations, universities, and world-wide industry should identify such ‘breakaway’ threads early, work with industry, investors and regulators to understand potential roadmap and impact. Then DOE, EPRI, and industry should collaborate to develop and fund a research agenda that creates fast-moving programs that help to de-risk such solutions from technology, market, and regulatory perspectives.
Recommendation 5.3: DOE, EPRI, other domestic and international research organizations, universities, and world-wide industry should develop relevant supporting ICT to permit (a) secure, reliable, private, and fast communication, and (b) security, safety, accuracy, privacy, and speed in computation, so as to incentivize various asset owners to participate in a retail market structure that allows DER to participate and be compensated for distributed generation, grid support services, and/or flexible load consumption.
Recommendation 5.4: DOE, EPRI, other domestic and international research organizations, universities, and world-wide industry should support the development of new suites of technologies that can enable the high levels of automation needed in a future grid. These include: (1) ultra-automation strategies to allow millions of edge-intelligent devices (e.g., fast responding inverters) that coordinate in real-time in a secure manner; (2) technologies grounded in power-electronics, communications, computing, and control to ensure a cyber-enabled, DER-rich distribution grid that ensures resiliency and reliability, with the bulk-power system transporting low-cost energy as needed; (3) technologies that enable a resilient cluster of electrical islands interconnected through DC or controllable AC links.
Recommendation 5.5: DOE should support a sustained collaboration of national labs, academia, utilities, and vendors to develop a family of intercompatible simulation tools that have common standard interfaces to work together to assess the performance of the present grids and better anticipate the implications of the various ways the grid architectures may evolve in the future. As having a single large integrated model of very large, complex grids is impractical, the development and standardization of common interfaces between simulation tools will enable the studies of evolving architectures of generation, transmission, distribution, and ICT.
Recommendation 5.6: As new technologies that impact the architecture of the grid are deployed in the grid, NERC should develop and FERC should approve standards that more specifically address new technologies and ensure that information is available to enable the development of improved modeling and simulation tools.
- NERC and then FERC should ensure that the process and parameters for a new technology that affects the grid are made available by the vendors and users of the technology so that they can be incorporated into the analytical and simulation tools.
- NERC and then FERC should develop new standards or modify old standards to consider and address the impact of all new technologies.
Recommendation 5.7: As more capable and intercompatible simulation tools become available, system planners and operators should use the results and insights that are gained to develop better grid architectures, plans and operational procedures; they should also inform regulators and policy makers, like FERC and NERC, about potential issues and opportunities for improving grid operations and planning, so that this information can be used to update the regulations and standards.
Recommendation 5.8: Because there will always be limits to what can be learned through simulation, DOE should choose the most promising new architectures indicated by large scale simulation studies in order to identify and plan a number of large-scale field experiments that could verify the advantages of such grid architectures under actual operations. Such field experiments of grid architecture would be qualitatively and quantitatively much larger in scope than the usual prototyping of a component such as a storage device, and should be reserved for when adequate resources and opportunities are available.
Recommendation 5.9: Congress should provide funding for the Department of Labor, Department of Education, and Department of Energy to build on previous experiences in funding workforce training programs (e.g., 2009 Recovery Act Workforce Development, Grid Engineering for Accelerated Renewable Energy Deployment (GEARED), etc.) and provide funding to support vocational, professional, and academic programs to train, retrain, and educate the current and future workforce in the electric utility sector and electrical manufacturing industries. These programs should be implemented in a way that allows for state of the art quantitative analysis of program effectiveness and learning for future policy development.
Recommendation 5.10: The BLS, in conjunction with DOE, should invest in accurately estimating job numbers in more granular categories of work in industries that are part of the electricity system supply chain of the future. An analysis of the overlap of electricity with other employment sectors is necessary to understand the economic significance of electricity-specific employment changes. Furthermore, an analysis of wage impacts following displacement and/or retraining due to transition-related job loss is necessary to better address equitable worker transitions. This includes those employed in commissioning and installation as well as end-use manufacturers, with a focus on moving from fossil-focused to renewables and electrification focused employment.
Recommendation 6.1: DOE’s research program in grid cybersecurity is an important source of innovation to improve the resiliency of future grid infrastructure and operations. DOE should develop a regularly updated R&D priority roadmap in collaboration with the electric industry with input from academic and national lab researchers, and the vendor community. The R&D priorities in the roadmap should be funded by appropriations from Congress to DOE. The roadmap should be oriented to develop and demonstrate new technologies for resilient architectures that will enable energy delivery systems, and any interconnected systems, to be designed, installed, operated, and maintained to survive a cyber incident while sustaining critical functionality and enabling quick recovery.
Recommendation 6.2: Due to the increasing importance of computing, communications, and control technologies for the operation of the current and future grid, Congress should appropriate funds to the National Science Foundation, in consultation with DOE, to specifically focus on research programs exploring the implications and applications of rapidly evolving computing, communications, and control technologies on grid cybersecurity and cyber resiliency.
Recommendation 6.3: Congress should appropriate funds to the DOE, DHS and Department of Labor to establish programs that provide cybersecurity training specifically for the current and future workforce of engineers, operators, technicians, and IT and OT positions associated with the real-time operation of electric grid systems.
Recommendation 6.4: Congress should instruct DOE to create a joint task force that includes FERC, NERC, E-ISAC and the electric industry to identify new legislative authority needed for obtaining early warnings associated with self-reporting security conditions that may potentially disrupt the electric power grid. A mechanism analogous to the independent non-regulatory Aviation Safety Reporting System (ASRS) operated through NASA is needed to support anonymous reporting and quickly assess and inform relevant decision makers. The intention would be that security audit findings would not incur financial penalties to the reporting entity if the violation was: within the scope of a self-reported concern; within the timeframe of a correction action timeline; and did not result in any customer outages. (See Recommendation 3.1 for other tasks that would be assigned to this joint task force.)
Recommendation 6.5: Pertinent information about known and emerging advanced persistent foreign and domestic cybersecurity threats should be communicated to industry stakeholders in a proactive, timely and effective manner. DOE, DHS, DoD, their partners in the intelligence community, and relevant ISACs, should, in coordination with industry, collectively identify parameters defining the most relevant information to share, and create a process for securely releasing information to industry.
Recommendation 6.6: Congress should give regulatory authority to DHS, which should work with the sector-specific agencies and other relevant government and industry stakeholders, to establish cybersecurity regulations across all critical infrastructure sectors for equipment, devices and software used in those sectors. The goal of these regulations is to specify standards that vendors will implement to develop products with superior cybersecurity attributes.
Recommendation 6.7: DOE should partner with relevant agencies to develop a joint utility and industry-driven analysis of electric system interdependencies with connected infrastructure (e.g., communications networks, natural gas system) and provide guidelines on how to address the reliability and security vulnerabilities from such interdependencies.
Recommendation 6.8: Because investor owned utilities, coops, and municipals cannot, on their own, justify covering the cost of implementing protections of the power system against electromagnetic pulse (EMP) or major state-sponsored cyber and other attacks, Congress should directly address this issue and initiate a process to develop a solution for how to cover the costs of implementing appropriate protections.
Recommendation 6.9: Congress should appropriate funds to DOE for the National Association of Regulatory Utility Commissioners to develop guidance for distribution-level resiliency requirements to be implemented at the state and local level, in coordination with the National Rural Electric Cooperative Association, American Public Power Association, Large Public Power Council, Edison Electric Institute, and other relevant stakeholders.
Recommendation 6.10: DOE and DHS (including FEMA) should expand interactions with industry through exercises, red and purple teaming, and assessments to enhance the electric power system’s security posture. DOE and DHS should provide funding to regional, state and local entities to support exercises in collaboration with industry to enhance grid cybersecurity incident response.
