Microgrids in California: How State Regulations Continue to Limit the Deployment of Microgrids

Filipp Franke Quijada, 2L

[1] The year 2022 was one of the hottest on record in California, creating a historic demand for electricity. California’s electrical grid was pushed to the edge of its capacity. The crisis also illustrated how microgrids could help make the current electrical grid more resilient — supplementing energy production through the use of distributed energy resources.  In 2018, the California state Legislature passed Senate Bill 1339 to facilitate the commercial development of microgrids. However, five years later, regulatory barriers to implementation persist. California’s legislature must pivot its approach to address these barriers head-on to facilitate the implementation of microgrids. 

[2] Extreme weather events fueled by global climate change, like the 2022 heatwave, put immense stress on the already strained electrical grid. When extreme weather events occur, electricity demand increases in parallel because of the use of air conditioners and other household appliances. However, when demand outstrips supply generated by the grid, blackouts occur.

Since the turn of the last century, we have depended on the traditional electrical grid to supply our electricity demand. Rigid and linear, the traditional electrical grid uses centralized facilities coupled with a defused network of transmission lines and distribution centers to deliver electricity to consumers. However, this modality is not resilient. It cannot quickly recover from emergencies or disasters and thus leaves consumers without electricity when needed most. As the frequency of extreme weather events continues to increase, it is clear that the electrical grid, a relic of 20th-century technology, is under-equipped to deal with 21st-century issues.

[3] Microgrids are a relatively new implementation of distributed energy resource technology that can help bring the electrical grid into the 21st century. As its name implies, a microgrid, at its most basic level, is a smaller electrical grid. Contrary to the traditional grid, a microgrid’s generation, transmission, and distribution infrastructure is highly localized to a single parcel, but can be scaled to service a campus or community. Crucially, a microgrid can “island” or, in other words, independently provide power to its users and run in parallel to the traditional grid. Notably, a microgrid’s ability to self-generate energy while “islanding” allows the entity serviced to continue to operate when the larger grid has been shut down. This ability to keep the lights on during a blackout improves resiliency. Naturally, greater implementation of microgrids helps to mitigate demand and subsequently eases stress on the grid.

[4] In an effort to improve resiliency and modernize California’s electrical grid, the state Legislature passed Senate Bill 1339. The legislation directed the CPUC to pursue policy actions, including the development of rates, tariffs, and rules necessary to remove barriers limiting the deployment of microgrids without shifting costs onto non-benefiting customers. This multi-track proceeding has yet to be completed. Currently on Track 4 of a total of 5 Tracks, stakeholders, including each of the state Utility Companies and the CPUC are developing a microgrid tariff.

[5] As a whole, SB 1339 has improved the deployment of microgrids. However, the “over-the-fence” rule has proven to be an immovable barrier that has hamstrung the greater development of microgrids within the state. Section 218 of the California Utilities Code, known as the “over-the-fence” rule, limits the distribution or sale of self-generated energy to only adjacent parcels and outright bars electricity transmission across public streets. Any entity that violates the over-the-fence rule is then subject to public utility regulation. In most cases, the regulations imposed are an administrative and financial burden prohibitive to the development of commercial microgrids. Additionally, policy measures implemented through SB 1339, must conform to and may not circumvent or modify the “over-the-fence” rule since it’s codified in state law. Thus, the solution to the issue is clear – If microgrids are to be deployed in greater volume in the future, the state legislature must first address the “over-the-fence” rule.

Taiwan in the Global Climate Fight, and how America can Support it.

by Linden Dexter, 2L.

[1] The recent 27th United Nations Climate Change Conference (COP 27) provided an illustration of a novel way to protect the climate: by passing the Taiwan Enhanced Resilience Act (TERA) as part of the National Defense Authorization Act of 2022 (NDAA).[1]

[2] Our climate is rapidly deteriorating, and the world is running out of time to come together and stabilize it. Humanity cannot afford to allow any country to prevent another country from participating in the global climate fight. In response to strong support among attendees for Taiwan’s inclusion in the conference, China reminded the world of its stance on Taiwan, stating: “There is only one China in the world, and Taiwan is an inalienable part of China”.[2] China maintains that Taiwan is a part of China, while Taiwan does not. The two countries have been locked in a deeply ambiguous, pseudo cold war for decades. China wields significant economic and political influence on the global stage. For another country to defy China’s stance on Taiwan would most likely have disastrous effects for many nations that benefit greatly from Chinese trade. As a result, China’s brief statement regarding Taiwan at COP27 will most likely have a significant chilling effect on other nations and thus impede Taiwan’s aspirations to work more closely with the international community.

[3] Despite being excluded from COP27, Taiwan has nonetheless diligently worked towards a better climate future. In March of 2022, Taiwan published “Taiwan’s Pathway to Net-Zero Emissions in 2050”, a plan containing 4 major transition strategies for Taiwan in the fields of energy, industry, lifestyle, and social life, as well as legislation promoting sustainability and green R&D.[3] This indicates that Taiwan genuinely wants to cooperate with the rest of the world in working toward a better climate future, if given the chance to do so.

[4] Therefore, as part of its efforts to protect the environment, America must continue to counteract Chinese influence over Taiwan by passing the NDAA, which contains the TERA. Congress has passed the bill and has presented it to President Joe Biden.[4] The TERA contains approximately 10 billion dollars in security assistance and weapon procurement for Taiwan, as well as the establishment of training programs for Taiwan’s military. Though the link between a military funding bill and the environment may not be facially apparent, the benefit comes from Taiwan’s increased legitimacy on the global stage. Every action America takes to support Taiwan reverberates in the international community and indicates to the world that Taiwan is a valuable American partner. Just as China’s stance on Taiwan may have a chilling effect on international cooperation, America’s stance on Taiwan may have a warming effect that counteracts it. This, in turn, may encourage other countries to advocate more fiercely for Taiwan’s inclusion in global climate ventures.