IEEE Power & Energy Magazine - May/June 2016 - 19

us fundamentally change the way energy is produced, consumed, and transacted throughout the state.
REV reflects the fact that technology, consumer demands,
and environmental exigencies simultaneously allow and
require us to transform this sector into one that is consumer
centric, is increasingly economically and environmentally
efficient and sustainable, and embraces-as opposed to
resists-market and business model innovation.
REV will bring information technology into the electric
system. Our goal is transactive energy, enabled by utilities, that will allow consumers and other parties to take full
advantage of every type of energy resource-on both sides
of the meter. The framework order for REV analyzed current
and projected trends in the electric system, through the lens
of six policy objectives:
✔ enhanced customer knowledge and tools that will support effective management of the total energy bill
✔ market animation and leverage of customer contributions
✔ system-wide efficiency
✔ fuel and resource diversity
✔ system reliability and resiliency
✔ the reduction of carbon emissions.
A range of activities are now underway or planned for
2016 that are designed to implement our REV road map
based on four major pillars of state policy design and
implementation.
✔ First, our targets will be clear and ambitious. The 2015
state energy plan includes a target to achieve 50% of
the state's electric consumption by renewable resources in 2030. Governor Andrew Cuomo has directed the
New York State Public Service Commission to commence a proceeding to determine how best to convert
the target into an enforceable mandate.
✔ Second, we must revise the policies and practices governing how we regulate and set obligations and business practices for utilities and retail market design
including rates and prices for electric service to make
certain that are regulatory rules are not inimical to the
changes we want to occur.
✔ Third, we will reexamine how we use the tools of incentives and financial support for clean energy targets
and markets to drive scale and reduce barriers to entry.
✔ The fourth pillar consists of actions the state, through its
agencies and authorities, can adopt to lead by example.
Each pillar embraces the fundamental precept that clean
energy deployed at scale holds the potential to address the
pressing environmental and energy challenges of our time
while providing enormous economic opportunity for New
York. To tap this potential, all of the state's clean energy
efforts need to become more efficient and strategic so that
each dollar of clean energy spending achieves greater savings and animates market participation and investment.

may/june 2016

Why REV Is Needed
It is almost impossible to open an energy industry newsletter or magazine without reading about the coming of distributed resources and the vision of a "transactive" electric grid. Envisioning a transactive grid, however, is a very
different task from actually defining the path forward and
achieving it. Our century-old physical and regulatory system has a tremendous amount of inertia. Without a dedicated
effort to shape a new path, the default for the way ahead
is a haphazard advancement of disruptive trends and battles
between incumbent and new industries. This is illustrated by
the widespread discourse over net metering and demand
response. REV is a concerted effort to bring disparate interests into partnership by developing a path forward that serves common
industry interests and, ultimately, the
best interests of customers.
The buzz around distributed
energy resource (DER) and a
transactive grid reflects the
growing awareness that
the conventional way to
run an electric system
has become outmoded
and is no longer suitable for the modern,
digitized information
driven economy. For
decades, the electric industry has been operated
and regulated on the basis of several now-outdated assumptions: consumer demand is largely inelastic, power is best
generated by central station power plants; and reliance on
clean energy and DERs will result in higher power costs.
Price signals do not align customer-side resources with system costs and benefits and demand response programs are
used primarily to avert emergencies or mitigate extreme
peak prices. Customer-sited generation has been seen as an
exception around which the conventional system must devise
accommodations. As a result, we continue to overbuild an
electric system to meet uncoordinated peaks while leaving a
huge pool of resources untapped.
It is time to recognize that the demand side of the grid
can be a more-valuable resource than we could have imagined 30 years ago. Rooftop solar, energy storage (from
household batteries to electric vehicles), smart energy management technology, and the aggregation of demand are all
areas where demand, rather than generation, can become
the state's primary energy resource. Instead of being the last
resource we manage in the system, demand should be the
first. Dynamic demand can provide cost-effective reliability,
balancing, and load-shaping support for the grid, thereby

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Table of Contents for the Digital Edition of IEEE Power & Energy Magazine - May/June 2016