local photovoltaic, wind and water systems at the
house or business site. This is more cost-effective
for the consumer. But it means we have to figure
out how to simultaneously integrate both very
long lines and very close sources.”
Even;without;distributed;power,;Wellinghoff
pointed out that the energy mix has changed dra-
matically.;“In;the;1930s,;40;percent;of;our;power
was from large hydro sources,” he noted. “And 10
to 20 percent was small wind. So we had 40 to 50
percent renewable power then. Then it changed to
12 to 14 percent, including large hydro. And now
it’s changing again.”
Distributed Resources
The rise of distributed sources blurs the
line between retail and wholesale distribution.
“To the extent that [distributed sources] offset
local power, they’re considered retail trans-
actions,” Wellinghoff said. “Under PURPA
[Public;Utility;Regulatory;Policies;Act,;amend-
ed in 2005], to the extent they add power they
can be wholesale systems. There is a possibil-
ity;all;the;time;for;conflicts;between;state;law
and;PURPA.;State;regulatory;regimes;are;not
used to seeing consumers be generators. For
instance, Hawaii is concerned about the level
of photovoltaics (PV) on local distribution
feeders.;This;is;the;kind;of;conflict;we;can;help
to work out so that local consumers can have
competitive choices.”
In;fact,;Wellinghoff;reports,;FERC;spends
up to half its time and resources dealing with
local;integration;issues.;“In;California,;we;need-
ed to ensure that their feed-in tariff could go
forward in a way that was not inconsistent with
PURPA,”;he;noted.;“The;small;generator;inter-
connection standard encourages states to adopt
[policies friendly to distributed generation].
We are paying attention to local distribution
and;demand-side;requirements.;We’ve;issued;a
number of rules on both the supply and demand
side, meant to enable [distributed sources] to
participate in a competitive market.”
At the utility scale, a major barrier remains
long-distance transmission. New transmission
lines often run into not-in-my-backyard local
opposition,;and;FERC;has;been;exploring;ways
to resolve those disputes. Thus, the commis-
sion’s;Order;1000,;announced;in;July,;requiring
(among other things) that utilities coordinate
regionally in planning new transmission lines,
and allocate costs of new transmission to the
beneficiaries of the lines.
