[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 1243 Introduced in Senate (IS)]

114th CONGRESS
  1st Session
                                S. 1243

  To facilitate modernizing the electric grid, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                              May 7, 2015

  Ms. Cantwell (for herself, Ms. Hirono, and Mr. King) introduced the 
 following bill; which was read twice and referred to the Committee on 
                      Energy and Natural Resources

_______________________________________________________________________

                                 A BILL


 
  To facilitate modernizing the electric grid, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Grid Modernization Act of 2015''.

                      TITLE I--GENERAL PROVISIONS

SEC. 101. STATEMENT OF POLICY ON GRID MODERNIZATION.

    It is the policy of the United States to promote and advance--
            (1) the modernization of the energy delivery infrastructure 
        of the United States, including bolstering the reliability, 
        affordability, diversity, efficiency, security, and resilience 
        of domestic energy supplies, through advanced grid 
        technologies;
            (2) the modernization of the electric grid--
                    (A) to continue facilitating the development of a 
                Smart Grid as characterized in section 1301 of the 
                Energy Independence and Security Act of 2007 (42 U.S.C. 
                17381);
                    (B) to enable a robust multidirectional power flow 
                that leverages distributed energy resources; and
                    (C) to facilitate the alignment of business and 
                regulatory models to achieve a grid that optimizes--
                            (i) the entire electric delivery system; 
                        and
                            (ii) a sustainable, reliable, and resilient 
                        energy future;
            (3) relevant research and development in advanced grid 
        technologies, including--
                    (A) energy storage;
                    (B) predictive tools and requisite real-time data 
                to enable the dynamic optimization of grid operations;
                    (C) power electronics that ease the challenge of 
                intermittent and distributed generation;
                    (D) real-time data and situational awareness tools 
                and systems; and
                    (E) tools to increase data security, physical 
                security, and cybersecurity awareness and protection;
            (4) the leadership of the United States in basic and 
        applied sciences to develop a systems approach to innovation 
        and invention of cybersecure advanced grid technologies, 
        architectures, and control paradigms capable of managing 
        diverse supplies and loads;
            (5) the safeguarding of the critical energy delivery 
        infrastructure of the United States and the enhanced resilience 
        of the infrastructure to all hazards, including--
                    (A) extreme weather events;
                    (B) cyber and physical threats; and
                    (C) other factors that affect energy delivery;
            (6) the coordination of goals, investments to optimize the 
        grid, and other measures for energy efficiency, advanced grid 
        technologies, interoperability, and demand response resources;
            (7) partnerships with States and the private sector--
                    (A) to facilitate advanced grid capabilities and 
                strategies; and
                    (B) to provide technical assistance, tools, or 
                other related information necessary to enhance grid 
                integration, particularly in connection with the 
                development at the State and local levels of strategic 
                energy, energy surety and assurance, and emergency 
                preparedness, response, and restoration planning;
            (8) the deployment of information and communications 
        technologies at all levels of the electric system;
            (9) opportunities to provide consumers with timely 
        information and advanced control options;
            (10) sophisticated or advanced control options to integrate 
        distributed energy resources and associated ancillary services;
            (11) open-source communications, database architectures, 
        and common information model standards, guidelines, and 
        protocols that enable interoperability to maximize efficiency 
        gains and associated benefits among--
                    (A) the grid;
                    (B) energy and building management systems; and
                    (C) residential, commercial, and industrial 
                equipment;
            (12) private sector investment in the energy delivery 
        infrastructure of the United States through targeted 
        demonstration and validation of advanced grid technologies; and
            (13) establishment of common valuation methods and tools 
        for cost-benefit analysis of grid integration paradigms.

SEC. 102. GRID STORAGE PROGRAM.

    (a) In General.--The Secretary of Energy (acting through the 
Assistant Secretary of the Office of Electricity Delivery and Energy 
Reliability) (referred to in this Act as the ``Secretary'') shall 
conduct a program of research and development of electric grid energy 
storage that addresses the principal challenges identified in the 2013 
Department of Energy Strategic Plan for Grid Energy Storage.
    (b) Areas of Focus.--The program under this section shall focus 
on--
            (1) materials and electrochemical systems research;
            (2) power conversion technologies research;
            (3) other fundamental and applied research critical to 
        widespread deployment of storage;
            (4) device development that builds on results from research 
        described in paragraphs (1) through (3), including combinations 
        of power electronics, advanced optimizing controls, and energy 
        storage as a general purpose element of the electric grid;
            (5) grid-scale testing and analysis of storage devices, 
        including test-beds and field trials;
            (6) cost-benefit analyses that inform capital expenditure 
        planning for regulators and owners and operators of components 
        of the electric grid;
            (7) storage device safety and reliability, including 
        potential failure modes, mitigation measures, and operational 
        guidelines; and
            (8) standards for storage device performance, control 
        interface, grid interconnection, and interoperability.
    (c) Assistance to States.--The Secretary may provide technical and 
financial assistance to States, Indian tribes, or units of local 
government to participate in or use research, development, or 
deployment of technology developed under this section.

SEC. 103. ELECTRIC SYSTEM GRID ARCHITECTURE, SCENARIO DEVELOPMENT, AND 
              MODELING.

    (a) Grid Architecture and Scenario Development.--
            (1) In general.--Subject to paragraph (2), the Secretary 
        shall establish and facilitate a collaborative process to 
        develop model grid architecture and a set of future scenarios 
        for the electric system to examine the impacts of different 
        combinations of resources (including different quantities of 
        distributed energy resources and large-scale, central 
        generation) on the electric grid.
            (2) Market structure.--The grid architecture and scenarios 
        developed under paragraph (1) shall account for differences in 
        market structure, including an examination of the potential for 
        stranded costs in each type of market structure.
            (3) Findings.--Based on the findings of grid architecture 
        developed under paragraph (1), the Secretary shall make 
        recommendations regarding additional standards that may be 
        required, if any, to ensure the interoperability of grid 
        systems and associated communications networks.
    (b) Modeling.--Subject to subsection (c), the Secretary shall--
            (1) conduct modeling based on the scenarios developed under 
        subsection (a); and
            (2) analyze and evaluate the technical and financial 
        impacts of the models to assist States, utilities, and other 
        stakeholders in--
                    (A) enhancing strategic planning efforts;
                    (B) avoiding stranded investments; and
                    (C) maximizing the cost-effectiveness of future 
                grid-related investments.
    (c) Input.--The Secretary shall develop the scenarios and conduct 
the modeling and analysis under subsections (a) and (b) with 
participation or input, as appropriate, from--
            (1) the National Laboratories;
            (2) States;
            (3) State regulatory authorities;
            (4) transmission organizations;
            (5) representatives of the electric industry;
            (6) academic institutions;
            (7) independent research institutes; and
            (8) other entities.

                    TITLE II--DEMONSTRATION PROGRAMS

SEC. 201. TECHNOLOGY DEMONSTRATION ON THE DISTRIBUTION SYSTEM.

    (a) In General.--The Secretary shall conduct 6 demonstration 
projects to expand the application of technologies to improve 
observability, advanced controls, and prediction of system performance 
on the distribution system.
    (b) Participation.--The demonstration projects conducted under 
subsection (a) shall include the participation of a diverse selection 
of relevant owners and operators of distribution systems, including--
            (1) a utility;
            (2) a political subdivision of a State; and
            (3) an electric cooperative.
    (c) Cybersecurity Plan.--Each demonstration project conducted under 
subsection (a) shall include the development of a cybersecurity plan.

SEC. 202. RESILIENT COMMUNITIES PROGRAM.

    (a) In General.--The Secretary shall establish a program for the 
development and promotion of grid-scale energy storage with microgrids 
to enhance the resilience of critical infrastructure.
    (b) Collaboration.--The program established under subsection (a) 
shall provide for the collaboration of relevant stakeholders in the 
program, including--
            (1) States;
            (2) Indian tribes;
            (3) regional entities and regulators;
            (4) units of local government;
            (5) institutions of higher education; and
            (6) private sector entities.
    (c) Phases.--The program established under subsection (a) shall be 
divided into the following phases:
            (1) Phase I, which shall consist of the development of a 
        feasibility assessment.
            (2) Phase II, which shall consist of cost-shared 
        demonstration projects that include the development of physical 
        and cybersecurity plans to take appropriate measures to protect 
        and secure the electric grid.
            (3) Phase III, which shall establish a benefits analysis 
        plan to help inform regulators, policymakers, and industry 
        stakeholders about the value of the resilience investments of 
        Phase II.

             TITLE III--STANDARDS AND ASSISTANCE FOR STATES

SEC. 301. STATE CONSIDERATION OF RESILIENCE.

    (a) Adoption of Standards.--Section 111(d) of the Public Utility 
Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) is amended by 
adding at the end the following:
            ``(20) Resilience.--
                    ``(A) Definition of electric grid resilience.--The 
                term `electric grid resilience' means the ability of 
                the electric grid to adapt to changing conditions and 
                withstand and rapidly recover from disruptions.
                    ``(B) Required consideration.--Each electric 
                utility shall incorporate into the integrated resource 
                planning of the electric utility consideration of 
                electric grid resilience.
                    ``(C) Factors.--Consideration under subparagraph 
                (B) shall include an evaluation of potential benefits 
                of enhancing electric grid resilience, including--
                            ``(i) system stability under severe and 
                        nontraditional hazards;
                            ``(ii) adaptation to region-specific 
                        natural threats and vulnerabilities;
                            ``(iii) adaptation to climate change-
                        related extreme weather disruptions;
                            ``(iv) support provided to interdependent 
                        critical infrastructures reliant on energy 
                        services to operate;
                            ``(v) reduced costs under normal operating 
                        conditions;
                            ``(vi) enhanced distributed generation and 
                        microgrid functionality to operate as an 
                        integrated energy system in intentional 
                        islanding mode;
                            ``(vii) localized energy generation that 
                        avoids incurrence of transmission and 
                        distribution losses;
                            ``(viii) system operational flexibility; 
                        and
                            ``(ix) ancillary environmental benefits, 
                        including greenhouse gas reductions.''.
    (b) Compliance.--
            (1) Time limitations.--Section 112(b) of the Public Utility 
        Regulatory Policies Act of 1978 (16 U.S.C. 2622(b)) is amended 
        by adding at the end the following:
            ``(7)(A) Not later than 1 year after the date of enactment 
        of this paragraph, each State regulatory authority (with 
        respect to each electric utility for which it has ratemaking 
        authority), and each nonregulated electric utility, shall--
                    ``(i) commence the consideration referred to in 
                section 111; or
                    ``(ii) set a hearing date for such consideration, 
                with respect to the standard established by paragraph 
                (20) of section 111(d).
            ``(B) Not later than 2 years after the date of enactment of 
        this paragraph, each State regulatory authority (with respect 
        to each electric utility for which it has ratemaking 
        authority), and each nonregulated electric utility, shall--
                    ``(i) complete the consideration required under 
                subparagraph (A); and
                    ``(ii) make the determination referred to in 
                section 111 with respect to the standard established by 
                paragraph (20) of section 111(d).''.
            (2) Failure to comply.--Section 112(c) of the Public 
        Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) is 
        amended by adding at the end the following: ``In the case of 
        the standard established by paragraph (20) of section 111(d), 
        the reference contained in this subsection to the date of 
        enactment of this Act shall be deemed to be a reference to the 
        date of enactment of that paragraph.''.

SEC. 302. VOLUNTARY MODEL PATHWAYS.

    (a) Establishment of Voluntary Model Pathways.--
            (1) Finding.--Congress finds that a set of voluntary model 
        pathways for modernizing the electric grid would provide 
        policymakers and regulators with valuable and flexible options 
        to consider in adapting policy or regulatory mechanisms to 
        match the needs of an evolving electric grid.
            (2) Establishment.--Not later than 90 days after the date 
        of enactment of this Act, the Secretary shall initiate the 
        development of voluntary model pathways for modernizing the 
        electric grid through a collaborative, public-private effort 
        that--
                    (A) produces illustrative policy pathways that can 
                be adapted for State and regional applications by 
                regulators and policymakers;
                    (B) facilitates the modernization of the electric 
                grid to achieve the objectives described in paragraph 
                (3);
                    (C) ensures a reliable, resilient, affordable, 
                safe, and secure electric system; and
                    (D) acknowledges and provides for different 
                priorities, electric systems, and rate structures 
                across States and regions.
            (3) Objectives.--The pathways established under paragraph 
        (2) shall facilitate achievement of the following objectives:
                    (A) Near real-time situational awareness of the 
                electric system.
                    (B) Data visualization.
                    (C) Advanced monitoring and control of the advanced 
                electric grid.
                    (D) Enhanced certainty for private investment in 
                the electric system.
                    (E) Increased innovation.
                    (F) Greater consumer empowerment.
                    (G) Enhanced grid resilience, reliability, and 
                robustness.
                    (H) Improved--
                            (i) integration of distributed energy 
                        resources;
                            (ii) interoperability of the electric 
                        system; and
                            (iii) predictive modeling and capacity 
                        forecasting.
            (4) Steering committee.--Not later than 90 days after the 
        date of enactment of this Act, the Secretary shall establish a 
        steering committee to facilitate the development of the 
        pathways under paragraph (2), to be composed of members 
        appointed by the Secretary, consisting of persons with 
        appropriate expertise representing a diverse range of interests 
        in the public, private, and academic sectors, including 
        representatives of--
                    (A) the Smart Grid Task Force; and
                    (B) the Smart Grid Advisory Committee.
    (b) Technical and Financial Assistance.--
            (1) In general.--The Secretary may provide technical and 
        financial assistance to States, Indian tribes, or units of 
        local government to adopt 1 or more elements of the pathways 
        developed under subsection (a)(2).
            (2) Distribution of financial assistance.--Any financial 
        assistance provided to a State under paragraph (1) may be 
        distributed by the State to units of local government in the 
        State for purposes of implementing the pathways developed under 
        subsection (a)(2).

SEC. 303. PERFORMANCE METRICS FOR ELECTRICITY INFRASTRUCTURE PROVIDERS.

    (a) In General.--Not later than 2 years after the date of enactment 
of this Act, the Secretary shall--
            (1) develop baseline, voluntary model performance metrics 
        to facilitate and promote the adoption of best practices and 
        processes for electricity infrastructure providers to design, 
        build, and implement a modernized electric grid and maximize 
        opportunities to enhance progress in grid technologies and 
        capabilities, consumer engagement, and policy;
            (2) quantify the potential performance improvements that 
        could be achieved through deployment of new grid technologies 
        and systems; and
            (3) distribute through appropriate channels a report 
        describing the findings under paragraph (1).
    (b) Considerations.--In developing the performance metrics under 
subsection (a)(1), the Secretary shall consider--
            (1) standard methodologies for calculating improvements or 
        deteriorations in the performance metrics, such as reliability, 
        grid efficiency, power quality, consumer satisfaction, 
        sustainability, and financial incentives;
            (2) standard methodologies for calculating value to 
        ratepayers, including broad economic and related impacts from 
        improvements to the performance metrics;
            (3) appropriate ownership and operating roles for electric 
        utilities that would enable improved performance through the 
        adoption of emerging, commercially available or advanced grid 
        technologies or solutions, including--
                    (A) multicustomer microgrids;
                    (B) distributed energy resources;
                    (C) energy storage;
                    (D) electric vehicles;
                    (E) electric vehicle charging infrastructure;
                    (F) integrated information and communications 
                systems; and
                    (G) advanced demand management systems; and
            (4) with respect to States, the role of the grid operator 
        in enabling a robust future electric system to ensure that--
                    (A) electric utilities remain financially viable;
                    (B) electric utilities make the needed investments 
                that ensure a reliable, secure, and resilient grid; and
                    (C) costs incurred to transform to an integrated 
                grid are allocated and recovered responsibly, 
                efficiently, and equitably.

SEC. 304. DISTRIBUTION PLANNING.

    (a) In General.--Upon the request of a State or regional 
organization, the Secretary shall partner with States and regional 
organizations to facilitate the development of State and regional 
distribution plans by--
            (1) conducting a resource assessment and analysis of future 
        demand and distribution requirements; and
            (2) developing open source tools for State and regional 
        planning and operations.
    (b) Existing Tools.--The tools developed under subsection (a)(2) 
shall build on existing tools used or developed by the Department of 
Energy.
    (c) Risk and Security Analysis.--The assessment under subsection 
(a)(1) shall include--
            (1) the evaluation of the physical and cybersecurity needs 
        of an advanced distribution management system and the 
        integration of distributed energy resources; and
            (2) advanced use of grid architecture to analyze risks in a 
        holistic all-hazards approach that includes communications 
        infrastructure, control systems architecture, and power systems 
        architecture.
    (d) Technical Assistance.--For the purpose of developing 
electricity distribution plans, the Secretary shall provide technical 
assistance to--
            (1) States;
            (2) regional reliability entities; and
            (3) other distribution asset owners and operators.

               TITLE IV--AUTHORIZATION OF APPROPRIATIONS

SEC. 401. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated to the Secretary carry out 
this Act (including the amendments made by this Act) and other related 
activities $200,000,000 for each of fiscal years 2017 through 2021.
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