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H 7878Renewable Energy

Public Utilities and Carriers - Energy Storage Systems Act

Mandates electric companies pay incentives to energy storage systems that connect to overloaded parts of the power grid.

Introduced
Population
Affected
35
Email Legislator
Introduced Feb 27, 2026Committee House Corporations

Plain-English Summary

This legislation amends the "Energy Storage Systems Act" to encourage the installation of energy storage systems (such as large batteries) in Rhode Island. It requires electric distribution companies with over 100,000 customers to create a specific payment plan (tariff). Under this plan, owners of energy storage systems connected to overloaded parts of the electric grid ("constrained feeders") will receive $185 per kilowatt per year for ten years. This program is capped once 100 megawatts of storage are connected. The goal is to improve grid reliability, reduce electricity prices, and avoid the need for expensive infrastructure upgrades.

For younger readers

This law helps fix the electric grid, which is the network of wires that brings power to our homes. Sometimes, certain wires get too crowded with electricity. This bill says that the electric company must pay people who hook up big batteries to those crowded wires. These batteries store power when it is cheap and release it when everyone needs electricity. This helps keep the lights on and stops the wires from getting overloaded. The law creates a rule to pay these battery owners for ten years to help the system work better.

Who & Where It Applies

Impacted groups
Electric distribution companies (Rhode Island Energy)Energy storage system developersUtility ratepayersPublic Utilities CommissionRenewable energy investors
Impacted communities
All

Constitutional & Fiscal Check

None Likely

Estimated cost
None
Estimated revenue
None

Bill Analysis

Both viewpoints
For Progressives
  • Promotes the integration of renewable energy sources by incentivizing storage systems that can balance intermittent power generation, aiding the transition away from fossil fuels.
  • Improves the reliability and resilience of the electrical grid, which is a vital public service, ensuring communities have stable power and backup options during outages.
  • Reduces the need for building new, expensive, and potentially polluting "peaker" power plants by utilizing storage to manage high-demand periods on constrained lines.
  • The costs of the tariff payments ($185/kW) will likely be passed on to all ratepayers, potentially increasing monthly utility bills for low-income households to subsidize private storage owners.
  • Provides guaranteed revenue streams and financial incentives to private entities and developers rather than investing directly in public ownership of energy infrastructure.
  • While the Commission is tasked with preventing "inequitable cross subsidization," the structure may still result in the general public bearing the financial risk while private investors reap the profits.
For Conservatives
  • Encourages a decentralized approach to grid management that relies on private investment in storage technology rather than government-funded infrastructure projects.
  • Improves the efficiency of the existing grid infrastructure, potentially preventing costly capital expenditures on new transmission lines that would otherwise drive up rates.
  • Strengthens energy security and grid reliability, reducing the likelihood of blackouts and ensuring businesses have the power needed to operate.
  • Imposes heavy government mandates on private electric distribution companies, dictating specific pricing models and operational requirements rather than letting the free market determine rates.
  • Creates a subsidy structure where the costs of incentivizing specific technologies are likely socialized among all customers, distorting the energy market.
  • Empowers the Public Utilities Commission with expanded regulatory authority to oversee and approve tariffs, increasing bureaucratic control over the energy sector.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 53 additions · 12 deletions

SECTION 1. Sections 39-33-1, 39-33-2 and 39-33-3 of the General Laws in Chapter 39- 33 entitled "Energy Storage Systems Act" are hereby amended to read as follows: 39-33-1. Definitions. As used in this chapter:

(1) "Constrained feeder" means a distribution feeder owned and/or operated by an electric distribution company as defined in § 39-1-2 which feeder is eighty percent (80%) or higher load constrained.

(2) “Commission” means the public utilities commission. (2)(3) “Energy storage system” means any technology capable of converting electrical energy to some form of stored energy for reconversion to electrical energy at a later time. (3)(4) “Long-duration energy storage system” means energy storage systems that are capable of permanently displacing fossil fuel energy systems designed to store energy or necessary for balancing intermittent renewable energy resources. 39-33-2. Storage tariff.

(a) No later than September 1, 2024, the public utilities commission shall engage stakeholders to adopt a framework for an energy storage system tariff for energy storage systems connected to the electric distribution system.

(1) The tariff framework should, at a minimum, address the ability of energy storage systems to charge from and discharge to the electric distribution system.

(2) The commission shall set a schedule that is designed to result in a model tariff no later than May 1, 2025, consistent with the tariff framework.

(3) Following that date, if the commission finds that the energy storage system tariff can be implemented without inequitable cross subsidization between customers, each electric distribution company as defined in § 39-1-2 that has greater than one hundred thousand (100,000) customers shall file the model tariff for review and approval by the public utilities commission in a contested proceeding. Otherwise, the model tariff shall be included as part of the electric distribution company’s next general rate filing.

(b) Notwithstanding subsection (a) of this section, no later than September 30, 2026, each electric distribution company as defined in § 39-1-2 that has greater than one hundred thousand (100,000) customers shall file an energy storage system tariff for review and approval by the commission in a contested proceeding which tariff shall contain the following provisions:

(1) The owner/operator of an energy storage system shall be compensated one hundred and eighty-five dollars per nameplate kilowatt capacity ($185/kW) per year for a system no greater than five megawatts (5 MW) in size and connected to a constrained feeder. This tariff shall be effective until one hundred megawatts (100 MW) of energy storage systems have been connected to constrained feeders at which point the commission may extend the tariff, revise the tariff or discontinue the tariff. The tariff shall provide for this compensation for ten (10) years following the energy storage system’s receipt of authorization to interconnect.

(2) The tariff may require that the energy storage system discharge at certain times during the day and at certain times during the year to maximize the benefits to the grid. The tariff may not require systems to discharge more than seventy (70) times per year. The owners/operators of the energy storage system shall pay the G-32 rate (or, if the G-32 rate is discontinued, the most comparable rate class then existing) when charging. The tariff may provide for financial penalties for energy storage systems failing to comply with the discharging requirements.

(3) The tariff shall provide that the determination of whether an energy storage system is proposed to be connected to a constrained feeder shall be made when the owner/operator of the energy storage system files its interconnection application with the electric distribution company and the energy storage system shall not lose eligibility for this tariff program following the eligibility determination and for ten (10) years after the receipt of authorization to interconnect.

(4) The tariff shall provide for the execution of a contract between the owner/operator of the energy storage system and the electric distribution company reflecting the operational and compensation terms of the energy storage system.

(5) The tariff may contain any other provisions which are reasonable and necessary to facilitate a tariff program on the terms set forth in subsections (2)(b)(1) through (2)(b)(4) of this section. 39-33-3. Interconnection.

(a) No later than September 1, 2024, the commission shall commence a process, which includes stakeholder engagement, to adopt a framework for an interconnection tariff for energy storage systems connected to the electric distribution system that recognizes the flexible operating characteristics of energy storage systems.

(b) Following the public utilities commission’s adoption of a framework, which shall be completed no later than May 1, 2025, each electric distribution company as defined in § 39-1-2 that has greater than one hundred thousand (100,000) customers shall file a proposed energy storage system interconnection tariff for review and approval in a contested proceeding. No later than September 30, 2026, each electric distribution company as defined in § 39- 1-2 that has greater than one hundred thousand (100,000) customers shall file a proposed energy storage system interconnection tariff for review and approval by the commission in a contested proceeding. The tariff shall regulate the interconnection of energy storage systems in a manner commensurate with the manner in which the Narragansett Electric Company Standards for Connecting Distributed Generation (R.I.P.U.C. No. 2258) regulates distributed generation. The tariff may contain provisions which are reasonable and necessary to regulate interconnection of energy storage systems and, more specifically, the tariff may address concepts such as import/export capacity and operating profiles and schedules.

SECTION 2. Chapter 39-33 of the General Laws entitled "Energy Storage Systems Act" is hereby amended by adding thereto the following section: 39-33-6. Legislative purpose. The purpose of this chapter is to facilitate and promote the installation of energy storage systems in the State of Rhode Island. Energy storage systems are capable of delivering significant benefits to the electric power system. Energy storage systems can reduce the market price for electricity, improve power quality by charging and discharging as needed, avoid the need for new capacity investments, and supply backup power during grid outages.

SECTION 3. This act shall take effect upon passage.