The New Jersey Board of Public Utilities – in an order dated May 28, to be effective on June 7 – directed electric distribution companies (EDCs) to file by Dec. 15 individual study reports that look into the optimal voltage for use in their respective distribution systems.
As noted in the order, New Jersey Gov. Phil Murphy in May 2018 signed into law the Clean Energy Act, which required the board to direct each electric public utility to undertake such a study.
Board staff and the New Jersey Division of Rate Counsel have engaged in discussions on how best to fulfill the statutory mandate with Exelon’s (NYSE:EXC) Atlantic City Electric; FirstEnergy’s (NYSE:FE) Jersey Central Power & Light; Public Service Enterprise Group’s (NYSE:PEG) Public Service Electric and Gas; Rockland Electric Company; and Butler Power and Light – collectively referred to as the EDCs.
The board added that through those discussions, the EDCs reviewed some of the available optimal voltage/voltage optimization literature, revealing that numerous studies have already been undertaken on those issues in other jurisdictions. The board said that its staff believes that the appropriate process to maximize the benefit to New Jersey is a comprehensive analysis of the information already available. The board noted that its staff believes that that analysis would shed light on the potential costs and benefits of pursuing optimal voltage within the state’s individual distribution systems, as well as inform the board and EDCs in their consideration of any benefits of voltage optimization in each of their distribution systems.
The board said that its staff recommends that under the Clean Energy Act, the board direct the EDCs to conduct a study, by analyzing the data available nationwide on voltage optimization and on optimal voltage, with recommendations on the individual EDCs’ ability to implement specific measures and the anticipated impact to each EDCs’ respective system. While each EDC will submit a separate report to the board, staff recommends that the EDCs be directed to jointly hire a consultant to analyze the readily available information. Staff further recommends that the board direct each EDC to extrapolate the data in the consultant study to the EDC’s own distribution system, the board added, noting that such extrapolation would aid in gauging whether or not tangible and cost-effective benefits can be attained from establishing an optimal voltage.
If after the board reviews the reports submitted by each EDC, it determines that additional information is necessary and warranted, the board will direct the EDCs to conduct additional analysis and review, which may include a system modeling study utilizing the options available to the individual EDC systems, on varying voltage class circuits, for optimal voltage measures. The board added that the modeling study would include analysis of the measures identified as feasible to implement a pilot program to determine the optimal voltage in one or more EDC systems. The board said that that process will allow it to make an informed decision at each juncture, while avoiding waste of utility resources and ratepayer dollars.
Staff recommends that the study be guided by a proposed outline submitted by the EDCs in March, which notes, for instance, that “Section #1” of the study include an introduction of the EDC’s distribution system design and operation, while “Section #2” include equipment currently in place to adjust voltage/vars and a description of how it currently operates, with numbers of each type in service.
The board added that staff further recommends that the board require the study to include such considerations as:
- The effect of raising system voltage including system losses, total usage, customer experience, distributed generation hosting capacity, and constraints on when voltage adjustments can and cannot be made
- Advantages and disadvantages of using different system voltages, including operational considerations, storm response, maintenance, effects on capital equipment, planning parameters and RTO interaction
- The EDC’s ability to optimize power factor such that the utility has to generate less power to satisfy its customers’ demands
The study should include a narrative section and provide the EDCs’ conclusions regarding:
- Handling voltage volatility due to increasing penetration of intermittent renewable generation sources and increasing diversity and variability of loads
- Providing the ability to optimize within operating parameters especially when running at the system capability limits
- Optimizing the power factor such that the utility has to generate less power to satisfy its customers’ demands
The board noted that it finds that:
- A joint study of the existing literature by the EDCs is an efficient way to initiate the review of the optimal voltage for use within each EDC’s respective distribution system
- Such a study will provide a useful mechanism to initiate consideration of the possible role of voltage optimization in New Jersey’s energy future
- Extrapolation of the study data onto the individual New Jersey electric distribution systems will effectively advance the board’s consideration of whether to pursue the establishment of an optimal voltage and/or implement voltage optimization in the state
The board directed the EDCs to develop a joint proposed request for proposals (RFP) for a consultant to perform the study. The board added that the RFP should be submitted to staff and Rate Counsel by June 28.