Take several actions toward making Distributed Energy Resources (DERs) easier to install, aggregate, control, and value. Together, these actions can make DERs more competitive with traditional supply-side investments in utility planning, including in Intergrated Resource Plans (IRPs) and distribution system planning. Actions include:

• Creating a statewide framework that standardizes DER valuation and compensation, accounting for the time and location of the resource, avoided distribution and transmission costs, emissions reductions, flexibility, and resilience benefits, among others. This framework can build on the results of the ongoing Washington State Academy of Sciences study on the value of distributed solar and storage, which will consider options for a value stack that could be applied to a broader range of DERs.
• Establishing device interoperability standards with original equipment manufacturers (OEMs) to encourage consistent telemetry rules above a certain kW threshold and voluntary pathways for third-party control of devices. This follows Washington’s example of requiring CTA-2045 ports in water heaters for demand response communications, but it goes further to include a broader range of devices and more precise operating standards for consistency across device brands.
• Requiring utilities to offer Time-of-Use (TOU) rates.
• Requiring more utility data sharing, including hosting capacity maps and customer usage data. Data should be shared with customers and authorized third parties, with privacy protections for customers, and should be of a quality and frequency that enables third party DER siting and dispatch.
• Developing a statewide DER interconnection standard that utilities can adopt to provide clarity and consistency to the private market, including contractors and third-party aggregators.

DERs can reduce peak load, improve grid flexibility, defer infrastructure upgrades, and provide revenue streams for their owners. They are a powerful tool to accelerate building decarbonization and meet growing demand for electricity without raising rates. Developing consistent valuation methods, standardized interoperability and interconnection, and visibility into utility distribution systems are all pieces of recognizing the full value of DERs in utility planning. With more of the value of DERs enabled, the market clarity emerges for utilities, aggregators, contractors, and OEMs to develop business models and programs that treat DERs as integral grid assets. This shift could reduce utility costs and align utility resource acquisition in Washington with the realities of a changing electricity system and the goal of decarbonizing buildings.

Regulators and utilities should ensure that DER value signals do not disadvantage customers in older buildings, which means making upgrades for electrification infrastructure available to all customers. In their planning, utilities should prioritize the deployment of DERs in highly impacted communities where those DERs could reduce energy burdens, improve resilience in extreme weather, or provide other non-energy benefits. Utilities, regulators, and additional entities should provide training to small contractors and community organizations to enable their participation in the DER ecosystem.

2027:‍

• The Washington State Legislature directs the Department of Commerce and the Utilities and Transportation Commission (UTC) to establish a statewide DER value framework and initiate rulemaking on data access, interconnection, data sharing standards, and interoperability standards. The Legislature also directs Commerce and the UTC to require utilities to offer time of use rates.

2028:‍

• The Department of Commerce and the UTC publish the DER valuation , framework, and completed rules, including a statewide DER interconnection standard.

2029:

• Utilities begin publishing hosting capacity maps, providing interval load data access to customers and aggregators, and implementing new interconnection processes for DERs.

2030 and beyond:

• The Department of Commerce and the UTC periodically update the DER value framework. DERs are better valued and incorporated into resource adequacy, IRPs, and a potential distributed capacity procurement target (see: Modern Utility Regulation, Align I-937 for 2050 Goals)