An Act To Create a Smart Grid Policy in the State
Maine Legislature, Session 124, LD 1535
Committee: Utilities and Energy
Sponsors: HINCK, RUSSELL, BERRY, FITTS, FLETCHER, GOODALL, HOBBINS, MILLS
Amends: 35-A MRSA §3143

MAINE STATE LEGISLATURE 
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124th MAl E LEGISIJATURE 
Legislative Document 
No. 1535 
H.P. 1079 
House of Representatives, December 21, 2009 
An Act To Create a Smart Grid Policy in the State 
(EMERGENCY) . 
Approved for introduction by a majority of the Legislative Council pursuant to Joint Rule 
203. 
. 
Received by the Clerk of the House on December 17, 2009. Referred to the Committee on 
Utilities and Energy pursuant to Joint Rule 308.2 and ordered printed pursuant to Joint Rule 
401. 
Presented by Representative HINCK of Portland. 
Cosponsored by Representative RUSSELL of Portland and 
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1J1.17lt1l;~{ 
MILLICENT M. MacFARLAND 
Clerk 
Representatives: BERRY of Bowdoinham, FITTS of Pittsfield, FLETCHER of Winslow, 
SIROIS ofTull1er, Senators: GOODALL of Sag ada hoc, HOBBINS of York, MILLS of 
Somerset. 
Prillll!J llll rccydeu paper 
Emergency preamble. Whereas, acts and resolves of the Legislature do not 
become effective until 90 days after adjournment unless enacted as emergencies; and 
Whereas, the State currently lacks a unified state policy on smart grid energy 
infrastructure but faces critical decisions regarding the implementation of smart grid 
technology and the creation of such a unified smart grid policy; and 
Whereas, the cost of electricity to consumers in the State is high compared with 
costs in similar markets elsewhere and impedes economic development in the State; and 
Whereas, the State has recognized the consequences of climate change and has 
committed to policies to reduce emissions of greenhouse gases; and 
Whereas, the State's electric grid and long-term infrastructure investment are vital 
to continued security and economic development, and a smart grid will deliver electricity 
from suppliers to consumers using modern technology to increase reliability, save energy, 
reduce costs and enable greater consumer choice; and 
Whereas, it is vital that a unified smart grid policy be developed. to ensure.that all 
ratepayers and the State as a whole are afforded the benefits of smart grid infrastructure; 
and 
Whereas, in the judgment of the Legislature, these facts create an emergency within 
the meaning of the Constitution of Maine and require the following legislation as 
immediately necessary for the preservation of the public peace, health and safety; now, 
therefore, 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 35-A MRSA §3143 is enacted to read: 
§3143. Declaration of policy on smart grid infrastructure 
1. Definitions. As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings. 
A. 
"Smart grid" means an electric system that provides or supports smart grid 
functions. 
B. "Smart grid functions" means those functions that advance the policy of the 
United States as specified in the federal Energy Independence and Security Act of 
2007, Public Law 110-140, Section 1301, including functions that enable consumers 
to access information about and to manage and adjust their electricity consumption or 
to generate and store electricity and functions specified in Section 1306(d) of that 
Act. 
2. Legislative findings. The Legislature finds that: 
A. The cost of electricity to consumers in this State is high in comparison to costs in 
similar markets and impedes economic development; 
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B. The State has recognized the consequences of climate change and has committed 
to policies to reduce emissions of greenhouse gases; 
C. 
The State's electric grid and long-term infrastructure investment are vital to 
continued security and economic development, and a smart grid will deliver 
electricity from suppliers to consumers using modem technology to increase 
reliability, save energy, reduce costs and enable greater consumer choice; 
D. The State currently lacks a unified state policy on smart grid infrastructure but 
faces critical decisions regarding the implementation of a smart grid, and the 
commission and the Legislature will play central roles in making those decisions; and 
E. 
It is vital that a smart grid policy be developed in order to ensure that all 
ratepayers and the State as a whole are afforded the benefits of smart grid 
infrastructure. 
3. Policy; creation of a smart grid. In order to improve the overall efficiency of the 
electric system, better manage energy consumption, reduce greenhouse gas emissions and 
control consumer costs, it is the policy of the State to promote, in a manner consistent 
with applicable industlY standards for reliability, safety and security, a rapid increase in 
the availability and use of smart grid functions through: 
A. 
Increased use of digital information and control technology to improve the 
reliability, security and efficiency of the electric system; 
B. 
Deployment and integration into the electric system of renewable capacity 
resources, as defined in section 3210-C, subsection 1, paragraph E, that are 
interconnected to the electric grid at a voltage level less than 69 kilovolts; 
C. 
Deployment and integration into the electric system of demand response 
technologies, demand-side resources and energy-efficiency resources; 
D. 
Deployment of smart grid technologies, including real-time, automated, 
interactive technologies that optimize the physical operation of energy-consuming 
appliances and devices, for purposes of metering, communications concerning grid 
operation and status and distribution system operations; 
E. Deployment and integration into the electric system of advanced electric storage 
and peak-reduction technologies, including plug-in electric and hybrid electric 
vehicles; 
F. Provision to consumers of timely energy consumption information and control 
options; and 
G. 
Identification and elimination of barriers to adoption of the technologies, 
practices and services listed in paragraphs A to F. 
4. Policy goals and priorities. In developing the State's smart grid infrastructure, it 
is the goal of the State to improve electric system reliability as well as the overall 
efficiency of electric energy resources and the electric grid while reducing energy 
consumption, greenhouse gas emissions and costs to consumers, in part by offering 
consumers greater choice and information about their electricity consumption. To meet 
this goal, it is the policy of the State that all available resources be assessed, including the 
following types of resources, which are ranked in order of priority from highest to lowest: 
A. Energy efficiency; 
B. Demand management, including but not limited to establishment of time-of-use 
tariffs and performance-based rates; 
C. 
Renewable resources, as defined in section 3210, subsection 2, paragraph C, 
located in the State; 
D. 
Renewable resources, as defined in section 3210, subsection 2, paragraph C, 
located outside of the State; 
E. Resources, other than those listed in paragraphs C and D, that are located in the 
State and are interconnected to the electric grid at a voltage level of less than 69 
kilovolts; and 
F. Transmission lines for whic ·1 a certificate of public convenience and necessity is 
required under section 3132, su .section 2. 
5. 
Commission review of uD{!rades and investments. 
In any proceeding 
commenced after the effective date of this subsection in which the commission reviews a 
transmission and distribution utility's electric transmission or distribution system 
investments or upgrades, the commission shall ensure that the transmission and 
distribution utility has appropriately and adequately considered the deployment of 
technologies that support smart grid functions in a manner consistent with the policies 
and goals of this section. 
6. Compliance with safety, security and reliability standards. In implementing 
the policies specified in this section, the commission and other agencies and 
instrumentalities of the State shall ensure that applicable regional, national and 
international grid safety, security and reliability standards are met. The commission and 
other agencies and instrumentalities of the State shall seek to cause standards that 
promote cost-effective technologies and practices supporting smart grid functions to be 
integrated into national and international grid safety, security and reliability standards. 
7. Cost recovery. The commission shall, upon petition, permit a transmission and 
distribution utility to adjust its rates to recover the utility's prudently incurred incremental 
costs associated with creating a smart grid or otherwise taking reasonable actions 
consistent with the policies of this section, to the extent that the costs are not already 
reflected in the utility's rates and the adjustment does not result in rates that are unjust or 
unreasonable. A grant by a utility in an amount approved by the commission to the 
University of Maine System for smali grid research and development is deemed to be a 
prudently incurred incremental cost associated with creating a smart grid. 
8. 
Report. 
The commISSIOn, as part of its annual report on electric industty 
restructuring pursuant to section 3217, shall include a report on the progress of the State 
in achieving the purposes of this section. The commission may include in its report any 
recommendations for changes to law to promote the purposes of this section. 
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Sec. 2. Examination of creation of reliability utility. The Public Utilities 
Commission shall undeliake an examination of the need for and feasibility of creating or 
designating a smali grid company in each transmission and distribution utility service 
territory to facilitate a rapid increase in the use of smart grid functions as defined in the 
Maine Revised Statutes, Title 35-A, section 3143. For purposes of this section, a smaIi 
grid company is a company that is jointly owned as follows: the majority ownership of 
the company is held by an entity, such as GridSolar, L.L.C., that has a strong interest in 
aggressively pursuing the purposes of this section and the minority ownership of the 
company is held by the transmission and distribution utility in whose service territory the 
company will provide services. If the commission determines that creating or designating 
such companies is feasible and an appropriate means of achieving the purposes of this 
section, the commission shall develop recommendations for how to create or designate 
such companies; otherwise the commission shall recommend alternative means of 
facilitating a rapid increase in the use of smart grid functions. The commission shall 
repOli its findings and recommendations to the joint standing committee of the 
Legislature having jurisdiction over utilities and energy matters no later than January 15, 
2011. The joint standing committee may report out legislation regarding the subject 
matter of the commission's report to the First Regular Session of the 125th Legislature. 
Notwithstanding Title 35-A, section 32] I-A, subsection 5, the commission may use lip to 
$100,000 of the funds in the conservation program fund to pay for its costs in undertaking 
the examination required under this section. 
Emergency clause. 
In view of the emergency cited in the preamble, this 
legislation takes effect when approved. 
SUMMARY 
This bill establishes a state policy on smart grid infrastructure including employment 
of a smart grid to improve power reliability as well as the overall efficiency of the power 
resource and delivery system while reducing energy consumption, greenhouse gas 
emissions and costs to consumers, in part by offering consumers greater choice and 
information about their electricity consumption. The state policy ensures that deployment 
of a smart grid is done in a manner that is consistent with applicable safety, security and 
reliability standards. The bill includes legislative findings regarding the high cost of 
electricity to consumers, the need for smart grid electric infrastructure, the lack of a state 
policy on smart grid infrastructure and the need for such a policy. 
The bill allows transmission and distribution utilities to recover reasonable costs 
associated with creating a smart grid. It also directs the Public Utilities Commission to 
examine the need for and feasibility of creating or designating a special entity in each 
transmission and distribution utility service territory to facilitate a rapid increase in the 
availability and use of smart grid functions.