ORS 757.302: Regulatory framework allowing microgrids and community microgrids within service territories of electric companies.

(1) As used in this section: (a) “Community-based organization” means an organization with demonstrated efficacy that is representative of a community or specific segments of a community and serves to meet the community’s needs. (b) “Community microgrid” means a microgrid that is located within a geographical area that a local government designates as a microgrid zone under ORS 197.729. (c) “Electric company” has the meaning given that term in ORS 757.600. (d) “Front-of-meter” means the utility side of a transmission or distribution system in reference to a customer’s meter. (e) “Microgrid” means a group of interconnected loads and distributed energy resources within clearly defined electrical boundaries that functions as a single controllable system, irrespective of whether the microgrid is operating independently of or in conjunction with an electric grid. (f) “Microgrid operator” means an entity that is identified as having responsibility for overseeing the coordination of a microgrid’s interconnected loads and distributed energy resources and representing the interests of the microgrid participants in interactions with an electric company. (2) The Public Utility Commission shall conduct an investigation and establish a regulatory framework for allowing the ownership, deployment and use of microgrids and community microgrids within the service territories of electric companies. (3) The regulatory framework established under this section must: (a) Take into consideration the benefits and constraints of deploying microgrids and community microgrids. (b) Take into consideration the role of microgrids and community microgrids in supporting economic growth, innovations around zero emissions energy and reliable electricity service. (c) Take into consideration different approaches to designing, deploying and operating microgrids or community microgrids that serve a single customer or multiple customers. (d) Provide for interconnection standards and requirements. (e) Provide for safety and performance standards. (f) Utilize an application and approval process that is accessible. (g) Include a framework for compensation and cost allocation that recognizes the value microgrids and community microgrids provide to all electricity customers, the electric grid and local users of the electric grid. The framework for compensation and allocation must take into consideration: (A) The reliability and resilience services that a microgrid or community microgrid provides to a transmission or distribution system and to a community in which the microgrid or community microgrid is located. (B) A microgrid or community microgrid’s ability to operate in parallel to a transmission or distribution system as a resource pursuant to a tariff rate. (h) Include a methodology for compensating an owner, subscriber or developer of a microgrid or community microgrid for the value that the microgrid or community microgrid provides. The methodology must: (A) Incorporate the value of lost load during a public safety power shutoff; and (B) Include a schedule of avoided costs of a utility that reflects the value of the energy generated or saved by a microgrid or community microgrid. (i) Allow excess energy generated by a microgrid or community microgrid to be sold to a utility on a nondiscriminatory basis. (j) Subject to ORS 757.300, the Public Utility Regulatory Policies Act of 1978, 16 U.S.C. 2601 to 2645, and an electric company’s technical feasibility and system reliability requirements, allow an owner or microgrid operator of a microgrid or community microgrid to incorporate front-of-meter energy resources that are owned or operated by a utility, third-party developer, local or tribal government or community-based organization. (k) Allow an electric company to partner with municipalities, businesses or communities to develop microgrids that improve resilience or mitigate the need for infrastructure upgrades. (L) Provide for a standard for reasonable shared costs for community energy resilience that is provided by a community microgrid that allow for owners or microgrid operators of a community microgrid to recover the costs for designing, constructing or maintaining the community microgrid from customers who use: (A) The microgrid; (B) The distribution system located within a microgrid zone designated under ORS 197.729 within which the community microgrid is located; or (C) The distribution system local to the community microgrid. (m) Allow for redundant infrastructure that supports community microgrids. (n) Provide for the approval of a community microgrid if the community microgrid enhances local energy resilience and is capable of supporting critical infrastructure during and after an emergency, natural disaster or disruption to the electric grid or energy supply. (o) Include a process for investigating standards and procedures that would enable a microgrid operator to operate one or more community microgrids independently from the electric grid system during an emergency. (p) Provide standards for coordination and collaboration between microgrid operators and electric companies in the operation of microgrids and community microgrids. (q) Prohibit a microgrid operator from assuming an electric company’s role in controlling the electric company’s own distribution infrastructure. [2025 c.472 §2] Sec. 3. The Public Utility Commission shall complete the investigation and establish a regulatory framework under section 2 of this 2025 Act [757.302] not later than 18 months from the effective date of this 2025 Act [September 26, 2025]. In conducting the investigation, the commission shall consult with appropriate local, state and federal agencies. [2025 c.472 §3]