Peco has called a retreat on plans to install a $35 million self-sustaining "microgrid" in Delaware County after the proposal generated stiff opposition from customer advocates.
The Philadelphia utility, in a filing posted with the Pennsylvania Public Utility Commission, withdrew the plan to build the experimental microgrid in an area of Concordville that has endured a large number of power outages.
The proposed microgrid, which could operate independently of the regional power grid during a widespread outage, included 10.5 megawatts of natural-gas and solar-power generators and 200 kilowatts of battery storage.
But advocates for small businesses, consumers, industrial users, and retail energy suppliers had questioned whether it was proper for Peco to reenter the power-generation business it had been forced to spin off under the 1996 Electricity Generation Customer Choice and Competition Act.
The advocates also questioned whether all Peco customers would benefit from the project, whose costs the utility had proposed to recover in rate surcharges that would affect all of its 1.6 million customers. Peco said the impact would eventually require an increase of about 29 cents a month for a residential electrical customer using 1,000 kilowatt hours.
Peco's proposal "raises significant legal and policy questions," the Pennsylvania Office of Consumer Advocate said in a June filing with the PUC.
Peco had suggested scaling back the project, but said in an Oct. 28 filing that it decided to withdraw the proposal altogether and now will launch a "stakeholder collaborative" to gauge the best way to build and test the systems on its distribution network.
"The collaborative process will allow us to work together to determine the best opportunities for microgrid application across the Peco service territory," utility spokesman Ben Armstrong said Wednesday. "This will allow Peco to more fully understand the concerns some stakeholders have raised."
Microgrid projects, which are expected to proliferate as power grids become increasingly spread out, can provide added reliability during an extended outage. But utilities will be challenged to integrate the microgrids into their systems, which was one of the aims of the Peco pilot project.
Last year, the PUC signaled its interest in the microgrid project when Peco included plans for one in its long-term infrastructure plan.
Peco's microgrid would have supplied power to three government facilities and 27 businesses in a 388-acre area that includes the Concord Township Municipal Complex, a fire station, a sewage-treatment plant, a retirement community, two medical facilities, two motels, and two shopping centers.