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Report | 2021-2022

PUC Modernization Issue Briefs

Purpose, People, and Process

By Jessie CiullaDan Cross-CallCory FelderRachel GoldAaron Schwartz

Public utilities commissions (PUCs) in the United States are uniquely positioned to orchestrate the transition to a zero-carbon grid. These state-level regulatory bodies hold decision-making authority over the utilities that serve roughly 72 percent of US electricity customers. But PUCs must modernize to keep pace with the transition to a decarbonized, more distributed, and flexible grid.

Unfortunately, most PUCs have not been modernized to make decisions based on the need to eliminate the pollution that hurts our economy, health, and communities; to prioritize equity; or to ensure our communities are protected from climate-induced natural disasters. This leaves many commissions taking on the gargantuan transition to a more equitable, zero-carbon grid with unclear boundaries on their legal authority and responsibility.

This series of PUC Modernization Issue Briefs focuses on three dimensions of PUC modernization: purpose, people, and process. The series aims to assist policymakers, advocates, and regulators in their zero-carbon efforts. The briefs each draw on independent RMI analysis and more than a dozen interviews with industry experts.

The first brief in the series, Purpose: Aligning PUC Mandates with Clean Energy Goals, explores why the role of state PUCs must evolve in the face of an increasingly complex energy system. The brief includes priority actions for state policymakers and the PUCs themselves, including updating and clarifying the mission and regulatory authority of the PUC, as well as modernizing the definition of the “public interest” that guides PUC decisions.

The second brief in the series, The People Element: Positioning PUCs for 21st-Century Success, focuses on relationships and governance structures within PUCs. It explores challenges that state commissioners and commission staff typically face—including funding constraints, a growing need for highly specialized expertise, limited access to cutting-edge trainings, and rules that can prevent commissioners and staff from working collaboratively. The brief includes priority actions for commissioners and state legislatures to address these challenges by updating existing rules, revisiting staff allocations, and expanding access to technical capabilities needed for PUCs to make informed decisions.

The third brief in the series, Regulatory Process Design for Decarbonization, Equity, and Innovation, examines regulatory process design changes that enable PUCs to rapidly deliver a carbon-free electric grid. It explores how increased caseloads, growing stakeholder diversity in regulatory dockets, ambitious policy implementation timelines, and persistent information asymmetries between regulators and utilities are creating a need for new PUC procedures. The brief offers examples and recommendations around goal definition for proceedings, nonutility stakeholder engagement, data transparency, and when to initiate new processes to expedite decarbonization.

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