Rhode Island is actively pursuing the development of a clean energy economy for the purposes of creating jobs and industry growth, mitigating against price volatility and increasing reliability through a diversification of the current energy portfolio and improving environmental quality by reducing reliance on carbon emitting sources of energy. In order to create an overarching strategy, the state is presently gathering data, setting goals and is planning to recommend action regarding near and long term plans to manage Rhode Island’s energy system. An update to the Rhode Island State Energy Plan (RISEP) is expected to be complete in March 2014.

In 2006, Rhode Island enacted The Comprehensive Energy Conservation, Efficiency and Affordability Act. Under the Act, effective January 1, 2007, each gas distribution company shall include, with approval of the Commission, a charge of up to fifteen cents ($0.15) per decatherm delivered to demand side management programs, including, but not limited to, programs for cost-effective energy efficiency, energy conservation, combined heat and power systems, and weatherization services for low income households. On December 1, 2006, National Grid filed a gas demand-side management (DSM) program with the Rhode Island Public Utilities Commission (RIPUC), which included a surcharge to fund the program. On December 19, 2006, RIPUC approved the surcharge on an interim basis, pending further review of the program. On June 14, 2007, RIPUC approved National Grid’s DSM plan. RIPUC released an order on July 23, 2007.

On May 3, 2013 (pursuant to a March 21, 2013 Bench Order) the Rhode Island Public Utilities Commission issued a Written Order approving the National Grid’s annual Gas Infrastructure Safety and Reliability Plan, which included an Expansion Pilot Program. Through the Pilot Program, the Company will identify areas in Rhode Island where the distribution system could be expanded efficiently in terms of the number of potential customers and cost considerations. The Company offers and incentive to offset the first 75% of the project for customers in a particular area so that the customer only bears the cost of the remaining 25% of the cost to provide service.

In 2010, the Rhode Island General Assembly passed legislation to amend Chapter 39-1 of the Rhode Island General Laws to allow the Rhode Island PUC to approve revenue decoupling and infrastructure investment tracking mechanisms. As a result of this legislation, National Grid utilizes a Infrastructure Safety and Reliability Plan (ISR) which replaced its existing Accelerated Replacement Program (ARP). This program began April 2011 and funds both replacement of leak prone mains and bare steel, high pressure services. The plan also includes funds for system reliability, mandated programs and special projects and includes a fully-reconciling rate mechanism designed to recover actual and anticipated capital investments as reflected in the approved ISR spending plan. In its FY 2015 Gas Infrastructure Safety and Reliability Plan (ISR) (Docket No. 4474), the Commission authorized the company to target 70 miles of main per year, which would reduce the time frame for removal of leak prone pipe to approximately 20 years. The company had replaced 50 miles in FY 2014.

National Grid owns 2 stations in the state which are managed by Clean Energy. Under the terms of a 2010 management agreement, Clean Energy operates and maintains the National Grid stations, sells CNG to third parties, upgrades the onsite equipment to increase vehicle fueling capacity for the growth of the National Grid CNG truck fleet, and works with National Grid to continue the growth of the CNG vehicle market.

National Grid operates under a full revenue decoupling mechanism.