Terminology

Unclear terminology has impeded successful pilot and innovation programs . Following are key terms used in this toolkit.

• Innovation is “the search for, and the discovery, development, improvement, adoption and commercialization of new processes, new products, and new organizational structures and procedures.” Innovation requires both creating new ideas and implementing those ideas (Source: Costello, 2016.)
• Innovation vehicle refers to a program or mechanism specifically designed to promote testing and acceleration of ideas that go beyond the status quo. These may include things like research and development (R&D) programs, startup incubators and accelerators, venture capital investments, pitch-fests that connect innovators to investors, or other events to bring entrepreneurs to investors, task forces, or other intentional structures for promoting innovation.
• Regulatory sandboxes are a type of innovation vehicle that offer a structured environment for testing new technologies and business approaches under modified rules to increase the speed of adoption. Regulatory sandboxes establish processes, with appropriate guardrails, for utilities to take on calculated risks that might not otherwise be feasible under standard regulatory practices and to quickly adapt to learnings during the trial phase and identify scaling strategies.
• Derogations are modifications to or exemptions from typical regulations or rules deployed as part of a regulatory sandbox.
• Sandbox-type mechanisms are a group of programs and mechanisms that act similarly to regulatory sandboxes, but have specific or unique identifying characteristics. These include funding opportunities, pilot processes, and rate case examples (see Map of Sandbox Mechanisms.) In most cases, these programs fit under the broad definition of a regulatory sandbox because they deviate in some way from traditional utility regulatory processes. Because of the important differentiating features and naming conventions for each type of mechanism, however, we categorized each as its own type of mechanism that is similar to a regulatory sandbox.
• Advanced grid technologies are advanced equipment, services, and applications (both hardware and software) that enhance transmission and distribution (T&D) systems by unlocking new capacity and capabilities to meet system needs.

Table of Acronyms

Line Sensor Technology (Source: U.S. Department of Energy)