Load Shift Working Group AUG 22, 2018 10AM 2PM PST CPUC COURTYARD - - PowerPoint PPT Presentation

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Load Shift Working Group AUG 22, 2018 10AM 2PM PST CPUC COURTYARD - - PowerPoint PPT Presentation

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Load Shift Working Group AUG 22, 2018 10AM 2PM PST CPUC COURTYARD ROOM https://gridworks.org/initiatives/load-shift-working-group/ Agenda 10:00AM -10:20 AM: Intros, Updates, and Purpose Introductions DR Regulatory Updates

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Load Shift Working Group

AUG 22, 2018 10AM – 2PM PST CPUC COURTYARD ROOM

https://gridworks.org/initiatives/load-shift-working-group/

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Agenda

10:00AM -10:20 AM: Intros, Updates, and Purpose

  • Introductions
  • DR Regulatory Updates
  • Today’s Objective: Refine our thinking on:
  • CLECA’s Critical Consumption Period pilot/product
  • Evaluation criteria for a load shift product
  • Possible impacts of the load shift product on the distribution system

10:20AM – 10:35 AM: Evaluation Criteria: Overview 10:35 AM – 12:00 PM: Critical Consumption Period Pilot/Product (Nora Sheriff, CLECA) 12:00 PM – 1:00 PM: Lunch 1:00-1:45 PM: Evaluation Criteria: Discussion on Applying the Framework 1:45 – 2:25 PM: Distribution Impacts Associated with a Load Shift Product (Chase Sun/Larsen Plano, PG&E) 2:25 PM – 3:00 PM Next Steps

  • Recap of meeting
  • Update on Workplan and Future Sessions

https://gridworks.org/initiatives/load-shift-working-group/

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Introduction and Purpose

Introduction: Roll call

DR Regulatory Updates Today’s Objective: Refine our thinking on:

  • CLECA’s Critical Consumption Period pilot/product
  • Evaluation criteria for a load shift product
  • Possible impacts of the load shift product on the distribution system

https://gridworks.org/initiatives/load-shift-working-group/

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Evaluation Framework

LSWG Evaluation Framework

https://gridworks.org/initiatives/load-shift-working-group/

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www.buchalter.com

Presented by

Nora Sheriff, Counsel to CLECA nsheriff@buchalter.com

August 22, 2018

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CLECA Critical Consumption Period Pilot

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www.buchalter.com

Critical Consumption Period Pilot Goals

  • To help raise the belly of the duck and avoid renewable curtailment
  • Enable California ratepayers to take advantage of their renewable investment

– CAISO transfers through the EIM

  • 66 GWh of renewable energy to other states’ ratepayers in Q1 2018, “saving $42 M” for EIM

participants

  • 129 GWh of renewable energy to other states’ ratepayers in Q2 2018, “saving $71 M” for EIM

participants

– California ratepayers should also be able to access excess, low cost, renewable supply – California ratepayers have already paid for the renewable resources and will continue to pay for them in their rates

  • Address the current gap in DR Programs due to termination of Demand Bidding

Program by enabling industrial customers to dual participate in both reliability and economic demand response, per dual participation rules

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www.buchalter.com

Critical Consumption Product

  • A DR load increase product

– Possibly paired with a load drop and thus a load shift product, depending

  • n notification times

– To be delivered during Critical Consumption Periods – Not directly dispatchable by CAISO

  • No changes needed to CAISO processes, practices or policies

– To be considered “integrated” into the CAISO market because the DLAP or nodal price signal sent to the participating customers is the CAISO real time energy market price – No requirement for exact 1:1 load shift

  • allow more flexibility for customer response to wholesale market pricing signal

8/22/2018 CLECA - Market Participation Deck, LSWG 7

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www.buchalter.com

How are loads instructed to shift

  • IOU communication based on their day-ahead forecast periods of

negative pricing (expected mostly during the winter season) as indicative of expected renewable curtailment

– when the DLAP or nodal pricing is forecast to be mainly negative or low

  • Granularity of pricing (DLAP or nodal) is still under discussion
  • Customer takes the price risk

– Duration of Critical Consumption Period: 3 to 5 hours

  • Up to the customer to pick duration

– IOU communicates the forecast price the day ahead by 2 pm – Customers “bid” Critical Consumption amount by 5 pm

  • Exact timing can be revised, but notification must be day-ahead

8/22/2018 CLECA - Market Participation Deck, LSWG 8

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www.buchalter.com

Frequency of Critical Consumption Periods

  • Range of 12-15 Critical Consumption Periods (event days) over the course of the

year

– 2017 CAISO Real time 15 minute pricing data on periods of low or negative prices suggest there could be more, but fewer periods of negative pricing so far in 2018

  • Most Critical Consumption Periods would be expected in winter season (during

shoulder months)

  • Signal is not expected to change, but participation in Critical Consumption Period

is voluntary, so long as customer participates in at least 4 events

– this should enable sufficient flexibility for customer equipment outages or maintenance

  • If in the unlikely event there are simultaneous Critical Consumption Periods and

Base Interruptible Program events, Base Interruptible Program events take priority

8/22/2018 CLECA - Market Participation Deck, LSWG 9

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www.buchalter.com

Organizational Roles

  • Customer provides the energy product and is paid (pass-thru of wholesale

energy price for the Critical Consumption Period) by the LSE/Distribution Utility

– Like XSP Pilot

  • Third Party / Aggregator: not applicable
  • Non-IOU Load Serving Entity (CCA or DA provider) may have customers

participate

  • LSE/Distribution Utility “pays” customer for energy and administers* the

pilot (*or has an administrator)

  • CAISO: not applicable
  • This would be a CPUC-jurisdictional Pilot

8/22/2018 CLECA - Market Participation Deck, LSWG 10

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www.buchalter.com

Customers

  • Limit to bundled large power customers

– PG&E E-19T, E-20T; SCE TOU-8-Sub – Open to allowing DA/CCA customers too, if LSE (ESP/CCA) wants to participate

  • MUST ALLOW DUAL PARTICIPATION WITH BIP

– No need for capacity value payment if can dual participate with BIP (capacity program) and pilot (energy program)

  • Customer co-benefits (CLECA perspective):

– Increases RDRR headroom under cap – Enables increased in-state energy-intensive manufacturing, which helps the state meet its climate goals by avoiding leakage

  • Estimated min/max size per site: 0.5 MW to 10 MW
  • Likely use cases where participant economic benefit coincides with grid needs:

– increased manufacturing production during low price periods

  • No expectation of need for control technology upgrade

8/22/2018 CLECA - Market Participation Deck, LSWG 11

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www.buchalter.com

Participating Load/Device Boundary/Settlement

8/22/2018 CLECA - Market Participation Deck, LSWG 12

  • Critical Consumption Period Pilot should be technology-neutral
  • Smallest intended boundary for settlement is whole premise

– No expected sub-metering needs

  • Settlement process: how is value estimated and performance

verified

– By the LSE/IOU (not CAISO); like XSP – Compare event load to typical usage – Performance = event load minus baseline – Use 10-in-10 wholesale baseline methodology

  • Estimate average load to get baseline
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www.buchalter.com

Expected Challenges

  • Retail maximum demand charge

– non-coincident facilities related demand charge – for transmission, set at FERC, passed through to CPUC – E20T Transmission Max Demand Charge $8.01/kW

  • Power Charge Indifference Adjustment
  • Retail rate signals from current Time-of-use

periods

  • Pilot funding

8/22/2018 CLECA - Market Participation Deck, LSWG 13

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www.buchalter.com

Potential Solutions

  • Sufficiently negative energy prices to overcome/help mitigate the maximum

demand charge?

– Query how much higher it would be due to Critical Consumption Period

  • Flexibility around CPUC-jurisdictional, generation-related coincident demand

charge

  • Consider seeking FERC-approval (with CPUC support) for pilot ratchet-based

maximum demand charge

– 12 month rolling period; get charged maximum demand set during the 12 month period – Anticipation is for transmission system to continue to be summer-peaking, so winter Critical Consumption Periods should not lead to increased marginal transmission costs

  • Fund-shifting, or work into XSP for PG&E

8/22/2018 CLECA - Market Participation Deck, LSWG 14

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www.buchalter.com

Grid IT Systems: Describe how the product is

compatible with existing utility IT/metering/billing systems

  • Does retail meter data granularity meet product needs?

– For large C&I, yes

  • Do overall utility IT systems meet product needs?

– Not yet; expect a “work-around” (like PG&E’s use of Olivine for XSP)

  • If no to any above, what changes may be warranted?

– Utility billing system changes to enable real-time pricing

  • What are potential challenges/costs of those changes?

– Utility billing system changes are significant

  • What are potential spillover benefits of those changes?

– More dynamic and responsive load generally

8/22/2018 CLECA - Market Participation Deck, LSWG 15

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www.buchalter.com

Grid Needs: Avoid Renewable Generation Curtailment

8/22/2018 CLECA - Market Participation Deck, LSWG 16

Grid Policy Need Value Market Mechanism Revenue for Shift DR Operational Requirements Good fit for Shift?

Low Pollution (at low cost) GHG Emission Reductions ? Value of GHG reductions that is not reflected in RPS compliance credit. ? Not established

Low cost dispatch (with low pollution)

Fuel and other marginal cost

  • perational

savings while balancing dispatchable generation with net load Day-ahead Energy Energy market price arbitrage

CAISO’s ESDER 3 proposes load shift resource through PDR. [see note below on PDR for Shift] OR

Real-time dynamic prices + responsive load controls. Real-time Energy Energy market price arbitrage Same as above.

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www.buchalter.com

Grid Needs: Avoid Renewable Generation Curtailment

Grid Policy Need Value Market Mechanism Revenue for Shift DR Operational Requirements [see notes below for selected details] Good fit for Shift? Low cost dispatch (with low pollution)

Renewable generation capacity that is built for RPS compliance RPS Compliance Credit Who gets the value from a salvaged RPS credit when curtailment is avoided? Not established

8/22/2018 CLECA - Market Participation Deck, LSWG 17

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www.buchalter.com

  • Questions?

– Nora Sheriff

  • Direct Dial: (415) 227-3551
  • Email: nsheriff@buchalter.com
  • www.buchalter.com

– Paul Nelson

  • Direct Dial: (213)444-9349
  • Email: paul@barkovichandyap.com

8/22/2018 CLECA - Market Participation Deck, LSWG 18

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Lunch Break

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Evaluation Framework

LSWG Evaluation Framework

https://gridworks.org/initiatives/load-shift-working-group/

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Load Shift Working Group: Initial Discussion on Impacts of a Load Shift Product on the Distribution System

August 22, 2018 Larsen Plano, PG&E

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Agenda

  • 1. Objectives and Key Points
  • 2. Setting the Context: Introduction to the

Distribution System

  • 3. Examples of Potential Good and Bad

Impacts on the Distribution System

  • 4. Example of Analysis of Impacts
  • 5. Considerations
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  • 1. Objectives and Key Points

Objective: Begin a discussion on load shift impacts

  • n distribution system

Key Points:

  • 1. Load Shift DR can impact the distribution system
  • 2. Impacts can be both positive and negative

impacts

  • 3. Impacts depend on resource location, size and

duration

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  • 2. Context: The Distribution System
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  • 2. Context: The Distribution System
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  • 2. Context: The Distribution System

Transmission

  • Transmits bulk power from generation facilities to

distribution substations

  • Largely meshed network design (i.e. numerous paths for

power from A to B) Distribution

  • Distributes electric power to customers
  • Radial Power Flows (i.e. one path for power from A to B)
  • Frequently reconfigured (i.e. connections and switches

between distribution circuits, enable pathways to be changed)

  • Requires various levels of granular review and planning

Distribution system is more diverse and dynamic than the bulk power system.

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  • 2. Context: The Grid has Become More Complex to Operate

Energy Flow Information Flow Climate Change/Grid Resiliency DC Fast Charger Impacts (EV) Frequency of distribution

  • utages and use
  • f switching

Volatility in frequency and voltage Public Safety Power Shut Off for extreme fire conditions Communications network reaching capacity limits DER Participating in Wholesale Markets Two-Way / Unpredictable power flows Higher amount

  • f Masked Loads

Integration of Smart Inverter functions & capabilities Integration of Non-Wires Alternatives for Grid Services Maintaining cybersecurity

PG&E is investing in its system to coordinate increasing quantities and sophistication of DER. PG&E is looking at the load shift product to help solve– not exacerbate– system conditions.

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Agenda

  • 1. Objectives and Key Points
  • 2. Setting the Context: Introduction to the

Distribution System

  • 3. Examples of Potential Good and Bad

Impacts on the Distribution System

  • 4. Example of Analysis of Impacts
  • 5. Considerations
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Example #1: Load Shift as Beneficial to a Feeder Huron Substation: Loading Forecasts

A low CAISO price dispatch of Load Shift DR could benefit the distribution system if at the right place, time and duration

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Example 2: Load Shift a Risk to a Feeder Gonzales Bank #4 2025: Shoulder Months

A low CAISO price dispatch of Load Shift DR could harm the distribution system if at the wrong place, time and duration

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Example of Analysis: Circuit Load Correlation with Market Prices

24-hour Period MW Pnode $ 24-hour Period MW Pnode $

Feeder 1: Market Prices are Correlated w/Feeder Load Feeder 2: Market Prices are NOT Correlated with Feeder Load A systematic analysis of correlation between CAISO prices and distribution load shapes can shed light on prevalence of potential problems and benefits

Illustrative example of data analysis being performed. Does NOT represent actual data.

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A systematic analysis of correlation between CAISO prices and distribution load shapes can shed light on prevalence of potential problems and benefits

Example of Analysis: Circuit Load Correlation with Market Prices

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Entire Year Spring Month of March Feeder

24-hour Period (t0-t23h)

Feeder

24-hour Period (t0-t23h)

Feeder

24-hour Period (t0-t23h)

Green: Positive Strong Correlation Red: Negative Strong Correlation (Conflicting Signals)

Illustrative example of data analysis being performed. Does NOT represent actual data.

Example of Analysis: Circuit Load Correlation with Market Prices

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Agenda

  • 1. Objectives and Key Points
  • 2. Setting the Context: Introduction to the

Distribution System

  • 3. Examples of Potential Good and Bad

Impacts on the Distribution System

  • 4. Example of Analysis of Impacts
  • 5. Considerations
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Considerations When Developing a Load Shift Product

  • 1. Initial analysis and anecdotal evidence suggest that

positive and negative impacts of load shift DR are real

  • 2. Analysis and coordination are needed
  • 3. Multiple attributes of a load shift product design are

material:

  • Resource Location (Local distribution load profiles

and forecasts)

  • Resource Size and Concentration (Individual

resources and in aggregate)

  • Resource Dispatch Timing, Duration and Response

Speed

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Questions?

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Next Steps - Update on Future Meetings

  • September 17
  • RA issues : CPUC and CAISO
  • PDR enhanced: Write Up & Presentations
  • Update on ESDER 3 Proposal - Eric Kim
  • PDR Enhanced Refinements from Third Parties – Jennifer Chamberlin
  • Leaning from other load shift pilots/examples
  • October 24
  • Pilots: Write Up & Presentations (July meeting)
  • Demand approach – Peter Alstone
  • Real Time Product – Erik Woychik / Rick Aslin
  • Review of all proposed products in light of the evaluation criteria, make recommendations
  • Develop a list of data access issues relevant to new models that should be addressed prior to

launching new models

  • Develop a proposal on how to better coordinate efforts of CAISO and Commission to integrate

new models of DR into the CAISO market

https://gridworks.org/initiatives/load-shift-working-group/

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Next Steps - Update on Future Meetings

  • November 14
  • Refine a list of data access issues relevant to new models that should be addressed prior to

launching new models

  • Refine a proposal on how to better coordinate efforts of CAISO and Commission to integrate

new models of DR into the CAISO market

  • Provide outline of written report and next steps for sharing, review, and commenting
  • December 12
  • Final written report – rough draft for stakeholder discussion

https://gridworks.org/initiatives/load-shift-working-group/