Locational RFOs in support of the Preferred Resources Pilot (PRP) - - PowerPoint PPT Presentation

Southern California Edison 1

IDER Workshop – Competitive Solicitations

Locational RFOs in support of the Preferred Resources Pilot (PRP) & DG Solutions RFP

March 28, 2016

Southern California Edison 2

PREFERRED RESOURCES PILOT RFOS

Southern California Edison 3

• PRP region is located in the Western LA Basin.

The basin is impacted by:

• Closure of the San Onofre Nuclear Generation Station
• Impending closure of ocean cooled power plants
• Population and business growth in the PRP region

resulting in an increased peak demand

• PRP supports western LA basin reliability needs

by:

• Resolving contingencies associated with resource

deficiencies in the Western LA Basin since resources sited in the southwest part of SCE’s territory are more effective

• Validating CEC’s and CAISO’s assumptions about preferred

resources ability to achieve energy savings and peak load reductions

• Informing decision on gas‐fired generation in the southwest

part of SCE’s territory if some of the Western LA Basin mitigation projects are delayed or fail

Distribution Resource Plan Demonstration Region

http://on.sce.com/preferredresources

PRP Background

The PRP objective is to determine if preferred resources (PRs) can deliver what is needed, when needed, and for as long as needed by designing, acquiring, implementing and measuring a diverse portfolio of PRs that can manage the ~300 MW load growth to net zero

Southern California Edison 4

• PRP’s resource acquisition strategy relies

upon three key acquisition mechanisms*:

• DSM programs
• Existing solicitations
• Product‐specific targeted solicitations
• Development of the resources attributes for

locational RFOs supporting the PRP is driven by a portfolio design process

• A detailed, location‐specific, 365/24/7 load

forecast

• Defined resource attributes that may meet the

forecasted peak demand

PRP Acquisition of Resources

*Other sources includes utility owned energy storage

• Delivery lead time

varies by resource

• Ability of

programs to deliver varies by resource type

• Performance

requirements and penalties may increase the dependability of contracted resources

Lessons Learned through Acquisition Efforts

Southern California Edison 5

• PRP RFO 1
• Focused solely on renewable Distributed Generation due to DG specific

pipeline concerns

• Launched in November 2014, bids received July 2015
• Worked with DG market to identify potential barriers and modified existing

pro formas (RAM 5) in an effort to overcome barriers

• Targeted 50 MW of in front of the meter DG
• Very limited response to RFO
• PRP RFO 2
• Launched in September 2015, bids submitted in February 2016
• Expanded eligible products to include DG, DR, ES to build pipeline toward 2022

need

• Robust response from market across each individual resource types and

combinations of resources

• Currently working through short‐listing process

PRP RFO #’s 1 & 2

Southern California Edison 6

• Securing large sites in highly urbanized areas is challenging
• SCE lowered the project size requirements from 500 kW to 250 kW in
• rder to increase the likelihood of sellers securing sites
• In location specific RFOs, a significant number of projects may enter

the interconnection queue and potentially impact the results of the interconnection studies

• SCE modified the PRP DG RFO requirements associated with

interconnection

• In subsequent solicitations with similar characteristics SCE may consider

de‐linking the offer evaluation from the interconnection study process

• Once a project is shortlisted, a completed interconnect application would

be required to facilitate a more efficient interconnection review process for shortlisted projects

PRP RFO Lessons Learned

Southern California Edison 7

DG SOLUTIONS RFP

Southern California Edison 8

DG Solutions RFP Background

• 2003 CPUC Decision (03.02.068) requiring IOUs to:
• Develop a methodology to evaluate and incorporate DG into Distribution

System Planning

• Provide DG community information through RFPs when viable
• Offer DG compensation
• Previous Evaluation Methodology
• Report produced annually starting in 2003, but no viable projects identified

until 2014

• SCE was challenged during 2012 GRC proceeding and reached a

Settlement Agreement

• Pilot Request For Proposal
• Prepared Pro Forma Contracts and other RFP documents
• RFP launched during 2012 GRC Cycle (2014)
• SCE must report the results of the RFP during the 2012 GRC Cycle (i.e. by the end
• f 2014)

Southern California Edison 9

• Project site selection guidelines:
• Customer Type (Commercial/Industrial/Residential)
• Minimum Generation Required to defer project 2 years
• Sufficient Load Customer Size (Feasibility) in need area
• Economic feasibility
• DGS cost could not exceed cost of deferred project
• DG project cost impacted by automatic load reduction scheme requirement
• One site identified as viable, RFP launched for DG solutions in June

2014, bids due August 2014

• No bids submitted to SCE
• At same time as RFP, an RFI for alternative solutions was released
• SCE did receive responses to RFI for projects that were not exclusively DG

DG Solutions RFP Process and Results

Southern California Edison 10

• Various regulatory requirements presented problems:
• Physical Load Reduction Assurance requirements were a barrier to market

participation

• Impaired economics of proposal, added equipment cost without payment stream
• Created risk for customers to participate
• No alternative solutions permitted, limiting market opportunities
• In‐service date requirement and RFP timeline did not align well
• Short payment duration for proposed projects, i.e. only duration of deferral
• Limited potential projects to large customers and large generators only
• Reduced number of deferral projects and potential customers for market to

partner with

• Less prescriptive lead to greater response
• Multiple parties responded to RFI with package solutions addressing

alternatives to prescriptive requirements

• Costs not specifically addressed, so unclear if economically viable

DG Solutions RFP Lessons Learned