Workshop II Best Practices & Case Studies: Economic Benefits of - - PDF document

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Workshop II Best Practices & Case Studies: Economic Benefits of - - PDF document

Workshop II Best Practices & Case Studies: Economic Benefits of Distributed Solar in Ohio Wednesday, February 20, 2019 2 p.m. to 3:15 p.m. Biographical Information Dan Smies, Managing Director, Business Development AEP OnSite Partners,


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Workshop II

Best Practices & Case Studies: Economic Benefits of Distributed Solar in Ohio

Wednesday, February 20, 2019 2 p.m. to 3:15 p.m.

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Biographical Information Dan Smies, Managing Director, Business Development AEP OnSite Partners, 303 Marconi Blvd., Columbus, OH 43215 614-583-6837 dbsmies@aepes.com Dan is responsible for leading the AEP OnSite Partners business development team and helping the company grow its portfolio of customer centric energy assets through helping customers manage their energy cost by implementing asset-based products and services. With over 15 years in the energy industry, Dan brings an extensive breadth of knowledge and experience in various leadership roles in several regulated and non-regulated electric utility companies, including Integrys Energy Group (now WEC Energy Group), Integrys Energy Services, and Wisconsin Public Service

  • Corporation. Dan started his career in corporate treasury, and has held various

positions with increasing responsibility in regulated renewable development, wholesale power marketing, competitive energy asset development, and generation dispatch strategy and analytics. Peter Protopappas, CEM, Business Development AEP OnSite Partners, 303 Marconi Blvd., Columbus, OH 43215 pprotopappas@aepes.com Peter is a business-minded energy engineer and certified energy manager focused on energy savings and conservation in the US with diverse experience in consumer product development, batteries and energy storage, fuel cells, solar technologies, and building energy systems. His specialties include: Energy Technologies, Risk Analysis, Data Mining, Operational Strategy, Lean Six-Sigma, Operations Management, Product Development Engineering, Project Management, Energy Management, Energy Storage He manages project development, acquisitions, and strategy for AEP's unregulated distributed energy resources business, AEP OnSite Partners. In this role, he evaluates acquisitions and develop projects to install behind the meter customer energy solutions such as solar PV, battery energy storage, CHP, peaking gen, fuel cells, VFDs, and substations. AEP OnSite Partners is a wholly owned subsidiary of American Electric Power.

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SLIDE 3 AEP Energy is a competitive retail electric service provider and a competitive retail natural gas supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

Best Practices & Case Studies:

Economic Benefits of Distributed Solar in Ohio

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

AEP OnSite Partners

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  • Provide capital for behind–the-meter (BTM) systems

and technologies, including:

  • solar, combined heat and power, energy storage,

waste heat recovery, energy efficiency, and peaking generation resources.

  • Provide customers with greater control and options

that are reliable and provide longer-term price stability.

  • Share strong market knowledge, fundamental

engineering, develop new energy innovations, and creatively structured partnerships with customers to save money.

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

AEP OnSite Partners

Behind the Meter (BTM) Solar in Ohio Sites currently Operating in Ohio:

  • Clyde: 3.6 MW-dc
  • Ada I & II: 2.07 MW-dc
  • Yellow Springs: 1.01MW-dc
  • Columbus: 0.1MW-dc
  • Newark: 1.06 MW-dc
  • Granville: 2.3 MW-dc
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SLIDE 7

AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

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Energy Supply Costs

Solar Impacts

Solar Impacts More than Just Energy

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

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Solar PV

Single Axis Tracking vs. Fixed Tilt Systems Tracking Extends Solar Peak Capacity and Increases Ability to Drive Coincident Peak Savings

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

  • Typical Customer & Product:

– Values Renewables & Long Term Energy Security – High On Peak, Low Off Peak Usage – AEP Energy Product: True Demand

  • Projects pay for themselves and offer savings

– Requires transmission pass-through

  • Mainly Municipalities in AEP and ATSI
  • Ground mounted solar needs 4 – 6 acres/MW
  • Typical customer contracts 20-25 years

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Technology Benefits

  • Peak Demand Reduction
  • Capacity
  • Transmission

Benefits & Tariff Analysis

Solar Energy (PV) – Ground Mounted & Roof

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

Capacity and Transmission

Savings from Solar – AEP Zone

*Analysis aligns PJM published PLC and NSPL hours from 2011‐2015 with PVSyst production data using SolarAnywhere v2.3 time series data near Central Ohio. Resulting reduction shown is for a 1 MW DC array for all three scenarios. *2014 and 2015 NSPL winter peaks

500 kW of reduction = $30,054 of annual savings with PLC values of $164.68/MW‐Day

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

Capacity and Transmission

Savings from Solar – AEP Zone 500 kW of reduction = $30,054 of annual savings with PLC values of $164.68/MW‐Day

*Analysis aligns PJM published PLC and NSPL hours from 2011‐2015 with PVSyst production data using SolarAnywhere v2.3 time series data near Central Ohio. Resulting reduction shown is for a 1 MW DC array for all three scenarios. *2014 and 2015 NSPL winter peaks. 2016‐2018 NSPL peaks occurred

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

Energy Costs

RT LMP Values and Daily Irradiance

  • Comparison of Real Time LMP values and irradiance

*Analysis uses OSU.138KV.T1.PJMRT nodal point as representation of Columbus Real Time LMP

  • values. Irradiance values were obtained from Clean Power SolarAnywhere v2.3
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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

Case Study: Solar “Over” Sizing

Ohio Municipal Load

*Analysis uses customer load data from 1/1/2017 through 12/1/2017. Solar production is based on Clean Power SolarAnywhere V3.2 TMY3 data.

  • Actual developer sizing for customer load. Approximately 2300 hours of

yearly export. Expensive to customer with small benefit.

  • Some developers will oversize system to fit land available
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SLIDE 14

AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

  • Updated size system for same customer
  • Approximately 10 hours export
  • In this case, limited opportunity because flat load produces small

demand benefits, or energy only benefits

  • Regulated customer without control of PLC/NSPL

Case Study: Correct Solar Sizing

Ohio Municipal Load

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

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Case Study: Ohio Solar

2017 Annual Savings Analysis

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

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Adaptable Design

25 Year PPA: 2.3 MW-dc, ~3,000 MWh/yr Annually

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

Value Drivers

Value Stacking with Solar in Ohio

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  • Added Qualitative Benefits

– Sustainability Goals – Exemplify Good Environmental Stewardship – Diversify Electric Supply and Realize Behind the Meter Benefits

PPA Price vs Effective Energy Price Waterfall

Effective Energy Price REC Value Energy Savings Transmission Savings Capacity Savings Solar PPA

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

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Solar Build Costs

Solar Energy (PV) – Ground Mounted

EPC Year 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Bonus Dep 50% 50% 100% 50% 50% 50% 50% 50% 50% 100% 100% 100% ITC 30% 30% 30% 30% 30% 30% 30% 30% 30% 30% 30% 26%

$0.00 $0.02 $0.04 $0.06 $0.08 $0.10 $0.12 $0.14 $0.16 $0.18 $0.20 $0.22 $0.24 $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 EPC ($/w) PPA ($/kWh)

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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

Contracting Options

Power Purchase Agreement (PPA) vs Direct Ownership

  • Third Party/PPA

Pros:

  • No Up Front Cost
  • Behind the Meter (BTM)

Benefits

  • Fixed Priced Energy
  • Eliminate Operating Risk
  • Eliminate Maintenance

Risk

  • Long Term Energy Partner
  • 24/7 Monitoring

Cons:

  • Savings realized over time

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  • Direct Ownership

Pros:

  • Energy Savings
  • Behind the Meter (BTM)

Benefits

  • Depreciation/Tax

Incentives when possible Cons:

  • Up Front Cost
  • Operating & Maintenance

Risk

  • Production Risk
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AEP Energy is a competitive retail electric service provider and a competitive retail natural gas

  • supplier. AEP Energy is an affiliate of AEP Ohio. AEP Energy is not soliciting on behalf of and

is not an agent of AEP Ohio. AEP Ohio customers do not need to purchase any competitive retail electric service from AEP Energy to receive or to continue to receive non-competitive retail electric services from AEP Ohio.

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Peter Protopappas

AEP OnSite Partners pprotopappas@aepes.com O: 614.583.3917 M: 614.204.8280

Dan Smies

AEP OnSite Partners dbsmies@aepes.com O: 614.583.6837 M: 920.268.7444