helping utilities make smart solar decisions november 16, 2015 phase ii developing roadmaps for the...

Helping Utilities Make Smart Solar Decisions

November 16, 2015

Phase II

Developing Roadmaps for the Future


Webinar FAQs

•Recording & slides will be sent to all registered attendees within two business days.

•Submit questions in the questions or chat window at any time.

•Questions will be answered throughout the webinar.


Upcoming Events

Webinar:

New Lessons from the Lone Star StateThursday, December 10, 201511 am PT / 2 pm ET

Free Webinar Brief: Community Solar Program Design TrendsTuesday, December 15, 2015 11 am PT / 2 pm ET (30 minute duration)

Register today: www.solarelectricpower.org


Presenters

Tanuj DeoraExecutive VP & Chief Strategy Officer

Solar Electric Power Association

John SterlingSenior Director, Research & Advisory Services

Solar Electric Power Association


What is the 51st State?

Recap of Phase I

▪ SEPA launched the 51st State Initiative with two primary objectives:

1. To create equitable business models and integrated grid structures to ensure that electricity is provided safely, reliably, efficiently, affordably, and cleanly; and,

2. To meet customer demand in the near and long term for solar and other distributed options

▪ A “crowd-sourced” effort took place where ideas on a blank slate market were submitted

– 13 qualifying submissions were received (http://www.sepa51.org/submissions.php)

▪ Ideas ranged from small tweaks to massive shifts in the way we transact today

1

http://www.sepa51.org/submissions.php

http://www.sepa51.org/submissions.php


Summary of Phase I Ideas

2


Launch of Phase II

▪ Brainstorming what the future should look like is much easier than determining how to get there

▪ Phase II will focus on just that – identifying what specifically needs to change, when those changes should occur, and how all aspects of the industry are impacted

3


Phase II Overview

51st State Roadmap

Articulate the Starting Point

Determine the Changes Required Across a Variety of Factors

Lay out the Incremental Steps

Identify Go/No-Go Decisions

4


Step 1: Identify the Starting Point

▪ How can the “current state” be described?

▪ What characterizes this market?

▪ What type of utility serves it?

▪ What policies are in place today?

5


Step 2: Determining Change

▪ SEPA has broken down the variety of areas impacted by market transformation into six distinct Swimlanes

▪ Across each of these Swimlanes, it is possible to outline not only how the Current State needs to transform to become the 51st State, but also the time horizon and incremental steps required to make that transformation successful for all parties

6


Retail Market Design

How will retail markets be structured? Is there full retail competition or just for

certain customer classes? Do customer classes need to be

redefined based on technologies instead of residential/commercial/etc.?

How do low- and limited-income customers get treated?

How do customers interact with the grid, and is it different for different customer classes?

What products and services are consumers buying, who sells them, and how are they valued?

What options exist for customers who want their electricity transaction to remain largely unchanged from today?

Do customers opt in to all of the technological integration choices or opt out?

Who invests in technologies behind the meter, and who is responsible for operating, monitoring, and controlling them?

Who is responsible for planning, operations, and maintenance?

Who can own DERs? Who owns the data generated by DERs

on customer premises?

7


Wholesale Market Design

Is the wholesale market based on an RTO/ISO or some other model?

Who can own generation? Who is responsible for

generation dispatch decisions?

How are DERs accounted for in the capacity planning process?

Who can own transmission? Who is responsible for

transmission planning and operations?

How are wholesale generation and transmission costs recovered?

8


Utility Business Model

What role does the utility play?

What level of participation can the utility have in wholesale and retail markets?

Will utilities remain responsible for societal services such as low income support, or will those be assumed by other parties?

What is the revenue model for utilities?

What investments can utilities make, and how do those get recovered?

How can they recover stranded asset costs (if any)?

9


Asset Deployment

What wholesale generation resources are required, what triggers those investments, and who plans and owns them?

What transmission system technologies are required, what triggers those investments, and who plans and owns them?

What distribution system technologies are required, what triggers those investments, and who plans and owns them?

What on-premise technologies (including service drop through the meter) are required?

Who determines the investment requirements?

How are new technologies, standards, etc., adopted and incorporated?

Who is responsible for asset operations and maintenance?

What are the timing requirements and triggers associated with these new technologies getting deployed?

What are the physics of grid operation, and who ensures a diversity of generation resources are deployed to minimize risk?

10


IT

What functionalities and capabilities are required for tracking and analyzing the data requirements?

What functionalities and capabilities are required in the utility’s back office systems (CIS, MDMS, etc.)?

To what extent is real-time information and communications exchange required?

Who owns customer data and information, and how is it safeguarded?

Who is responsible for these investments?

What protocols and other safeguards are needed, and who is responsible for, cyber-security?

Are decisions made between devices in the real time, or are decisions made at a central operator and pushed downstream?

How frequently and quickly must decisions be made based on the data collected?

11


Rates & Regulation

What level of regulation is required in wholesale and retail markets, and what entities are subject to regulation?

What do consumer protection regulations look like, and who is ultimately responsible for enforcing them?

What is required to monitor and prevent market manipulation at the retail level?

What entity (utility, 3rd party, etc.) ultimately bears the risk for safety and reliability, and how are they compensated for those services?

What is the predominant retail rate structure, and is that an opt-in or opt-out for residential customers?

How are utility fixed and variable investments recovered?

Is performance-based ratemaking appropriate?

Under what structure can DERs transact?

12


17

Step 3: Identifying the Incremental Changes & Triggers

• Focus on an incremental transformation• Understand what needs to occur before moving

forward• Identify major indicators that could signal a

course correction

13


Putting it All Together:Developing a Roadmap

14


Call for Papers

1. Roadmap document – white paper on how existing markets can be transformed to achieve the desired structure and outcomes of the 51st State market design, including:

A. One Current State – leveraging the high level descriptors found in Table 1

B. One Future State – describe what constitutes the final 51st State market construct you are building towards

C. Swimlanes – discuss and describe how the Current State market needs to be modified over time to achieve your desired outcome

D. Stages, Checkpoints, & Signposts –address the major Stages of the process, the overall goals and guiding principles of each Stage, and identify the relevant Checkpoints and Signposts to signal how and when to move forward

E. Alternative Scenario – provide a brief summary of the ways in which the Swimlanes, Stages, etc., would need to be modified if starting from a different Current State or going to a different Future State

2. 51st State Market Transformation Roadmap Graphic – graphic of the Roadmap that visualizes the ways the market transforms in a visually understandable format

3. Draft Poster Exhibit – as part of the 51st State Phase II Summit, SEPA will host a poster exhibit for all submitted papers15


Notice of Intent to Submit

▪ Form available at www.sepa51.org- Non-binding

- Not required

▪ Provides SEPA with list of interested participants to filter additional, tailored communications and updates on the submission process

▪ Ability to request assistance on specific Swimlanes- SEPA will attempt to find partners if requests align

▪ Request completion of form by November 19, 2015

16

http://www.sepa51.org/


21

Phase II Summit

▪ April 14, 2016 in Denver, CO

▪ Co-located and directly following SEPA’s Utility Solar Conference

▪ All submitters will be invited to attend- SEPA will host a poster exhibit reception for all submitters

▪ Agenda will focus on similarities and differences across each Swimlane

▪ GOAL - identify common ground and “no regrets” strategies that work regardless of the future state

17


Key Dates

November 19, 2015

• Notice of Intent to Submit

March 9, 2016

• Submission of papers

April 14, 2016

• Phase II Summit in Denver, CO

18


Executive Leadership Council

MembersRon Binz - Former Chairman, Colorado Public Utilities Commission

Ben Bixby - Head of Energy and Enterprise Partnerships, NestMike Champley - Commissioner, Hawaii Public Utilities Commission

Steve Corneli - SVP, Policy & Strategy, NRG

John Di Stasio - CEO, Large Public Power Council

Seth Frader-Thompson - President, EnergyHub

Lisa Frantzis - SVP, Strategy & Corporate Development, Advanced Energy Economy

Ralph Izzo - CEO, PSEG

Ken Munson - CEO, SunvergeFrank Prager - VP, Environmental Policy & Services, Xcel Energy

Anne Pramaggiore - CEO, Commonweath Edison

Joe Slater - CEO, Southern Maryland Electric CooperativeKelly Speakes-Backman - Former Commissioner, Maryland PUC; SVP, Alliance to Save Energy

Adam Umanoff - EVP/General Counsel, Edison International

Mark Vanderhelm - VP, Energy, Walmart

Geisha Williams - President, Electric Ops, PG&E

Purpose

▪ Provide strategic guidance to SEPA on Phase II

▪ Participate and lead sessions at Summit and other industry events

▪ Review and comment on a Capstone report developed based on all submissions

19


Why Participate?

▪ Discussing the incremental steps, requirements, roles, and responsibilities that are necessary to facilitate a high DER penetration future is challenging but critical

- There is no single outcome that can work coast to coast

- The industry needs more ideas and solution sets on the table

▪ Common ground does exist- Focusing on areas of agreement and understanding how vastly different future market structures are based on similar incremental concepts can drive consensus on “no regrets” strategies

20


25

Questions?

John Sterling

Senior Director, Research & Advisory Services

P: 202-559-2022

[email protected]

www.sepa51.org

mailto:[email protected]

helping utilities make smart solar decisions november 16, 2015 phase ii developing roadmaps for the...

Documents

smart solar decisionsstep

smart solar decisionsphase

overview4helping utilities

parties6helping utilities

today1helping utilities

impacted3helping utilities

market transformation

different customer classes