Speakes-Backman Presentation 9.20.13

Report
Maryland’s Grid Modernization
Experience
Presentation for the New England
Electricity Restructuring Roundtable
Kelly Speakes-Backman
Boston, MA
September 20, 2013
1
EmPOWER Maryland Energy Efficiency Act

Enacted: April 2008 (PUA § 7-211)

15% by 2015: per capita energy consumption reduction by 2015


2117 MW
5,475,000 MWh

Multi-faceted : Cost-effective programs for energy efficiency (EE), demand
response (DR), distributed generation, CVR, and AMI/Smart Grid

Verifiable: §7-211(g)(1) requires projected & verifiable electricity savings

Three year plans: 2009-2011, 2012-2014 plans developed as Work Group
recommendation of PSC Staff, OPC, MEA, Utilities and other stakeholders

Reporting: Quarterly data to Staff, semi-annual reports to the Commission
2
Scope of EmPOWER Maryland

Includes Energy Efficiency (EE), Demand Response (DR) & Smart Grid (SG)

2012 – 2014 program portfolios $695m in EE/DR Programs
2009 – 2015 projected to exceed $1b (not including SG)

Customer-Facing
 Lighting & Appliance rebates
 HVAC
 HPwES (existing homes, whole-house)
 Residential New Construction
 C&I prescriptive measures (lighting,
HVAC, motors, VSD, custom retrofits,
CHP)
 Low-income
 Multi-family housing (e.g., commonarea EE measures)
 Direct Load Control
Grid-Facing
 AMI (BGE, Pepco, DPL, SMECO)
 Conservation Voltage
Reduction (Pepco, DPL, PE)
3
EmPOWER Maryland Progress
Utility Program Achievement of the 2015 Energy Reduction Goal
Energy Reduction
Percentage of 2015
Program-to-Date,
2015 Goal (MWh)
Goal
September 30, 2012
BGE
1,231,156
3,593,750
34%
Pepco
424,839
1,239,108
34%
PE
176,686
415,228
43%
DPL
75,724
143,453
53%
SMECO
87,630
83,870
105%
Utility Program Achievement of the 2015 Peak Reduction Goal
Demand Reduction
Percentage of 2015
Program-to-Date,
2015 Goal (MW)
Goal
September 30, 2012
BGE
726
1,267
57%
Pepco
188.357
672
28%
PE
24.511
21
117%
DPL
39.765
18
221%
SMECO
56.558
139
41%
4
Cost Recovery Mechanisms

Customer-Facing Portfolios: monthly surcharges
2012 Residential Avg Monthly Impacts 2012 C&I Consumption Charge (per kWh)
Utility
BGE
Pepco
DPL
PE
SMECO

EE&C
$1.28
$1.13
$1.07
$1.67
$1.52
DR
$0.75
$1.53
$1.89
n/a
$1.47
Total
$2.03
$2.66
$2.96
$1.67
$2.99
Utility
BGE
PEPCO
DPL
PE
SMECO
EE&C
$0.000870
$0.000831
$0.000430
$0.000754
$0.000180
DR
N/A
$0.000101
$0.001055
N/A
$0.001470
Grid-Facing Programs: regulatory asset


Smart grid utilities will use AMI reg asset
Non-smart meter utilities will recover in rate base (PE)
5
Maryland Smart Grid Context




Introduced in the context of EmPOWER
No legislative mandate or specific guidelines set forth
BGE and Pepco each received up to $200m ARRA Smart Grid
Investment grants
All Maryland AMI proposals were preceded by pilot projects,
including:



Technology pilots
Multi-year peak pricing pilots
Operational benefits pilot
6
Maryland Smart Grid Business Cases

BGE, Pepco, DPL proposals estimated strong cost-effectiveness



Roughly half the benefit from operational savings and half from peak
load reductions (mostly capacity benefits)
Dynamic pricing using peak time credit approach to achieve usage
reductions during critical peaks
SMECO cost effectiveness positive



Includes operational benefits only
Did not include peak load reduction savings
Possible time of use rates in the future
7
Maryland Commission Decisions



Cost recovery contingent upon demonstrated costeffectiveness
Smart grid expenditures may be requested in first rate case
following full deployment and cost-effectiveness analysis
Plans and Metrics




55 total metrics
Metrics monitor deployment progress, costs/benefits, customer
engagement
Customer education plans
Cyber-Security plans
8
Maryland Smart Grid Progress

BGE



Pepco-MD (PHI Affiliated)




550,000 electric meters in Maryland (largest jurisdictional PHI utility)
Preceded (one year) by full implementation in Pepco-DC
98% complete by June 2013
DPL-MD (PHI Affiliated)




1.2 million electric & 660,000 gas meters
Roughly 33% of installations completed, complete in 2014
210,000 electric meters in Maryland
DPL-DE completed full implementation (electric and gas) in 2012
Installations underway, complete late 2013/early 2014
SMECO


160,000 electric meters
Approved Summer 2013
9
Maryland Smart Grid: AMI

AMI overall benefits





Reliability (duration)
Demand reduction
Energy use information transparency
New technology advances and applications
Forecasted Smart Grid demand reductions through 2017
(MW)
10
Leveraging EmPOWER and AMI

Dynamic Pricing







Direct load control
Peak time rebates
Time of use pricing
Real-time pricing
Conservation Voltage Reduction (“CVR”)
Behavior-based EE programs
Electric Vehicles and the Grid
11
Maryland Smart Grid: Dynamic Pricing

Dynamic pricing includes DLC, PTR, TOU, real time pricing

Peak event days





Includes PJM DR days, high LMP days, and could include distribution
problem days
In most cases, declared for the following day
Generally declared June – Sept.
Maximum hours are 12pm – 8pm, usually actual is less
Multiple customer communication streams in advance
12
Maryland Smart Grid: Direct Load Control


DLC program reductions approximately 700 MW
BGE “Smart Energy Rewards”




PHI “Peak Energy Savings Credit”






Voluntary
“Opt-in” for residential
100%, 75%, 50% option
Voluntary
“Opt-in” for residential, small commercial
100%, 75%, 50% option
$1.25/kWh during peak period
Reductions monetized in PJM capacity and energy markets
True-up in annual distribution surcharge/credit
13
Maryland Smart Grid: Peak Time Rebates

$1.25/kWh credit for reduction from customer-specific
baseline


Cash flow similar to DLC programs





Peak load reductions monetized in PJM capacity and energy markets
PJM payments fund customer credits
True-up in annual distribution surcharge/credit
Can augment DLC programs


Calculates usage difference from a comparable degree-day
If monthly reduction exceeds DLC commitment, customer receives
end-of-season credit for the difference
No penalty for non-participation
Retail supply neutral – except for customers whose supplier
provides their own PJM based load reduction program
14
Maryland Smart Grid: CVR

PE received approval to implement CVR program under
its EmPOWER portfolio


Recovery of program costs will be sought in rate base after full
implementation
Commission Order No. 84569 directed other utilities to
investigate feasibility of implementing CVR in respective
service territories (Dec. 22, 2011)

Directed recovery of program costs to be sought through rates
15
Maryland Smart Grid: Behavior-based EE


Behavior-based programs encourage direct customer
engagement
April 2012: Commission authorized EmPOWER utilities to
implement energy usage programs
Behavior-Based Residential Program Results
(Net Wholesale 2013 Q1 and Q2)
Metric:
Pepco
DPL
PE
SMECO
Forecasted
Reported
Forecasted
Reported
Forecasted
Reported
Forecasted
Reported
Participants
50,000
50,198
25,000
24,024
25,000
72,697
12,500
51,486
Annualized
Peak
Total
Energy
Demand
Program
Savings
Reduction
Expenditures
(MWh)
(MW)
5,126
0.000
$381,327
5,517
2.427
$617,669
1,809
0.000
$154,888
0
0.000
$350,981
9,398
1.071
$412,749
11,824
0.111
$588,530
3,888
0.445
$114,440
1,769
1.592
$304,983
16
Maryland Smart Grid: Electric Vehicles

Maryland Senate Bill 179 (2011)

Establish “a Pilot Program for electric customers to recharge electric
vehicles during off-peak hours.”





Increase efficiency and reliability of electric distribution system
Encourage lower electricity use at times of high demand
BGE Pilot Program: voluntary, residential, TOU rate


Pilot Program in place June 30, 2013
Report findings to General Assembly by February 1, 2015
Based on whole-house TOU with lower off-peak pricing (400)
Pepco Pilot Program: voluntary, residential options



Existing customers with EVSE: whole-house TOU or PIV rate (200)
Existing customers without EVSE: PIV rate and bill, Level II charging
station, second meter (50)
New customers without EVSE: whole-house TOU (1000)
17
Maryland Smart Grid: Opt-out?

Jan. 7, 2013: Order No. 85294


Commission concluded (3-2) that the public interest requires provision
of additional option related to installation of smart meter
Additional proceedings held August 20, 2013





Whether to allow option to retain existing meter, RF-free or “near RFfree” meter
Associated costs, allocation and procedures for exercising option
Treatment of “non-responsive” customers
What percentage opt-out scenario to consider
Low-income opt-out scenarios
18
Maryland Smart Grid: Cyber Security Plans

Company-specific AMI cyber security plans



Plans apply to AMI, not utility-wide operations
Work Group consensus support
Commission oversight plan applicable to BGE, Pepco, DPL


Key feature is independent 3rd party consultant answerable to PSC to
review all details of utility AMI cyber security activities and incidents
Approved by Commission June 21, 2013
19
For more information…
www.psc.state.md.us
20
SMECO Operational Pilot Results
21

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