HomeMy WebLinkAbout20031202DRAM Comments.pdff~ECEIVED 0FILED
2003 DEC -2 PH 3: 00
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iU i 'JuLICDE MAN D RES P 0 N SJ=TltlfTiIWlY(j.fjM1gPlCNQE T E R IN G Co a irian
O. BOX 33957
WASHINGTON , DC
20033
phone (202) 441.1410
VIA EMAIL
December 1 , 2003
Dave Schunke
Section Supervisor
Idaho Public Utilities Commission
Re: Idaho Power Company Advanced Metering Program
Dear Mr. Schunke
In response to your request, the Demand Response and Advanced Metering Coalition
("DRAM") is pleased to provide comments on the advanced metering pilot now under
development in Idaho. These comments are a distillation of lessons learned in recent
activity in California, as well as the very rich and broad academic literature. Our
members have had extensive experience with numerous advanced metering and
demand response programs , including dynamic pricing, and have been very active in
California s Statewide Pricing Pilot via an organization in which many of our members
also participate, the California Consumer Empowerment Alliance ("CCEA"
We offer these observations:
1. First and foremost, keep it simple. Many programs are very complex, with
numerous experimental treatments. It's important to remember that this is human
behavioral research in the real world with numerous confounding variables. The
simpler the better, and more friendly to customers the better.
2. Focus on the areas of greatest value. The paramount benefits of advanced
metering are in utility operational benefits, led by remote meter reading, and in
dynamic pricing focused on the top 100 hours of the year. Figure 1 of the
attachment is a load duration curve showing how demand response in just these
hours can reduce the need for total generating by up to 25% (!). That's because
the 25% of the generating capacity is needed to serve the extra load , higher line
losses, and greater reserves associated with these 100 hours. While the curve is
for California, Idaho s should be very similar.
3. Keeping 1 and 2 in mind , include a simple critical peak pricing program in Idaho
advanced metering pilot with the following features:
a. Sample size that allows for statistically significant results that can be
projected to the population as a whole. This could be as few as a couple
of hundred customers.
b. Focus on assessing total peak reduction for the population. Avoid
attempting to measure reductions associated with specific types of
customers (e.g. high usage vs. low usage, customers with and without air
conditioning). While such comparisons are tempting, they will greatly
complicate Phase One , and sufficient academic literature - literally
hundreds of programs and analyses - is available to enhance the results
if necessary to consider specific policy options.
c. Provide a simple, customer friendly rate that combines features of other
successful programs, as follows (please note that these are examples of
features that have been successful for others and that the process should
remain flexible so Idaho can develop a program specific to its own
needs ):
i. Rate during all but the 100 critical peak hours remains as it is
today
ii. The critical peak hours are set for noon to 6 p.m. on 16 days per
year. The fixed time period makes it easy for customers to
remember.
iii. The critical peak days will be dispatched based on forecast
wholesale energy prices, targeting the most expensive days of the
year. High temperatures can be used as a proxy for wholesale
energy prices if necessary.
iv. On critical peak days , customers will receive a 50% rebate if they
reduce their consumption during the critical peak hours by 10%
compared to their average consumption during the critical peak
hours. The rebate is calculated on the bill for the critical peak
hours only, so rebate amounts are quite small , even though 50%
sounds large. (It is important that customers understand that, even
though individual savings are likely to be small, overall ratepayer
savings will be in the millions of dollars, and there are
environmental benefits as well. It's very much like recycling in that
the financial benefits are small individually, but the societal
benefits are substantial.)
v. Customers will be notified the day before critical peak days , so
they can plan ahead if desired (note that their bill remains exactly
the same if they do nothing; the 20/20 discount amount is
designed to approximate wholesale energy purchase savings).
Notification in the pilot would be via an automated phone call or
email at the customer s preference. Notification in a large-scale
program would be via mass media, such as newspaper and radio
announcements.
vi. Calculate and bill the customers manually in Phase One in a
customer-friendly, graphical format that allows customers to
understand how they reduced critical peak usage.
d. Compare the critical peak usage of the participants with non-participants
to estimate the total peak reduction (see Figure 3).
4. Appropriate baseline data can be obtained if the advanced metering system is
deployed by June of 2004. It is anticipated that Phase I will encompass the towns
of Emmett and McCall (approximately 25 000 residences). Upon issuance by the
Commission in the near term of an Order approving Idaho Power
implementation plan , IP can in turn have contracts executed with the AMR
vendor and the meter vendor(s), products ordered, and an adequate and
appropriate deployment schedule for those areas created. This will enable IP to
begin acquiring baseline data for the summer of 2004 that can be used to
analyze a dynamic pricing pilot to be operated in the summer of 2005. This will
also allow IP time to create any necessary CIS changes in the event they
determine that an automated billing process is possible (but see, 3., above).
Perhaps, most importantly, however, it will allow the overall schedule set by the
Commission for activity during 2004 and 2005 to be met.
Although this Phase I deployment is to further the goal of measuring the biggest value
items (see 2., above) it should be noted that it may also allow other benefits to be
immediately realized - such as better customer service, improved distribution
engineering, et cetera.
We appreciate the opportunity to comment and would be pleased to answer any
questions or otherwise assist with Idaho s advanced metering pilot.
Sincerely,
Isl CHRIS KING
Chris King
Acting Chair
Demand Response and Advanced Metering Coalition
cc:President Paul Kjellander, I PUC
Commissioner Dennis Hansen , IPUC
Commissioner Marsha Smith, IPUC
Maggie Brilz, Idaho Power Company
One quarter of
capacity used
less than 100
hours per year
- 40000
3(j()(Xj
.l!.-
2(100(1
Attachment
Figure 1 - Load Duration Curve for California
P\a1qnitng tWier..... Maruin: $4. U2 ftfW
&1O!W
Sj'JiMil'llJ RotCNO Rcquit(.~ SUIU MW
Peak Coman.:!: 52. 00& t/.W
50000 1~~r!kiJ~D~~s(~a!b~1if!!I~4M2~~. - . -
. - . . - . " - . " " , . - . " - . . " . . . .
5% of Ttno Demond orcatcrUllln 42.313MW
\1% QfI((l'IId')ftt'llJfnt!.groborlhan 39,244 MW
----~-_. ----..-----.----- .----. ------ ._-------_.~--.. "'-"-- -.".......-. .........-......-..
toO!W
-- -
-.---- ----- -~---- --.--- ---_Ow ------
.-----------.
Numbcr~fifouns
t 501 1001 1501 2001 2&:01 3001 3SfJ1 40:21 4GOt !;()O1 SSG! 6001 MO1 1001 1501 eoO! &501
SaulteR: C3firOffl lit EMrO'1l Commission. CatilOmia 1$0 Reouirt!ment!t
Sample ~w~ ttJ.,
~2~ M~in St.
Account Number
I\BO.12344567
24 hr Customer Service
800~ABC-5000
50/10
earns 50% rebale when yoo
reduce usage by 10% from
noon.6 p.m. during Super
Peak events. The rebate !s
caculated on yoor usage
during these six hoofs.
June 14, 2003
Noon t06 p.
June 15,2003
Noon to 6 p.
June 29, 2003
Noon to 6 p.
Suoer Peak Hours
From 1100n to 6 p.m. during
critical system oondlUcms.
Customers are notified by 5
m. the day prior to the .
event.
Reaular Hours
All other weekday hours
AU day on weekends
Figure 2 - Sample Bill Summary
SUPE:R PEAK REBATE SUMMARY
Your Super Peak 20/20 Target is 20'%, less usage than your
average usage on weekdays ~tween noon and 6 p.
f)i~Y~P9t $Ol~g g~b~
8 SUper Peak Target 6/3/03 to 7/2/03 10 kWh
. SUper Peak Day 6/27/03 11 kWh
super Peak Day 6/28/03 7 kWh
Super Peak ,Day 6/29/03 7 kWh
$0.
$0.
$0.
Your Daily Peak Usage
.1ft
4 .
:2 '
~O T$fgt!Su~ Ptik
61'27100
$UjJtf?~k
&1aiO-3
Super Peak
o"29.'~
Congratulations! You earned SOl10 rebates on two of three Super Peak
days.
'MIlle individual savings may be small, aU consumers together be.neftl
sIgnificantly by oo~ing fewer peaker power plants aoo having reduce(J air
poUulion emissions.
Thank you for yoor participation"
1.4
J. 1.2
~ 0.
~0.
~ 0.4
~ 0.
Figure 3 - Sample Critical Peak Rate Response from California
Statewide Pricing Pilot
Data for July and August 2003
A\entge Hniy FlErgy tie By Ture Period
An-Zore A\ernge For (PP-F ilitoJ:re~ OJ. (PP Th)S
..................... .
t-
.. .. ....... .... ... ....... ....
........u.........
4 5 7 8 9 ronunWBMTI~~Wlin~~
Ihr
-Treatnut ....... CoItrol
Source: Joint Utilities Monthly Report to California Public Utilities Commission
November 15, 2003.