20171031IPC to Volt Solar Attachment 35.pdf

Net Metering Customer and
Stakeholder Workshop
Tami White
Connie Aschenbrenner
July 27, 2016
Tonight’s Agenda
Welcome & Introduction
Tami White
Overview of Residential Rates
Review of Annual Net Metering Report
Potential Rate Design Changes
Connie Aschenbrenner
Feedback/Comments
Facilitated by Tami White
2
What is “the Grid”?
3
Idaho Power’s Energy Grid
4
Idaho Power’s Total Cost
5
Grid Costs
(fixed)
Energy Cost
(variable)
Total Annual
Cost
(Revenue Requirement)
Idaho Power’s Total Cost
5
Grid Costs
(fixed)
Idaho Power’s Total Cost
5
Energy Cost
(variable)
Idaho Power’s Total Cost
5
Grid Costs
(fixed)
Energy Cost
(variable)
Total Annual
Cost
(Revenue Requirement)
Total Annual Cost = ~ $1 billion
Class Cost-of-Service
Small
Commercial
Industrial
Residential
Special
Contract
Irrigation
Total Annual
Cost
(Revenue Requirement)
$1 billion
6
* Idaho Power assigns costs to approximately 20 individual Schedules/Classes based on usage of each group of customers
*
*
*
*
*
Residential Class Cost-of-Service
Energy Costs
Residential
Total Annual
Cost
~($450m)
7
Grid Costs
67%33%
$300 million $150 million
Collection of Costs
(Residential Class)
Cost Category Total Cost
Grid Costs
(fixed)$300 million
Energy Costs
(variable)$150 million
8
Total $450 million
Type of
Charge
Authorized
Rates
Service Charge
(Fixed $5/mo.)$25 million
$/kWh
(volumetric)$425 million
Total $450 million
$275m Grid
$150m Energy
Collection of Costs
(Residential Class)
Cost Category Total Cost
Grid Costs
(fixed)$300 million
Energy Costs
(variable)$135 million
9
Total $435 million
Type of
Charge
Authorized
Rates
Service Charge
(Fixed $5/mo.)$25 million
$/kWh
(volumetric)$383 million
Total $408 million
$435m Costs -$408m Collection = $27m Short Fall
Assume: 10% reduction in kWh sales
Annual Net Metering Report
IPUC Order No. 32846*:
“the Company shall file an annual
status report with the Commission
discussing the net metering service.
The report shall discuss, without
limitation, the net metering service
provisions and pricing and how
distributed generation may be
impacting system reliability”
* Case No. IPC-E-12-27
10
System Counts
11
0
1
2
3
4
5
6
7
8
9
0
100
200
300
400
500
600
700
800
900
1,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Q1
2016
Na
m
e
p
l
a
t
e

(
M
W
)
Sy
s
t
e
m

C
o
u
n
t
s
TOTAL Installed Capacity
System Counts
March 2016
11
0
1
2
3
4
5
6
7
8
9
0
100
200
300
400
500
600
700
800
900
1,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Q1
2016
Na
m
e
p
l
a
t
e

(
M
W
)
Sy
s
t
e
m

C
o
u
n
t
s
TOTAL Installed Capacity
867 customers, 7.1 MW
System Counts
148% Increase since 2012
11
0
1
2
3
4
5
6
7
8
9
0
100
200
300
400
500
600
700
800
900
1,000
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Q1
2016
Na
m
e
p
l
a
t
e

(
M
W
)
Sy
s
t
e
m

C
o
u
n
t
s
TOTAL Installed Capacity
353 customers, 2.7 MW
867 customers, 7.1 MW
Monthly Cost of Service
(per customer)
Avg Residential
Customer Total Cost
Grid Costs
(fixed)$64
Energy Costs
(variable)$31
12
Total $95
Avg Residential
Net Metering
Customer (6kW)Total Cost
Grid Costs
(fixed)$52
Energy Costs
(variable)$19
Total $71
26% Reduction in Cost to Serve
How Do Net Metering Customers
Use the Grid?
•Balancing Service
–Supplies energy when net metering system isn’t producing
–Accepts delivery of excess net energy from the customer’s system
–Avoids the need for customer storage or generation curtailment
•Motor starting service
–Allows customer to size system to meet annual energy needs and start
the larger household motors
•Regulation service
–Maintain voltage and frequency within customer’s equipment
operating range
13
Monthly Cost of Service
(per customer)
Avg Residential
Customer Total Cost
Grid Costs
(fixed)$64
Energy Costs
(variable)$31
14
Total $95
Avg Residential
Net Metering
Customer (6kW)Total Cost
Grid Costs
(fixed)$52
Energy Costs
(variable)$19
Total $71
26% Reduction in Cost to Serve
71% Reduction in Costs Collected Through Rate Design
$444 potential annual “cost shift”
Potential Future Cost Shift
•Customer growth projected through 2021
15
2,330
4,191
5,930
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2014 2015 2016 2017 2018 2019 2020 2021
Cu
s
t
o
m
e
r
s
Low Median High
Potential Future Cost Shift
•Potential cost-shift per customer ($444) applied against
future growth scenarios
16
$755,170
$1,324,362
$1,858,780
$0
$500,000
$1,000,000
$1,500,000
$2,000,000
2015 2016 2017 2018 2019 2020 2021
Low Expected High
The Questions…
•How should Idaho Power collect grid costs from net
metering customers?
•If we change rates, how can Idaho Power mitigate the impact
to existing net metering customers?
17
New Customer Classes
•Establish new rate classes for residential and small
commercial net metering customers
•Assign costs to class based on how these classes use and
interact with the grid
18
Rate Design
•Collect more fixed, grid-related costs through the fixed charge
•Remove collection of those fixed costs from the volumetric rate
19
Variable Costs
33%
Volumetric Charge
($/kWh)
94%
Volumetric Charge
($/kWh)
80%
Fixed Costs
67%
Fixed Charge 6%Fixed Charge
20%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Cost-of-Service Current Potential
Discussion / Feedback
•The questions…
–How should Idaho Power collect grid costs from net metering
customers?
–If we change rates, how can Idaho Power mitigate the impact
to existing net metering customers?
20
Thank You!
•Submit comments about Idaho Power’s Net Metering
report or the workshop:
–Online at:idahopower.com/NMWorkshop
–By mail:
Idaho Power
Attn: Net Metering Workshop
P.O. Box 70
Boise, Idaho 83707
26