11. Demand Response and Load Management Technology
The October 27, 2010 ALJ ruling requested that parties consider whether the Commission should direct utilities to include cost-effective load management functions to target Electric Vehicle charging as part of their on-going demand response programs. Focusing on the capabilities of the Electric Vehicle service equipment, rather than the utilities' demand response programs, NRDC proposed the Commission require that Electric Vehicle service equipment include communications and controls so that Electric Vehicle charging could respond to load management signals to limit grid impacts. (NRDC November 12, 2010 comments at 9.) Notably, the California Plug-In Electric Vehicle Collaborative's strategic plan also identified the potential value of Electric Vehicle load management or smart charging programs, stating that:
Emerging technologies and communications between the grid and PEVs could enable customers to opt into programs that allow for demand response from PEV charging. Under such scenarios, charge rates could increase or decrease to match intermittent renewable generation and optimize the use of power plants and local electricity distribution systems. These demand response programs, which might allow consumers to charge their PEVs based on utility price signals, can provide load predictability, which may help to balance intermittent wind generation, optimize use of thermal power plants, and may have net cost benefits.39
Electric Vehicle demand response and load management technology, generally, offers the potential to more efficiently utilize grid resources, including the integration of renewables.
We consider here the merits of additional Commission involvement in areas related to the utilities' demand response programs and Electric Vehicle service equipment to encourage Electric Vehicle charging to respond to load management signals.
11.1. Load Management Technology
NRDC's proposed that the Commission require Electric Vehicle service equipment to include communications and controls so that charging can respond to load management signals to limit grid impacts.
In response to this proposal, the EVSP Coalition stated that charging equipment capable of supporting demand response and smart charging is readily available today. More broadly, parties noted that smart charging of Electric Vehicles includes hardware and software technologies that relate to several areas, such as load shaping, remote utility operation, HAN interaction, Vehicle 2 Grid (V2G), demand response, renewable generation integration, ancillary services, and more. (DRA November 10, 2010 comments at 9.) DRA, however, was unaware of any technology ready for wide-scale deployment. (EVSP Coalition December 3, 2010 comments at 10; DRA November 10, 2010 comments at 10.) SCE replied that the market for charging equipment is new and a service precondition for a load management device on the customer side of the meter may subvert customer choice. (SCE December 3, 2010 comments at 11.)
While we support the intent of NRDC's proposal, we decline to require that load management technology (demand response) be part of Electric Vehicle service equipment at this time. We view preservation of customer choice as an important policy objective aimed at encouraging maximum early market growth. Customers should be able to choose whether or not to use equipment with load management capabilities. Even though such technology offers potential environmental benefits by encouraging more efficient Electric Vehicle charging, the Commission also finds that, because widely accepted standards for communications and controls related to Electric Vehicle charging are still under development, it is premature to adopt specific requirements at this time. Existing Electric Vehicle rates, which are generally non-tiered and time-of-use, are designed to induce customers to charge in a manner that achieves maximum environmental benefits without adverse impacts to the electric grid. To the degree customers elect to charge at sub-optimal times, they should bear the costs.
11.2. Electric Vehicle Demand Response
We now consider the merits of additional Commission action in areas related to the utilities' demand response programs to further encourage Electric Vehicle charging to respond to load management signals.
Current demand response programs incorporate price signals to encourage efficient use of grid resources. For example, existing optional time-of-use rates enable price-based demand response from end-use customers who charge Electric Vehicles. However, the extent to which demand response price signals influence Electric Vehicle charging behavior is unclear.
We agree with DRA and TURN that utilities should demonstrate sufficient need for and feasibility of incentive-based smart charging programs before we order such programs be provided by the utilities. (DRA November 10, 2010 comments at 9; TURN November 12, 2010 comments at 12.) We also agree with NRDC that the potential benefits of enabling demand response for Electric Vehicle charging offers benefits that include lowering energy procurement costs and supporting integration of intermittent renewables resources.
For Electric Vehicles to provide grid support services and demand response at an economic scale, there must first be a sufficient Electric Vehicle market. At this early market stage, we view demand response applications for the 2012-2014 cycle as the appropriate forum to consider utility requests for pilot funding for Electric Vehicle demand response programs. We note there are currently no demand response incentive-based programs tailored to residential Electric Vehicle customers that would enable smart charging goals.40 We intend to consider broader retail smart charging programs after establishing the 2012-2014 demand response programs.
Moreover, if utilities did not address "unnecessary duplication" for any requested funding for Electric Vehicle demand response programs in their demand response applications for the 2012-2014 cycle, utilities must seek the approval of the presiding officer to submit supplemental testimony in their application proceedings addressing this matter. The requests to the presiding officer should be made within 15 days of the effective date of this decision. Supplemental testimony should be submitted 30 days after approval is obtained unless otherwise determined by the presiding officer.
39 The California Plug-in Electric Vehicle Collaborative. Taking Charge: Establishing California Leadership in the Plug-in Electric Vehicle Marketplace, December 2010 at 58.
40 PG&E response to December 2, 2010 Energy Division data request.
