7. Demand Response Counting Issues

Load Impacts for Dynamic Rate Programs

In D.11-06-022, Ordering Paragraph 14, the Commission allowed PG&E to receive load impacts averaged over the hours of 2 p.m. to 6 p.m. for their dynamic rates DR programs, instead of the standard 1 p.m. to 6 p.m. interval over which load impacts are averaged for other DR programs. PG&E was ordered to "propose changes to the current large commercial and industrial and agricultural customers PDP [Peak Day Pricing] operational period of 2 p.m. to
6 p.m. to 1 p.m. to 6 p.m. in its 2012 Rate Design Window (RDW) application." PG&E has proposed the change to the operational hours in compliance with the requirement for its Peak Day Pricing in its RDW application,⁸ which is pending Commission's approval.

PG&E is concerned that the Commission may not issue a decision in time for PG&E to implement the new operation hours prior to the 2013 RA Year Ahead compliance filing. PG&E requests that for purposes of the load impacts from this program, the impacts would be averaged over the 2 p.m. to 6 p.m. time interval as was done for this program in the 2012 RA compliance year in the event PG&E does not receive Commission authorization to shift the dynamic rate operating hours in time for implementation in 2013. If the shift is authorized in time to allow for implementation for 2013, load impacts would be computed over the 1 p.m. to 6 p.m. time interval consistent with other DR programs. We will adopt this continued treatment for PG&E's dynamic rate programs in general and Peak Day Pricing in particular, to account for timing of other Commission actions.

In D.11-10-003, the Commission ruled that DR resources, not including dynamic pricing programs, must be capable of being dispatched by Local Capacity Area (LCA) by 2013 in order to receive local resource adequacy credit. That decision ruled that utilities may request an exemption to the 2013 requirement for specific demand response programs if: 1) the Commission proceedings addressing demand response program designs and funding issues have not concluded with sufficient time to modify the program in question prior to the 2013 RA compliance year; or 2) the Commission has found in a demand response proceeding that a particular demand response program should not be modified to comply with the rule for various reasons, e.g., cost-effectiveness or implementation-related issues.

PG&E originally requested an exemption to the Local Dispatchability Requirement for its Aggregator Managed Program (AMP), Capacity Bidding Program (CBP), and Demand Bidding Program (DBP) for the 2013 RA compliance year, but in comments on the Proposed Decision now only requests an exemption for AMP because PG&E has determined that it expects to be able to implement local dispatchability for CBP and DBP by May 1, 2013. PG&E argues that, however, due to the uncertainty associated with the results of its Request for Offer (RFO) for the AMP contracts and the Commission decision, it requests the Proposed Decision be modified to grant an exemption for 2013 for the AMP contracts.

We grant an exemption through May 1, 2013 for all three DR programs. D.11-10-003 ruled that utilities may request an exemption to the 2013 RA local dispatchability requirement if the Commission proceedings addressing demand response program designs and funding issues were not concluded with sufficient time to modify the program in question prior to the 2013 compliance year.¹⁰
D.12-04-045, the Commission's recent decision approving DR budgets, was issued approximately four months after the anticipated schedule. Implementation associated with that decision will take another 60-90 days. This will not allow PG&E to implement the programs in time for the 2013 RA year. PG&E has shown that the timing of D.12-04-045 meets one of the requirements in D.11-10-003 for an exception from that decision's local dispatchability requirement for certain DR programs.

In comments on the Proposed Decision, PG&E seeks further exemptions for AMP. PG&E has not shown sufficient rationale for further exemptions and we will not modify the Proposed Decision on this point.