9. Incremental Programs to Expand Demand Response for Summer 2005
Because we remain concerned about shortfalls in Summer 2005, we considered several other ways to expand demand response for the coming summer. Many parties commented in their testimony that the Commission should approve proposed modifications to existing demand response programs, rather than implementing a default tariff for Summer 2005. In addition, many parties commented that the December Ruling's focus on customers over 200 kW was misplaced given the load profiles of smaller customers and that more attention should be given to small customer programs. On January 27, 2005, D.05-01-056 adopted 2005 demand response programs for all three utilities, focused on achieving demand response from all customer segments. Therefore, we believe that we have already been responsive to these calls by parties.
Several parties recommended reopening interruptible/non-firm tariffs to new customers. We decline to do so, in part because in making their proposals to reopen the rates in R.02-06-001, PG&E and SCE did not forecast significant enrollment increases from reopening the rates. Because the BIP programs remain open to customer sign-ups, and we prefer the structure of that program over discounted rates, we find that customers who have the ability to shed load under emergency conditions already have an option to be compensated for making that load available to PG&E and SCE.
9.1 SDG&E Commercial/Industrial 20/20 Program Eligibility
In comments on the proposed decision, SDG&E recommends expanding its Commercial/Industrial 20/20 program authorized in D.05-01-056 for customers between 20 and 200 kW in D.05-01-056 to customers over 200 kW. SDG&E's program requires the customer have an interval meter in place and specifically focuses on the critical peak. Expanding eligibility for the program to customers 200 kW and over is logical and should be adopted.
9.2 SDG&E Day-Of Reliability Tariff
SDG&E, does not have a comparable non-firm rate to PG&E and SCE. For SDG&E we will adopt the Day-Of Reliability Tariff it proposed in this proceeding (CPP-E). This rate provides a high price critical peak price of $3.45/kWh for up to 6 hours a day, for a maximum of 80 hours per year over an entire year. Like the PG&E and SCE non-firm/interruptible rates, SDG&E's proposed rate requires participants to reduce load on 30 minutes' notice in exchange for discounted rates during non-critical peak periods. Given our concerns over sufficient resources to serve Southern California for the upcoming summer, we authorize this rate and the accompanying tariffs set forth in Exhibit 7, Chapter 2, Attachment D.
9.3 Reopen ISO Demand Relief Program
CIPA/COPE propose that the Commission revive the Demand Relief Program Pilot that was operated and funded by the CAISO in 2000 and 2001. CIPA/COPE believe that the program provided significant demand response, was based on a pay-for-performance incentive, and achieved a 90% compliance rate. After evaluating its design, performance and costs in 2000, the ISO re-designed the program for 2001. The program was discontinued by the CAISO in 2002.
According to a 2001 Energy Division report on interruptible programs,49 the Demand Relief Program was created by the CAISO to attract new load that was not participating in utility interruptible programs and was operated in a similar manner to interruptible programs with customers required to curtail their demand within 30 minutes of being notified for periods lasting two to eight hours. The program had a maximum of 120 hours of interruption. In 2000 the program produced an average of about 40 MWs of interruptible load (out of 65-70 MWs committed) for each summer month. Participants were paid both a monthly capacity payment as well as energy payment. The CAISO made $7.8 million in total payments in 2000 equating to $124,000 per MW in 2000. For comparison purposes, the utility's average cost per MW for their interruptible programs in 2000 ranged from $73,000 - $118,000 per MW. (Energy Division Report, ibid.) Penalties for non-performance included forfeiture of both energy payments and the monthly capacity payment. The 2001 Energy Division report stated that participants complied 44 - 66% of the time when called to interrupt in 2000, not the 90% compliance rate identified by CIPA/COPE. The program operated just for the summer months and was dispatched AFTER interruptible programs, but before Stage 3 alerts.
The 2001 program allowed for participation through aggregation (or by a single facility) with load equal to or greater than 1 MW by customers not participating in any existing or proposed utility interruptible or curtailable load programs and not part of the CAISO Participating Load Program. Participants would be called on to reduce their loads for 2-8 hours in a day, up to 30 hours a month. In 2001, participants were to be paid a monthly $20,000 per MW reservation payment, and an energy payment of $500 per MWh, with the reservation payment adjusted based on monthly performance. For greater than 50% performance, the participant would be paid the monthly average performance times the reserved demand times $20,000/MW. Between 25-50% the entity would receive a payment that was 2 times the monthly average minus 50% (i.e., with a 26% performance record, the participant would receive 2% of the reservation payment) but below 25% performance, no reservation payment would be made. Other than the adjustments made to the reservation payment just described, no penalties would attach. In 2001, the program was called only once, and produced 162 MWs. The costs for this program were billed to CAISO Scheduling Coordinators based on metered demand and exports.
The structure of the Demand Relief Program was built around utilizing aggregators who were motivated to find load that could accomplish demand reductions. In comparison to other existing interruptible programs, the payments under the Demand Relief Program were quite generous. The current DRP, which is operated by the California Power Authority, was modeled after the Demand Relief Program, but with different pricing terms. It is unclear, given the existing programs in place whether restarting the Demand Relief Program would achieve additional load reductions or whether that load has subscribed to other current programs. In any event, the CAISO has not proposed reopening the program and approval by the Federal Energy Regulatory Commission (FERC) might be required. Therefore we decline to adopt a Demand Relief Program, as proposed by CIPA/COPE, at this time.
9.4 Aggressively Market Existing Programs
CLECA encourages us to direct SCE to use public information and advertising programs to make its air conditioning customers aware of the potential for a generation resources shortfall this summer. CLECA believes a targeted advertising program, which could be amplified in the event we actually experience 1 in 10 weather conditions, could prove to be a very cost-effective method of assuring that air conditioning load is reduced and that a peak resources shortfall is averted. SCE should pursue this approach within the funding authorized for 2005 programs, focusing on all customer types (residential and commercial) that have air conditioning load and aggressively marketing the BIP program.
9.5 Summary of 2005 Programs
Because we are approving modifications to the voluntary CPP programs, we incorporate those changes into the 2005 Program Summary Tables that we adopted in D.05-01-056 and D.05-02-030. Each table lays out the approved program funds for each utility for all 2005 demand response programs, as well as the adopted goals for each program.
Summary of Adopted Utility Demand Response Programs and Goals for 2005 - PG&E
COSTS
2005 PROGRAMS Admin (O&M) Capital M&E Customer Incentives Total Request 2003-2004 Carryover Allocation TOTAL NET REQUESTED Summer 2005 Total Potential MW Day-Ahead Notification Programs
Demand Bidding Program (DBP) 2/ $306,000 $100,000 $150,000 $2,835,000 $3,391,000 $1,376,000 $2,015,000 155 CPA Demand Reserves Partnership Program 3/ $500,000 $750,000 $125,000 $0 $1,375,000 $1,375,000 0 245 CPA Managerial Agreement $500,000 $0 $75,000 $0 $575,000 $575,000 0 N/A Business Energy Partnership Pilot Program $1,500,000 $0 $150,000 $850,000 $2,500,000 $0 $2,500,000 10 Critical Peak Pricing Rate $785,000 $30,000 $475,000 $0 $1.290,000 $0 $1,290,000 25 Adopted Day-Ahead Trigger Programs Subtotal $3,591,000 $880,000 $975,000 $3,685,000 $9,131,000 $3,475,000 $5,656,000
Reliability Day-Of Programs
Base Interruptible Program (BIP) $100,000 $0 $100,000 $840,000 $1,040,000 $0 $1,040,000 26 Existing Non-Firm rates E-19/E-20 1/ 347 Other existing reliability programs $100,000 $100,000 $50,000 $50,000 13 Develop 2006 A/C Cycling Program $150,000 $150,000 $150,000
Adopted Reliability Programs Subtotal $250,000 $0 $200,000 $840,000 $1,290,000 $50,000 $1,240,000
1/ This is an existing program. This Decision does not approve the re-opening or expansion of this program. The existing MWs will carry over to 2005. 2/ PG&E's CPP carryover of $1.176 million was re-allocated to DBP. 3/ $149,000 of PG&E's carryover DRP funds remain unallocated and may be reserved for future use for the DRP if needed PG&E 2005 PROGRAMS Admin (O&M) Capital M&E Customer Incentives Total Request 2003-2004 Carryover Allocation TOTAL NET REQUEST Summer 2005 Potential MW Technology Assistance and Incentives
Technology Assistance and Incentives 4/ 100000 7500000 7600000 2976000 $4,624,000
Adopted Technology Assistance and Incentives Subtotal $0 $0 $100,000 $7,500,000 $7,600,000 $2,976,000 $4,624,000
Education, Awareness & Outreach
Flex Your Power Now! (FYPN!) $3,130,000 $600,000 $150,000 $0 $3,880,000 $415,000 $3,465,000
General Education & Outreach $800,000 $800,000 $0 $800,000
Emerging Markets and Research 5/ $250,000 $250,000 $115,000 $135,000
Community Partnership Program $1,500,000 $0 $1,500,000 $0 $1,500,000
IDSM $2,075,000 $50,000 $2,125,000 $2,125,000
Adopted Education, Awareness & Outreach Subtotal $7,755,000 $600,000 $200,000 $0 $8,555,000 $530,000 $8,025,000
Other Programs
20/20 TOU and Non-TOU - res/commercial $6,500,000 $0 $100,000 $62,500,000 $69,100,000 $0 $69,100,000 250 M&E Cost Benefit Evaluation Framework 6/ $250,000 $250,000 $250,000 $0
Adopted Other Programs Subtotal $6,500,000 $0 $350,000 $62,500,000 $69,350,000 $250,000 $69,100,000
TOTAL $18,096,000 $1,480,000 $1,825,000 $74,525,000 $95,926,000 $7,281,000 $88,645,000 1051 4/ PG&E's 2-part RTP carryover of $1.195 million was re-allocated to Technology Assistance and Incentives. 5/ $115,000 of PG&E's carryover M&E funds was re-allocated to Emerging Markets and Research. 6/ $250,000 of PG&E's carryover M&E funds were allocated to M&E Cost Benefit Evaluation Framework. Summary of Adopted Utility Demand Response Programs and Goals for 2005 - SCE
COSTS
SCE 2005 PROGRAMS Admin (O&M) Capital M&E Customer Incentives Total Request 2003-2004 Carryover Allocation TOTAL NET REQUESTED Estimated Summer 2005 Total Potential MW Day-Ahead Notification Programs
Demand Bidding Program (DBP) 4/ $1,087,656 $409,000 $150,000 $800,000 $2,446,656 $2,446,656 $0 120 CPA Demand Reserves Partnership Program 5/ $191,200 $0 $150,000 $0 $341,200 $341,200 $0 117 Critical Peak Pricing Rate $25,000 $0 $150,000 $0 $175,000 $0 $175,000 5 Adopted Day-Ahead Trigger Subtotal $1,303,856 $409,000 $450,000 $800,000 $2,962,856 $2,787,856 $175,000
Reliability Day-Of Programs
Base Interruptible Program (BIP) $105,200 $0 $100,000 $1,560,000 $1,765,200 $0 $1,765,200 79 Existing I-6 & Ag Interruptible Program 1/ 539 Existing ACCP - C&I 33 Expanded Air Conditioner Cycling Program (ACCP) - res 2/ $7,650,000 $0 $0 $6,000,000 $7,650,000 $0 $7,650,000 214 Smart Thermostat - small C&I 1/ $879,000 $0 $0 $900,000 $1,779,000 9 Adopted Reliability Programs Subtotal $8,634,200 $0 $100,000 $8,460,000 $11,194,200 $0 $9,415,200
1/ This is an existing program. The Decision does not approve the re-opening or expansion of this program. The existing MWs will carry over to 2005. 2/ Incentive costs are paid as a bill credit and were authorized in SCE GRC base revenues and are not part of SCE's requested budget for 2005 programs. 5/ $2,349,519 in 2003-2004 carryover DRP funds remain unallocated and may be reserved for future use for the DRP if needed. SCE 2005 PROGRAMS Admin (O&M) Capital M&E Customer Incentives Total Request 2003-2004 Carryover Allocation TOTAL NET REQUESTED Estimated Summer 2005 Total Potential MW Technology Assistance and Incentives
Technical Equipment Incentive 4/ $1,138,400 $0 $75,000 $6,000,000 $7,213,400 $3,406,647 $3,806,753
Education, Awareness & Outreach
Flex Your Power Now! $2,690,000 $0 $125,000 $0 $2,815,000 $0 $2,815,000
Community EE/DR Partnership Demonstration $801,000 $0 $0 $0 $801,000 $0 $801,000
Emerging Markets 4/ $1,150,000 $0 $0 $0 $1,150,000 $1,150,000 $0
Integrated EE/DR Marketing $452,040 $0 $0 $0 $452,040 $0 $452,040
Adopted Education, Awareness & Outreach Subtotal $5,093,040 $0 $125,000 $0 $5,218,040 $1,150,000 $4,068,040
Other Programs
20/20 TOU 20 to 200kW $1,214,748 $0 $50,000 $240,000 $1,504,748 $0 $1,504,748 0 20/20 Summer Rebate -res and small C&I 3/ $4,861,728 $0 $120,000 $70,000,000 $74,981,728 $0 $74,981,728 150 Annual M&E Report 4/ $0 $0 $130,000 $0 $130,000 $130,000 $0
Adopted Other Programs Subtotal $6,076,476 $0 $300,000 $70,240,000 $76,616,476 $130,000 $76,486,476
TOTAL $22,245,972 $409,000 $1,050,000 $85,500,000 $103,204,972 $7,474,503 $93,951,469 1266 3/ The O&M budget of $4.86 million includes both residential and small commercial 20/20 programs. The MW estimate of 150MW is for both programs as well. 4/ SCE's 2-part RTP carryover of $985,075 was allocated to Demand Bidding Program ($320,368) and Technical Equipment Incentive ($664,707). SCE's CPP carryover of $2,132,624 was allocated to Technical Equipment Incentive. SCE's WG2 Costs carryover of $1,889,316 was allocated to Annual M&E Report ($130,000), Emerging Markets ($1,150,000), and Technical Equipment Incentive ($609,316). SCE's Demand Bidding Program carryover was allocated to Demand Bidding Program. Summary of Adopted Utility Demand Response Programs and Goals for 2005 - SDG&E |
|||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
COSTS |
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||||
SDG&E 2005 PROGRAMS |
Admin (O&M) |
Capital |
M&E |
Customer Incentives |
Total Request |
2003-2004 Carryover Allocation |
TOTAL NET REQUEST |
Summer 2005 Total Potential MW |
|||||||||||||||||||||||||||||||||||||||||||||||
Day-Ahead Notification Programs |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Demand Bidding Program 1/ |
$552,000 |
$600,000 |
$35,000 |
$495,000 |
$1,682,000 |
$1,007,000 |
$675,000 |
28 |
|||||||||||||||||||||||||||||||||||||||||||||||
CPA Demand Reserves Partnership Program (DRP) |
$105,000 |
$0 |
$10,000 |
N/A |
$115,000 |
$10,000 |
$105,000 |
N/A |
|||||||||||||||||||||||||||||||||||||||||||||||
C&I 20/20 Program |
$483,000 |
$0 |
$50,000 |
$2,141,000 |
$2,674,000 |
$393,000 |
$2,281,000 |
31 |
|||||||||||||||||||||||||||||||||||||||||||||||
Voluntary Critical Peak Pricing |
$374,000 |
$680,000 |
$35,000 |
$0 |
$1,089,000 |
$0 |
$1,089,000 |
20 |
|||||||||||||||||||||||||||||||||||||||||||||||
Adopted Day-Ahead Trigger Programs Subtotal |
$1,514,000 |
$1,280,000 |
$130,000 |
$2,636,000 |
$5,560,000 |
$1,410,000 |
$4,150,000 |
79 |
|||||||||||||||||||||||||||||||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reliability Day-Of Programs |
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Rolling Blackout Reduction Program (RBRP enhanced) |
$66,000 |
$0 |
$5,000 |
$248,000 |
$319,000 |
$5,000 |
$314,000 |
42 |
|||||||||||||||||||||||||||||||||||||||||||||||
Base Interruptible Program (BIP) |
$83,000 |
$0 |
$5,000 |
$420,000 |
$508,000 |
$5,000 |
$503,000 |
6 |
|||||||||||||||||||||||||||||||||||||||||||||||
Existing reliability programs 2/ |
31 |
||||||||||||||||||||||||||||||||||||||||||||||||||||||
Residential Smart Thermostat (modified) |
$431,000 |
$0 |
$50,000 |
$360,000 |
$841,000 |
$0 |
$841,000 |
2 |
|||||||||||||||||||||||||||||||||||||||||||||||
Adopted Reliability Programs Subtotal |
$580,000 |
$0 |
$60,000 |
$1,028,000 |
$1,668,000 |
$10,000 |
$1,658,000 |
|
|||||||||||||||||||||||||||||||||||||||||||||||
SDG&E 2005 PROGRAMS |
Admin (O&M) |
Capital |
M&E |
Customer Incentives |
Total Request |
2003-2004 Carryover Allocation |
TOTAL NET REQUEST |
Summer 2005 Total Potential MW |
||||||
Technology Assistance and Incentives |
| |||||||||||||
Technology Incentives |
$1,194,000 |
$0 |
$10,000 |
$2,250,000 |
$3,454,000 |
$5,000 |
$3,449,000 |
10 | ||||||
Technical Assistance |
$1,059,000 |
$0 |
$10,000 |
$0 |
$1,069,000 |
$10,000 |
$1,059,000 |
5 | ||||||
Adopted Technology Assistance and Incentives Subtotal |
$2,253,000 |
$0 |
$20,000 |
$2,250,000 |
$4,523,000 |
$15,000 |
$4,508,000 |
| ||||||
Education, Awareness & Outreach |
| |||||||||||||
Flex Your Power Now! (FYPN!) |
$558,000 |
$0 |
$50,000 |
$0 |
$608,000 |
$398,000 |
$210,000 |
N/A | ||||||
Customer Education, Awareness & Outreach |
$1,990,000 |
$0 |
$50,000 |
$0 |
$2,040,000 |
$50,000 |
$1,990,000 |
N/A | ||||||
Emerging Markets |
$343,000 |
$100,000 |
$10,000 |
$0 |
$453,000 |
$0 |
$453,000 |
N/A | ||||||
Water District Partnership (Engineering Analysis) |
$75,000 |
$0 |
$0 |
$0 |
$75,000 |
$0 |
$75,000 |
N/A | ||||||
Community Partnerships |
$225,000 |
$0 |
$50,000 |
$0 |
$275,000 |
$0 |
$275,000 |
N/A | ||||||
Circuit Savers (new) |
$76,000 |
$0 |
$25,000 |
$0 |
$101,000 |
$0 |
$101,000 |
N/A | ||||||
Adopted Education, Awareness & Outreach Subtotal |
$3,267,000 |
$100,000 |
$185,000 |
$0 |
$3,552,000 |
$448,000 |
$3,104,000 |
| ||||||
|
| |||||||||||||
Other Programs |
| |||||||||||||
20/20 Res and Small Commercial 3/ |
$1,260,000 |
$0 |
$100,000 |
$4,400,000 |
$5,760,000 |
$0 |
$5,760,000 |
7 | ||||||
Adopted Other Programs Subtotal |
$1,260,000 |
$0 |
$100,000 |
$4,400,000 |
$5,760,000 |
$0 |
$5,760,000 |
| ||||||
TOTAL |
$8,874,000 |
$1,380,000 |
$495,000 |
$10,314,000 |
$21,063,000 |
$1,883,000 |
$19,180,000 |
182 | ||||||
1/ SDG&E's CPP carryover of $449,000 was re-allocated to DBP, in addition to the existing $558,000. |
||||||||||||||
2/ SDG&E's Other Existing Reliability Programs includes 31MW for AL-TOU-CP. |
||||||||||||||
3/ Adopting SDG&E's proposed "Traditional 20/20" budget, December 1, 2004 filing. |
||||||||||||||
