2019 in review

Tuesday, December 31, 2019

Here's a roundup of some of the items published on this blog in 2019 that have drawn significant interest:
Will these trends continue in 2020?

2019 FERC staff report on demand response, advanced metering

Monday, December 16, 2019

Wholesale demand response programs -- which generally pay electricity consumers for reducing their consumption of power during times of high demand on the grid if doing so is cost-effective -- experienced increased participation in the U.S. in 2018, according to a recent federal report, but participating capacity in New England fell by nearly half from 2017 to 2018.

Section 1252(e)(3) of Energy Policy Act of 2005 requires the Federal Energy Regulatory Commission to prepare and publish an annual report covering six sets of items:
  • saturation and penetration rate of advanced meters and communications technologies, devices and systems;
  • existing demand response programs and time-based rate programs;
  • the annual resource contribution of demand resources;
  • the potential for demand response as a quantifiable, reliable resource for regional planning purposes;
  • steps taken to ensure that, in regional transmission planning and operations, demand resources are provided equitable treatment as a quantifiable, reliable resource relative to the resource obligations of any load - serving entity, transmission provider, or transmitting party; and
  • regulatory barriers to improved customer participation in demand response, peak reduction and critical period pricing programs.

Commission staff's report, 2019 Assessment of Demand Response and Advanced Metering, presents an updated look at these topics. As with previous reports such as in 2011, the 2019 report notes a  continued increase in advanced meter penetration rates, with advanced meters now account for most meters installed in the U.S.

According to the 2019 report, overall demand response participation in the wholesale markets increased by approximately eight percent from 2017 to 2018, to a total of 29,674 megawatts, with the greatest regional increases in California ISO (CAISO) and Midcontinent Independent System Operator (MISO). Overall, demand response registration in the wholesale capacity, energy, and ancillary services markets increased to six percent of peak demand in 2018.

At the same time, participation decreased most in ISO New England, declining from 684 megawatts of enrolled demand response capacity in 2017, to 356 megawatts. According to the report:
ISO-NE reported the greatest percentage change in demand resource participation, a 48 percent decrease, from 2017 to 2018. The reason for the decrease in demand resource participation in ISO-NE is unclear. However, the decrease coincides with the implementation of ISO-NE’s Pay-for-Performance program, which places more stringent requirements on resources – including demand resources – participating in ISO-NE’s forward capacity market. Pay-for-Performance was introduced concurrently with the full integration of demand response into ISO-NE’s price-responsive demand program in June 2018, which replaced the real-time demand response program.
While the FERC staff's 2019 report on demand response and advanced metering does not contain policy recommendations or conclusions, the data it presents informs future decisions about energy policy.

New England prepares for competitive transmission solicitation

Thursday, December 12, 2019

U.S. utility regulators have accepted another round of "transmission planning improvement" tariff revisions proposed by New England's regional transmission organization as a measure to enhance the competitiveness of a new process for soliciting proposals for certain transmission improvements. The Federal Energy Regulatory Commission's December 10, 2019 Order Accepting Tariff Revisions filed by ISO New England Inc. brings the region one step closer to its first competitive solicitation for transmission solutions.

New England's path to regional competitive procurement of transmission solutions has been lengthy. In 2001, the Federal Energy Regulatory Commission issued its Order No. 1000, which reformed how public utilities plan and pay for transmission upgrades. Much of the impetus behind Order No. 1000 ultimately derives from shifts in the nation's portfolio of electric generation resources, which helped spur transmission development, but not always in the most cost-effective ways. As a result, the Commission directed public utility transmission providers to revise their tariffs in certain ways with respect to electric transmission planning and cost allocation requirements.

One of the revisions called for in Order No. 1000 is the removal of "provisions from Commission-jurisdictional tariffs and agreements that grant incumbent transmission providers a federal right of first refusal to construct transmission facilities selected in a regional transmission plan for purposes of cost allocation." As described by the Commission, this reform "allows, but does not require, public utility transmission providers in a transmission planning region to use competitive bidding to solicit transmission projects or project developers."

New England's regional grid operator ISO New England Inc. filed a series of tariff revisions implementing changes in response to Order No. 1000, as did other public utility transmission providers. Other regional transmission organizations have subsequently conducted a number of competitive transmission solicitations under the processes created by these tariff revisions. To date ISO-NE has not, but in July 2019 the grid operator gave notice of its intent to initiate the region's first competitive procurement of transmission for the Boston area, and in October it filed further proposed tariff revisions to enhance the competitiveness of the procurement process.

In a December 10 order, the Commission has accepted the October 2019 tariff revisions. In so doing, it found that comments and a protest by the Massachusetts and Connecticut Attorney Generals (respectively) regarding the role of non-transmission alternatives (NTA) in ISO-NE's competitive solicitation process were "outside the scope of this proceeding".

The order paves the way forward for New England's first competitive solicitation of transmission, scheduled for initiation later this year or early in 2020.

Maine Executive Order 13 on sustainability

Saturday, December 7, 2019

Maine Governor Janet T. Mills has issued an executive order calling for state agencies to "lead by example through energy efficiency, renewable energy and sustainability measures." Signed on November 26, 2019, her Executive Order 13 sets a state policy goal and directs state agencies to take various actions addressing sustainability.

The preamble to Executive Order 13 cites context including the negative impacts of climate change on Maine; Maine's pledges to be carbon neutral by 2045 and to reduce greenhouse gas emissions 45% below 1990 levels by 2030 and by at least 80% by 2050; Maine's expanded renewable portfolio standard which now requires 80% renewable energy by 2030 and a goal of 100% by 2050; opportunities for beneficial electrification of heating and transportation; and the work of the newly formed Maine Climate Council. It concludes with the philosophy that "state government should lead by example and invest in renewable energy, increase energy efficiency and resiliency, encourage waste reduction, and strive to reduce operational costs."

Operationally, Executive Order 13 contains seven core sections. Section 1 establishes a state policy goal:
Maine state government will lead by example in investing in energy efficiency, renewable energy, and emissions reductions; promoting health and sustainability in the workplace; and building resilient infrastructure. State government operations will strive to equal or exceed Maine's emissions reduction targets and seek cost efficiencies. State facilities will be designed with greater resilience to new climate conditions. These efforts aim to reduce waste, promote employee health and increase operational efficiency.
Section 2 calls for the Governor's Energy Office and the Governor's Office of Policy Innovation and the Future to convene a Sustainability Leadership Committee with representatives from the Department of Environmental Protection, Efficiency Maine Trust, Department of Administrative and Financial Services, and Department of Transportation, to develop a baseline of energy use and greenhouse gas emissions from state operations by February 1, 2021, and for subsequent biannual reporting.

Section 3 requires state agencies to by February 1, 2021 coordinate with the Leadership Committee to develop and implement a sustainability plan to meet or exceed the state's renewable energy and greenhouse gas reduction timelines and targets.

Section 4 focuses on responsible procurement, requiring state agencies to "reduce their impact on the environment and enhance public health by procuring environmentally preferable products and services whenever such products and services are readily available, perform to satisfactory standards, and represent best value to the State of Maine."

Other sections require state agencies to encourage practices that lead to healthier and less wasteful workplaces; to promote the resiliency of new state facilities, other construction projects, and leased space; and to designate a state sustainability coordinator to facilitate and support activities across agencies.