Determining Utility System Value of Demand Flexibility From Grid-interactive Efficient Buildings

This report focuses on ways current methods and practices that establish the value to electric utility systems of distributed energy resource (DER) investments can be enhanced to determine the value of demand flexibility in grid-interactive efficient buildings that can provide grid services. The report introduces key valuation concepts that are applicable to demand flexibility that these buildings can provide and links to other documents that describe these concepts and their implementation in more detail.The scope of this report is limited to the valuation of economic benefits to the utility system. These are the foundational values on which other benefits (and costs) can be built. Establishing the economic value to the grid of demand flexibility provides the information needed to design programs, market rules, and rates that align the economic interest of utility customers with building owners and occupants. By nature, DERs directly impact customers and provide societal benefits external to the utility system. Jurisdictions can use utility system benefits and costs as the foundation of their economic analysis but align their primary cost-effectiveness metric with all applicable policy objectives, which may include customer and societal (non-utility system) impacts.This report suggests enhancements to current methods and practices that state and local policymakers, public utility commissions, state energy offices, utilities, state utility consumer representatives, and other stakeholders might support. These enhancements can improve the consistency and robustness of economic valuation of demand flexibility for grid services. The report concludes with a discussion of considerations for prioritizing implementation of these improvements

Dual Environmentalism: Demand Response Mechanisms in Wholesale and Retail Energy Markets

This note argues that a dual jurisdictional approach to demand response programming is better suited to mitigate environmental harms than an “either-or” regulatory model. Through an exploration of FERC’s authority over wholesale demand response, state authority over retail-level demand response, and implications for electricity and capacity markets arising out of the Court’s decision in FERC v. EPSA, this note will offer effective legal mechanisms for mitigating environmental costs, while fostering environmental benefits. The next section of this note analyzes the strengths and weaknesses of state and federal regulatory approaches to demand response in isolation. Based on this assessment, this note suggests the policy mechanisms most conducive to environmentally-conscious electric energy regulation. This note concludes with a model regulatory scheme that utilizes demand response to mitigate global climate change and advance environmental sustainability

Diverse, remote and innovative - Prospects for a globally unique electricity network and market in Western Australia

WA’s electricity industry supply infrastructure comprises the South West Inter-connected System (SWIS), the North West Interconnected System (NWIS) and 29 regional noninterconnected power systems 1. WA exhibits a diversity of generation systems located in some of the most isolated regions of Australia, supplying a wide range of energy demand profiles. These characteristics and the unique networks that comprises WA’s electricity infrastructure makes WA a unique place to research, develop and integrate new technical options within a world-class industrialised electricity system

Diverse, remote and innovative - Prospects for a globally unique electricity network and market in Western Australia

WA’s electricity industry supply infrastructure comprises the South West Inter-connected System (SWIS), the North West Interconnected System (NWIS) and 29 regional non-interconnected power systems 1. WA exhibits a diversity of generation systems located in some of the most isolated regions of Australia, supplying a wide range of energy demand profiles. These characteristics and the unique networks that comprises WA’s electricity infrastructure makes WA a unique place to research, develop and integrate new technical options within a world-class industrialised electricity system

Carbon Pricing in New York ISO Markets: Federal and State Issues

New York’s Clean Energy Standard (“CES”), adopted in August 2016, aims to steer the state’s electricity sector away from carbon-intensive generation sources. It supports low-carbon alternatives by requiring retail electricity suppliers to purchase credits, the proceeds from which are paid to renewable and nuclear generators. Recognizing that this will affect the operation of wholesale electricity markets, New York’s electric transmission grid operator (the “New York Independent System Operator” or “NYISO”) has commenced a review to assess possible means of incorporating the cost of carbon emissions into market prices. This Article explores two approaches to carbon pricing in NYISO markets: the first would involve NYISO adopting a carbon price of its own initiative with a view to improving the operation of wholesale electricity markets (“Approach 1”), while the second would involve adoption of a carbon price designed to reflect and harmonize state-level policies aimed at reducing electricity sector emissions (“Approach 2”). Under either approach, NYISO would adopt a per megawatt hour carbon price and use it to establish a fee for each generating unit, consistent with its emissions profile. This fee would be added to the prices generators bid into the wholesale electricity market and those adjusted prices used by NYISO to determine the dispatch order. The result would likely be a re-ordering of dispatch, with high-emitting generators dispatched (and paid) less frequently, and cleaner alternatives more frequently. Our proposal, while conceptually simple, is likely to be difficult to implement

Local flexibility market design for aggregators providing multiple flexibility services at distribution network level

This paper presents a general description of local flexibility markets as a market-based management mechanism for aggregators. The high penetration of distributed energy resources introduces new flexibility services like prosumer or community self-balancing, congestion management and time-of-use optimization. This work is focused on the flexibility framework to enable multiple participants to compete for selling or buying flexibility. In this framework, the aggregator acts as a local market operator and supervises flexibility transactions of the local energy community. Local market participation is voluntary. Potential flexibility stakeholders are the distribution system operator, the balance responsible party and end-users themselves. Flexibility is sold by means of loads, generators, storage units and electric vehicles. Finally, this paper presents needed interactions between all local market stakeholders, the corresponding inputs and outputs of local market operation algorithms from participants and a case study to highlight the application of the local flexibility market in three scenarios. The local market framework could postpone grid upgrades, reduce energy costs and increase distribution grids’ hosting capacity.Postprint (published version

Large Scale Deployment of Renewables for Electricity Generation

Comparisons of resource assessments suggest resource constraints are not an obstacle to the large-scale deployment of renewable energy technologies. Economic analysis identifies barriers to the adoption of renewable energy sources resulting from market structure, competition in an uneven playing field and various non-market place barriers. However, even if these barriers are removed, the problem of ‘technology lock-out’ remains. The key policy response is strategic deployment coupled with increased R&D support to accelerate the pace of improvement through market experience. The paper suggests significant contributions from various technologies, but does not assess their optimal or maximal market share

Market and Economic Modelling of the Intelligent Grid: 1st Interim Report 2009

The overall goal of Project 2 has been to provide a comprehensive understanding of the impacts of distributed energy (DG) on the Australian Electricity System. The research team at the UQ Energy Economics and Management Group (EEMG) has constructed a variety of sophisticated models to analyse the various impacts of significant increases in DG. These models stress that the spatial configuration of the grid really matters - this has tended to be neglected in economic discussions of the costs of DG relative to conventional, centralized power generation. The modelling also makes it clear that efficient storage systems will often be critical in solving transient stability problems on the grid as we move to the greater provision of renewable DG. We show that DG can help to defer of transmission investments in certain conditions. The existing grid structure was constructed with different priorities in mind and we show that its replacement can come at a prohibitive cost unless the capability of the local grid to accommodate DG is assessed very carefully.Distributed Generation. Energy Economics, Electricity Markets, Renewable Energy

Microgrids & District Energy: Pathways To Sustainable Urban Development

A microgrid is an energy system specifically designed to meet some of the energy needs of a group of buildings, a campus, or an entire community. It can include local facilities that generate electricity, heating, and/or cooling; store energy; distribute the energy generated; and manage energy consumption intelligently and in real time. Microgrids enable economies of scale that facilitate local production of energy in ways that can advance cost reduction, sustainability, economic development, and resilience goals. As they often involve multiple stakeholders, and may encompass numerous distinct property boundaries, municipal involvement is often a key factor for successful implementation. This report provides an introduction to microgrid concepts, identifies the benefits and most common road blocks to implementation, and discusses proactive steps municipalities can take to advance economically viable and environmentally superior microgrids. It also offers advocacy suggestions for municipal leaders and officials to pursue at the state and regional level. The contents are targeted to municipal government staff but anyone looking for introductory material on microgrids should find it useful