Demand response is there anything more important
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Demand Response – Is There Anything More Important?. Scott Miller New England Conference of Public Utilities Commissioners June 18, 2002. DR – The Long Wait. Much has been said about demand response but not much has been done Demand Response has become a motherhood and apple pie issue

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Demand Response – Is There Anything More Important?

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Demand response is there anything more important

Demand Response – Is There Anything More Important?

Scott Miller

New England Conference of

Public Utilities Commissioners

June 18, 2002


Dr the long wait

DR – The Long Wait

  • Much has been said about demand response but not much has been done

  • Demand Response has become a motherhood and apple pie issue

  • Discussion seems to stop with “yes, we must do that”

  • Feds and states have a role that needs to compliment each other


Dr the promise

DR – The Promise

  • Demand Response benefits

    • Mitigation of Market Power

    • Mitigation of Load Pocket Issues (Boston, etc)

    • Environmental Benefits

    • DR should lead to innovative Distributed Generation (DG) such as fuel cells

    • Enhance Reliability

    • Reduce Retail costs relating to ICAP, gen adequacy standards


Supply demand

Supply/Demand

  • Whether states have retail access or not, a market needs an elastic demand curve

    • This is critical

  • ISOs, States have tried some demand programs but mostly “placeholders”

  • FERC has told ISOs to accommodate demand bidding but little else

  • Standard Market Design and state programs must mesh… but how?


What smd will do

What SMD Will Do

  • Requirement that load (demand) has to be treated the same as supply for bidding

  • Day ahead market requirement should facilitate some demand bidding

  • What else do we need on the wholesale side to make to meet state requirements?

  • We could use some help here…


Proposal for new england

Proposal for New England

  • Need to get real demand response going real soon

  • New England region has a generally homogeneous interest in DR

  • Need a regional approach, not a single state

  • Unique position to work as a group to advise FERC on SMD helping to make make demand responsive


Proposal 2

Proposal (2)

  • Goal: Get 5-10% of NE load into a stable DR program that has longer than a summer peak lifespan

    • for 3-4 year period

  • FERC would provide $50,000 for consultant work (collaborate on selection) to help

    • DoE will provide $40,000 and national lab experts

  • Timeline: Results needed by mid-November to be included in SMD final rule

  • FERC personnel work with NE effort after NOPR


Proposal 3

Proposal (3)

  • Need NE group to come up with a “business plan” that details what states are going to do and what they need SMD to do

  • DoE will look to provide funding in FY 2003 ($200K) to support program implementation for states

  • EPA looking to fund complimentary programs & possible help on SIP offset


Caveat

Caveat

  • DR in the past has suffered from stop-gap, one year pilot programs

  • Nothing done on a regional basis that really gets demand response other than during “emergencies”

  • Effort needs to get to real tariff results, not more consultant platitudes

  • Plan needs implementation follow through, stability, and occasional tweaks


Benefits for new england

Benefits for New England

  • You get to tell Feds what to do… who wouldn’t love that?

  • NE could become the experts on DR and the national lab on the subject

  • Get the promise of DR earlier than everyone

    • Environmental

    • Real market driven mitigation

    • Congestion relief

    • Others


Benefits for ferc

Benefits for FERC

  • Help from a region with a corresponding interest

  • If successful, will help market oversight as markets become more competitive

  • Help connecting SMD to the missing element… responsive demand

  • Markets will not work as hoped without real demand response


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