TO: State/Provincial Participants in the October 30 WIEB/CREPC Demand Response Meeting
FROM: Doug Larson
DATE: November 2, 2001
SUBJECT: Demand Response Questions; Demand Response Team
At the October 30 joint WIEB/CREPC meeting, two actions were take to implement a demand response research initiative: (1) State and provincial members volunteered to join a Demand Response Team to guide work under the initiative; and (2) questions were identified that need to be addressed when considering various demand response initiatives (e.g., demand bidding, real-time pricing).
Those who expressed interest in participating in the Demand Response Team were: Bill Eastlake (ID PUC), Chair; Phil Carver (OR OE); Larry Nordell (MT DEQ); Carl Linvill (NV Gov’s office); Dick Byers/Nicholas Garcia (WA UTC); Craig Marks (AZ EO), Ken Corom (NWPPC); Liz Klump (WA OTED) We are still accepting expressions of interest in joining the team. IF YOU ARE INTERESTED IN JOINING THE TEAM, PLEASE LET ME (dlarson@westgov.org; 303/573-8910) or BILL EASTLAKE (beastla@puc.state.id.us, 208/334 0363 ) KNOW.
YOU ARE ASKED TO REVIEW AND GROUP, AND MODIFY AND EXPAND, ON THE QUESTIONS AT THE END OF THIS MEMO AND E-MAIL YOUR MODIFICATIONS TO BILL EASTLAKE AND DOUG LARSON BY NOVEMBER 9. PLEASE INDICATE THE HIGHEST PRIORITY QUESTIONS FOR YOU.
Note that the list of questions includes some that Bill Eastlake (ID PUC) prepared prior to the meeting.
It is anticipated that the Demand Response Team members will review the suggested additions and modifications to the questions and develop a plan to address the questions. A draft paper will be prepared for your review. We expect to schedule a day-long workshop on demand response in conjunction with the April CREPC meeting. We will be organizing a Demand Response Team page on the WIEB web site.
Thank you all for participating in the meeting this week.
(RTP = Real Time Pricing)
(TOU = Time-of-Use Pricing)
Will PUCs feel comfortable putting in place RTP during times of high price
volatility? Will consumers demand price stability?
How do you decide the geography of zones in which different prices for load
reduction would be offered?
Should demand response programs be limited to certain types of customers?
What equity issues will PUCs need to address if a demand response program is
limited to only certain customers?
What are the environmental impacts of peak shifting or shifting to backup
generation?
What is the impact of (TOU/RTP) on low income customers? Do they have
capability to change energy use in response to changes in prices?
What information/education is needed regarding the benefit to low-income from
TOU/RTP even if that class does not reduce use?
Should TOU/RTP programs be voluntary or mandatory? Will an opt out program
eliminate this concern?
Have there been effective demand response programs for residential customers?
Where is the hourly price going to come from for a real-time pricing program? How
important is a transparent market to efficient operation of demand response
programs? Can there be a westwide demand bidding program without transparent
prices?
Is it the economic incentives in TOU/RTP that are causing changes in consumer
electricity use OR is it the customers’ sense of control and willingness to reduce
demand for the public good that is causing changes in electricity use?
What were the savings with the ad hoc demand reduction programs implemented in
the past year in the West (and at what cost)?
How best can we create or maintain the capability for rapid deployment of demand
response measures?
What are the longer term avoided cost (generation, transmission and distribution)
benefits from reducing the peak demand?
What is the most cost-effective means of reducing load? Price signals to residential
consumers? Demand bidding programs? Power buyback programs? In the
Northwest, will fuel switching be a more effective means of reducing load?
What are the metering and communication system costs associated with improving
demand response? How much higher would the costs be with RTP? How much
more expensive is it to have a two-way communication system to control thermostats
and other consumer devices?
Is TOU/RTP putting the focus on peak load management, not reductions in overall
electricity use?
In TOU, how do you pick the price differential for different periods?
Which peak loads to reduce? Daily peak? Weather event peaks? High price
periods? How do different strategies impact each of these types of peaks?
Can regionwide demand bidding programs be made consistent with state level
statutory service obligations? If improved demand response is viewed as essential to
achieve the federal government’s objective of competitive wholesale electricity
markets, should the federal government contribute to the cost of putting in place
necessary metering.
Are there significant implementation differences between regulated IOUs vs. BPA
vs. RTOs?