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At least 19 records

Unlocking load growth at the grid edge: Practices for managing, recovering, and allocating distribution system investments

Utilities and utility regulators are preparing to make significant investments in the electricity distribution system driven by expected load growth in coming years and decades. Regulators will be tasked with vetting investment proposals and implementing cost recovery and allocation mechanisms. In particular, state regulators are anticipating the need to make proactive distribution system investments, building the capability to serve new load in advance of demand. This report focuses on load growth from homes and businesses that adopt electric vehicles and heat pump heating technologies. Through a review of legislation and regulatory dockets in a subset of states, we provide insights into emerging utility and regulatory practices to recover and allocate costs of electrification-driven distribution system investments necessary to accommodate these technologies. Our review focused on utility electrification programs, line extension policies, and proactive investments. Our report is largely descriptive, offering detailed information about approaches different state commissions and utilities have implemented to inform future decision-making.

24 POWER TRANSMISSION AND DISTRIBUTION↗

Regulatory Mechanisms to Enable Investments in Electric Utility Resilience

In 2019, Sandia National Laboratories contracted Synapse Energy Economics (Synapse) to research the integration of community and electric utility resilience investment planning as part of the Designing Resilient Communities: A Consequence-Based Approach for Grid Investment (DRC) project. Synapse produced a series of reports to explore the challenges and opportunities in several key areas, including benefit-cost analysis, performance metrics, microgrids, and regulatory mechanisms to promote investments in electric system resilience. This report focuses on regulatory mechanisms to improve resilience. Regulatory mechanisms that improve resilience are approaches that electric utility regulators can use to align utility, customer, and third-party investments with regulatory, ratepayer, community, and other important stakeholder interests and priorities for resilience. Cost-of-service regulation may fail to provide utilities with adequate guidance or incentives regarding community priorities for infrastructure hardening and disaster recovery. The application of other types of regulatory mechanisms to resilience investments can help. This report: characterizes regulatory objective as they apply to resilience; identifies several regulatory mechanisms that are used or can be adapted to improve the resilience of the electric system--including performance-based regulation, integrated planning, tariffs and programs to leverage private investment, alternative lines of business for utilities, enhanced cost recovery, and securitization; provides a case study of each regulatory mechanism; summarizes findings across the case studies; and suggests how these regulatory mechanisms might be improved and applied to resilience moving forward. In this report, we assess the effectiveness of a range of utility regulatory mechanisms at evaluating and prioritizing utility investments in grid resilience. First, we characterize regulatory objectives which underly all regulatory mechanisms. We then describe seven types of regulatory mechanisms that can be used to improve resilience--including performance-based regulation, integrated planning, tariffs and programs to leverage private investment, alternative lines of business for utilities, enhanced cost recovery, and securitization--and provide a case study for each one. We summarize our findings on the extent to which these regulatory mechanisms have supported resilience to date. We conclude with suggestions on how these regulatory mechanisms might be improved and applied to resilience moving forward.

24 POWER TRANSMISSION AND DISTRIBUTION↗

Performance Metrics to Evaluate Utility Resilience Investments

In 2019, Sandia National Laboratories (Sandia) contracted Synapse Energy Economics (Synapse) to research the integration of community and electric grid resilience investment planning as part of the Designing Resilient Communities (DRC): A Consequence-Based Approach for Grid Investment project. Synapse produced a series of reports to explore the challenges and opportunities in several key areas, including benefit-cost analysis (BCA), performance metrics, microgrids, and regulatory mechanisms. This report focuses on BCA. BCA is an approach that electric utilities, electric utility regulators, and communities can use to evaluate the costs and benefits of a wide range of grid resilience investments in a comprehensive and consistent way. While BCA is regularly applied to some types of grid investments, application of BCA to grid resilience investments is in the early stages of development. Though resilience is increasingly cited in connection with grid investment proposals and plans, the resilience- related costs and benefits of grid resilience investments are typically not fully identified, infrequently quantified, and almost never monetized. Without complete assessments of costs and benefits, regulators can be hesitant to approve some types of grid resilience investments. This report provides the first application of the framework developed in the 2020 National Standard Practice Manual for Benefit-Cost Analysis of Distributed Energy Resources (NSPM for DERs) to grid resilience investments. We provide guidance on next steps for implementation to enable grid resilience investments to receive due consideration. We suggest developing BCA principles and standards for jurisdiction-specific BCA tests. We also recommend identifying the resilience impacts of the investments and quantification of these impacts by establishing utility performance metrics for resilience. Proactive integration of grid resilience investments into existing regulatory processes and practices can increase the capacity of jurisdictions to respond to and recover from the consequences of extreme events. 1 National Energy Screening Project. 2020. National Standard Practice Manual for Benefit-Cost Analysis of Distributed Energy Resources.

24 POWER TRANSMISSION AND DISTRIBUTION↗

Advancing Electric System Resilience with Distributed Energy Resources: Key Questions and Resources

This resource has two complementary parts: (1) A list of questions that offers an initial starting point for state public utility commissions (commissions) to frame how they review proposed utility investments and considerations that could offer resilience benefits; (2) A list of relevant resources to improve a regulator's ability to oversee resilience investments and obtain the best possible solutions for customers. The list of resources includes a synopsis of relevant topics covered in each resource. This document is not intended to offer a complete picture of resilience literature, but instead suggests strategies for state regulators to convene conversations and make decisions to achieve better resilience outcomes for customers. It is meant to serve as a starting point for commissions to understand and incorporate resilience into regulatory processes. The list of questions and resources will not be perfectly suited to the particular needs of each commission. As the resilience conversation advances, regulators will need to take advantage of available resources to build their capacity to assess resilience risks, compare investment options, and evaluate performance.

14 SOLAR ENERGY↗

Valuing Resilience for Microgrids: Challenges, Innovative Approaches, and State Needs

The United States depends on the delivery of reliable, affordable, clean, and safe electricity. Electric utilities invest billions of dollars each year in generation, transmission, and distribution assets to meet this need. However, experiences with recent natural disasters of increasing frequency and duration demonstrate the shortcomings of this approach in the face of modern threats. Further, as customers rely on electricity for a broader range of important needs, such as transportation, as well as critical life-saving services and mission critical facilities such as water treatment, medical care, shelters, telecommunications, and more, the need to minimize the likelihood and impacts of outages grows. Against this backdrop, resilience has emerged as a key consideration to guide electricity spending, whether from utilities, customers, or taxpayers. Although reliability has been defined and measured for decades with broadly accepted metrics that measure how many customers lose power and at what frequency and duration, resilience considers the electricity system’s response to a disruption and its subsequent impacts on customers. Developing tools and methods to accurately assess the costs and benefits of resilience investments is a critical step toward the goal of mitigating the impacts of outages on customers and society. Today, electric system resilience is largely treated as an externality due to challenges estimating the costs of long-duration outages, impacts of outages on society, and increasing reliance on electricity for a growing set of interdependent services. These interdependencies include the water, wastewater, telecommunications, natural gas, and health sectors. Without knowing how much a given resilience investment will benefit customers or society more broadly, investors, policymakers, and regulators are less likely to make or approve such investments, and less able to prioritize those investments. State Energy Offices and public utility commissions (PUCs) lead the development of state-level energy policy and utility regulation, respectively, and each has interests in encouraging appropriate public and private investments in resilience. To this end, the National Association of State Energy Officials (NASEO) and National Association of Regulatory Utility Commissioners (NARUC), with the support of the U.S. Department of Energy (DOE) Office of Electricity (OE), formed a joint Microgrids State Working Group to explore the costs and benefits of microgrids, barriers to broader deployment of microgrids to meet resilience and other objectives, and policy and regulatory strategies to optimize investments in resilience, including but not limited to microgrids. Although no universally accepted valuation tool for resilience exists, National Laboratories, utilities, researchers, and state and federal agencies have collaborated to develop, apply, and improve a number of approaches to quantify resilience, several of which are still in progress at the time this report is published. This report seeks to share these important advances by discussing current definitions of resilience (Section 1), how microgrids are defined and used to meet resilience objectives (Section 2), new approaches to valuing resilience (Section 3), steps State Energy Offices and PUCs have taken to further resilience valuation efforts (Section 4), and finally, considerations and suggested next steps for State Energy Offices and PUCs (Section 5). Relevant examples of specific microgrid projects and resilience valuation efforts are included throughout the report. While this report is written specifically for NASEO and NARUC members, it may be useful for utilities, local governments, and individual customers interested in improving the way public and private dollars are spent to achieve resilience outcomes.

24 POWER TRANSMISSION AND DISTRIBUTION↗

Effectively Considering the Distribution System in Integrated Resource Plans

While electricity planning practices vary by state and utility based on utility type and market structure, integrated resource planning (IRP) remains a prominent vehicle — even in states with centrally-organized wholesale electricity markets. IRP focuses on meeting forecasted long-term electricity needs. Typically, utilities have not considered impacts of design and operation of the low-voltage distribution network in IRP. With advanced capabilities of grid-edge technologies to generate and store electricity and provide load flexibility, and large utility investments in distribution systems, it's increasingly important to consider at least some distribution planning elements in IRP. This report considers the value proposition for doing so, such as reducing utility costs through resource co-optimization and strategic siting of grid-edge resources, and idenfities the most important touchpoints between planning for bulk power and distribution systems and provide a range of tactics for integrating these two processes.

Relf, Grace [Lawrence Berkeley National Laboratory↗

The use of price-based demand response as a resource in electricity system planning

Utilities have conducted IRP for decades to consider both supply- and demand-side resources to meet bulk power system needs. More recently, an increasing number of states are requiring regulated utilities to file plans that identify distribution system needs, including DERs that can avoid or defer certain types of traditional utility investments cost-effectively. Price-based demand response (DR) is an underutilized resource that could substantially contribute to load flexibility. We find that evaluation of price-based DR as a solution to meet identified electricity system needs is uncommon at both planning processes. Where price-based DR is considered as a solution, methodologies are often deficient in the characterization and treatment of this resource. Based on our analysis of utility filings and state requirements, this brief provides recommendations for improving consideration of price-based DR in the context of long-term planning for bulk power and distribution systems.

24 POWER TRANSMISSION AND DISTRIBUTION↗

Selecting Critical Scenarios of DER Adoption in Distribution Grids Using Bayesian Optimization

We develop a new methodology to select scenarios of DER adoption most critical for distribution grids. Anticipating risks of future voltage and line flow violations due to additional PV adopters is central for utility investment planning but continues to rely on deterministic or ad hoc scenario selection. We propose a highly efficient search framework based on multi-objective Bayesian Optimization. We treat underlying grid stress metrics as computationally expensive black-box functions, approximated via Gaussian Process surrogates and design an acquisition function based on probability of scenarios being Pareto-critical across a collection of line- and bus-based violation objectives. Our approach provides a statistical guarantee and offers an order of magnitude speed-up relative to a conservative exhaustive search. Case studies on realistic feeders with 200-400 buses demonstrate the effectiveness and accuracy of our approach.

Mulkin, Olivier↗

Demand response roadmap for the New Jersey Board of Public Utilities [Slides]

The New Jersey Board of Public Utilities (BPU) requested technical assistance from Berkeley Lab to inform its strategy for advancing demand response through its demand-side program planning process. Berkeley Lab developed this roadmap to delineate milestones for the portfolio's development and to identify the utility investments and BPU actions that achieve those milestones.

24 POWER TRANSMISSION AND DISTRIBUTION↗

Space Resource Utilization and Extending Human Presence Across the Solar System

The Presidents Vision for Exploration is not a single mission, but an open ended journey that seeks to answer "How can we live on other worlds?" Using space resources is the only known approach for affordable, sustained, flexible, and self sufficient, human occupation beyond Earth orbit. Earth is a large planet. A simple analysis using the rocket equation shows that if Earth were a bit larger, chemical propulsion as a mechanism to access space would become impractical. Thus, even with the most efficient chemical rocket launch capability, the cost of lifting massive payloads into space will remain very steep (currently about $l00k/lb to the Moon and greater than $500k/lb to Mars). Space resource utilization should begin with an aggressive broad based demonstration program as afforded by the precursor missions implementation of the President's Vision of Exploration. Ion engine upper stages, for example, were studied for over 30 years, but only implemented in design after the Deep Space 1 in space demonstration. These demonstrations should include: extraction of elements from lunar regolith, and Martian soil and atmosphere, demonstration of power break even and growth from lunar or Mars moons derived photovoltaics, oxygen extraction for life support and propellant, and metals and alloys for in space repair and the production of habits and radiation shielding. Space resource utilization yields operational dividends through the subsequent programs including: propellant from lunar oxygen which could cut transportation costs from Earth in half, mega watts per year of power grown from lunar photovoltaics at decreasing cost per kW, decreased cost for human Mars missions by a factor of 10 by using propellant derived from Mars atmosphere for return, and in space manufacturing and food production with space resources yielding safe sustained and eventually self sufficient human presence in space. After the demonstration and implementation, the space resource utilization investment enables commercial and private viability beyond Earth orbit. For example, analysis has shown the lunar oxygen production for propellant becomes commercially viable after the exploration program completes the R&D, and power from lunar derived photovoltaics could, according to past NASA sponsored studies, pay for themselves while supplying most of Earth's electrical energy after about 17 years. Besides the Moon and Mars the resources of the near Earth asteroids enable the building of large space structures and science payloads. Analysis has shown that one of the thousands of these objects (some as easily accessible in space as the Moon and Mars), 2 km dia, the size of a typical open pit mine, would cost the total global financial product of Earth for 30,000 years if we were to launch it from Earth. Beyond Mars, the belt asteroids have been calculated to contain enough materials for habitat and life to support 10 quadrillion people. Thus, the development and use of space resources enables the extension of human life through the solar system allowing humanity to move from a planetary to a solar system society.

Curreri, Peter A.↗

Cost Optimization and Technology Enablement COTSAT-1

Cost Optimized Test of Spacecraft Avionics and Technologies (COTSAT-1) is an ongoing spacecraft research and development project at NASA Ames Research Center (ARC). The space industry was a hot bed of innovation and development at its birth. Many new technologies were developed for and first demonstrated in space. In the recent past this trend has reversed with most of the new technology funding and research being driven by the private industry. Most of the recent advances in spaceflight hardware have come from the cell phone industry with a lag of about 10 to 15 years from lab demonstration to in space usage. NASA has started a project designed to address this problem. The prototype spacecraft known as Cost Optimized Test of Spacecraft Avionics and Technologies (COTSAT-1) and CheapSat work to reduce these issues. This paper highlights the approach taken by NASA Ames Research center to achieve significant subsystem cost reductions. The COSTAT-1 research system design incorporates use of COTS (Commercial Off The Shelf), MOTS (Modified Off The Shelf), and GOTS (Government Off The Shelf) hardware for a remote sensing spacecraft. The COTSAT-1 team demonstrated building a fully functional spacecraft for $500K parts and $2.0M labor. The COTSAT-1 system, including a selected science payload, is described within this paper. Many of the advancements identified in the process of cost reduction can be attributed to the use of a one-atmosphere pressurized structure to house the spacecraft components. By using COTS hardware, the spacecraft program can utilize investments already made by commercial vendors. This ambitious project development philosophy/cycle has yielded the COTSAT-1 flight hardware. This paper highlights the advancements of the COTSAT-1 spacecraft leading to the delivery of the current flight hardware that is now located at NASA Ames Research Center. This paper also addresses the plans for COTSAT-2.

Spremo, Stevan↗

A strategy for investment in space resource utilization

Considerations governing a strategy for investment in the utilization of space resources are discussed. It is suggested on the basis of an examination of current trends in terms of historical processes which operate on new frontiers that the limited markets and unfamiliar technologies associated with space commercialization today may change dramatically in 20 years when lunar resources are accessible. It is argued that the uncertainty of such projections discourages investment at a useful scale unless a strategy for technology development can be implemented which provides tangible and marketable benefits in the intermediate term. At present, technologies can be identified which will be required (and therefore valuable) at the time of lunar settlement, and whose development can be planned to yield marketable intermediate products on earth. It is concluded that the formation of precompetitive collaborative research consortia in the industrial sector could reduce technical and economic risk in the early stages and could promote a favorable political environment for the future growth of space activities.

Mendell, Wendell W.↗

Benefit-Cost Analysis for Utility-Facing Grid Modernization Investments: Trends, Challenges, and Considerations

In recent years, many electric utilities have submitted grid modernization plans for review by state public utility commissions. A central objective of these plans is to demonstrate that grid modernization investments will provide net benefits to customers, be reasonable and be in the public interest. The plans typically include some form of benefit-cost analysis, but the assumptions, methodologies and frameworks vary considerably between utilities. This report: -Describes utility-facing technologies and projects for modernizing distribution systems, including interdependencies of grid components -Highlights benefit-cost considerations related to grid modernization -Summarizes recent trends in benefit-cost analysis for grid modernization based on a review of 21 plans by U.S. electric utilities -Discusses challenges state public utility commissions face in reviewing utility plans and provides options for addressing challenges

24 POWER TRANSMISSION AND DISTRIBUTION↗

Using Mapping Tools to Prioritize Electric Vehicle Charger Benefits to Underserved Communities

Mapping tools can play an important role in incorporating equity into planning, implementing, and evaluating investments in electric vehicle (EV) charging stations, also referred to as EV chargers or electric vehicle supply equipment (EVSE). Federal, state, and local organizations need methodologies for using mapping tools as they pursue equity-focused goals to ensure that the benefits of investments in EV chargers flow to energy and environmental justice (EEJ) underserved communities. This report provides examples of how to apply mapping tools to identify priority locations for installing EV chargers that may benefit EEJ underserved communities through four EV charger planning approaches: corridor charging, community charging, fleet electrification, and diversity in STEM and workforce development. It also explores various methodologies for calculating low-public EVSE density. Ensuring that the benefits of EV charger investments flow to underserved communities involves prioritizing locally identified needs and incorporating community input when choosing charging station locations. Installing EV chargers in a census tract identified as an EEJ underserved community does not inherently mean that those EV chargers provide benefits to residents of that community. In addition, representatives of historically disadvantaged communities or environmental justice communities have concerns that installing EV chargers in their communities could potentially exacerbate or propagate existing inequities. While the methodologies described in this report may help identify priority census tracts for equity-focused EV charger investment, additional community engagement and site evaluation are necessary to determine whether EV chargers are accessible, affordable, and convenient to EEJ underserved community residents and what benefits the local community is looking to realize with EV charger installations. This report is the culmination of many discussions with project leaders from DOE-funded projects deploying EV chargers in communities across the nation, organizations representing EEJ underserved communities, state agencies developing EV investment plans, utilities making major EV investments, and DOE national laboratory experts working in transportation electrification. The authors distributed a draft report for peer review, and reviewer comments are summarized in this report. These methodologies are likely to evolve as more EV charger funding programs are implemented and more real-world data is available to measure the effectiveness of strategies for incorporating equity in EV charger deployment projects. Continued efforts to document best practices and critically evaluate whether equity-focused programs achieve their goals are needed as transportation electrification proceeds at the local, regional, and national levels.

29 ENERGY PLANNING, POLICY, AND ECONOMY↗

Electric utility companies and geothermal power

The requirements of the electric utility industry as the primary potential market for geothermal energy are analyzed, based on a series of structured interviews with utility companies and financial institution executives. The interviews were designed to determine what information and technologies would be required before utilities would make investment decisions in favor of geothermal energy, the time frame in which the information and technologies would have to be available, and the influence of the governmental politics. The paper describes the geothermal resources, electric utility industry, its structure, the forces influencing utility companies, and their relationship to geothermal energy. A strategy for federal stimulation of utility investment in geothermal energy is suggested. Possibilities are discussed for stimulating utility investment through financial incentives, amelioration of institutional barriers, and technological improvements.

Pivirotto, D. S.↗

Calculating Behind-the-Meter Energy Storage Incentives on an Avoided Cost Basis

Behind-the-meter (BTM) energy storage offers the potential for shared investment by utilities and their customers, in which both parties share in the costs and benefits of battery investment. Several utilities and a handful of states have begun providing incentives to help customers purchase BTM energy storage, and in exchange, operate that battery on behalf of the customer to realize grid benefits such as meeting peak capacity needs. But there is wide variation in the value and structure of these incentives, suggesting a lack of clarity on the value of BTM storage to the grid and to non-participating customers who fund the incentives for participating customers. This paper provides an objective framework for establishing BTM energy storage incentives based on the avoided cost of generation from a marginal, gas-fired peaking plant. It also conducts several sensitivity analyses to see how those avoided costs vary with emissions pricing, gas prices, plant heat rates, and utility capital structures. This work may be of use to utilities, regulators, and energy system stakeholders in providing a value-based framework for BTM incentive programs that can be used in the absence of policy guidance.

Twitchell, Jeremy B.↗