���������������������������� The California Statewide Pricing Pilot ------------------- Lessons Learned David G. Hungerford, Ph.D. California Energy Commission
���������������������������� California Demand Response Objectives � Integrate energy efficiency with demand response � Economic Response – Let the customer decide. � Reliability Response – Provide the system operators (ISO/utilities) with control. � All customers – not just a select few.
���������������������������� CEC Vision of Price Response � Always TOU or Better if digital meters available and if economic � “CPP” is an extension of TOU � Residential and Small Commercial � Default = CPP � Option = TOU or Flat w/hedge premium � Intermediate Size Customers (perhaps 200 kw to 1 MW) � Default = CPP � Option= TOU or RTP � Large (perhaps > 1 MW) � Default = RTP � Option = CPP or perhaps TOU
���������������������������� Objectives of the Statewide Pricing Pilot � Test customer acceptance of dynamic pricing rates and enabling technologies � Measure average load impacts from different types of dynamic rates � Estimate Price elasticities for different customer types as a function of appliances, weather and notification period � Test new forms of information displays that provide notification and feedback to customers � Evaluate customers willingness to stay on dynamic rates and pay for controls
���������������������������� Significant Design Features � Representative sample of ~2500 customers � Treatment groups for 3 rate designs, enabling technologies and information only � SCE, PG&E and SDG&E cooperative joint- venture pilot. � Revenue neutral rate designs. � CPP-V participants linked to existing thermostat pilots mandated under SB970. � Cost – approximately $20 million.
���������������������������� Summary Conclusions Residential CPP rates can, within five years of System deployment reduce California’s peak load by 1,500 Impacts to over 3,000 MW. Dynamic rates encourage greater conservation Conservation and peak demand impacts than conventional and Peak Load Impacts inverted tier or time-of-use rates. Residential and small to medium commercial and industrial customers Customer Acceptance understand and overwhelmingly prefer dynamic rates to existing inverted tier rates.
���������������������������� Residential Results � Residential CPP-F rates reduced critical peak period ( 2PM to 7PM) energy use by more than 13% (average). (range 8-17%) � Customers who opted to install and use automatic controls and had air conditioning reduced critical peak energy use on average by 30%. � Critical peak Pricing produced stable results-- Residential peak period reductions were almost identical in the summers of 2003 and 2004. � Average peak period reductions held steady throughout multiple day peak pricing events usually associated with heat storms. Source: California’s Statewide Pricing Pilot: Update of Results, Charles River Associates, January 7, 2005.
���������������������������� Small Commercial Results � CPP-V rates reduced peak period energy use during the critical peak time period (2PM to 7PM) by more than 6% for customers <20kW peak and 9.5% for customers between 20 kW and 200 kW (on average). � Customers who opted to install and used automatic controls reduced critical peak energy use on average by between 14 and 18 %. Source: California’s Statewide Pricing Pilot: Update of Results, Charles River Associates, January 7, 2005.
���������������������������� Rate Design Residential SPP Rates TOU Tariff- (high) CPP Tariff- (high) 80 $0.7336 70 Critical Peak 60 Summer Peak Summer Off-Peak 50 Cents per kWh Existing Rates 40 Avg. Summer Price 13.36 ¢/kWh 30 $0.2596 $0.2336 20 $0.1026 10 $0.0886 Maximum 1,500 hrs/yr 7,260 hrs/yr 75 hrs/yr 1,425 hrs/yr 7,260 hrs/yr 0 2:00-7:00pm Other Weekday & Dispatched 2:00-7:00pm Other Weekday & Weekdays Weekend hours 2:00-7:00pm Weekdays Weekend hours
���������������������������� SPP Bill Impacts Average Bill Impacts (summer / winter 2003) Commercial / Residential Industrial CPPV CPPF TOU Info Only CPPV TOU Participants (%) 80.3% 58.2% 71.1% 73.7% 70.0% 79.0% Bill Average Monthly 5.1% 5.5% 4.5% 5.4% 12.2% 9.6% Savings (%) Savings Average Monthly $1,521 $869 $53 $35 $29 $19 Savings ($) Participants (%) 28.9% 26.3% 30.0% 21.0% 19.7% 41.8% Bill Increases Average Monthly 4.0% 6.2% 3.0% 10.0% 5.0% 10.0% Increase (%) Average Monthly $39 $44 $30 $9 $224 $600 Increase ($) Source: Statewide Pricing Pilot, Shadow Bill Results, WG3 report, June 9, 2004.
���������������������������� Rate and Residential Load Impacts Technology Critical Peak Impacts By Rate Treatment Hottest Critical Average Critical Peak Day – Year 1 Peak Day * 47.4% 50% Peak Load Reduction 40% 34.5% Critical 30% Peak Critical Variable Peak With Variable 20% Automated With 12.5% Controls Automated Controls 10% Critical 4.1% Peak Fixed 0% Time of Use CPP-F CPP-V CPP-V TOU Source: Statewide Pricing Pilot Summer 2003 Impact Analysis, Charles Rivers Associates, August 9, 2004, Table 1-3, 1-4,.
���������������������������� Rate and Residential Load Impacts Technology Critical Peak Impacts By Rate Treatment Critical Weekday – Inner Summer Year 2 50% Peak Load Reduction 40% 27.2% 30% Critical Peak 20% Variable 13.1% With Automated Critical 10% Controls Peak Fixed 0.6% 0% Time of Use CPP-F CPP-V TOU Source: Impact Evaluation of the California Statewide Pricing Pilot, CRA, March 16, 2005, Table 1-1, 4-3.
���������������������������� Residential SPP Impacts Consistency Hottest Critical Average Critical Peak Day Peak Day * 47.4% 50% 41.0% Peak Load Reduction 35.0% 40% 34.8% 34.5% Three Tier TOU with Three Tier Two Tier Dispatched 30% Three Tier TOU with TOU with CPP Dispatched TOU with Two Tier Dispatched Dispatched CPP TOU with CPP 20% CPP Dispatched CPP 10% 0% 2 4 3 California Pilot 1 AEP Pilot Gulf Power Pilot Midwest Pilot California Pilot 1 2003 1991 1992-1993 2003 2004 Source: 1. Statewide Pricing Pilot Summer 2003 Impact Analysis, Charles River Associates, Table 1-3, 1-4, August 9, 2004. Hottest day impacts on page 105. 2. Private communication, residential pilot study, May 2005. 3. Results of the Pilot Residential Advanced Energy Management System, Gulf Power, November 1994. 4. Levy Associates case study report, July 1994.
���������������������������� Residential SPP Impacts Incentives Residential Response with Automation: Participation Incentive vs. Critical Peak Rate 5.0 CPP Event 4.5 Control Group Participation Incentive 4.0 Critical Peak Rate 3.5 3.0 kW 2.5 2.0 1.5 1.0 0.5 0.0 Noon 2:30 7:30 Midnight Hot Day, August 15, 2003, Average Peak Temperature 88.5 0
���������������������������� Residential SPP Impacts Demographics Percent Reduction in Peak Period Usage (CPP-F) Year 1 20 19.2% 18 17.2% 16 15.1% Percent Reduction 13.5% 14 12.8% 12.3% 12.5% 12.1% 12.1% 12 200% Average Use 9.8% 9.79% YES 10 > $100,000 Single Family 8 50% Average Use < $40,000 YES Multi-family NO NO 6 4 2 0 Central AC Pool State-wide High vs. Income Single vs. Ownership Ownership Average Low User Multi-Family Source: Statewide Pricing Pilot, Summer 2003 Impact Analysis, CRA, August 9, 2004, Table 5-9, p.90
���������������������������� Residential SPP Impacts Demographics Percent Reduction in Peak Period Usage (CPP-F) Year 2 20 18 17.4% 16.2% 15.8% 16 14.7% 14.0% Percent Reduction 14 13.1% 13.0% 12.2% 11.8% 12 10.9% 200% Average Use 10 > $100,000 Single Family 50% Average Use YES 8.1% YES 8 Multi-family < $40,000 NO 6 NO 4 2 0 Single vs. Central AC Pool State-wide High vs. Income Multi-Family Ownership Ownership Average Low User Source: Statewide Pricing Pilot, Summer 2003 Impact Analysis, CRA, August 9, 2004, Table 5-9, p.90
���������������������������� Rate and Small C/I Load Impacts Technology Critical Peak Impacts Enabling Technology Impacts 14 13.2% 12 Percent Reduction 10 9.6% With Technology 8 6.6% With Technology 5.5% 6 4.9% No Technology 4 2 0.8% 0 < 20 kW > 20 kW < 20 kW > 20 kW
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