© 2016 Electric Power Research Institute, Inc. All rights reserved. Salvador A. Casente, Jr. Vice President, General Counsel, Chief Compliance Officer & Secretary NASUCA Mid-Year Meeting June 7, 2016 Integrated Grid: Realizing the Full Value of Central and Distributed Energy Resources
2 © 2016 Electric Power Research Institute, Inc. All rights reserved. Electric Power Research Institute
3 © 2016 Electric Power Research Institute, Inc. All rights reserved. Advisory Council Includes leaders from regulatory, academic, environmental, and scientific organizations, along with the finance and business sectors Advises EPRI management on trends in political, economic and social issues Ensures research relevance and balance in serving the public interest
4 © 2016 Electric Power Research Institute, Inc. All rights reserved. Developing Foundation for an Integrated Grid Phase 1 Integrated Grid Concept Paper Feb 2014 Phase 2 Benefit - Cost Framework Feb 2015 Phase 3 Integrated Grid Pilot Projects Now Extensive Industry Coordination in all Phases More Information Available at:
5 © 2016 Electric Power Research Institute, Inc. All rights reserved. Define Integrated Grid Concept Phase I 2014 Phase Phase Integrated Grid Concept Paper How will power systems evolve with DER growth? Can we capture the benefits of both central and distributed resources? How do we fairly, thoroughly and transparently evaluate costs? Key attributes on an integrated approach
6 © 2016 Electric Power Research Institute, Inc. All rights reserved. Integrated Grid: The Vision Power System that is Highly Flexible, Resilient and Connected and Optimizes Energy Resources
7 © 2016 Electric Power Research Institute, Inc. All rights reserved. Interconnected Value of Grid Connectivity Integrated Value of DER and Grid Interconnected but Not Integrated Integration Enables Values of all Resources
8 © 2016 Electric Power Research Institute, Inc. All rights reserved. The Integrated Grid is about Enabling the Customer The integrated grid allows Local Energy Optimization to become part of Global Energy Optimization.
9 © 2016 Electric Power Research Institute, Inc. All rights reserved. Less Dispatchable, Less Forecastable, More Dynamic, More Interactive A Look Ahead: The Power System
10 © 2016 Electric Power Research Institute, Inc. All rights reserved. Enables Optimization of Local & Central Resources with Customer Needs A Look Ahead: The Integrated Grid T & D Becomes More Controllable and Resilient Generation Becomes More Flexible The Edge Consumers Become Energy Producers Loads Become More Interactive and Dynamic
11 © 2016 Electric Power Research Institute, Inc. All rights reserved. Develop Benefit-Cost Framework Phase I 2014 Phase Phase Assess the impacts to improve system planning and operation Bulk System Resource Adequacy Flexibility Operational Practices & Simulation Transmission Performance Transmission Expansion Distribution System Hosting Energy Capacity Reliability Scenario Definition DER Adoption Market Conditions System Assumptions Customer or Owner Cost/Benefits Societal Costs/Benefits Benefit/Cost System Cost Changes
12 © 2016 Electric Power Research Institute, Inc. All rights reserved. Features of the Benefit-Cost Framework Comprehensive: Can include any quantifiable impacts from distribution to bulk system, with or without externalities Flexible: Designed to address a variety of economic questions from a variety of perspectives
13 © 2016 Electric Power Research Institute, Inc. All rights reserved. EPRI’s Benefit-Cost Framework Societal Impacts Customer Impacts Bulk System Impacts Distribution System Impacts Net Capital Cost Changes Net Fuel/O&M Changes (Avoided less Incurred) Net Capital Cost Changes Net Fuel/O&M Changes (Avoided less Incurred) Net Capital Cost Changes Net O&M Cost Changes (Avoided less Incurred) Net Capital Cost Changes Net O&M Cost Changes (Avoided less Incurred) Change in Utility Cost (The Utility-Cost Function) Reduced/Increased Emissions General Economic Effects Reduced/Increased Emissions General Economic Effects Monetization Protocols Direct Customer Benefits Net Societal Benefits Reliability Improvement Resiliency Improvement Customer Equipment Cost Reliability Improvement Resiliency Improvement Customer Equipment Cost Monetization Protocols Societal Benefits
14 © 2016 Electric Power Research Institute, Inc. All rights reserved. Steps to Apply Cost-Benefit Framework Formulate Question Define Scenarios and Assumptions Evaluate Scenarios Using Benefit - Cost Framework Compare Scenarios and Identify “Best” Option The economic and technical questions for the framework are not pre-configured.
15 © 2016 Electric Power Research Institute, Inc. All rights reserved. Putting the Framework to the Test Phase I 2014 Phase Phase Better understanding of operational values, issues & economic impacts Provide rigorous testing platform for system evolution Deliver consistent, repeatable transparent methodology to validate an integrated approach Ensures the ability to make the most prudent business/investment decisions going forward
16 © 2016 Electric Power Research Institute, Inc. All rights reserved. EPRI Integrated Grid Pilots Utility Scale Solar Utility Scale Solar + Storage Distributed Energy Storage Microgrids EV Charging Infrastructure Customer-Side Technologies We Energies AEP Alliant TVA Hoosier KCPL NYPA APS SRP Entergy HydroOne SCE LGE Exelon/PECO Exelon
17 © 2016 Electric Power Research Institute, Inc. All rights reserved. Integrated Grid Success Wide Coordination is Crucial Standards Organization Global R&D Key Stakeholders EPRI Members
18 © 2016 Electric Power Research Institute, Inc. All rights reserved. Together…Shaping the Future of Electricity For more information contact: Sal Casente, Deana Dennis,