Smart Grid: an Ontario Perspective Brian Hewson, Senior Manager Regulatory Policy Hamilton May 8, 2013

22 Overview Role of the Ontario Energy Board What is smart grid – a very quick picture What are the smart grid issues? The policy context for smart grid Whats happening in Ontario?

33 Role of the Ontario Energy Board OEB regulates (licence and set rates) 77 distributors of varying size and 5 transmitters, OPA and IESO (including SME) Licences generators, wholesalers, sub-metering and retailers Establishes rules for network businesses conduct with customers and with other market players Review and approval of major transmission facilities Review of market rules, reliability standards Sets CDM targets and establishes compliance with targets Five objectives guide the Board in electricity sector regulation: –protecting the interests of consumers –Maintaining financial viability and economic efficiency –promotion of renewable energy generation and CDM, facilitate development and implementation of smart grid

44 4 What is a smart grid? Telecom Network -Phone -Internet -Smart Meter communication infrastructure Intelligence/Communications Layer Conventional Grid Smart Grid Status / Control Diagram source: EPRI Conventional grid interoperates with smart grid intelligence through enhanced devices: - Smart meters - Switches - Transformers

55 What is smart grid? CustomersDistributionTransmission Energy management Renewable energy Storage EVs Micro-grids Automated switching Sensors Power quality/reliability Self-healing systems Storage Automation Integration of renewable energy Storage

66 What are the key smart grid issues and challenges? Data access and analytics Cyber security Privacy Customer value and Cost Interoperability/compatibility

77 So how are the issues being addressed? Interoperability –Standards development –NIST, IEC, Standards Council of Canada –Transmission and distribution - coordination –Behind the meter – more challenge Cyber-security –Standards – NERC/NIST –Utility focus – protection of grid???

88 So how are the issues being addressed? Integration of new technology –Pilots and demonstration programs: EVs, storage, sensors, self-healing –Renewable energy –solar, wind, fuel cells Data access – privacy, security Data management - analytics

99 The Ontario policy context for addressing these issues Green Energy Act 2009 – smart grid objective Ministers Directive on smart grid –3 areas of focus: customer control, system operations and adaptive infrastructure –10 policy objectives OEB Renewed Regulatory Framework Smart Grid Report Review of plans for demonstrations and smart grid related to connection of generation

10 Renewed Regulatory Framework Objectives Shift focus from utility cost to value for customers Better align utility reliability and quality of service levels with customer expectations Institutionalize continuous improvement and innovation Provide for a comprehensive approach to network investments to achieve optimum results Better align timing and pattern of expenditures with cost recovery Provide a sustainable, predictable, efficient and effective regulatory framework

11 Defined Outcomes Customer Focus –services are provided in a manner that responds to identified needs customer preferences Operational Effectiveness –Continuous improvement in productivity and cost performance is achieved; and utilities deliver on system reliability and quality objectives Public Policy Responsiveness –Utilities deliver on obligations mandated by government (e.g. in legislation and in regulatory requirements imposed further to Ministerial directives to the Board) Financial Performance –Financial viability is maintained; and savings from operational effectiveness are sustainable

12 Smart Grid Development & Implementation Smart grid is a modernization of the grid Meter is demarcation point for utility smart grid activities Allow opportunity for all players, creativity and innovation Board Report recognizes need for innovation, develop appropriate incentives for utilities Provides direction on developing a clear set of expectations for utilities in planning for smart grid

13 Smart Grid Report Direction to network businesses Develop plans which must address smart grid policy: –Customer engagement –Data access –Automation of networks to provide flexibility –Integration of technology - storage –Assessment of new innovative technology Plans to consider 10 policy objectives –Principle concern for value, reliability, consumer

14 Whats happening now in Ontario? Hydro One Networks –Owen Sound smart zone to demo a number of technologies for system and customer –Sensor deployment –Renewable integration – automated switching Toronto Hydro –North York smart pilots –Community storage –Automation to support renewables

15 Whats happening now in Ontario? Powerstream –EV demonstration –Micro-grid –Grid automation/sensing 20 or so utilities working together on data security assessments, analysis System Operator developing alternative technologies to manage the provincial grid –Storage, demand control –Peak management – DR automation

16 Whats next? Utilities developing plans based on policy direction Standards development –SCC work Data access –Green Button Smart grid is an evolution not a revolution.

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