Rates, Rate Design and Sustainable Energy Decisions

Transcription

1 Rates, Rate Design and Sustainable Energy Decisions Jan Berman, Sr Director CES Policy & Integrated Planning 12 th Annual Energy Summit June 8, 2012 Mountain View, CA

2 Bundled System Average Electric Rates ( /kwh) 25.0 Projected Average Electric Rates RPS Relative to New CC Generation and Incremental Transmission Non-Generation Capital Inflation (CPI) All Other Supply Costs Other Bundled system average rates from 2011 Integrated Energy Policy Report 1

3 Renewable Portfolio: Past, Present, and Future 2002 Actual 10.6% of total bundled retail sales 2011 Preliminary 19.4% of total bundled retail sales 2020 Projected 33% of total bundled retail sales Geothermal 15% Geothermal 26% Geothermal 11% Small Hydro 7% Solar PV 31% Bioenergy 41% Small Hydro 31% Bioenergy 23% Small Hydro 19% Bioenergy 8% Wind 13% Wind 31% Solar PV 1% Wind 23% Solar Thermal 20% Total RPS-Eligible Procurement 7,504 GWh Total RPS-Eligible Procurement 14,487 GWh Projected RPS-Eligible Procurement ~27,000 GWh Source: PG&E s 2002 Corporate Environmental Report and PG&E s March 2012 RPS Compliance Report (modified to reflect notes below) Notes: PG&E currently estimates that it met approximately 19.4% of its 2011 retail sales with actual 2011 deliveries from approved RPS-eligible procurement. The final 2011 RPS % will be reflected in PG&E s annual Corporate Sustainability Report in August 2012 after PG&E has concluded all 2011 settlement activity and WREGIS tracking been completed. PG&E s 2011 RPS procurement would increase to 20.1% of retail sales if the Renewable Energy Credits ( REC ) associated with 2011 deliveries from executed RPS transactions pending Commission approval are included deliveries are based on current and projected future contractual commitments 2

4 $/MMBTU Historical and Forward Gas Prices $10.00 PG&E CityGate Gas Prices $9.00 $8.00 $7.00 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $ /7/2012 Forward Settled 3

5 Forecast of Capital Investment $5,000 $4,000 $3,000 $2,000 $1,000 $- Capital Investment Increases Transmission Distribution Interconnecting Remote Renewable Generation Integration of Customer Generation Aging Infrastructure Transmission Capital Investment Rises Faster than Distribution 2012 $2.9 Billion 2020 $4.5 Billion Distribution 74% Transmission 26% Distribution 65% Transmission 35% 4

6 Average Rate Cents/kWh Rate Impacts Differ by Customer E-20 E-19 High Useage Average 2012 Rate Low Usage Mid Res Cust Average 2020 Rate CARE 5

7 Customer Charges Norm for Most Ca. Utilities California Utilities/Muni s/id s ($/month) Shasta Modesto ID Turlock ID Gridley Lassen Roseville SMUD Redding Glendale Riverside Colton Truckee Pasadena Burbank Pittsburg Imperial ID Anaheim Merced Banning Santa Clara Alameda Vernon Corona SCE SDG&E PG&E $0.88 $0.88 $0.00 $0.00 $5.60 $4.79 $4.56 $3.60 $3.06 $3.00 $3.00 $2.90 $2.50 $2.37 $6.76 Avg: $6.18 $8.21 $8.06 $8.00 $11.00 $10.50 $10.00 $10.00 $10.00 $9.80 $12.50 $

8 Customer Charges Norm Across the Country Connecticut Light & Power Alabama Commonwealth Edison Ameren Illinois Duke Power PacificCorp Georgia Power & Light Portland General Progress Florida Pennsylvania Power & Light Arizona Public Service Baltimore Gas & Elec Puget Sound PECO Energy Entergy Gulf Virgina Elec & Power Progress Carolinas Indiana Power & Light Northern States Power Consumers Energy Detroit Edison Florida Power & Light Potomac Edison TXU Energy Public Service Elec & Gas SCE SDG&E PG&E Top Utilities by Retail Sales -- Most Recent, as of April ($/month) $2.27 $0.88 $0.00 $0.00 $9.90 $9.00 $9.00 $9.00 $8.76 $8.75 $8.67 $7.50 $7.25 $7.20 $7.04 $7.00 $6.75 $6.70 $6.65 $6.00 $6.00 $5.90 $5.00 $4.95 Avg: $7.95 $16.00 $14.50 $13.64 $

9 California IOUs have relatively high upper tier rates Residential Rates of Large US Utilities, As of January ($/kwh) CenterPoint Energy Inc. (Houston Electric) 3/ Entergy Corporation (Louisiana, LLC) Southern Company (Georgia Power) American Electric Power (Appalachian Power Co) NextEra Energy Inc. (Florida Power and Light) Progress Energy (Carolina Power Light, North) NiSource (No Indiana Public Service) Xcel Energy (Northern States Power - Minnesota) 4/ TECO Energy (Tampa Electric) Pinnacle West Capital (Arizona Public Svc) San Diego Gas and Electric Southern California Edison Pacific Gas & Electric $ $ $ $ $ $ $ $ Avg Rate Highest Tier 8

10 Cents/KWh Paid for Energy Rooftop Solar /kwh /kwh /kwh 5 0 Generation Rate Costs Shifted To Other Customers Typical Residential Solar Rate Savings 1 Typical residential solar customer saves 32 /kwh The generation part of the residential rate is 7 /kwh The difference is funded by all other non-solar customers 1. Based on average home usage of 1,000 kwh/ month, a 4-tier rate structure, and a 4-kW solar system with a 17% capacity factor (that generates 500 kwh per month of electricity) 9

11 Bill Impacts from Rooftop Solar Today MW 2,400 MW $294,000 $150 $97,000 $74,000 $35 $50 $24,000 $10 $0 $0 $0 $0 E-20 (S,P,T) E-20T Res High Useage Res Mid Res Low Usage CARE Annual bill impacts from rooftop solar primarily impact high usage residential customers, and all non-residential customers. 10

12 What is the Optimal, Sustainable Approach? Design rates so that charges reflect cost causation Improve price signals to customer Increase transparency regarding subsidies embedded in rate design Both how much and who pays Replace 12 month NEM true-up with a less confusing, less costly approach 11

13 Thank You