Value of the Integrated Grid Utility Integrated Distributed Resource Deployment

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1 Value of the Integrated Grid Utility Integrated Distributed Resource Deployment Robin E Manning Vice President - Transmission, EPRI PSERC Summer Workshop July 15, 2015

2 EPRI s Integrated Grid Concept Phase 1 Integrated Grid (IG) Paper FEB 2014 Phase 2 Benefit/Cost Assessment OCT 2014 Phase 1 IG Pilots NOW Extensive Electricity Sector Stakeholders in All Phases 2

3 Action Plan Inform Stakeholders on Key Concept & Challenges Benefit/Cost Framework for Different Designs Global Demonstrations Data, Information and Tools Global Collaboration to Establish the Science, Engineering and Economics 3

4 EPRI Whitepapers Aligned with the Integrated Grid Grid Modernization Power System Resiliency Phase 1 Integrated Grid (IG) Paper FEB 2014 Physical Security, EMP, GMD, Sensors, UAV, Advanced Structures Communication Standards and Interconnection Rules Recommended Settings for Voltage and Frequency Ride-Through of Distributed Energy Resources Are Current Unintentional Islanding Prevention Practices Sufficient for Future Needs Integrated Planning and Operations Contributions of Supply and Demand Resources to Required Power System Reliability Services Distribution Feeder Hosting Capacity: What Matters When Planning for DER Informed Policy and Regulation Power System Flexibility (PS Connectivity pending) Importance of Capacity and Energy in Supply and Demand 4

5 Integrated Grid - Benefit Cost Framework Phase 2 Benefit/Cost Assessment OCT

6 EPRI Integrated Grid Pilots: Building an Industry Repository of Integration Approaches, Benefit-Cost and Business Models Utility Scale PV Utility Scale PV + Storage Distributed Storage Microgrids EV Charging Infrastructure Customer Side Technologies 6

7 Why Integrated Grid Pilots and EPRI? An Integrated Approach Uses consistent, transparent methodology intended to be broadly applicable Goes considerably beyond technology demonstrations Performance, costs, environmental and operational impacts and business models Assesses societal and grid benefits that far outweigh technology benefits alone Requirements and approaches for integration at much larger scales EPRI s Role Develop requirements for integrated approach Help implement approach For planned or existing technology deployments Collect and analyze data to assess costs and benefits Inform and benefit industry research programs to enhance industry platforms and standards for integration 7

8 Integrated Approach to Deploying Distributed Energy Resources (DER) The integrated approach allows Local Energy Optimization to become part of Global Energy Optimization The Integrated Grid Discussion Topics DER technology outlook Value of Integrated Grid Examples of Integrated approach for DER 8

9 Value of the Grid to DER Power (kw) Residential Load PV Output Hour 9

10 10 Grid Connectivity Reduces Harmonic Impact

11 Site Demand (kw) Value of Grid for a Net Zero Energy Home 5 4 Capacity Capacity Mon Tue Wed Thu Fri Sat Sun 11 Need to Value Both Capacity and Energy

12 Outlook of Residential and Commercial PV 43% decline in 5 years $ Trends $ Residential PV System Price $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 Key contributor to price reduction PV Module Price per Watt $ PV Module Price Trend Residential PV installations exceeded non-residential More than 1/3 of residential PV installations came online without any state incentive School, government, and nonprofit PV installations increasing Future price decline will depend on addressing soft costs Factoids 1 Residential system prices fell 7%, from $4.91/W (1Q13) to $4.56/W (1Q14) Non-residential system prices fell 5.7% year-over-year, from $3.95/W to $3.72/W Supply Chain, Overhead and Margins largest cost category (40%) Other significant include the PV module (20% of total pricing) and direct installation labor (13%) of total pricing). 1 SEIA/GTM Research 1Q2014 PV 12

13 Lithium Ion Technology Outlook Projected Cost (in $/kwh) Cell Residential ES System $180-$225 $100-$120 $1000-$1200 $500-$600 Battery Pack $400-$500 $200-$250 Utility Scale ES System $800-$1000 $400-$500 Costs can differ significantly at the cell, battery pack, and complete system levels 13

14 Smart Appliance as a Grid Resource Water Heater Passive Energy Storage kw Uncontrolled Water Heater (kwh) Controlled Water Heater (kwh) Hours Intelligent Average Intelligent set energy point set control, point draw profile control charging of to an provide and electric discharging grid water benefits heater decoupled 14

15 Value of an Integrated Approach: Smart Inverter Assisted Voltage Control Voltage at END of Feeder Voltage (pu) 1.10 No Control 1.05 Volt/Var Control 1.00 Substation Line Regulators Time (sec) Simulation results indicate use of smart inverters can mitigate many of the voltage issues resulting from PV 15

16 Multiple Applications for Distributed Storage Distribution Investment Deferral System Electric Supply Capacity Dispatch Priority 1 Dispatch Priority 2 Electric Energy Time Shift Regulation Spinning Reserve Non-Spinning Reserve Dispatch Priority 3 Distribution Substation Substation Storage Community Storage Residential Storage Key long-term need: distribution communication/control platform to integrate and optimize 16

17 Cost Composition of Residential Bills (approximated from public data) Utility #1 Utility #2 Utility #3 Utility #4 Utility #5 Utility #6 Utility #7 Utility #8 Utility #9 Utility #10 Total Fixed Total Variable 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Analysis of cost for 10 representative US utilities 17

18 Key Research Challenges: Enable Integration of Customer Resources Load Impacts Highly Uncertain New technologies are altering load shapes in ways we are only beginning to comprehend Customer Adoption and Use Not Modeled No robust model to estimate customer adoption and use of technology and resultant grid impacts Integration Platforms Early Evolution Platforms to link and aggregate devices (controls, inverters, appliances) at the customer premises Grid Ops & Planning Integration Unproven Reliable forecasts of availability and dispatch-ability of customer resources needed for ops and planning Measurement & Verification Needed Methods to characterize benefits and impacts attributable to customer resource interventions 18

19 Electric Power Research Institute Together Shaping the Future of Electricity 19