PSC Opens Investigation Of Demand Response Aggregation Of Retail Supplier Customers, Including Aggregation By Non-LSE Third Parties
November 26, 2018 Email This Story Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • firstname.lastname@example.org
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The Michigan PSC has opened a proceeding (Case No. U-20348) to examine issues related to the demand response aggregation of customers of retail suppliers (alternatives electric suppliers, or AESs)
Noting nearly 10 years worth of cases addressing various issues related to wholesale demand response, the PSC said that it is aware that several important issues have been left unaddressed by its prior orders, "including whether a non-AES aggregator or other third party may bid DR into the wholesale market, and the appropriate treatment of aggregated DR that is not associated with the capacity demonstration requirements of MCL 460.6w."
"The Commission notes that ... federal regulations currently permit states to ban DR aggregation in their jurisdictions, but the FERC has also found that states may not ban or restrict third-parties from accessing wholesale markets for aggregated energy efficiency resources," the PSC said in its order
"With this background, the Commission seeks to establish a process for DR aggregation for customers who are served by AESs that: (1) aligns with federal requirements and policy directions (on fundamental jurisdictional questions as well as technical specifications for qualifying DR resources under the RTO’s tariff); (2) ensures proper tracking, particularly to avoid double counting in the state’s capacity demonstration programs or other gaps that could ultimately affect electric reliability; (3) identifies any unnecessary barriers to third-party aggregation to make it scalable; and (4) works through issues in a collaborative manner, including any state and federal jurisdictional questions, to provide a template for scaling up aggregation that may also accommodate other applications," the PSC said
To that end, the Commission directed the Commission Staff (Staff) to work with third party DR aggregators, AESs, AES customers, regulated utilities, MISO, and other stakeholders on issues related to:
1. whether the ability to aggregate DR for customers of Michigan AESs for bidding into RTO markets should be limited to AESs, or be extended to non-AES third parties such as CSPs [curtailment service providers];
2. how to adequately track DR resources being used for capacity demonstration purposes under MCL 460.6w;
3. the appropriate treatment of aggregated DR outside the capacity demonstration framework that may affect capacity requirement allocations to LSEs, such as aggregated DR for capacity, ancillary services, and/or energy; and
4. what are appropriate reporting requirements related to DR and aggregation, and whether the capacity demonstration filing requirements need revision.
The Staff shall also examine the status of DR aggregation in Michigan over the 2017-2019 time period with a view to identifying barriers or other issues warranting guidance from the Commission. The Commission directs the Staff to file a report detailing its findings and recommendations no later than May 30, 2019.