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D.C. Grid Modernization Work Group Draft Report Recommends Dynamic Pricing Program Be Developed

Recommends Utility Ownership Of Distributed Generation, Storage, Microgrids

Address Access To Customer Data, Security Requirements For Such Access

April 13, 2019

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Copyright 2010-19 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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The Modernizing the Energy Delivery System for Increased Sustainability (MEDSIS) work group process established by the District of Columbia PSC has released a draft report and recommendations

Among other things, a Rate Design Working Group recommends the DCPSC establish a Dynamic Pricing working group to formulate the details of a dynamic pricing program for submittal to the DCPSC for their approval in time for the 2020 summer cooling season

Various details and design elements are left to the Dynamic Pricing working group, including SOS versus Third-Party Supplier Applicability

The recommendation does contemplate that the Dynamic Pricing program would be for residential customers only, and would contain a Critical Peak Rate, with the work group to determine the basis for the kWh rebate amount and source of funding

Specifically, the Dynamic Pricing working group should define all dynamic pricing program elements needed to facilitate DCPSC approval such as:

A. Rate Class Applicability – Expected to be Residential Only

B. SOS versus Third-Party Supplier Applicability

C. Opt-In versus Opt-Out

D. Critical Peak Rate – Basis for kWh Rebate Amount and Source of Funding

E. Customer Baseline Calculation

F. Event Triggers

G. PJM Market – Energy and Capacity Market Options

H. Interaction with Existing Residential Direct Load Control Program

I. Pepco Dynamic Pricing Billing and Metering Capabilities

J. Customer Education Plan Including Initial Educational Materials and Ongoing Communications/ Event Notifications

The goal is for the working group to bring to the DCPSC a program driven by stakeholder input that can be quickly approved and therefore, quickly implemented by the Spring of 2020, the draft report said

The draft report also addressed the provision of competitive energy supplier information for District customers

The Customer Impact working group recommends the DCPSC investigate the possibility of creating a website similar to the PA Power Switch website to house up-to-date competitive energy supplier offers as well as energy education material that would aid customers in evaluating offers. The website could be a stand-alone site or part of the existing DCPSC website so long as it is easily identifiable and accessible from the PSC home page. A marketing campaign should accompany the availability of this new website to increase customer awareness of the site, the draft says

The draft also addresses utility ownership of distributed generation, storage, and microgrids

The draft says that utilities should be allowed to own front-of-the-meter energy storage assets for the primary purposes of providing grid reliability services. DCPSC should continually reevaluate this recommendation to consider ownership for additional applications as the energy storage applications evolve with time, the draft says

The draft says that utilities should be allowed to operate energy storage assets in wholesale markets to the benefit of ratepayers. DCPSC should continue to ensure that utility’s wholesale market revenues continue to offset the revenue requirement of the asset for the ratepayers’ benefit, the draft says

The draft says that utilities should be able to control energy storage assets behind-the-meter if they are to be used as a grid reliability asset and only if customers and third party providers consent to such control. Control in this application should be defined in the contractual nature between the utility, third-party provider and customer-owned assets for dispatching to meet utility needs, the draft says

The draft says that utilities should not at this time be allowed to own energy storage assets behind-the-meter. DCPSC should continually reevaluate this recommendation to consider ownership for additional application as the energy storage applications evolve with time, the draft says

Utilities should continue to be allowed to own solar PV assets as long as it’s not for the purposes of selling retail electricity to customers, the draft says

Utilities should be allowed to own wind, biomass, waste-to-energy, cogeneration and microturbine assets as long as it’s not for the purposes of selling retail electricity to customers, the draft says

The draft contemplates utility ownership of microgrids.

Concerning the interaction of microgrids and retail supplier choice, the draft says:

A. For Single Customer Microgrids and 3rd Party Campus Single Customer Microgrids, the customer choice statute applies under current laws and there is no need to make special requirements.

B. For all Multi-Customer Microgrids, several stakeholders believe a private contract with microgrid-specific disclosure provisions is sufficient for retail choice and should be subject to compliance review regarding such provisions by DCPSC. If the DCPSC decides that private contract is sufficient, DCPSC should ensure appropriate use of microgrid-specific private contract disclosure provisions can allow for safe harboring of such private contracts from advanced DCPSC review. Safe harbor provisions regulated by the DCPSC could include but are not limiting to full disclosure of long term retail choice, restrictions on the ability for individual customers to exercise customer choice for imported electricity separately from the microgrid operator’s decision, appropriate customer disclosure of the microgrid itself and the associated long-term commitment.

Furthermore, regarding customer protections for microgrids, the draft provides as follows:

A. For Single Customer Microgrids and 3rd Party Campus Single Customer Microgrids, a private contract is sufficient to cover customer rights, responsibilities and protections for self-generation and imported power from Electricity Suppliers; provided that DCPSC should apply Consumer Rights and Responsibilities and Customer Protection standards applicable to Electricity Suppliers outlined in Title 15 of DCMR.

B. For all Multi-Customer Microgrids, DCPSC should apply Consumer Rights and Responsibilities and Customer Protection standards parallel to the standards applicable to Electricity Suppliers and Electric Companies as outlined in Title 15 of DCMR.

The report says that Distribution assets within the microgrid that are owned by the utility should be considered regulated assets subject to cost recovery through the utility’s ratebase, specifically via a Microgrid Tariff that addresses appropriate charges for microgrid customer(s) for the microgrid’s internal use of the utility distribution assets referred to in Recommendation 5.5.4. If there is a distribution asset that is built solely for the purposes of adding a resiliency benefit to a potential microgrid that benefits all ratepayers, the asset is subject to cost recovery through the utility’s ratebase.

The draft outlines a process to consider pilot projects under the MEDSIS process, and ratepayer funding of such projects (which may be undertaken by third parties)

The pilot recommends how to apply the Customer Bill of Rights (CBOR) and other customer protections to pilots under the MEDSIS process

Concerning customer access to usage and other energy data, the draft says that the Customer Impact Working Group would like to ensure the continuation of existing data access initiatives and promote the ongoing ability of customers to realize the full value of the grid through the sharing of their data with third parties by recommending:

1. Pepco should proceed with investigating the implementation of the Green Button Connect My Data (CMD) functionality in accordance with standards established by the Green Button Alliance. The DCPSC should review Pepco’s existing data security standards for adequacy based on the CMD standard.

2. Third parties seeking access to customer data via an electronic interface with Pepco must adhere to Pepco’s cybersecurity standards for protection of this data. The DCPSC should have the authority to audit third parties’ systems and processes to ensure compliance with these standards

3. The DCPSC should ensure utilities and energy service providers develop policies and practices to address the integrity and confidentiality of customer data. The draft says that USGBC's PEER Scorecard on Data could serve as a model for these policies and should ensure the information security of all interfaces, devices and operations involving customer data sharing includes but is not limited to the following:

     a. An opt-out data sharing policy for aggregated data to protect customer privacy and personally identifiable information (PII)

     b. An opt-in customer data sharing agreement for PII data

4. A connection between a customer’s energy usage and their environmental impact should be made to:

     a. Aid in a customer’s decision making around accessing their data for the purposes of participating in Pepco or third-party programs and

     b. Encourage customer investment in non-carbon DER through access to and analysis of their usage data

This connection could be accomplished via carbon impact information displayed directly on customer bills or via display of this information on Home Energy Reports like those used by Pepco in its Maryland territory. Bills should emphasize greenhouse gas (GHG) generation and relative energy usage/cost compared to comparable homes/ businesses. Information should also offer energy usage improvement options and include references to available aid programs

Concerning data security, the draft says that DCPSC should ensure that utilities and third-parties that receive customer data directly from new utility data portals apply the same level of rigor in their policies and practices to address cybersecurity threats that include but not limited to: data anonymization and aggregation, data access, data encryption, data security audits, automatic data breach detection, threat and vulnerability assessments and data security awareness training. DCPSC should hold the responsibility to ensure third-parties that receive customer data directly from new utility data portals maintain appropriate security practices, the draft says

Link to draft report

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