beneficial electrification - beneficial electrification ensuring electrification in the public...

Download Beneficial Electrification - Beneficial Electrification Ensuring Electrification in the Public Interest

Post on 28-Oct-2019

0 views

Category:

Documents

0 download

Embed Size (px)

TRANSCRIPT

  • Beneficial Electrification Ensuring Electrification in the Public Interest

    By David Farnsworth, Jessica Shipley, Jim Lazar, and Nancy Seidman

  • JUNE 2018

    The Regulatory Assistance Project (RAP)® 50 State Street, Suite 3

    Montpelier, Vermont

    USA

    Tel: 802-223-8199

    E-mail: info@raponline.org

    raponline.org

    linkedin.com/company/the-regulatory-assistance-project

    twitter.com/regassistproj

    © RAP. This work is licensed under a Creative Commons Attribution-NonCommercial License

    (CC BY-NC 3.0).

    How to Cite This Paper Farnsworth, D., Shipley, J., Lazar, J., and Seidman, N. (2018, June). Beneficial electrification: Ensuring

    electrification in the public interest. Montpelier, VT: Regulatory Assistance Project.

  • BENEFICIAL ELECTRIFICATION: ENSURING ELECTRIFICATION IN THE PUBLIC INTEREST | 1 REGULATORY ASSISTANCE PROJECT

    Table of Contents About This Series. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

    Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

    Executive Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

    Principles for Maximizing the Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

    Putting Beneficial Electrification Into Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

    Lay the Foundation in Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11

    Ensure an Open Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

    Anticipate Specific Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

    Opportunities in a Changing Energy Sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

    Principles for Maximizing the Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23

    Principle 1: Put Efficiency First . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25

    Principle 2: Recognize the Value of Flexible Load for Grid Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

    Space Heating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

    Water Heating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30

    Electric Vehicles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

    Principle 3: Understand the Emissions Effects of Changes in Load . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

    Principle 4: Use Emissions Efficiency to Measure the Air Impacts of Beneficial Electrification . . . . . . . 37

    Principle 5: Account for the Lives of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

    Principle 6: Design Rates to Encourage Beneficial Electrification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

    Timing Should Matter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41

    What’s the Differential? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

    Twin Peaks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

    Putting Beneficial Electrification Into Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45

    Lay the Foundation in Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

    Develop Goals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

  • 2 | BENEFICIAL ELECTRIFICATION: ENSURING ELECTRIFICATION IN THE PUBLIC INTEREST REGULATORY ASSISTANCE PROJECT

    Identify Barriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46

    Establish Metrics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

    Address Timing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

    Consider Flexibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

    Identify Affected Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

    Ensure an Open Process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

    Anticipate Specific Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49

    Rate Design . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50

    Utility Incentives for Participating Customers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50

    Energy Efficiency Resource Standards and Financing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50

    Energy Standards for New Construction and Appliances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50

    Fossil Fuel Phaseout . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51

    Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52

    Appendix: Beneficial Electrification and Carbon Management . . . . . . . . . . . . . . . . . . . . . . .53

    Assessing Emissions Effects of Electrification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

    Identifying Marginal Emissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

    Modeling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

  • BENEFICIAL ELECTRIFICATION: ENSURING ELECTRIFICATION IN THE PUBLIC INTEREST | 3 REGULATORY ASSISTANCE PROJECT

    Acknowledgments Editorial assistance was provided by Camille Kadoch, Donna Brutkoski, Ruth Hare,

    Ken Colburn, and Rick Weston

    The authors would like to acknowledge and express their appreciation to the following

    people who provided helpful insights into early drafts of this paper:

    Ann Rendahl, Commissioner, Washington Utilities and Transportation Commission

    Matthew Schuerger, Commissioner, Minnesota Public Utilities Commission

    Gary Connett, formerly Great River Energy

    Noel Crisostomo, California Energy Commission

    Katherine Dayem and Peter May-Ostendorp, Xergy Consulting

    Keith Dennis, National Rural Electric Cooperative Association

    Erin Falquier, Chicane Labs

    Noah Garcia, Natural Resources Defense Council

    Jamie Howland, Mark LeBel, and Emily Lewis, Acadia Center

    Drew Kodjak, International Council on Clean Transportation

    Chris Neme, Energy Futures Group

    Responsibility for the information and views set out in this paper lies entirely with the authors.

  • 4 | BENEFICIAL ELECTRIFICATION: ENSURING ELECTRIFICATION IN THE PUBLIC INTEREST REGULATORY ASSISTANCE PROJECT

    Abbreviations BE . . . . . . . . beneficial electrification

    BNEF . . . . . . Bloomberg New Energy Finance

    Btu . . . . . . . . British thermal unit(s)

    CO2 . . . . . . . . carbon dioxide

    EV . . . . . . . . . electric vehicle

    GWh . . . . . . . gigawatt-hour

    kWh . . . . . . . kilowatt-hour

    MWh . . . . . . . megawatt-hour

    PUC . . . . . . . public utility commission

    TOU . . . . . . . time-of-use

    VER . . . . . . . variable energy resource

  • BENEFICIAL ELECTRIFICATION: ENSURING ELECTRIFICATION IN THE PUBLIC INTEREST | 5 REGULATORY ASSISTANCE PROJECT

    Figures Figure 1. Solar Photovoltaic Costs, Third Quarter 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Recommended

View more >