View
212
Download
0
Category
Preview:
Citation preview
Grid-based Technology and Business Model Innovation: DG, DR, and EE
How will Disruptive Challenges in Electric Markets Impact Michigan’s Energy Decisions?
Presented byLisa Wood
Executive Director, IEEVice President, Edison Foundation
June 26, 2013
Disruptive challenges in electricity
Demand side: > “negawatts” or energy efficiency (EE)> Smart grid related technologies / networked homes
Demand & supply side: demand response (DR)> Flattens peak demand> Firms variable renewable energy sources
Supply side: Distributed generation (DG) > Increasing role of renewable energy in supply mix > 3rd party suppliers of rooftop solar
2
2012 AEO reference case from 2010-2035: Increase of 710 TWh over 25 years
3
3,730 3,763
3,929
4,099
4,282
4,440
3,200
3,400
3,600
3,800
4,000
4,200
4,400
4,600
2010 2015 2020 2025 2030 2035
TWh
Demand-side: Energy efficiency and Smart Grid Technologies
Cause: Policies driving energy efficiency (“negawatts”) Regulatory policies
Fixed cost recovery mechanisms/decoupling (27 states). In Michigan, DTE has a revenue decoupling mechanism.
Performance incentives (23 states). DTE has a performance incentive for EE in Michigan (earn up to 15% or program spending if energy savings targets exceeded)
Energy efficiency resource standards (EERS). In Michigan, 1% for electric utilities in 2012 and beyond.
Energy codes and national appliance/equipment standards becoming more stringent
5
Source: IEE, State Electric Efficiency Regulatory
Frameworks, July 2012. www.edisonfoundation.net/IEE.
EE programs and codes & standards are major contributors to “negawatts”
6
242277
249
420
0
50
100
150
200
250
300
350
400
450
2025 2035
Elec
tric
ity
(TW
h)
EE
C&S
Cause: Smart grid technologies driving energy management (EE, DR, DG)
Smart meter deployment (networking customers)> 40 million deployed; 65 million expected by 2015> In Michigan, about 866,000 smart meters deployed as of EOY
2012. Over 1 million expected by EOY 2013 (about 50% of DTE electric customers).
Networked customers opens door to possibilities> Energy management and demand response> Smart technologies in home or business; smart appliances> Smart charging of EVs
7
Smart meter installations in the US: 2007-2015 (millions)
8
7
13
27
36
42
51
59
65
0
10
20
30
40
50
60
70
Milli
ons
Installed Smart Meters
Projected Smart Meter Installations
Effect: Energy efficiency flattens energy consumption growth in the US (IEE forecast based on AEO 2012 reference case)
9
3000
3200
3400
3600
3800
4000
4200
4400
4600
2010 2015 2020 2025 2030 2035
TWh
Ratepayer Funded EE Programs
Moderate Codes and Standards
Aggressive Electric Transportation
AEO 2012 Reference Case
IEE Forecast
EE Programs (-249 TWh)
Codes &Standards (-420 TWH)
Electric Transportation(+147 TWh)
3,918 TWh
Source: IEE, Factors Affecting Electricity Consumption in the U.S. (2010-2035). March 2013.
Effect: Correlation between GDP and electricity sales appears broken
10
-500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
2010
2012
Elec
tric
ity
Cons
umpti
on (
TWh)
GDP
(Bill
ions
of
curr
ent $
)
Electricity GDP
Source: EIA, Annual Energy Review, September 2012;BEA
Business models when demand is flat
Xx Xx xx
11
Supply side: Distributed Generation
Projected electricity generation by fuel source: Renewable energy growth (TWh)
13
0
1
2
3
4
5
6
1990 2000 2020 2030 2040
History 2011 Projections
30%
16%
35%
17%
1%
25%
13%
19%
42%
1%
Natural gas
Renewables
Nuclear
Coal
Oil and other liquids
2010
1993
13%
11%
19%
53%
4%0
1
2
3
4
5
6
1990 2000 2020 2030 2040
History 2011 Projections
30%
16%
35%
17%
1%
25%
13%
19%
42%
1%
Natural gas
Renewables
Nuclear
Coal
Oil and other liquids
2010
1993
13%
11%
19%
53%
4%
Source: EIA, Annual Energy Outlook 2013 Early Release
Growth in renewable energy in US
How much can renewable energy contribute to future U.S. electricity supply. > AEO forecast of 16% by 2040 is too conservative. > NREL Renewable Electricity Futures Study (2012) shows 80%
renewable energy by 2050 possible in the U.S.
With DR and storage, electric power system can accommodate higher levels of variable generation from wind and solar?
In recent past, high growth in wind energy. Now at 3%. Now, high growth in solar PV expected. Now at 1%.
Could grow to 3% by 2016.
14
Cause 1. Policies and pricing driving DG
29 state plus DC have RPSs, 17 with mandates/programs for solar and other DG
Net metering in 43 states Feed-In Tariffs – adopted/proposed in a few states
(common in Europe) Reverse auction mechanism (CA & CT) Subsidies, rebates, tax incentives, financing. Zero net energy goals Critically important to price DG right - cost of access to
grid; cost of energy (e.g., Virginia standby charge)
15
Is solar DG becoming a disruptive technology?
Annual PV installations grew 76% in 2012 in US, reaching 2,816 MW (2.8 GW)
Greentech media forecasts 30% growth in US market in 2013
Cumulative 2012 solar capacity in US: 6,175 MW (6.2 GW) Cumulative solar capacity in US projected to be 28 GW by
2016 > [28,000 MW/1,171,000 MW] = 3% of total US capacity
16
Source: SEIA and GTM Research, U.S. Solar Market Insights 2012 Year in Review. 2013
Annual PV installed capacity in US (MW): growing exponentially
17
Source: SEIA and GTM Research, U.S. Solar Market Insights 2012 Year in Review and Q1 2013
Note: Assumed 85 percent DC to AC conversion efficiency
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Sola
r PV
(MW
)
Installed PV Capacity by Sector
Residential Non-Residential Utility Projection (All Segments)
Cumulative PV capacity in US reached 6.2 GW in 2012 (utility owned is not DG)
18
Source: SEIA and GTM Research, U.S. Solar Market Insights 2012 Year in Review. 2013
Note: Assume 85% DC to AC inverter efficient.
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2010 2011 2012
Capa
city
(MW
)
Cumulative PV Capacity by Sector
Utility
Non-Residential
Residential
Cumulative PV capacity projected to be 28 GW 2016 (4x 2012)
19
0
5,000
10,000
15,000
20,000
25,000
30,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Sola
r PV
(MW
)
Cumulative PV Capacity
Residential Non-Residential Utility Projection (All Segments)
Source: SEIA and GTM Research, U.S. Solar Market Insights 2012 Year in Review and Q1 2013
Note: Assumed 85 percent DC to AC conversion efficiency
Possible scenarios and effects
Outcomes> Utilities lease rooftops and own solar PV> Disintermediation: 3rd party owns solar PV and
sells contract to customer> Customers own solar PV
Is solar PV the “wireless” technology for the electric power sector?
21
Source: SEIA and GTM Research, U.S. Solar Market Insights 2012 Year in Review. 2013
Wireless transformed telecom sector> Decline in landlines (traditional cash cow for telecom)> Wireless developed in places without landlines
DG today> So far, DG is not utility owned (utilities own large solar PV)> Top states today: CA, AZ, NJ> Subsidies galore
What is the biz model for DG?> Own solar panels and lease rooftops – comm, resi> Combined business – solar DG and efficiency and utility
supplied power. Is this a regulated or non regulated business?
For more information, contact:
Lisa WoodExecutive Director, IEEVice President, Edison Foundation
IEE701 Pennsylvania Ave., N.W.Washington, D.C. 20004-2696202.508.5550
lwood@edisonfoundation.net
www.edisonfoundation.net/IEE
Recommended