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Microgrids PUC Regulatory IssuesBack to the Future
Michael Winka Sr Policy Advisor
Baltimore MD August 29, 2016
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First Issue
Are you in a Vertically Integrated State ? regulates generation, transmission and distribution in their state
Or
An Energy Competition State ?regulates some transmission and distribution in their state
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State PUC regulate customers rates for the investment owner/private utilities
Balance the needs of Utilities and All CustomersProtect customer – Protect the public interest
Ensure the delivery of adequate, safe, reliable Services at fair and reasonable rates for all customers
Public Utility Commission’s Mission Statements
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Definition of DER or DGDistributed energy resources consists of a range of smaller-scale and modular generation and storage devices designed to provide electricity, and sometimes also thermal energy, in locations close to consumers or end user.
Definition of MicrogridA microgrid is a group of interconnected loads and distributed energy resources within clearly defined electrical boundaries that acts as a single controllable entity with respect to the grid. A microgrid can connect and disconnect from the grid to enable it to operate in both grid-connected or island-mode.
Standard USDOE Definitions for DER and microgrids
Most States do not define DER or microgrids
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Level 1 or single customer microgrid.
This is a single DER system such as a PV system, combined heat and power (CHP) or fuel cell system that is serving one customer and that is connected to and can island from the distribution grid.
Level 2 or single customer – campus setting.
This is a single or multiple DER systems with multiple buildings, but controlled by one meter at the point of common coupling that is connected to and can island from the distribution grid.
Level 3 or multiple customers / advanced microgrid.
This is a single or multiple DER system that serves several different buildings/customers that are not on the same meter or on the same site as the DER. An advanced microgrid would be designed with one point of common coupling (PCC). The individual buildings/customers may be independently connected to the larger distribution grid and through the microgrid PCC..
Not all Microgrid are the Same - Classification System
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N.J.S.A. 48:3-51 - Definitions Off-site end use thermal energy services customer (aka CHP)
On-site generation facility (aka DG)
N.J.S.A. 48:3-77.1 Utilization of locally franchised public utility electric distribution infrastructure.
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Types of MG Distributed Generation or Distributed Energy Resources
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19901991
19921993
19941995
19961997
19981999
20002001
20022003
20042005
20062007
20082009
20102011
20122013
-
10,000,000
20,000,000
30,000,000
40,000,000
50,000,000
60,000,000
70,000,000
80,000,000
New Jersey Net In-State Generation and Imported Electricity, 1990 - 2013
Net In-state(70% increase)Imported (70% decrease)Linear (Imported (70% decrease))
Year
Mill
ion
Meg
awatt
-hou
rs (M
Wh)
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Petroleum Coal Natural Gas Nuclear Renewables0%
10%
20%
30%
40%
50%
60%
1%
8%
33%
56%
2%0%
3%
43%
51%
2%0%
3%
42%
52%
2%1%4%
44%47%
4%
New Jersey Electricity Generation by Fuel Type (%), 2011-2014
2011201220132014
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New Jersey’s Clean Energy Program EE reduction of Electric Sales – 0.5% annually total cumulative reduction 7%
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New Jersey Renewable Energy Portfolio Standard
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DER Number MW
CHP/FC total 219 2,900 CHP/DG DG 98 347 CHP/FC renewable 19 31
PV total 38,983 1,535 PV Behind the Meter 38,855 1,203 PV Grid Supply 128 332
TOTAL DER 39,100 1,913
Current New Jersey CHP/FC and DER facilities
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The advance microgrid can provide benefits to the grid 1. Produces electric and thermal energy for its customers. 2. Provides ancillary services and reduce the peak demand of the grid.3. Can defer related investment in distribution system upgrades.4. Produces and delivers energy more efficiently. 5. Reduce outages which can enhance resiliency and reliability. The advanced microgrid receives benefits from the distribution grid. 1. If not operating additional energy will need to be supplied by the grid.2. Upgrades can be deferred but not fully avoided.3. If not operating environment impacts may increase at peak times.4. If not properly managed could reduce resiliency and reliability.
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RAP DER Tariff Guidance
1. Customers should be able to connect at the cost of connecting2. Customers should pay for grid services based on what they use3. Customers should be fairly compensated for the value of the power they supply4. Tariffs should balance the interest of all shareholders
NARUC DER Tariff Guidance
1. Net metering2. Valuation3. Value of Resource4. Value of Service5. Transactive Energy6. Demand Charges peak/nonpeak7. Fixed Charges8. Standby/backup Charges9. Interconnection /metering fees
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Printed 2014/03/06 01:59 P
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Printed 2014/03/06 01:59 P
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