The grid will require a substantial transformation as more renewable sources come online. Some critics argue technological, financial, and institutional barriers will prevent significant decarbonization of the power sector, but four common clean energy myths are easily debunked by facts and real-world experiences showing the feasibility of a low-carbon energy future.
Electric Power Sector: Energy Efficiency and Demand-Side Management
This white paper is the second in our Incentive Mechanism Design series, which offers perspective on how regulators might decide to design performance incentive mechanisms for success. The paper explores different approaches to simplify the measurement of energy efficiency savings to better align utility incentives with efficiency outcomes. These metrics can be helpful for many states where utility revenue is linked to energy efficiency, but their programs are bogged down in tedious and controversial evaluation, measurement, and verification requirements.
An abundance of new technologies are now available to produce cleaner, cheaper electricity. But in order to take advantage of them, system operators must build a flexible electricity grid. This paper reviews the types of resources that can deliver grid flexibility and provides case studies and recommendations for how to incorporate flexibility into grid systems.
This paper offers a set of recommendations for enabling demand response in order to fully participate in Europe’s wholesale markets. In the short term, it recommends electricity prices should begin to reflect time-varying value of energy, and wholesale markets should establish a right for demand response to participate. In the long term, policymakers should mandate time-varying pricing for all customers; adopt codes and standards encouraging smart appliances, EVs, and in-home automation; reform utility business models to encourage demand response; and improve local value signals via integrated distribution system planning.
This report identifies objectives for demand response, explains the challenges in addressing them, and makes recommendations to policymakers, practitioners, and stakeholders. These include: expanding the understanding of demand response’s dual role as a supply resources and load reduction, increasing retail-wholesale coordination, improving planning, optimizing rates, valuing location, and improving verification.
This report offers perspective from five leading utilities on the challenges and opportunities for planning around distributed energy resources (DERs). It points out how existing distribution planning is insufficient to take advantage of the value of DERs, and suggests an iterative approach to improve planning. One major change will be incorporating incentive-based DER deployment into planning via new modeling approaches that can capture the complexity of a two-way distribution system.
This report uses California utilities’ Distributed Resource Plans as case studies to assert that current utility planning processes are leaving billions in potential benefits from distributed energy resources (DERs) on the table, and ought to be updated. It highlights regulatory models, utility incentives, and inadequate modeling of benefits as culprits for inefficient DER integration.
This report explores key elements and variations of performance-based regulation and its advantages and disadvantages from the perspectives of utilities and customers. A unique feature of the report is its treatment of comprehensive, performance-based approaches to regulation in the context of a potential future with a high reliance on energy efficiency, peak load management, distributed generation, and storage.
Future Opportunities and Challenges with Using Demand Response as a Resource in Distribution System Operation and Planning Activities
This report surveys the technical opportunities and barriers to greater use of demand response to manage the distribution system. It suggests that regulators and policymakers consider directing utilities to take a more integrated approach to distribution system planning to assess the least-cost solutionsfor reliably and safely operating the grid of the future.
This article discusses the possible outcomes of the Supreme Court’s ruling on FERC Order 745. The authors acknowledge the importance of finding the true value of demand response, but argue that too much emphasis has been places on finding this precise value without sufficient evidence about how demand response providers will respond to price signals.