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8 Electrification and Time-of-Use Study
Agendaitem#8TRUCKEEDONNERPublicUtilityDistrictACTIONTo:BoardofDirectorsFrom:JoeHorvathDate:October02,2019Subject:ConsiderationofanElectrificationandTime-of-UseRateStudy1.WHYTHISMATTERISBEFORETHEBOARDBoardauthorizationisrequiredforprocurementsinexcessof$15,000.2.HISTORYCaliforniahasambitiousgoalstoreduceGreenHouseGas(GHG)emissionsto40%below1990levelsby2030,asmandatedbyAssemblyBill32.TheDistricthasbeenproactiveiyincreasingitsportfolioofrenewablegenerationtomeetthemandatesoftheRenewablePortfolioStandards(RPS).TheDistricthasacheivedanRPSof65%in2018andwillbeatapproximately75%RPSin2022throughparticipationintheRedMesaSolarProjectwithUAMPS.Electrificationistheprocessofconvertingfromnaturalgastoelectricityformajorhouseholdappliancesincludingcentralheating,hotwaterandcooking.ElectrificationhasthepotentialtofurtherreduceGHGemissionsbyusingelectricityfromtheDistrictwithincreasinglyhigherRPSvalues.InJulyof2019,membersoftheBoardmetwithstafftorequestmoreinformationonelectrification,including:.informationonwhatendusescanbetargeted;.Informationonhowtoincentivizeelectrification;.InterestinastudyontheviabilityofTime-of-Use(TOU)ratesandthefinancialimpacttheymayhaveonelectrification;and.HowtoincentivizecustomersswitchingtoTOUrates.3.NEWINFORMATIONStaffproposedtoconsultwithHDRConsultants(HDR),anindependentthird-partyconsultingfirm.HDRhasperlormedseveralcostofservicestudiesfortheDistrict’sWaterandElectricutilitiesformanyyears,andarewell-acquaintedwithDistrictoperationsandthecoststoprovideservicestocustomers.StaffdevelopedadetailedscopeandsolicitedfeedbackfromHDRtorefinethescope.Theproposedscopeincludesthefollowing:1.MarketAnalysis-Thisdeliverablewillevaluateotherutilityrunelectrificationprogramstodeterminewhatenduseloadstheyaretargetingandtheirprogramdesignandincentivestructures.Thiswillalsoevaluateparticipationbycustomersegmentsanddemographics,includingreviewingcustomerfeedbackandsurveyresultstounderstandwhattypesofcustomersparticipatedandwhy.Themarket analysiswillalsoincludesurveysandresearchofcustomersinTruckeetodeterminethemarketpotentialofaprograminourDistrict.Thisproductresearchwillhelpdetermineincentiveamounts,potentialcustomersegmentstotarget,andinformationtoinformprogramandmarketingdesign.2.ElectrificationEndUseSpecificationsandCosts-Thisdeliverablewilldevelopatableofpotentialendusetargetstounderstandtheefficiencyandpriceofcarbon-basedversuselectricappliances.Enduseswillincludethemixofpropane,naturalgasandwoodfiredstoveswhicharethemainheatsourcesinresidentialandcommercialbuildings,alongwithgasanddieselvehicles.Thisdatawillbeusedtodevelopaneconomicscalculatortounderstandthecost/benefitanalysisofelectrifyingenduses.3.RebatesandRates-ThisdeliverablewilluseratedesignmethodstodevelophypotheticalresidentialandcommercialTOUrates.Threescenarioswillbeusedtounderstandhowchangesinourgenerationprocurementovertimewillimpacttheseratestructures.Thescenariosinclude:.BaseCase-dataprovidedforthe2018CostofServiceratestudy.Alternative1-Assumingagenerationportfoliowith75%RPS.Alternative2-Assumingagenerationportfoliowith100%RPSThisdeliverablewillalsoincludeinformationtohelptheDistrictunderstandthecriteriathatmustbemettonecessitatethepossibleuseofTOUrates.ThiswillalsoincludeadiscussionoftheadvantagesanddisadvantagesofTOUratesandthierassociatedimpactsonrevenues.4.ElectrificationBusinessCase-Thefinaldeliverablewilldevelopabusinesscaseforanelectrificationprogramthatachievesatleast10%adoptionfromcustomers.Thiswillincludearecommendedprogramdesign,cost/benefitimpacts,barrierstoimplementation,andanestimatedaveragecustomerbillimpact.AnExcelspreadsheetbasedeconomicscalculatorwillalsobedevelopedandgiventotheDistrict.Staffwillusethemodeltoperformfuturewhat-ifstudiesforcustomerelectrificationprojects.TheproposedtotalcostforHDRtopertormthisworkfortheDistrictis$65,000.4.FISCALIMPACTTheproposedprojectwasnotincludedintheElectricUtility’sFY19budget,butsufficientfundsexistforthisprocurement.5.RECOMMENDATIONAuthorizetheGeneralManagertoexecuteacontractwithHDREngineeringforanElectrificationandTime-of-UseRateStudyinanamountof$65,000plusa10%changeorderauthorizationforatotalnottoexceedcontractamountof$71,500.(frzJoeHorvathMichaelD.HolleyElectricUtilityDirectorGeneralManager