RI Docket 4600 Working Group

Meeting #4 October 27, 2016

Facilitator/Mediator: Dr. Jonathan Raab, Raab Associates, Ltd.

Consultant: Paul Centolella, Centolella & Associates

DRAFT High-Level Meeting Summary

Altogether there were over 25 people in attendance at the second Working Group meeting. See attendees in Appendix I.

See slide decks and documents used during this meeting HERE

Valuing Distribution and Energy Resource Investments

Dr. Raab began by thanking the WG for submitting their HW responses on the matrix, and then provided a recap of the overall purpose of the matrix—namely that that the PUC and stakeholders would have clear expectations about the types of costs and benefits that different technologies, investments, and programs would be expected to consider. Dr. Raab also explained that Mr. Centolella had put together an additional matrix that links the different technologies/investments to different Rhode Island laws and programs (See Policy Technology Matrix 10-27-16 on Website).

The WG discussed the overall purpose of the matrix, and concurred that trying to get the rows right (which represent the benefit and cost categories) was far more important than filling out the entire technology matrix as a Working Group.

Mr. Centolella then walked through a series of issues related to specific benefit and cost categories gleaned from his review of the HW responses, National Grid’s comments on various rows, and a discussion w/Karl Rabago about his suggested improvements/alternatives (seeCentolella 10-27-16 on Website). The issues touched during Mr. Centolella’s presentation and ensuing WG discussion included: price effects; environmental costs and externalities; innovation and learning effects; energy supply planning vs. private value; capacity value; and resources as hedge. The WG agreed that some refinements to the matrix rows based on the discussion. The WG also discussed adding several additional categories of costs and benefits (aka rows) based on WG input including: 1) Equity (energy burden, affordability, bill impacts); 2) Home energy security (avoiding termination and enhancing restoration); 3) Customer empowerment; and 4) Risk impacts.

Following the more detailed discussion of the various categories of costs and benefits, the WG returned to the overall purpose and design of the matrix, and after extensive discussion agreed to the following regarding the matrix:

  1. Add the additional categories of benefits/costs identified above.
  2. Change the organization of the matrix categories (aka buckets of costs and benefits) from 1) Bulk Power Level; 2) Distribution System Level; and 3) Customer Level to 1) UtilitySystem Level; 2) Customer Level; and 3) Societal Level.
  3. Combine rows that are referring to the same category but as cost or benefit into one category to reduce the number
  4. Identify the candidatemethodologies for assessing keycosts and benefits.

The WG agreed (and the PUC concurred) that if we could agree on a matrix with the changes above including identification of high-level candidate methodologies—it would not be necessary to fill out the technology matrix.

After lunch, the WG reviewed and discussed a first cut at reshuffling the categories of benefits and costs by UtilitySystem, Customer, and Societal that Tim Woolf put together over lunch. The WG agreed that Mr. Centolella should refine the matrix consistent with 1-3 above, and to put down some initial potential methods for each row. The WG discussed the fact that RI’s EE cost-effectiveness framework already has well-established or proposed methods from approximately half of the categories we are proposing to include here.

Dr. Raab and Mr. Centolella would then host a conference call with interested WG members ahead of the next meeting to work on the updated matrix (in particular the draft measurement/assessment methodologies). It would then be discussed and refined if need be at the November WG meeting.

The WG also briefly discussed how applicable the matrix approach would be for more traditional distribution system investments and for advanced metering infrastructure. National Grid offered some initial thoughts (that it might not work so well for traditional distribution system investments but could potentially for AMI), and the WG agreed to discuss this further as the matrix evolves.

Cost Effectiveness Framework for Rhode Island

Dr. Raab put up a slide that Mr. Woolf showed at the previous WG meeting that showed the categories for costs and benefits for three different tests: 1) Utility; 2) Total Resource Cost (TRS); and 3) Societal. He then asked the group whether the WG would like to recommend one test over the other, or whether the matrix we were developing would suffice. After a brief discussion the WG agreed that the categories of costs and benefits included in the matrix would de facto define the “Rhode Island Cost-Effectiveness Test,” so there was no need to choose among the three different types of test.

Planning for Meeting #5 (November 21st—9 AM to 4 PM)

The next meeting will focus on attempting to wrap up the cost-benefit matrix, and to begin the discussions about rate design and cost recovery.

For the cost-benefit matrix, as described above, Mr. Centolella will take the next cut at the matrix consistent with the WG guidance. Dr. Raab and Mr. Centolella will then host a conference call w/interested WG Members to further refine the matrix ahead of the next WG meeting. Both Mr. Centolella’s revised matrix and the further refined matrix based on the conference call will be posted ahead of the next WG meeting.

For rate design and cost recovery, we agreed to post a few things for WG members to peruse ahead of our next meeting including: 1) NARUC’s draft (or final if out soon) Rate Design Manual for DERs; 2) Public Utility Fortnightly piece that Mr. Centolella co-authored on incentive-based ratemaking/cost-recovery; and 3) A video clip and the PowerPoint of Mr. Centolella’srecent presentation at the NE Restructuring Roundtable in rate design for DERs. We also discussed starting the conversation at the next meeting focusing on high-level principles for rate design and cost recovery.

So for homework, WG members should:

  1. Review this meeting summary and send any corrections or suggested improvements in redline by Monday November 6th
  2. Participate in conference call on Cost/Benefit Matrix—if interested, please fill out Doodle Poll on availability by this Thursday COB
  3. Review readings/video clip on rate design and cost recovery
  4. Submit a few high-level principles on rate design and cost recovery by COB November 16th. We encourage you to work with other WG members on these

Appendix I: Meeting Attendees

Meeting Attendance
9/23 / 10/27
Acadia Center / Abigail / Anthony / X / X
Leslie / Malone (alt) / X
Mark / Lebel
Conservation Law Foundation / Jerry / Elmer / X / X
Direct Energy / Marc / Hanks / X / X
Pamela / Rutkowski
Division of Public Utilities & Carriers / Macky / McCleary / X
Steve / Scialabba / X / X
Tim / Woolf (Synapse) / X / X
E4TheFuture / Jenny / Weissbourd
EERMC / Marisa / DeSautel
Scudder / Parker / X / X
Energy Development Partners / Frank / Epps
Russell / Maymon / X
George Wiley Center / John / Willumsen-Friedman / X / X
Camilo / Viveiros (alt) / X / X
Chloe / Chassaing / X
National Grid / Tim / Roughan / X / X
Celia / O’Brien / X / X
Jim / Patterson / X
Jennifer / Hutchinson / X / X
Mary / Coleman / X / X
Meghan / McGuiness / X
Ryan / Constable / X / X
Alan / LaBarre / X / X
Courtney / Lane / X
NECEC / Janet / Besser / X / X
Jamie / Dickerson (alt) / X / X
New Energy, LLC / Seth / Handy / X / X
Karl / Rabago (alt) / X / X
Office of Energy Resources / Danny / Musher / X / X
Office of Lt. Governor / Leah / Donaldson
John / Farley
Mike / McElroy
Erika / Niedowski
People’s Power & Light / Kat / Burnham / X / X
RI Manufacturers Assoc / William / McCourt
RI PUC / Todd / Bianco / X / X
Cynthia / Wilson Frias / X / X
Solar City / Carine / Dumit
Brendan / Reed (alt)
Thad / Culley
TEC-RI / Doug / Gablinske
Utilidata / William / Pratt / X
Jesse / Reyes (alt)
RI PUC’s Mediator/Consultant / Jonathan / Raab / X / X
Paul / Centolella / X / X
Observers / Fred / Unger / X
Julie / Michals / X
Tamela / Bailey / X
Michelle / Carpenter / X
Linda / George / X
Kate / Grant / X
Michele / Leone / X
Kayte / O’Neill / X
Doug / Sabetti / X
Alan / Nault / X
Aaron / Regenberg / X