Status Update: WesternJoint Action Framework on Climate Change

On March 7, 2017, the Chairs of the respective California Public Utilities Commission, the Oregon Public Utility Commission and the Washington Utilities Transportation Commission signed the “Western Public Utility Commissions’ Joint Action Framework on Climate Change” (hereafter Western JAFCC) to support ongoing cooperation to reduce greenhouse gas pollution, improve reliability, and obtain cost benefits for ratepayers.

On May 24-25, staff from each commission met in Portland to develop strategies for implementing the JAFCC. Following this initial meeting, the agencies developed a Joint Framework Work Plan that identifies four categories of collaboration: (1) Energy Efficiency, (2) Rate Design for Emerging Technologies, (3) Knowledge Sharing and Technology Development, and (4) Resource Planning. Each category identifies specific collaboration projects with proposed timelines, and deliverables.

On October 30-31, staff met for a set of working meetingsin Seattle. This document provides a status update onthe Western JAFCCWork Plan resulting from thesemeetings. Note that these are dynamic projects, and many of the deliverables and timelines are expected to evolve as the multi-state discussions continue. (For example, as noted below, several projects have been added, removed, or revised from the projects identified in the initialWork Plan.)

Category 1: Energy Efficiency (WA is Category Lead)

Project 1, Coordinated Research & Development of Best Practices for Meter-Based Savings Programs:[1]Develop a guidance or set of best practices for the use of meter-based data in measuring energy savings.This project may be assisted by a staff task force recently developed by the California PUC to clarify requirements for program administrators and implementers who will be designing newly authorized programs in 2018 using metered data. The California metered-data task force will address issues related to: project and site eligibility, lifecycle energy savings estimates (that will be used for annual cost-effectiveness), timing and reporting, and normalizing methods and non-routine events. It will also assemble a set of approved and endorsed technical guidance documents and make them available to the public.

Evaluating conservation achievements through meter-based programs has the potential to significantly reduce utility and commission administrative burden, thus resulting in regulation that is more efficient and potentially additional conservation savings. This project will benefit the three states by developing answers to (rapidly) emerging questions about meter-based savings. New hardware and software for advanced metering and recent legislation in California are all driving new initiatives for the use of meter-based data and projects. However, these projects need guidance and rules around how program administrators and others design projects, including the requirements and specifications that should be required in solicitations and new contracts.

Status Update: Newly identified project, so still in formative stages. Next steps include:

  • Share the California PUC’s presentation on its recent baseline work/ CA / Completed
  • Hold monthly conference calls between WA/OR/CA to discuss progress on NMEC
  • Share the results of California’s Normalized Metered Energy Consumption (NMEC) staff task force once the first stage of its work is ready / CA / Q1 2018

Project 2, Avoided Cost Methodology Best Practices:Create an opportunity for staff to share and understand avoided costs methodologies in each state; develop a fact sheet on each methodology and explore where there may be areas for future collaboration.

Each of the states will benefit from the examination of its avoided cost methodologies, including the identification of non-energy benefits connected to state-specific policies (for instance, Washington will likely use some of the material in its ongoing integrated resource plan rulemaking). Lessons learned in one state can help avoid missteps in the other states, and support stronger new methodologies.

Status Update: Staff from each state shared high level descriptions of current avoided cost methodologies and challenges. Next steps include:

  • Draft, circulate, fact sheet template / WA / Q4 2017
  • Review, revise, and finalize template / All / Q4 2017
  • Populate template w state-specific information / All / Q1 2018
  • Set up a call and/or webinar to discuss and answer questions re: state-specific info / WA / Q1 2018
  • Set up / hold periodic calls (or other preferred forum) for diving deeper into various issues that surfaced in the fact sheet development process, and as each state’s AC proceeding unfolds / WA / TBD

Project 3, Market Transformation Collaboration Across WA, OR, and CA: Develop a shared approach to market transformation (most likely outside of the Northwest EEAlliance framework, but technical support could be provided by NEEA).The envisioned deliverable would be a plan for developing an approach to market transformation which combines the work already being done in the Northwest through NEEA with new market transformation programs required by recent California statute.

This project will benefit CA by leveraging best practices and avoiding “reinventing the wheel” when developing its new market transformation programs, and it will also help prevent CA from developing an approach to EE market transformation that complicates or works at cross-purposes with the existing NEEA programs in the Northwest. In addition, all three states will benefit from any specific efforts that are identified for joint implementation.

Status Update: Three NEEA representatives spent a full day in working meetings providing information regarding NEEA’s work and brainstorming collaboration opportunities. Next steps include:

  • California has some internal procedural steps to take to begin developing a record for market transformation program options within the current EE docket, especially to clarify the scope and potential breadth of such programs with the Assigned Commissioner and Administrative Law Judge, because the statutory requirement to develop MT programs is vague and open-ended.
  • CPUC and NEEA staff agreed to continue to engage to determine what role NEEA might take in the California effort so that it can best help the CPUC set up a market transformation effort.
  • NEEA agreed to share its evaluation and baseline frameworks/methodology with the CPUC.
  • The need was also identified for a workshop exploring how MT resources would be included in load forecasting (including the ProCost model) that would include the Northwest Power and Conservation Council, and the CaliforniaEnergy Commission. CPUC staff agreed to explore this idea.
  • UTC and WAPUC staff agreed to help coordinate the NEEA-portion of these efforts to manage the amount of time and effort needed from NEEA resources themselves, and to engage the OR and WA regulated entities at the appropriate point in this collaboration.

Category 2: Rate Design for Emerging Technologies (OR is Category Lead)

Project 1, Rate Design and Electric Vehicles: Develop an understanding of rate design for residential and public electric vehicle charging; and the sharing of best practices of regulated utilities participating in the competitive electric vehicle market.This project will benefit all three states by sharing key information related to rate design that supports the deployment of electric vehicles in a manner that optimizes their impacts on the grid and helps the states meet their greenhouse gas reduction goals.

Status Update: A panel on rate design principles was held in Seattle, to help the group answer the question of whether or not different principles should apply to distinct technologies such as electric vehicles, and the group consensus was that the principles of rate design still hold for new technologies. Each state then made a presentation about their current electric vehicle rate design and processes being undertaken by each of the states related to electric vehicles. Next steps include:

  • Share EV load profiles in three states/ OR / Q4 2017 (Max St. Brown will set up a meeting in coming weeks to discuss)
  • Share cost-effectiveness methodology to be developed within Oregon’s transportation electrification proceeding/ OR /TBD
  • Share data metrics developed in California transportation electrification proceedings / CA / Q4 2017

Project 2, Rate Design for Demand Response: Develop an understanding of key rate design attributes for the various categories of demand response customers and share best practices. This project will benefit all three states by sharing key information related to rate design that supports the deployment of demand response to optimize this resource’s value to the grid.

Status Update: The group discussed demand response as it related to electric vehicles, namely that very little work is being done on vehicle to grid rate development. Next steps include:

  • Develop a small summary from each state of what work has occurred on demand response rates for electric vehicle charging/ OR / Q2 2018
  • Develop shared understanding of what is included in cost-of-service calculations in each jurisdiction. Share cost-of-service data collected in Washington/ CA / Q2 2018
  • Barriers in rate design for new technological choices and grid operation with demand charges, namely a discussion on demand charges and non-coincident peak demand charges /OR / Q3 2018
  • Develop a set of best-practices in the utilization of Advanced Metering Infrastructure in rate design based on the outcome of the current California effort / All / TBD

Category 3: Knowledge Sharing and Technology Development

Project 1, Knowledge Sharing Platform: Develop ongoing, electronic communication tools to enable easy information sharing between Commission staff. This work will be beneficial to all of the states in facilitating the Western JAFCC’s collaboration, as well as providing a repository for materials that may be of use to the other states.

Status Update: Several staffers from each state have been provided access to a new GovSpace site developed by Oregon IT staff. A webinar “drive-thru” of the site was provided to all staff present in Seattle, and the general consensus was that the site can accommodate the needs of our collaboration work. Next steps include:

  • All Western JAFCC staff to be provided access to the site to demo it.
  • Project teams will begin using the site for document sharing, calendaring meetings, etc.

Category 4: Resource Planning (CA is Category Lead)

Project 1, Regional Planning[2]: Facilitate regional planning, lower ratepayer costs, and increase access to resources facilitating reliability, GHG emission reductions, and climate resilience and adaptation.This project will benefit California by identifying new markets and resources that could help reduce the costs of large, long-term capital investments in clean energy, capacity, and storage that will be needed to reduce GHG emissions and maintain reliability. It will also help California mitigate risks and reduce uncertainty regarding the future availability of out-of-state resources for meeting state goals. The information developed from this project will enable all three states to pursue their own individual state policies at least cost by clarifying opportunities to benefit from inter-state trading.

Sub-Project 1.1, Inter-State Benefits: Develop strategies for improving the efficiency of inter-state energy markets by researching key policy drivers for inter-state energy and capacity transactions (including reliability and GHG emissions reductions) to understand how state-specific rules, market requirements, transmission constraints, and planning conventions for addressing policy goals (e.g., different resource adequacy frameworks) may impact the ability for resource sharing between the states.

Status Update: Panels were conducted in Seattle to describe and discuss both long-term planning in a carbon-constrained future and challenges and potential improvements in nearer-term low-carbon resource procurement across the different states. Next steps include:

  • Draft proposal for aregional, PATHWAYS-like study or systematic review of previous studies, identifying potential benefits and challenges of multi-state (emphasis on CA, OR, WA)coordinated planningtowards 2050 under a carbon-constrained future / CA / Q12018
  • Draft problem statement outlining information gap regarding the long-term firm capacity of the NW-CA transmission intertie between the generation-side utility planning and the western transmission operators’ reliability planning. / WA / 2017
  • Draft synopsis of RA conventions across states and potential benefits of alignment. / WA / 2018

Sub-Project 1.2, Climate Resilience and Adaptation: Consider the incorporation of climate change impacts in resource planning.

Status Update: A group in Seattle discussed this issue, including the need for gathering temperature and weather data from forward looking climate change models to use in load forecasting. Next steps include:

  • State specific summaries of efforts to date, available resources, and reports on climate adaptation / ALL / Q4 2017
  • Powerpoint presentation that summarizes the potential risks to the electric system associated with climate change; and the barriers to and opportunities for improved consideration in Resource / CA / Q4 2017

Project 2, Distributed Resource Planning (DRP)Technical Assistance: Knowledge exchange and technical assistance with distributed resource planning. This project will primarily benefit OR and WA by discussing CA’s experience in developing and implementing distribution resource planning approaches. DRP tools and processes are instrumental to allow DER technologies to be considered against bulk-system supply resources in IRP optimizations to meet long-term climate planning objectives.

Status Update: A brainstorm / discussion of how best to conduct this information sharing took place in the Seattle meeting. Next steps include:

  • Conference call to develop scope of work and webinar curriculum/ CA/ Q4 2017
  • One online presentation or a series of short webinars during which PUC staff share with each other and the utilities their experience with various tools to carry out DRP and Integrated Distributed Energy Resources procurement / ALL /Q1 2018
  • (Potential Deliverable):A more in-depth 2-day customized training and facilitated dialogue /Third party facilitator such as More Than Smart / Q1 2018

Project 3, Regional Electrification Coordination:Knowledge exchange to better understand the role of utilities in building electrification and EV growth, customer behavior, and potential for improved planning and process alignment between the transportation and electric sector.[3]

This project will benefit California by imparting an understanding of how electrification policies and programs have performed in other states. Understanding the lessons learned in other states will help improve the effectiveness of electrification policy design in California. All three states will benefit from this mutual knowledge-sharing. Moreover, this project also has the potential to harmonize at least some aspects of electrification policy to create a more seamless electric transportation experience on the West Coast that could itself help accelerate adoption in all three states.

Sub-Project 3.1, State Electrification Planning Best Practices: Share and discuss best practices for electrification (fuel switching) planning for the states and utility service areas, to better understand possible impacts of fuel switching on natural gas usage and the natural gas utilities we regulate.

Status Update: A brainstorm / discussion of how best to share best practices for electrification planning took place in the Seattle meeting. Next steps include:

  • Develop proposal to consider electrification in state resource planning efforts, including assessing the potential scale of building, transportation, and industrial electrification in each state/ CA / Q2 2018
  • Develop a high-level summary of how eachstate’s policies and utilities commissions’ programs impact fuel switching (i.e. incentivize or discourage) / ALL / 2018
  • Develop a high-level summary of market, regulatory and operational issues that need to be considered with increasing electrification of buildings and transportation / ALL / 2018

11/30/2017Page 1

[1]This project replaces the“Regional Technical Forum which includes California” project in original Work Plan.

[2] This project expands the “Resource Adequacy” project in the original Work Plan into two distinct sub-projects.

[3] This project has been expanded in scope beyond the focus on interstate electric transportation corridors in the original Work Plan to address four distinct sub-projects.