Direct Testimony of Thomas M. Hildebrand - Consumer Advocate ...

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The State Energy Efficiencx Scorecard for 2006. ACEEE * States nith etemplarq iimo\atn e finance mechamsms \?ere giyen an evtra pomt Research and Development In 1990, several state energy R&D institutions established the Association of State Energ Research and Technology Transfer Institutions (ASERTTI)” in response to the increasing need for state initiatives in R&D. In addition to providing a variety of services to promote the creation, development, and commercialization of new technologies for enera efficiency, state R&D efforts can address a number of market failures that persist in the enere services marketplace (Pye and Nadel 1997). State-level institutions have the advantage of focusing on regional needs and opportunities that are not addressed by national programs. State institutions can also coordinate a range of resources from across the state. Other Policies Iiznovcrrive.finnizcing. States are developing a wide range of innovative financing mechanisms to finance programs to implement energy efficiency improvements in existing buildings and ne\\- state facilities, including revolving loan funds, tax-esempt master lease-purchase agreements, lease revenue bonds, pension funds, and performance contracting. These mechanisms are usually administered by the state energy office or other lead agency, which coordinates the program across multiple state agencies. 1oil.a has been a leader in state financing for public facilities. Legislation passed in the 1980s established the Iotl-a Energy Bank, which allows state agencies to use lease-purchase financing and loans for energy-management improvements, and the State Facilities Program (EPA 2006d). The Tesas LomSTAR program ivhich was initiated by the Texas Energ, Office in 1988? uses a revoll-ing loan fund mechanism that is funded at about $100 million. As of April 2006, LoanSTAR funded a total of 187 loans of which 17 were to state agencies, 46 to institutions of higher education, 36 to local governments, 78 to independent school districts, and 10 to counp hospitals (SECO 2007). 50
constraints.‘ Similarly. ISOs and RTOs estimate the degree to which congestion in specific areas would bs alleviated by transmission upgrades, because major reductions in congestion mean bill savings for electricity customers.’ Congestion also occurs in areas where thc grid is managed by individual integated utilities rather than by regional grid operators: however, since transmission, generation and redispatch costs are less visible in these areas, the costs of congestion are not as readily identifiable. As the tenn is used here, reliability refers to the delivery of electricity to customers in the amounts desired and within accepted standards for the frequency, duration, and magnitude of outages and other adverse conditions or e\*ents. Loadpockets are created when a major load center (such as a large city llke San Francisco or New York) has too little local generation relative to load and must import much of its electricity via transmission from neighbo+iing regions. For example, most of California is currently a generation-short load pocket; by contrast, transmission constraints cause Maine, which has far more generation than load, to be generation-rich. Because it is frequently difficult to site and build efficient new generation within a city, or to build additional transmission into a city, the resulting load pocket will often experience congestion-meaning it cannot import as much low-cost energy as it would like, and the city’s electricity provider(s) must operate one or iiiore existing power plants inside the city more intensively to ensure that all customer needs are met, although at higher cost. If electricity demand inside the load pocket grows quickly without being checked by energy efficiency and demand response, the load I pocket may face a looming reliability problem, vi ith too little supply (local generation plus transmission-eilabled imports) relative to demand-whether in actual ternis or according to accepted rules for safe grid operation. In such cases. it is necessary for the transmission owner(s) serving the load pocket to resolve the reliability problem as quickly as possible. 7, e case of a load pocket, thcre arc three primary 1 ways to deal with a long-teim congestion problem: 1. Build new central-station generation within the load pocket; 2. Build ncw or upgrade transmission capacity (some combination of lines and other equipment such as transfomiers and capacitors) to cnable distant generators to senre a portion of the area’s load; or 3. Reduce electricity demand (and net import needs) within the load pocket, through some combination of energy efficiency. demand response. and distributed generation. The three options can be used singly or in combination to solve a transmission constraint problcni flexibly and cost-effectively. Generation and transmission, however, are costly, time-consuming solutions that often face opposition. Demand-side options tend to be under-utilized because they have high transaction costs with results that may be less certain and less controllable. It should also be noted that there are a variety of transmission-only solutions to any specific transmission problem; not cyery transmission project (or cornbination of projects) will provide equal congestion relief, nor will it provide equal reliability or economic benefits to one in the affected region. \-p.o.-^------ - ‘See, for example. PJM’s statement that congestion costs resulting from constraints in the Allegheny Mountain area azotaled S747 million in 1005. with another $464 million on the Delaware River path that year. Se .Int~rest-L.ansinissioc-iomci~r-s pdi^ for additional detail. Organized to protect themselves irnd prevent the full cost of congestion from driving up their total deljvered electticity costs. ‘It is important to note that the purpose of this study was to identifj areas experiencins significant congestion, as opposed 10 estimating the net value of actions to address thc congcstion. See, for example., the CAISO’s estimate that transmission upgrades and operatianal impravcnienrs czonioleted in 2005 reduced summer congestion costs by more than $54 million in just two months (IIIPJ: ,ww,..2aiso cc.m.docs: , and that three newly approsed transmission project bonknecks and maintaining ackquate generalion for local rzliability by $30 million per year” 4 US. Department of Energy I National Electric Transmission Congestion Study ‘ 2006
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THOMAS M. HILDEBRAND 7336 Sheraton
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1 2 3 4 5 6 7) The TrAILCo applicat
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1 Q. WHAT ABOUT NEW GENERATION THAT
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THOMAS RI. HILDEBRAND Lieutenant Co
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? c 1600 LAIDLEYTOWER * EO. BOX 553
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BEFORE THE PEWSYLVANIA PUBLIC UTILI
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111. Conclusion WHEREFORE, the Offc
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Trans-Allegheny Interstate Line Com
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_,--I_- -I Trans-Allegheny Intersta
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1 INTRODUCTION The Commonwealth of
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Exhibit 5. Estimated Peak Demand (M
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O h Load Red1 tion in the Top 100 H
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6 How Dominion and Allegheny Power
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2 Section 1: Int7.oduction and Conc
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Page 55 and 56: north of Washington DC. Most of the
Page 57 and 58: ~~ ~~~ h 12 centers nd 0th r demand
Page 59 and 60: 14 Section 5: Did they find the Bes
Page 61 and 62: 16 This flagrant non sequitur shine
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Page 65 and 66: Appendix A: Alternatives to the Loz
Page 67 and 68: 22 Appendix B: Dominion 5 Analysis
Page 69 and 70: Ronnie BaileylCOMMOPSNANCPOW ER 051
Page 71 and 72: i Friday, January 26, 2007 Part II
Page 73 and 74: 3920 Federal Register/ Vol. 72, No.
Page 75 and 76: 3922 Federal Register / Vol. 72, No
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Page 80 and 81: Figure 1. Organization of entities
Page 82 and 83: VI. Energy and Water Management __.
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Page 87 and 88: PjM, New York, and New England) aio
Page 90 and 91: Department of Defense Fiscal Year 2
Page 92 and 93: I. INTRODUCTION The Department of D
Page 94 and 95: _ .I._. Back to the previous pa ...
Page 96 and 97: THE STATE ENERGY EFFICIENCY SCORECA
Page 98 and 99: The State Energ) Efficiency Scoreca
Page 102 and 103: and achievable cosi effective poten
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Page 106 and 107: North Anna Power Station Page 2 of
Page 108 and 109: Fredericksburg.com - Dominion to mo
Page 110 and 111: Dominion Seeks Approval for Power S
Page 112 and 113: opinion, a focus group's phrase, an
Page 114 and 115: wy_Jc- f W. Va. 19791 PUBLlC SERViC
Page 116 and 117: Virginia Business Magazine: Virgini
Page 118 and 119: Virginia Business Magazine: Virgini
Page 120 and 121: .. '2 c3 3 iJa e 16 Komr US. Busine
Page 122 and 123: --.% & WEST UIROINIA --.. . Print %
Page 124 and 125: i Keduce CjioDai vvarming raye L VI
Page 126 and 127: FOR IMMEDIATE RELEASE TUESDAY, OCTO
Page 128 and 129: The following eight states joined a
Page 130 and 131: Electric And Magnetic Field (tMk) K
Page 132 and 133: “43 HEAT STORM THANKS-2-2-2 The F
Page 134: FLEX ALERT Save Energy Now! ‘M bK
Page 143 and 144: R&D Critical Needs Dynamic modeling
Page 145 and 146: R&D Top I00 in the World SuperVAR
Page 147 and 148: From Silicon to Diamonds Chemical V
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U.S. appetite for electricity is =
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' AOOx power density of copper 1 lo
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Buckeye Power, Inc. Non-profit gene
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Demand Response
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Transmission Expansion Drivers Expa
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Economic Expansion Metric 1. Econom
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System Congestion Cost Savings soci
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Potential Beneficiaries Relative be
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- Change in Zonal Load Payment due
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0 bse rvations Difficult to justify
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A few thoughts on demand response r
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Barriers to 0 Traditional retail ra
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...--... I. VY, ,““Y I uvvcIllu
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Economic Benefits for Energy Effici
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Established energy efficiency as re
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- i'ciency Can Help Control rowth U
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Energy Efficiency Z2r * Utility fin
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Y STAR 0 ENERGY STAR is a cost-effe
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Direct Testimony of Thomas M. Hildebrand - Consumer Advocate ...

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