ORIGINAL REPORTING: The California Plan To Create A Customer-Driven Tomorrow Power System
Real-time pricing, new rates and enabling technologies target demand flexibility to ease California outages; Dynamic energy, capacity prices and an online “price machine” could make DER a reliability solution, regulators say
Herman K. Trabish, September 13, 2022 (Utility Dive)
Editor’s note: This California plan points to where the power system is going. It sounds too complicated now, like personal computing did in 1980 and like cell phones did in 1990.
Growing California power system reliability threats made vivid by early September Flex Alerts called by the state’s system operator could be relieved by a price signal based on real-time pricing, or RTP, linked to smart customer-owned resources through new enabling technologies, according to the California Public Utilities Commission Energy Division’s June 22 CalFUSE proposal.
The new approach could transform California’s high penetrations of customer-owned distributed energy resources into a response to electricity market supply and load fluctuations, commissioners agreed in a July 14 order opening a proceeding to investigate the proposal’s potential.
RTP can signal DER owners and aggregators to provide “demand flexibility” by rapidly and cost-effectively responding to rising market prices for electricity by decreasing consumption or exporting stored energy, staff added at a July 21 CalFUSE introductory workshop.
The CalFUSE framework “is complex, but the complexity will be outweighed by the benefits in the long run,” Southern California Edison Director of Pricing Design and Research Robert Thomas said. Customer bill credits “for responding to dynamic price signals” can “add up to significant affordability gains,” he added.
The proposal offers a vision of “a viable dynamic future grid,” and “utilities are critical to that vision, but it will not work without innovative third-party entrepreneurs engaging customers,” customer-owned device aggregator OhmConnect CEO and Founder Cisco DeVries cautioned.
CalFUSE’s rate design and enabling technologies can lower system and customer costs and drive system flexibility if customers participate and it is a solution that could work wherever power markets and RTP enable it, utilities, DER advocates, and other stakeholders agreed. But whether the plan is too complicated to be workable and how quickly it can be implemented remain highly debated… click here for more