1. DOE OE ARRA Program Steve Bossart Senior Energy Analyst U.S. Department of Energy National Energy Technology Laboratory EnergyTech 2012 May 29-31, 2012

2. 2 Topics Background OE Smart Grid ARRA Program Metrics & benefits approach Build and impact metrics status Consumer behavior projects (SGIG) Smart grid demonstration projects (SGDP) Case studies Qualitative metrics Lessons learned Life after ARRA

3. 3 Background

4. 4 DOE OE Mission Mission of Office of Electricity Delivery and Energy Reliability Lead national efforts to modernize the electric grid; Enhance security and reliability of the infrastructure; and Facilitate recovery from disruptions to energy supply

5. 5 Programs created by statute  Energy Infrastructure Security Act 2007: – Smart Grid Investment Grants (Sec. 1306) – Smart Grid Regional Demonstrations (Sec.1304)  Recovery Act Directed Programs: –Workforce Training - $100M –Interconnection-wide Transmission Planning and Resource Analysis - $80M –Interoperability Standards - $12M Additional OE initiatives - State & Local Energy Assurance - State Regulatory Assistance Recovery Act – Grid Modernization Top 10 States by Total Awarded StateAmt ($M) NC434 CA419 TX293 NY276 FL270 PA265 MD233 DC213 AL166 OH146 One-time Appropriation, $4.5B in ARRA funds  $620M for demonstration projects  $3.425B for deployment projects Investment Grants Smart Grid Demos Workforce Training Resource Assessment & Transmission Planning Smart Grid Interoperability Standards Other

6. 6 Value Proposition Cost to Modernize $338-$476B over 20 years –$ 82-90B for transmission –$232-$339B for distribution –$24-46B for consumer $17-24B per year Other cost estimate: Brattle >$800B Benefit of Modernization $1294 – 2028 Billion Overall benefit-to-cost ratio of 2.8 to 6.0 6 EPRI, 2011 Previous Studies Benefit to Cost Ratio for West Virginia of 5:1 Benefit to Cost Ratio for San Diego of 6:1 Benefit to Cost Ratio for EPRI (2004) 4:1-5:1 $165B Cost $638 - $802B Benefits EPRI Report: http://www.smartgridinformation.info/pdf/3272_doc_1.pdf

7. 7 DOE Smart Grid American Reinvestment and Recovery Act of 2009 Program

8. 8 American Recovery and Reinvestment Act ($4.3B) Smart Grid Investment Grants (99 projects) –$3.4 billion Federal; $4.7 billion private sector –>800 PMUs covering almost 100% of transmission –6500 distribution automation circuits –>15 million smart meters Smart Grid Demonstration Projects (32 projects) –$620 million Federal; $1 billion private sector –16 storage projects –16 regional demonstrations Smart Grid ARRA Activities

9. 9 Additional ARRA Smart Grid Activities –Interoperability Framework by NIST ($10M) –Transmission Analysis and Planning ($80M) –State Electricity Regulator Assistance ($50M) –State Planning for Smart Grid Resiliency ($55M) –Workforce Development ($100M) Smart Grid ARRA Activities (continued)

10. 10 Technology Deployment Customer Systems SGIG/SGDP Areas of Smart Grid Technology Deployment Customer Systems Advance Metering Infrastructure Electric Distribution Systems Electric Transmission Systems Displays Portals Energy management Direct load controls Smart meters Data management Back office integration Switches Feeder optimization Equipment monitoring Energy Storage Wide area monitoring and visualization Synchrophasor Technology Energy Storage Customer Systems Equipment Manufacturing Energy devices Software Appliances

11. 11 Schedule for Benefits Analysis The DOE Metrics and Benefits work is transitioning into the reporting and analysis of impact metrics. See smartgrid.gov Metrics and Benefits Plan Build Metric Reporting and Analysis We are here Impact Metric Reporting and Analysis

12. 12 Key Program Objectives Key Stakeholders: NARUC and PUCs EEI/EPRI NRECA/CRN APPA NASPI Consumer Advocates Utilities Three Objectives: Information Derived from 131 ARRA Smart Grid Projects Advancing the Business Case Sharing Lessons- Learned and Best Practices Determining R&D Needs System Engineering Advanced Analytics

13. 13 Metrics and Benefits Approach

14. 14 DOE Analytical Approach Example Improves feeder voltage regulation Reduced feeder losses worth $60 per MWh Automatic Voltage and VAR Control Capacitor controls Distribution Management System Functions Mechanisms Benefits What does the Smart Grid do? How does it do that? What “goodness” results? Monetary Value What is the goodness worth? What are Smart Grid technologies? Assets $6000

15. 15 Smart Grid Functions SensingControlProtection Wide Area Monitoring, Visualization, and Simulation Power Flow ControlFault Current Limiting Diagnosis & Notification of Equipment Condition Automated Feeder Switching Dynamic Capability Rating Real-Time Load Measurement and Management Automated Islanding and Reconnection Adaptive Protection Automated Voltage and VAR Control Enhance Fault Protection Real-Time Load Transfer Customer Electric Use Optimization

16. 16 Energy Storage Applications Renewable SupportInvestment DeferralAncillary ServicesLoad Management Renewables Energy Time Shift Electric Supply Capacity Deferral Area RegulationElectric Energy Time Shift Renewables Capacity Firming T&D Upgrade Deferral Load FollowingTransmission Congestion Relief Wind Generation Grid Integration, Short Duration Substation Onsite Power Electric Supply Reserve Capacity Time-of-Use Energy Cost Management Wind Generation Grid Integration, Long Duration Electric Service Reliability Voltage SupportDemand Charge Management Electric Service Power Quality Transmission Support

17. 17 Smart Grid Metrics Reliability Outage duration and frequency, momentary disruption, power quality Security Ratio of distributed generation to total generation Economics Electricity prices & bills, transmission congestion costs, cost of outages Efficient T&D electrical losses, peak-to-average load ratio Environmentally Friendly Ratio of renewable generation to total generation, emissions per kwh Safety Injuries and deaths to workers and public Field Data Metrics Benefits Value 17

18. 18 Five Primary Analytical Focus Areas Peak Demand and Electricity Consumption Advanced metering infrastructure Pricing programs & consumer devices Direct load control Peak Demand and Electricity Consumption Advanced metering infrastructure Pricing programs & consumer devices Direct load control Operations & Maintenance Savings from Advanced Metering Meter reading Service changes Outage management Operations & Maintenance Savings from Advanced Metering Meter reading Service changes Outage management Distribution System Reliability Automated & remote operations Feeder switching Monitoring & health sensors Distribution System Reliability Automated & remote operations Feeder switching Monitoring & health sensors Energy Efficiency in Distribution Systems Voltage optimization Conservation voltage reduction Line losses Operational efficiency Energy Efficiency in Distribution Systems Voltage optimization Conservation voltage reduction Line losses Operational efficiency Transmission System Operations & Reliability Application of synchrophasor technology for wide area monitoring, visualization, and control Transmission System Operations & Reliability Application of synchrophasor technology for wide area monitoring, visualization, and control

19. 19 Information Relating to Technology Deployment and Impacts Project Reporting For SGIG/SGDP Build Metrics: Technologies, configurations, functionality, costs, extent of deployment Impact Metrics: Peak demand and electricity consumption O&M improvements from AMI and DA Distribution system reliability Energy efficiency improvements in DA Applications of synchrophasor technology Consumer Behavior Studies: Response to pricing and enabling technologies Customer acceptance and retention Technology Performance Reports: SGDP technology performance and impacts Energy storage technology comparison

20. 20 Who are the Beneficiaries? Utilities (What’s in it for my shareholders?) Consumers (What’s in it for me?) Society (What’s in it for us?) We get what we reward!

21. 21 Metrics and Benefits Status

22. 22 SGIG Deployment Status 9.3 of 15.5 million residential and commercial smart meters Distribution automation equipment on 4,200 out of 6,500 circuits 195 out of over 800 networked phasor measurement units

23. 23 Smart Meters Deployed in SGIG Projects

24. 24 Application of Advanced Metering Infrastructure Investments in AMI are being made by 75% of the SGIG projects Peak and Overall Demand Reduction 62 projects are pursuing …… 40 w/ pricing programs 25 w/ customer systems 21 w/ direct load control devices Operational Efficiency Improvement 60 projects are pursuing …… 60 w/ automated meter reading 44 w/ voltage and power quality monitoring 51 w/ outage detection and notification 50 w/ tamper detection 48 w/ remote service switch Reducing requirements for generation capacity and energy (less fuel) Improved asset utilization Lower emissions (CO 2, NOx, SOx) Lower bills Operations and maintenance (O&M) cost reductions Greater responsiveness to customer Lower outage duration Improved energy efficiency

25. 25 Status of Smart Grid Investments in SGIG Program

26. 26 Automated Distribution Circuits in SGIG

27. 27 Distribution Automation DA investments are being made by over 50% of the SGIG projects Distribution Reliability 48 projects are pursuing distribution system reliability improvements 42 w/ automated feeder switches >6 w/ equipment monitoring 27 w/ DMS integration 21 w/ AMI integrated with OMS Volt/VAR Control 47 projects are pursuing voltage/VAR control and optimization 35 w/ automated capacitor banks 32 w/ automated voltage regulators 22 w/ DMS integration SAIDI, SAIFI and CAIDI improvements O&M cost reductions Energy efficiency improvements O&M cost reductions

28. 28 Phasor Measurement Units in SGIG Projects

29. 29 Application of Synchrophasor Technology Investments in synchrophasor technology are being made by 10 SGIG projects Benefits: Improved reliability and resiliency Improved asset utilization Reduced transmission congestion Integration of distributed generation and renewables

30. 30 Customer Devices in SGIG Projects

31. 31 Customers with Smart Meters Enrolled in Pricing Programs in SGIG

32. 32 Smart Grid Demonstration Projects Build Metrics 171,361 smart meters have been installed and are operational. Customer Systems 7,612 customer system assets –3,665 in-home displays –1,605 direct load control devices –1,920 programmable communicating thermostats –155 smart appliances –267 energy management devices 58,922 active web portal accounts have been created. Transmission System Assets –Dynamic capability rating systems (DCRS) on 11 transmission lines –11 phasor measurement units (PMUs) –4 phasor data concentrators (PDCs).

33. 33 Smart Grid Demonstration Projects Build Metrics Distributed Energy Resources 176 distributed generation units with combined capacity of 1.05 MW 30 storage units with combined capacity of 1.43 MW 25 plug-in electric vehicle charging points. Distribution System Assets –382 automated feeder switches –264 automated capacitors –105 automated regulators –12,947 feeder monitors –1 transformer monitor –428 smart relays.

34. 34 Consumer Behavior Studies

35. 35 SGIG Consumer Behavior Studies

36. 36 SGIG Consumer Behavior Studies: Study Population Statistics Total of ~145,000 customers are expected to “participate” as treatment or control customers Plan to collect key demographic information on all treatment and control customers (ideally), subject to survey response rates Assuming 3 years worth of hourly interval usage meter data (1 year pre-treatment and 2 years post-treatment); this represents 3.9 billion data observations To put our SGIG analysis and evaluation effort into perspective: ComEd’s CAP study included ~8,500 participants and ran for 12 months (June 2010 - May 2011) CA Statewide Pricing Pilot included ~2,500 participants and ran for 18 months (July 2002 – December 2003) 36

37. 37 SGIG Consumer Behavior Studies: Overview of Research Topics Given the diversity of studies being undertaken as part of the SGIG program, we have a unique opportunity to evaluate issues in several topical areas: Research Topical Areas 1. Customer Acceptance: What motivates customers to accept time-based rate programs? 2. Customer Retention: What motivates customers to remain on time-based rate programs? 3. Customer Response: Will customers respond, and if so by how much will they respond, to time-based rate programs? 4. Role of enabling technology and information/education: Will customers respond, and if so by how much will they respond, to control and/or information technology and/or education alone? 37

38. 38 Qualitative Feedback

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40. 40 Variety of Stakeholders Electric Service Provider Decision makers Operations & maintenance Planning Engineering & design Customer service Traders Purchasing Regulatory support Billing

41. 41 Smart Grid Demonstration Projects

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45. 45 Case Studies

46. 46 eEnergy Vermont A State-Wide Strategy for Smart Grid Development Key Activities Smart metering roll-out for outage management and time-based rates for demand response. Distribution system automation including switches, reclosers, SCADA, and communications backbone systems. Consumer behavior studies by Vermont Electric Cooperative (VEC)and Central Vermont Public Service to assess customer acceptance, response, and retention. Aims and Strategies A collaborative effort involving all of the state’s electric distribution companies to modernize Vermont’s electric grid and foster economic growth as part of the state’s “eState Initiative” with telecommunications and health care. Results and Benefits VEC’s outage management system has improved SAIFI by 50% and CAIDI by 40% since installed in 2008. VEC’s smart metering roll-out and outage management system has a 5 year payback period from operational saving alone. VEC received POWER Magazine’s first “Smart Grid Award” in August 2011 for its pioneering efforts in outage management. Restoration of the grid from Tropical storm Irene occurred quicker and with greater customer awareness of repair schedules due to smart meters, web portals, and more effective outage management. Utilities working together to modernize the grid. Facts & Figures Total Project Budget: $137,857,302 Federal Share: $69,928,650 Distribution Automation: 47 circuits and substations Smart meters: 311,380 Time-Based Rates: 1,500 customers targeted Vermont Electric Cooperative’s Smart Grid Operations Center

47. 47 Oklahoma Gas & Electric Reducing peak demand in Oklahoma Key Activities OG&E’s “Positive Energy Smart Grid Project” is installing 750,000 smart meters system-wide and distribution automation equipment on 40% of the circuits serving homes, offices, farms, and factories. Aims and Strategies Defer construction of two 165 MW power plants by lowering peak demand using demand response programs that involve time-based rates and customer enabling technologies. Improve service and lower costs by operating automated capacitors and distribution switches. Results and Benefits Pilot demand response project of 3,000 customers during the summer of 2010 o 98% of participating customers saved money on their bills o Measureable demand reductions from customers participating in critical peak and variable peak pricing and who use the web portal, programmable communicating thermostats, and in-home displays Expect to lower operations and maintenance costs and improve service reliability and power quality. Customer- Enabling Technologies Used by OG&E Facts & Figures Total Project Budget: $293,201,332 Federal Share: $130,000,000 Customers Served: 766,866 Service Area: 30,000 square miles in Oklahoma and Western Arkansas Generation Capacity: 6,600 MW In-Home Display

48. 48 City of Naperville Empowering Consumers in Illinois Key Activities Naperville’s “Smart Grid Initiative” completes a decade long efforts to automate the city’s entire electric distribution grid. Deploys smart meters city wide to all customers. Provides consumer education programs to engage public participation in shaping smart grid policies and programs. Aims and Strategies Strengthen reliability and reduce the frequency and duration of power outages. Empower consumers to manage their own power consumption and costs to enhance energy efficiency, reduce peak, and reduce power purchase costs from wholesale suppliers. Results and Benefits Distribution automation investments have improved System Average Interruption Duration Index each years since 1991 by from 15% to 55%. O&M costs from dispatching repair crews reduced by about 40%. Enacted Naperville Smart Grid Consumer Bill of Rights. Implemented Smart Grid Ambassadors Program Consumer programs for smart grid-savvy customers Facts & Figures Total Project Budget: $21,988,220 Federal Share: $10,994,110 Distribution Automation: Remaining 6 of 117 circuits Smart meters: 57,000 Time-based Rates: 1,500 customers targeted Residents provide feedback on Naperville’s smart grid policies and programs.

49. 49 M2M Communications Agricultural Demand Response Program Saves Electricity in California Key Activities M2M Communications of Boise, Idaho, has developed a two-way, web-to-wireless controller for irrigation pumps. The controller is part of an irrigation load control system that includes sensors, smart meters, and other monitoring equipment. M2M created the Peak Energy Agricultural Rewards (PEAR) program, a demand response program marketed to agricultural customers of California’s investor owned utilities. Aims and Strategies As part of the PEAR program, farmers can earn cash incentives and avoid peak demand charges. Water consumption and soil moisture can be monitored from a web portal, enabling farmers to make informed decisions about possible participation in peak demand events. Farmers can schedule irrigation pump start up/shut off, saving water, time, and manpower, and improving overall efficiency. Results and Benefits DOE ARRA funds greatly contributed to M2M’s final R&D push to get the controller to market. PG&E called four peak pricing events in 2011; PEAR program participation reduced summer peak demand by an average of 18 MW per event. Reducing Peak Electric Demand and Increasing Efficiency of Farm Operations Facts & Figures Total project budget: $4,342,340 Federal share: $2,171,170 Devices installed: 300 Total summer peak demand reduction in 2011: 72 MW An irrigation pump connected to and controlled by M2M’s web-to- wireless controller

50. 50 Operational Efficiency Improvements at Talquin Electric Cooperative Background: For over 70 years, members submitted their own meter readings (highly inaccurate) Rolling trucks 6,000 times/year for routine service connection/reconnection and 9,000 times/year for non- payment problems ($40-$50/truck roll) Outage locations based on pattern of customer phone calls TEC’s SmartGrid Program: Deployed AMI to about 56,000 customers and upgraded 46 of 86 circuits with advanced capacitors for voltage control and outage management. With AMI, TEC avoided 8,800 truck rolls in 2011 for non- payment problems saving more than $350,000 Expecting to avoid additional 5,500 truck rolls for routine service connections (savings of $200,000/year) Expecting to reduce outage durations from more precise pinpointing of faults and dispatching of repair crews to exact locations without guesswork. Technician changes out analog meter with a smart meter Facts & Figures Total Project Budget: $16,200,000 Federal Share: $ 8,100,000 Customers Served: 57,000 Service Area: 2,600 square miles spanning 4 counties in northern Florida

51. 51 Lessons Learned

52. 52 Regional Smart Grid Peer-To-Peer Meetings 8 regional meetings in 2011 and 2012 Common Themes Be prepared to address customer’s sensitive issues One size does not fit all Set reasonable expectations Prepay is showing promise for low income customers Strategy needed for change management Measure and communicate benefits to consumers Opt-out provisions are important Invest in staff training Customers need actionable information Grid modernization is an evolution

53. 53 Life After ARRA Smart Grid Program

54. 54 Life After ARRA Smart Grid Program Build and maintain momentum Make business case Identify, allocate, and quantify benefits Identify and quantify costs Address technical issues Address regulatory issues Address customers concerns

55. 55 Contact Information Steve Bossart (304) 285-4643 Steven.Bossart@netl.doe.gov Federal Smart Grid Website www.smartgrid.gov Smart Grid Clearinghouse www.sgiclearinghouse.org/ Smart Grid Implementation Strategy www.netl.doe.gov/smartgrid/index.html