1. CALIFORNIA ENERGY COMMISSION Utility of the Future: New Technologies in Integrated Energy Systems San Francisco, California June 17, 2002 Terry Surles, Ph.D Public Interest Energy Research (PIER) California Energy Commission

2. CALIFORNIA ENERGY COMMISSION Driving to a Sustainable Future: The “E”s are Linked  Environment  Energy  Economics  Equity  Education

3. CALIFORNIA ENERGY COMMISSION Issues  Complex system with lack of systems perspective  Energy is only, intermittently, a big deal  “Rube Goldberg” approach to energy policy  Market is unable to address all societally or politically acceptable externalities  New technologies to do not address Joe Bagadonitz needs

4. CALIFORNIA ENERGY COMMISSION Distributed Energy Resources Externalities (Attributes)  Environmental benefits: Resource development, emissions, GHG  System benefits: Transmission congestion, infrastructure interdependencies  Reduction of defense and security costs  Cost savings: Life cycle perspective, resource availability  Potential collateral benefits: Thermally-activated technologies, waste reduction alternative

5. CALIFORNIA ENERGY COMMISSION Barriers to DG Implementation  Potential for negative grid impacts  Utility resistance w backup rates w deferral rates w overly strict interconnection requirements w high grid-access charges (stranded cost recovery)  Permitting headaches  High standby/backup power costs  Capital constraints  Electric rate changes, fuel price volatility  Performance risk and guarantees

6. CALIFORNIA ENERGY COMMISSION Our R&D Program Must Address Future Market Scenarios Regulated De-regulated De-centralizedCentralized Status Quo New energy systems Same players Supermarket of Choices Same energy systems New players

7. CALIFORNIA ENERGY COMMISSION California has Established a $62M/yr. Public Interest Energy Research Program (PIER) California’s Energy Future Economy: Affordable Solutions Quality: Reliable and Available Environment: Protect and Enhance

8. CALIFORNIA ENERGY COMMISSION Carbon Management: An Approach for Integrated Energy Systems R&D Carbon Management Btu GSP < Decarbonization CO 2 Btu < CO 2 atm CO 2 emitted < Sequestration Efficiency

9. CALIFORNIA ENERGY COMMISSION California and United States Electricity per Capita Trends Since 1976

10. CALIFORNIA ENERGY COMMISSION Reducing Electricity Use by 8% Leads to Additional Environmental Benefits (Emissions Reduction)  2,044 tons CO  2,307 tons NO x  175 tons SO x  263 tons PM 10  600,000 MT CO 2

11. CALIFORNIA ENERGY COMMISSION Electricity Generating Capacity for 150 Million Refrigerators and Freezers in the US

12. CALIFORNIA ENERGY COMMISSION PIER Buildings Program Highlights Berkeley Lamp  Model partnership between CEC/DOE/California utilities w PIER funded Phase 1 to develop task/ambient lamp concept w DOE funded Phase 2 to develop specific lamp configuration w PIER was instrumental in moving the technology into the marketplace via coordination with utility Emerging Technology Coordinating Council http://www.energy.ca.gov/pier/pr.html Project is both a technical success and a customer success

13. CALIFORNIA ENERGY COMMISSION 1. Translucent Super- Insulating Power Generating Roof 2. Inverter, Storage for TOU 3. DC Dedicated Use 4. Net Metering 5. Night Breeze Cooling 6. Grid-friendly Appliances 7. Lighting for California Kitchens 8. Community based energy solutions Potential California Home with Efficiency and Integrated Solar

14. CALIFORNIA ENERGY COMMISSION PowerLight’s PowerGuard PowerLight’s insulated 30 year roof system reduces building air conditioning loads while it’s PV surface generates electricity during hot and expensive peak summer hours While California is known for its hot dry summers, that same solar resource provides a clean, safe and reliable way to generate electricity

15. CALIFORNIA ENERGY COMMISSION The Wind Turbine Company  Design, develop and demonstrate a utility-scale wind turbine  Horizontal axis, two-blade, downwind design  Prototype developed for PIER and tested at NREL rated at 250 kW  Commercial prototype demonstration sited at the Fairmont Reservoir in LADWP territory for a 500 kW - scaled up to 750 kW - wind turbine demonstration to begin in October 2001  Goal is to produce electricity  $0.035 cents per kWh per 100 unit wind farms with wind resources  15 mph

16. CALIFORNIA ENERGY COMMISSION CA Real Time Electricity Price Daily Variations For March 11, 2002 (California ISO) ~ $ 50/MWh

17. CALIFORNIA ENERGY COMMISSION Xonon Cool Combustion System - Catalytica Energy Systems, Inc. Description:  Gas turbine combustion system that controls combustion temperature to prevent the formation of NO X Benefits:  Lower NO X emissions without SCR;  Can retrofit existing turbines;  Allows deployment of smaller turbines for DG; and  Expandable to large, central station turbines.

18. CALIFORNIA ENERGY COMMISSION Fuel Cell / Turbine Hybrids  Integration of a fuel cell and a gas turbine into a single unit  Efficiency: 70%  Cost: 20-25% lower than non-hybrid fuel cell

19. CALIFORNIA ENERGY COMMISSION Combined Heat and Power (CHP) CO 2 emissions with and without CHP

20. CALIFORNIA ENERGY COMMISSION CEC is Developing a Biogas Solicitation that can Include MSW to Energy

21. CALIFORNIA ENERGY COMMISSION Distributed Energy Resources: Certification  Certification and labeling criteria  Test protocols and test results  Handbook on interconnection agreements  Web-based information hotline and technical training material  Interoperability requirements National approach will create consistency and common terminology

22. CALIFORNIA ENERGY COMMISSION Operational Tools for Restructured Electricity Markets Must:  Recognize that the objectives have moved from modeling machines and engineering analysis to understanding and coping with market behavior  Present real-time information to operators in readily understood forms that facilitates action  Measure, monitor, assess, and predict both system performance and the performance of market participants  Incorporate the latest advances in sensing, communication, computing, visualization, and algorithmic techniques and technologies

23. CALIFORNIA ENERGY COMMISSION Enabling Technology: Communications, Control, and Information Systems  Takes advantage of technologies developed in exogenous areas  Allows for partnerships with private sector developers and academic centers  Provides additional value for distributed energy resources and end-use technologies  Critical component of load management, demand response, demand-side management

24. CALIFORNIA ENERGY COMMISSION Volts Amps Reactive Management Tools  Could have prevented 1996 blackout of West Coast which cost California $100s of millions  Presents real-time info on system conditions in readily understood forms  Accelerates initiation of corrective actions by 30 minutes or more  Active demonstration at the CAISO

25. CALIFORNIA ENERGY COMMISSION Dynamic Transmission Line Rating  Congestion cost $169M on Path 15 in 4th Qtr 2000  System monitors line’s tension in real-time  Path 15 demonstration indicating greater than 39 MW’s increased capacity  Environmental benefit through delay/avoidance of new transmission corridors

26. CALIFORNIA ENERGY COMMISSION Proposed System for Demand Response in New Homes & Small Commercial Buildings Load Data 1 Price/Proxy/ Curtailment Signal 1 Interval Meter Δ$=$100 1 Communicating Thermostat Δ$=$50 2 Cost of Avoided Load: $100-200 per kW 1. Utility responsible for signal, communications, meter, and load data. 2. Builder responsible for communicating thermostat.

27. CALIFORNIA ENERGY COMMISSION Technical Support for DG Interconnection Standards  Reduces average cost of interconnection fees to consumers by 37%  Supports Rule 21 by resolving technical safety issues  Establishes technology & size neutral review process  Identified testing and certification requirements  Enables insertion of new generation (e.g. renewables) into the grid

28. CALIFORNIA ENERGY COMMISSION Role of Government  Purchasing: public/private partnerships in addressing “public good”  R&D through the “valley of death”  Make use of “bully pulpit” and policy tools w Take advantage of beneficial externalities w Sensibly address competing interests  Aggressive standard setting w Uniform approach for interoperability w Expand on Energy Star and NEMA Labels  Lead for public education & information dissemination Sustained Leadership is a Must

29. CALIFORNIA ENERGY COMMISSION KIT CARSON MIDDLE SCHOOL SACRAMENTO, CA

30. CALIFORNIA ENERGY COMMISSION Plan for Working with UC Centers  Initial Focus on Smart Buildings w High-density sensor networks will allow existing environmental control technologies to operate in more sophisticated and energy-efficient ways, and the redundancy of sensors will improve the reliability of control by detecting faulty signals. w High-density sensor networks will also allow new energy- efficient environmental control technologies to become feasible for the first time.  Future work with remote monitoring/control via internet  Inherent linkages between generation, T&D, end- use

31. CALIFORNIA ENERGY COMMISSION Breakout of Hetch Hetchy Projects

32. CALIFORNIA ENERGY COMMISSION State Funded R&D Programs Result in Collaboratively-Funded Programs with U.S. Department of Energy Current Collaborative Programs Renewables Efficiency Small-scale Fossil Systems & Environment

33. CALIFORNIA ENERGY COMMISSION Specific Related Program Areas with Collaborative Activities  Distributed utilities integrated testing w DOE: Program planning and facility evaluation w CEC: Phase 1 of test program w Hetch Hetchy: Also a co-funder  Consortium for reliability and Transmission System (CERTS) w DOE $9.3M, CEC $7.2M

34. CALIFORNIA ENERGY COMMISSION A Portfolio to Manage an Integrated System in Transition  DG vision can be one of a “Hydrogen Future” w Integration of transportation and generation systems with continuous incremental improvements  Insertion of renewables into grid requires changes from central station strategies w Continuous improvement critical for end-use technologies w Enabling technologies critical for efficient use of DG and in addressing demand response and DSM