D EPARTMENT OF E NERGY S TAKEHOLDER I NITIATIVES Eric Lightner Director, Federal Smart Grid Task Force June 8, 2015 Presentation for National Association.

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Presentation transcript:

D EPARTMENT OF E NERGY S TAKEHOLDER I NITIATIVES Eric Lightner Director, Federal Smart Grid Task Force June 8, 2015 Presentation for National Association of State Utility Consumer Advocates

Advance foundational science, innovate energy technologies, and inform data-driven policies that enhance U.S. economic growth and job creation, energy security, and environmental quality, with emphasis on implementation of the President’s Climate Action Plan to mitigate the risks of and enhance resilience against climate change. The Office of Electricity Delivery and Energy Reliability (OE) drives electric grid modernization and resiliency in the energy infrastructure. OE leads the Department of Energy’s efforts to ensure a resilient, reliable, and flexible electricity system. OE accomplishes this mission through research, partnerships, facilitation, modeling and analytics, and emergency preparedness. OE Mission 2 OE’s mission aligns with the Department’s strategic goals:

OE’s Activities and Programs CATALYST: OE encourages new ideas and business models through competition in prizes and challenges, open source software and data downloads, and voluntary participation in standards development activities. “Apps for Energy” Challenge Green Button InitiativeSmart Grid Interoperability Panel/ NIST GridWise Architecture Council Open Source Software & Toolkits CONVENER: OE brings together technical and policy expertise, along with a national, system-wide perspective, to facilitate a coordinated strategy to meet emerging energy challenges, and to support a secure and resilient energy system. North American SynchroPhasor Initiative (NASPI) Electricity Advisory Committee State and Regional Technical Assistance Emergency Response (ESF-12)Technical Workshops / Case Studies Federal Smart Grid Task Force State and Local Energy Assurance RESEARCH SUPPORT: OE invests in cross-cutting research at national laboratories, universities, and private industry (including small business), and sponsors the transition of results to a broad set of vendors and utilities, moving innovations into useful applications. Operations & Planning Tools Energy Storage Microgrids Advanced Modeling CyberSecurity Smart Grid Demonstrations Distribution Optimization Outage Management Systems Smart Grid Investment Grants Future of the Grid Initiative 3

Initiative Overview DOE facilitated; Industry led 2-year multi-stakeholder process Participants: Utilities, consumer advocates, vendors, third parties, state and federal governments Released on January 12 High visibility & support from the Obama Administration Transparent process with and all documents posted at Rebranded as DataGuard|Energy Data Privacy Program Voluntary Code of Conduct (VCC) for Smart Grid Data Privacy For utilities and third parties providing consumer energy use services. Focuses on protecting consumers. Establishes common practices that protect the access, use, and sharing of customers’ electricity usage and related data.

Rebranded for Consumers Marketing theme: Protection. Knowledge. Choice. New website under development: Available early July

DataGuard Program Not a regulation. A voluntary program. Legally enforceable by FTC under their mission to protect consumers from deceptive and unfair practices. Adopting companies expected to publicly commit to conformance with and observance of the VCC concepts and principles. High level principles that allows maximum flexibility in implementation Application of the principles and concepts is entirely up to the adopting entity. Adopted in its entirety, but limited exceptions allowed (due to laws, regulatory guidance, governing documents) if clearly noted. Frame customer data policies and practices that balance relevant needs/goals:  Encourage innovation by making data available to the market  Protect customer privacy and confidentiality  Provide customers access to their own data  Respect existing laws, regulations, governance policies, and business environments

Elements of the Code 7 Notice & Awareness: How the customer learns what he or she needs to know to exercise informed choice. Choice & Consent: Describes requirements for processes that allow the customer to control access to his or her data for Secondary Purposes Customer Data Access: Describes requirements for procedures that allow customers to access their data, identify possible inaccuracies, and request they be corrected. Data Integrity & Security: requirements for a cyber security risk management program, and methodologies for creating Aggregated or Anonymized Data. Self Enforcement Management & Redress: Describes requirements for actions by Service Providers who voluntarily adopt the Code to ensure that they comply with it.

Focus Groups to Gauge Consumer Sentiment 18 Focus groups conducted by private firm (New South Research) Took place across the country Partnered with utilities Purpose: Determine consumer sentiment regarding – How consumers’ perceptions and trust vary among different industries – Consumer attitudes towards utilities with regard to data privacy – Reactions to a Privacy Code of Conduct for energy usage Group respondents included – Smart meter and Non-smart meter users – High income, high education – Lower income, lower education – Tech savvy – Small business users – Rural and urban – Owners and renters Feedback consistent for all groups Objective: To gain an in-depth understanding of consumer perceptions of data privacy in utility companies and to solicit feedback on a Privacy Code of Conduct

Consumer Sentiment Consumer Reaction to the Code Perceived Value of the Code  Proactive: Respondents felt that a utility adopting the code was being proactive about caring for and serving their customers  Education: It educates customers about how their personal usage data is being stored, processed, and disposed.  Trust: Knowing that a provider has opted in to a voluntary code builds trust and improves perceptions of that utility  Uniformity: The code was appreciated because it provided an explanation of how utilities will process sensitive data and respondents are currently unfamiliar with their utility’s data privacy habits.  Reassurance: It gave utilities a way to let customers know that their data was being protected and that a company is looking out for their best interest. “I view it as a good thing because I feel like if they subscribe to it they voluntarily are trying to protect my data which is a good thing.” 68% of respondents thought that the Code was a great idea.

“They are setting a good example, there is a code of ethics that everybody can follow and by them doing it they are setting a good example for everybody else, and it makes you feel better about them.” -South “There is a whole bunch of people involved in this and it makes me feel that someone is looking out for me. Just a little bit.” -Southwest “I think by being more proactive and showing people that you’re going to have a recourse if something does happen, because of this consumer advocate thing— that’s a big plus to me, especially if it works.” –MidAtlatntic Perceptions of Utilities Adopting The Code In general, respondents have more positive perceptions of utilities that choose to adhere to the Privacy Code of Conduct. These companies are trusted more because they are perceived as looking out for the customer’s best interest.

11 Code was perceived to have many more strengths than weaknesses. Consumer Sentiment Consumer Reaction to the Code Gives the customer choices Consistency across all companies Properly discarding information after a certain amount of time Consumer advocate involvement Creates uniformity in how data is processed Adds some regulatory force to the utility industry Creates uniformity in how data is handled Involvement of the Department of Energy PROS Involvement of the Department of Energy There is no one to enforce the code The use of weak language like “guidelines” and “high level principles” Do not like that it is voluntary CONS

What can you do? Increasing Awareness Has you utility adopted DataGuard? Why or Why Not? Talk to your utility or commission about the benefits

Partnered with the GridWise Alliance to determine the changing operational, business and policy requirements needed in the electricity industry over the next 20 years to facilitate the industry’s transformation 13  Workshops in Seattle, Dallas, Durham, and New York City  National Summit in Washington, DC  Input from over 400 industry stakeholders – including policymakers, utility representatives, vendors, and game changers  Final report published in December  Available at: The Future of the Grid Phase I Evolving to Meet America’s Needs

New Approach to Understanding Challenges Looked at the grid in the context of the entire value chain Allowed an understanding of – the grid as an enabling platform – the evolving role of grid operators Illuminated necessary changes in – Utility business models – Regulatory framework Future Electric System Evolving Grid Operations Evolving Business Model Evolving Regulatory Model Planning the Transition

Characteristics: Electric System of the Future Generation Will be both centralized and distributed Will be both dispatchable and non-dispatchable Microgrids will be complementary, not a replacement 15 Consumers  Will have different expectations and demand new options  Prosumers Markets  Wholesale and retail  Third party non-regulated competitive players Balancing Supply and Demand  Will become increasingly complex and important Energy Storage  Will not replace the need for “dispatchable” options

Evolving Grid Operations: Key Themes from Workshops Will still want and need a grid No longer just a delivery “pipe” => two-way power flow Must be agile and “fractal” - flexible, adaptable, responsive Enabling platform for very dynamic and complex system Capable of supporting robust retail market transactions Capable of coordinating wholesale and retail functions (operational and market) will be essential Distribution grid will look and act more like transmission grid Balancing supply and demand - increasingly complex and important 16 Evolving Grid Operations

Evolving Business Model Evolving Business Model: Future Value Propositions for Grid Operator  Supporting/implementing public policies  Integrating all types of generation – agnostic to where it comes from  Increasing grid efficiency  Optimizing asset utilization  Maintaining a safe and reliable grid  Enabling highly reliable and resilient energy services to end consumers  Enabling customers to provide services back to grid  Facilitating a retail market for consumers to buy and sell services  Identifying most cost-effective way to achieve outcomes 17

Evolving Regulatory Model Evolving Regulatory Model: Challenges for Regulators  Providing regulatory clarity in time of significant change  Aligning regulatory process to embrace speed of change and technology innovation  Balancing pubic good with the needs and desires of individual consumers  Addressing consumers’ obligations to the grid as well as utilities’ obligations to consumers in the future 18

Recommendations Establish clear and comprehensive guiding principles to develop a unifying architecture to ensure interoperability across the entire grid Create a transition framework for guiding investments that will assist with regional/state planning which includes: Standardized industry metrics Foundational investments Drive solutions through stakeholder engagement and education. Address technology challenges and limitations through robust research and analysis. A collaborative approach that engages the ecosystem of stakeholders

Phase II - Transition to the Future Purpose: Implement recommendations #1 and #2 from the Future of the Grid initiative in partnership with GridWise Alliance. General Approach Open, transparent, multi-stakeholder effort Steering committee to guide effort Marketing/outreach activities to gain support/buy-in and broad awareness Include multiple data gathering techniques (RFI, webinars, interviews, etc.) to collect input from stakeholders to better inform and develop workshop/discussions Conduct stakeholder workshops Workshops a means to an end – not the main driver Conduct any needed research or modeling to make the process more efficient and results more actionable. (incorporate QER research and findings)

Phase II Overarching Objectives Process used should create/sustain momentum, engage stakeholders and build understanding and support Recognize and accommodate differences Develop actionable steps that can be undertaken to accelerate the transition Final deliverables complete by end of 2016 Stakeholder engagement and input critical Plan will include other data gathering options such as surveys, interviews, etc 21

Stakeholders Outreach Utilities/DSO TSO ISO/RTO Customer advocates Regulators (State and Federal) Legislators (State and Federal) Vendors of measurement, sensor, analytics, comms, control, compute, storage Vendors of energy services and behind the meter technologies Key associations ( e.g. EEI, APPA, NRECA, EPRI, NEMA, etc )

THANK YOU! Questions? Contact: VCC: Future of the Grid: