Demand Response Commissioner Suedeen Kelly June 3, 2008

6/3/2008 Integration – RTO/ISO Level ISO-NE NYISO PJM MISO CAISO

6/3/2008 Integration – ISO-NE Energy Market: –Four distinct programs –Day-Ahead and Real Time opportunities Forward Capacity Market (FCM) –Demand Resources treated as supply resources in FCM Ancillary Services: –Larger Demand Resources can participate fully (5+ MW) –Pilot program underway to enable smaller Demand Resources to participate in reserves market

6/3/2008 Integration – NYISO Energy Market: –Participation through Day-Ahead Demand Response Program and the Emergency Demand Response Program Capacity Market –Participation through Special Case Resource Program Ancillary Services: –Operating Reserves and Regulation Service

6/3/2008 Integration – PJM Energy Market: –Economic Load Response enables Demand Resources to respond LMP Capacity Market (RPM) –Demand Resources may participate as a forward capacity resource Ancillary Services: –PJM provides opportunity to offer into the synchronized reserves and regulation markets

6/3/2008 Integration – Midwest ISO Energy Market: –Participation through Emergency Demand Response Program Ancillary Services: –Operating Reserves and Regulation Service

6/3/2008 Integration – CAISO Participating Load Agreements MRTU Implementation MRTU Release 1A

6/3/2008 Competition NOPR Would require RTOs/ISOs to accept bids from demand response resources in their markets for certain ancillary services. Would eliminate, during a system emergency, a charge to buyers in the energy market for taking less electric energy in the real-time market than purchased in the day-ahead. Would permit an aggregator of retail customers to bid demand response on behalf of retail customers directly into energy markets. Required staff to conduct a technical conference on demand response.

6/3/2008 DR Technical Conference Issues Value of and appropriate compensation for demand response in organized electric markets. Barriers to comparable treatment of demand response that have not previously been identified. Potential solutions to eliminate barriers to demand response.

6/3/2008 Smart Grid Energy and Independence and Security Act of 2007 Interoperability Standards FERC-NARUC Collaborative

6/3/2008 Demand Response Assessment of Demand Response National Action Plan for Demand Response

6/3/2008 Conclusions Adding significant new amounts of DR represents a challenge as well as an opportunity Measurement and Verification protocols and processes will be increasingly important Ultimately, we will see significant technological infrastructure additions and improvements