1. Susan Covino Senior Consultant, Emerging Markets March 31, 2015
DER Participation in the PJM Wholesale Power Markets Mid-Atlantic Renewable Energy Association
Susan Covino
Senior Consultant, Emerging Markets
March 31, 2015

2. PJM as Part of the Eastern Interconnection
KEY STATISTICS
Member companies
Millions of people served
Peak load in megawatts 165,492
MWs of generating capacity 183,604
Miles of transmission lines 62,556
2013 GWh of annual energy ,089
Generation sources ,376
Square miles of territory 243,417
States served DC
For those of you who don’t know, PJM is one of the largest grid operators in the US.
21% of U.S. GDP produced in PJM
As of 4/1/2014

3. PJM's Priorities Reliability, Market Operations and Regional Planning

4. Current Demand Response Participation
DR Capacity – 2017/2018 Delivery Year = 10,975 MW
Typical Economic Energy DR in market = ~50 MW
DR Synchronous reserve capability ~ 320 MW, typical amount in market ~65 MW
DR Regulation capability ~ 10 MW, typical amount in market ~ 3 MW

5. Who Offers Demand Response into PJM’s Markets Today?
Curtailment Service Providers
Specialize in DR/EE services and do not supply the energy needs of their customers
Competitive
Retail Suppliers
Some retail suppliers provide DR/EE services to their customers
Retail Choice States
Utility DR/EE programs offered to SOS/BGS/POLR customers
Utility DR/EE programs offered to any customers
Vertically Integrated States
Utility DR/EE programs offered to the utilities customers
Utilities

6. Registered Demand Response by State Delivery Year 2014/15
LSE category = DR offered by utilities/Electric Distribution Companies (or their agents) and competitive retail electric suppliers
CSP category = DR offered by entities specializing in demand response and do not serve energy needs of customers

7. Demand Response Registrations Business Segments in 2014/15

8. Demand Response Registrations Reduction Methods in 2014/15

9. Demand Response Revenue by Year by Wholesale Service
*Capacity Net Revenue inclusive of Capacity Credits and Charges

10. Price Responsive Demand Implemented by PJM in 2011 & 2012
New option for wholesale participation by load reduction capability
Market rules require:
Metering capable of providing hourly interval usage values
Dynamic retail rates that are triggered by nodal Locational Marginal Prices in the PJM energy market
Automated response (and supervisory control for capacity market participants that can override automated controls

11. MW Today’s Economic Dispatch of Supply Resources
$100$85$70$55$40$25$15$10$ Hour of Day

12. Dispatch Incorporating Price Responsive Demand
Load Curve without PRD
Load Curve
Dispatch $90 resources
Same area of detail
$88 Price-Responsive Demand
Dispatch $85 resources
Energy Independence and Security Act of 2007 requirement that FERC provide an assessment of DR potential. FERC staff’s 2009 report included a “full participation” scenario = “advanced metering infrastructure universally deployed and dynamic pricing made the default tariff + proven enabling technologies” = looks a lot like PRD.
No dispatch of additional resources due to demand response at indicated price level

13. Distributed Energy Resources – the Vision
Presentation in Irvine, California, February, 2015 by Sean P. Meyn of the Florida Institute for Sustainable Energy, Department of Electrical & Computer Engineering, University of Florida
Presentation in Irvine, CA, February 2015 by Sean P. Meyn of the Florida Institute for Sustainable
Energy, Dept of Electrical & Computer Engineering, University of Florida

14. Comprehensive Plan: EE & DR
Load Curve
Usage Value (kW)
Consumers decrease energy demand during all hours of the day
Consumers decrease demand during peak load times- may shift load to higher than baseline after
Monetary Value ($)
Value in Energy Market (Money saved through decreased energy usage)
Value in Capacity Market (Revenue in PJM capacity payments in RPM)
Energy Market
~90% of Cash Flow
~5% of Cash Flow
Capacity Market
~10% of Cash Flow
~95% of Cash Flow
Energy Efficiency
Demand Response
RPM eligible kW
RPM eligible kW
Capture highest value from each to maximize returns under one, comprehensive energy plan
Used Average price, cleared MW in PECO for DR, EE $ value calculations