A Proposition for a New “Regulatory Contract”

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At the BPA Conference in Portland (Feb 2), one of the distinct highlights was a presentation by Pamela Lesh, VP Rates & Regulatory Affairs at Portland General Electric. She outlined a remarkable new approach for regulating distribution utilities that goes well beyond “performance based rates”. It was the first public airing of ideas she’s been developing for some time.

The real conceptual breakthrough is to separate the basis on which the utility gets paid from the way the customer is billed, so the right incentives can be presented to each one. Here’s the next to last slide (the complete text appears below):

——————————-
– Price to the utility to align success so that the more effectively the utility achieves the results, the better it does, i.e., unit-based, not usage-based, pricing.

– Price to the customer to encourage conservation and prevent abrupt shifts in cost, e.g., usage or demand-based, not flat, pricing.

– Yes we can price differently to the utility and to the customers! We will just need to balance collections with payments.
——————————-

Contact Pamela Lesh,
VP Rates & Regulatory Affairs, Portland General Electric.
503-464-7353, pamela_lesh@pgn.com

==============================

“What If’s, Why Not’s, and So What’s”

What If?
– Distribution utilities could become the drivers of new distribution technology, including distributed energy resources?

– The best and the brightest came to work in distribution utilities because, at these companies, commercial success was synonymous with innovative solutions, customer focus, and value, value, value?

Why Not?
– Because words like rate base, cost of service, disallowance, and prudence comprise our vocabulary and constrain our actions

– Because we reward increased electricity sales in the short term and increased rate base in the long term

– Because we are still using the system built to drive the finance, construction, and use of electric infrastructure even though we have long since achieved this purpose

Why not CHANGE?
Change the “frame” — change the framework

From a regulatory compact to one or more regulatory contracts
– make explicit that which is implicit
– pay for performance, not investment
– price on value and what, not on cost and how

Why not get what we–utilities, commissions, public interest representatives– want from distribution directly and up front in the same way that commercial parties bargain?

From a regulated entity to one or more regulated services, at regulated prices
– Distribution services
– Demand-side services
– Supply services
Why not free utility organizations to look for other ways to give and
receive value in the communities they serve and know so well?

The new framework
– A series of “regulated” contracts between a utility and a Public Utility Commission that express and price the values of those who use and/or are affected by a regulated service.

– Times at which the contracts expire, followed by extension, re-negotiation, and the possibility of termination and replacement.

– A permanent abandonment of rate base and cost-plus ratemaking.

What the heck is a “regulatory contract”?

A document with the following key terms:
– Scope
– Performance commitments
– Restrictions on how
– Consequences for non-performance
– Change orders and change process
– Term, termination and “unwind”
– Pricing

What is Scope?

Scope identifies the activities and facilities from which the service provider produces the committed results, e.g.,
– Design – Finance – Construction – Maintenance
– Restoration – Replacement – Access

What are performance commitments?

Measurable results based on what the buyer values, e.g.,
– Reliability – Power quality – Safety – Environmental responsibility
– Information accessibility

What’s all that other stuff?

Everything else except price affects price!
– Constraints are specific means the utility may not use to meet its commitments.

– Consequences are the penalties or damages for failure to meet commitments.

– The change process is the way the parties anticipate and cope with
uncertainty.

– Term is the length of the initial bargain and the process by which a new bargain is struck — or not, and what happens then.

How would you price this?

– Price to the utility to align success so that the more effectively the utility achieves the results, the better it does, i.e., unit-based, not usage-based, pricing.

– Price to the customer to encourage conservation and prevent abrupt shifts in cost, e.g., usage or demand-based, not flat, pricing.

– Yes we can price differently to the utility and to the customers! We will just need to balance collections with payments.

So what?

– So we remove the obstacles to deployment of distributed energy resources that the current regulatory system forces on us
? displacement of rate base
? displacement of utility kWh sales
? utilities precluded from participation because of concerns about
cross-subsidization

– So we enable utilities and others alike to compete to provide customers energy solutions, with the same distribution service available to all

So why not START NOW ??

Xenergy Distrib Power Study

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Xenergy, Inc., the consulting firm, is offering UFTO subscribers a special discount price for their Distributed Generation study, which was done as a companion to their ongoing Retail Energy Management (REM) multiclient program.

The deliverables include a report issued Nov 99, and two databases, which will continue to be updated. Excerpts from the report’s Executive Summary appear at the end of this note.

— The DP Competitor Database is an assembly of information on the competitors in the DP marketplace. This database highlights the activities of the utilities and ESPs which are selling products and services to the DP marketplace (generation that is sited at a customer location and driven by the needs of the onsite energy user). Data sources for the Competitor Database include corporate filings and financial data, product/service literature, personal communications, and other market data.

— The State Regulatory Database highlights regulatory conditions in nine key states that will likely have a strong positive (or negative) impact on the growth of DG capacity.

The two databases are both contained in a single Microsoft Access 97 database file.

The price, ordinarily $10,000, is reduced to $8,000 for UFTO companies. One or the other of the two databases can be purchased separately.

Contact:
Rebecca MacGillivray, 781-273-5700, x502 rmacgillivray@xenergy.com

Here is a portion of the press release which announced the study:
——————————
XENERGY Study Identifies Strategies in Distributed Power Market (11/08/99)

A new study from XENERGY identifies 12 strategies for energy companies eager to enter the newly emerging Distributed Power (DP) market — from technology acquisition to product distributor to retail energy service provider — and profiles market player success stories to date. According to the report, while the market remains in its infancy, opportunities exist for competitors to establish a stake.

According to XENERGY’s Francis Cummings, who headed up the study, many companies are keenly aware of the potential for explosive growth in this market. Said Cummings, “We constructed the study and corresponding DP Market database with market entry strategies in mind. Based on our regulatory and competitor analysis, the study helps clients to identify the Distributed Power strategy that best fits with their business plan.”

Six U.S. electric utilities or their affiliates – Avista, DTE, Duquesne, Edison International, GPU and Idacorp — have adopted a New Technology strategy (#3) by testing and acquiring rights to new advanced technologies, primarily fuel cells, through joint ventures and investments. DTE Energy Technologies, for example, purchased a stake in Plug Power, which is developing and manufacturing fuel cells, a promising generation technology for automotive and residential markets. Plug Power recently launched its IPO, and expects commercial sales to commence in 2000.

A low-cost, low-risk strategy is Demand-Side DP Bundling (#1) — Equitable Resources, an integrated energy company, is adding or expanding DG technologies as part of a package of demand-side energy services through its existing performance contracting unit, NORESCO. In contrast, PSEG Energy Technologies is pursuing Strategy #1 but as part of a broader “Integrated Soup-to-Nuts” strategy (#7) as a competitive supplier of commodity grid power, as well as serving as distributor for AlliedSignal’s new microturbine.

Distributed Generation (DG), or onsite power generation by end-users, has been in use for years, but recent announcements of small scale microturbines and fuel cells could dramatically increase the Distributed Power (DP) market size for applications less than 100 kW, called “micro-DG.”

Sponsors of the study will have access to XENERGY’s new DP Market database with embedded Internet links, which provides quick, flexible access to data on 50 companies currently involved in the DP market. Featured DP competitors include 27 electric utilities and their affiliates and 19 companies manufacturing distributed generating equipment. The database also includes data on key regulatory issues affecting the feasibility of distributed generation, organized on a state-by-state basis.

The newly released study is a companion to a larger XENERGY study, REM ’99, which is a comprehensive analysis of retail energy markets in New Jersey, Illinois and Pennsylvania. Results are confidential and limited to the study’s sponsors.
——————————–
RESEARCH SCOPE: CUSTOMER-DRIVEN ONSITE GENERATION

This study focuses on the market for small generation that is sited at a customer location and driven by the needs of the onsite energy user. The primary emphasis of the study is micro distributed generation projects, those less than 100 kW, that are driven by the onsite customer’s need for power quality, reliability and/or cost savings and those driven by the existence of a thermal load. We focused on distributed generation in the context of existing and potential retail power markets, such as those in California, Pennsylvania, New Jersey, Maryland, New York, Massachusetts, Connecticut, Illinois and Texas.

EXECUTIVE SUMMARY (Excerpts)

To assess the status of this market, we first developed a database with information on companies active in the DP industry and on regulations affecting DG projects in states with retail electric markets. This “DP Market Database” accompanies this report as a free-standing product, providing a unique directory and market assessment tool covering the major players in the DP industry, their products and services, and the rules under which they operate. The classifications of DP competitors in the database are based on the portion or portions of the company which were the focus of this study. In some cases this covers a family of affiliated companies, and in other cases, we drill down to a single DP company. The database is also designed to serve as a “portal” to the internet web sites for each of the companies and to web sites with resources on key DG-related regulations.

There are a number of key unresolved regulatory issues that will have strong positive or negative effects on the growth of the DP industry, but these issues are just beginning to be addressed. Early market participants often invest significant time addressing these regulatory drivers in order to take full advantage of the emerging DP market. The DP Regulatory Database provides a summary and comparison of key regulatory drivers of the DP market in states with retail access.

With the current increased availability of these technologies, customer demand for products and services offering enhanced power quality and reliability as well as independence from the grid is rising. In industries where short outage periods mean significant losses, the demand is especially likely to increase. The ability to generate cost savings as well as an increased focus on the environmental attributes in markets where there is customer choice are also key factors driving customer demand. Strain on utility transmission and distribution systems is also driving the “distributed utility” concept and increasing utility demand for DG technologies. While we did not develop an independent estimate for this study of the potential size of the DP market, estimates of the market have ranged as high as 20% of new additions to generating capacity over the next 20 years, which would amount to 35 GW.

This review of the present status of the DP industry and its regulatory context leads us to conclude that significant opportunities remain for energy companies to enter the competitive distributed power market and establish strong positions as innovators and leaders in these early stages of market development. These opportunities stem from the following factors:

* While many companies in the electric industry are assessing market opportunities, there are few that are actively marketing distributed power products in the regulated or deregulated gas and electric markets. * Product offerings of the firms that have entered the distributed power market are in early stages of development. Companies are still learning how to effectively market and price DP products and services. * While the supply of many distributed generation (DG) technologies remains low, many manufacturers are currently moving to commercial production and are planning to rapidly ramp up production.

We have developed twelve models of market entry strategies through which new entrants approach the DP market. These models are based on the examples of companies in the database, and on XENERGY’s discussions with representatives of these companies and with end-users and others familiar with the DP mark et.

News Watch – Not your Father’s utility industry

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This won’t be a regular UFTO feature, but I was awestruck by a couple of headlines today, and thought I’d pass along a comment. After the wild “dot com” style run up of a several fuel cell stocks lately (you know the drill — no earnings, huge valuations), another couple of amazing stories are breaking.

Gates Buys 5% of Avista

Avista’s stock has more than doubled this week, after it was announced that Bill Gates had taken a 5% stake in the company. It’s been trading in the mid to high teens for the last year, dropping below 15 at the beginning of January. Today it closed at 47. Of course, they were also benefiting from the fuel cell excitement, with their Avista Labs effort in PEM.

Sierra Pacific in Huge Telecom Deal

The other story was out late Friday in an article in Infoworld: a huge alliance of Hewlett Packard, Oracle, TelecommUnity Systems, and — are you ready for this — Sierra Pacific Power! The article claims that the utility is using $1/2 billion from the $1.6 billion sale of power plants to provide their stake in this huge plan to put fiber to the home and supply voice, data, and television services. (Recall that Sierra Pacific Power just merged with Nevada Power last July, and the new company is now buying Portland General Electric from Enron.)

The article was posted 6 pm Pacific time Friday, and I found it at
http://www.infoworld.com/

It will be very interesting to see how the companies respond to this “scoop”–and how much of it turns out to be right. (For example, the article says “Sierra Pacific Power Co.”, which is actually a regulated subsidiary of “Sierra Pacific Resources”, the holding company. One wonders what other details might be suspect.)

Since the story broke well after the markets closed, so no action on the stock (SRP closed very near its 52 week low, but we’ll see on Monday).

DOE Power Outage Study

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Power Outage Study Team (POST) Releases Interim Report

Bill Richardson initiated this effort last summer, on the heels of the various outages around the country. The team was assembled during September and went through its paces, coordinated by Paul Carrier in DOE headquarters. There’s no direct connection to the CERTS effort, though many of the same people are involved. The press release below explains all the key elements. In particular, note the workshops later this month, and the availability of the interim report in hard copy and on line. The team’s website was turned on 2 days ago, and has all the information: http://tis.eh.doe.gov/post/

Contact: Paul Carrier, 202-586-5659, paul.carrier@hq.doe.gov

—————-
DOE PRESS RELEASE January 4, 2000

Energy Department Team Examines Summer Outage Problems in the U.S. Electric Power System

Power Outage Study Team Releases Interim Report

U.S. Secretary of Energy Bill Richardson today received an Interim Report on the department’s investigation of the power outages and disturbances that occurred last summer. The high temperatures and heavy demand strained electric systems, affecting millions of people and businesses.

“The lessons that we learned as industry and government worked together preparing for the Y2K rollover were a good step toward achieving a more reliable electric grid,” Secretary Richardson said. “However, Congress needs to pass the administration’s electricity competition legislation in order to address many of the uncertainties that exist as the industry transitions to a new restructured environment.”

The investigation’s findings warn that while the electricity industry is undergoing fundamental change, the necessary operating practices, regulatory policies, and technological tools for dealing with those changes are not yet in place to assure an acceptable level of reliability. A significant increase in electricity use, especially during times of peak demand, is stressing the electric system.

The team of academics and departmental experts, formed last September as part of the Secretary’s six-point initiative to address electric reliability concerns, investigated outages in New York City, Long Island, New Jersey, the Delmarva (Delaware-Maryland-Virginia) Peninsula, Mississippi, Arkansas, Texas, Louisiana, and Chicago, and non-outage disturbances in New England and the Mid-Atlantic States.

A final report, to be issued in March, will provide recommendations and will be followed by regional policy-level discussions across the country among industry leaders and federal, local and state government officials.

The team will be conducting a series of three technical workshops to obtain stakeholder input and comment on the Interim Report. The 38 findings detailed in the report have been grouped into five topical areas to facilitate discussion at the workshops. The workshop times, locations and primary topics are:

January 20
San Francisco, California
– Topic 1: Transition to Competitive Energy Service Markets (morning session)
– Topic 2: Regulatory Policy for Reliable Transmission and Distribution ( afternoon session)

January 25
New Orleans, Louisiana
– Topic 3: Information Resources (morning session)
– Topic 4: Operations Management and Emergency Response (afternoon session)

January 27
Newark, New Jersey
– Topic 5: Reliability Metrics, Planning, and Tracking

All interested parties are invited to register to participate in one or more of the workshops. A registration form is provided on the world wide web at http://tis.eh.doe.gov/post/.

The Interim Report is also available on that website. Printed copies of the report may be obtained from the Energy Department’s Public Reading Room at 202/586-3142.

Comments on the Report can also be submitted through January 31 via the Internet. These comments, as well as those received at the technical workshops, will help develop recommendations for the final report.

New EIA report on Industry Mergers

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Happy Holidays! See you in the next thousand years…
————————————————————–

UFTO Note – New EIA report on Industry Mergers

An early Christmas present! This week’s issue of the ” Electric Utility Restructuring Weekly Update” arrived via email today, instead of Friday. (If you’re not a subscriber, I recommend signing up for it. It’s also available on the Internet at
http://www.eren.doe.gov/electricity_restructuring/weekly.html)

This item caught my eye. It’s an impressive compilation of data on utility mergers. the Update’s writeup came from the Sustainable Energy Coalition “Weekly Update,” Dec. 19, 1999

———————–
In a report titled, “The Changing Structure of the Electric Power Industry, 1999: Mergers and Other Corporate Combinations,” the Energy Information Administration finds that competition is causing the number of mergers to increase rapidly. There have been twenty-two mergers completed by investor-owned utilities (IOUs) over the last three years and another twenty-five mergers will most likely be completed by the end of 2000. In addition, by the end of 2000, approximately fifty-one percent of all IOU power production will come from the ten largest IOUs. The twenty largest IOUs will have seventy-three percent of all IOU power generation capacity. Since 1997, IOUs have been divesting or have divested over 300 power plants, usually selling at prices that are 1.5 to 2.5 times their book value. Nuclear power plants have sold for far less than their book value.

The report can be retrieved [as a PDF file] at:
http://www.eia.doe.gov/cneaf/electricity/corp_str/corpcomb.html.

The complete executive summary from the report is included below.

————————–
The EIA has a wealth of information about the industry.
Home page: http://www.eia.doe.gov/

One particularly interesting resource:
— Status of State Electric Utility Deregulation Activity Monthly
A map/chart of the status of deregulation activities by state.
http://www.eia.doe.gov/cneaf/electricity/chg_str/regmap.html
—————————

DOE/EIA-0562(99)

The Changing Structure of the Electric Power Industry 1999:
Mergers and Other Corporate Combinations

December 1999

Executive Summary

Since the passage of the Energy Policy Act of 1992, which opened the U.S. electric power industry to the start of competition,1 investor-owned electric utilities (IOUs) have been under pressure to cut costs, to become more efficient, and to expand their products and services. Mergers, acquisitions, asset divestitures, and other forms of corporate combinations have become widespread as IOUs seek to improve their positions in the increasingly competitive electric power industry.

Since 1992 IOUs have been involved in 26 mergers, and an additional 16 mergers are pending approval. One effect of these mergers is that the industry is becoming more concentrated. In 1992 the 10 largest IOUs owned 36 percent of total IOU-held generation capacity, and the 20 largest IOUs owned 56 percent of IOU-held generation capacity (Figure ES1). By 2000, the 10 largest IOUs will own an estimated 51 percent of IOU-held generation capacity, and the 20 largest will own an estimated 73 percent.

Wind Turbine Co Making Progress

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THE WIND TURBINE COMPANY

We first reported about WTC’s work in an UFTO Note 12 Dec 1996. The story is the same, except for the tremendous progress they’ve made in less than 3 years — pretty much according to their original plan!

The material below was adapted from the executive summary of their current business plan.

Wind energy is the fastest growing segment of the renewable energy industry and is by far the most economic form of grid-connected renewable electricity. Today, wind generated electricity costs as little as 5¢/kWh, and installed global wind energy capacity has increased by more than 25% annually since 1990. It now exceeds 11,000 MW. In 1998 alone, over 2,000 MW with a value exceeding $2 billion was installed. This figure is expected to increase to $5 billion by 2003.

The Wind Turbine Company (“WTC”) has developed new wind turbine technology that promises to slash 30% or more from the cost of wind generated power compared with today’s wind turbines. WTC did a ground-up, total system-level design of a 2-bladed downwind turbine (i.e. the turbine rotor blades operate downwind of the tower) whose principal advantage lies in its ability to shed excessive wind loads. This is in contrast to conventional upwind machines (i.e. blades upwind of the tower), which must be built sufficiently strong, rigid and consequently heavy, to absorb all foreseeable wind loads and avoid catastrophic blade-tower strikes.

Since the wind pushing on the blades causes them to bend in the direction the wind is blowing, blades oriented downwind of the tower can be made much less rigid than blades upwind of the tower. WTC’s turbine will weigh only 60% as much as a comparably rated 3-blade, upwind turbine. Its lighter weight will permit WTC’s turbine to operate higher above ground (100 meters or more) than is economic for upwind turbines, thus exposing it to higher winds resulting in more energy production. Lower weight and higher energy capture combine to provide a substantial reduction in the cost of wind generated electricity. The design incorporates a “yaw” braking mechanism to dampen the response to sudden changes in wind direction, a feature lacking in earlier downwind designs by Carter and others.

Windfarms using the WTC Turbine will be able to will produce power for an unsubsidized price of 3.5¢/kWh or less, including all capital and O&M.

WTC was founded in 1989 and has invested over $6 million in its technology. In 1995, WTC was selected by DOE for a $22 million contract to develop a 250 kW proof-of-concept (“POC”) turbine, followed by two full-scale 1000 kW wind turbines, over a 6-year period. This is the second largest wind energy contract ever awarded by DOE and the largest contract ever awarded by the National Renewable Energy Lab (NREL). The POC turbine should be operational in early 2000. (I have a photo I can send on request – jpeg format).

In 1998, WTC received a $950,000 contract from the California Energy Commission to develop a 500 kW commercial prototype to be developed early in 2000, following completion of initial POC testing. This unit will be operational in mid 2000. Commercial sales of 500 kW units will start in 2001, when WTC also plans to begin development of a 1000 kW commercial prototype.

To overcome market penetration barriers due to developers taking a wait-and-see attitude over concerns about technology and financial risk, WTC will develop and operate its own windfarms. In parallel with its manufacturing operation, WTC will establish project development and operating entities to manage windfarms using WTC’s equipment.

WTC’s initial project development strategy is to focus on the U.S. market where there is ample opportunity and relatively easy and inexpensive accessibility for Company personnel to ensure successful windfarm development and operation. WTC has already begun discussions with potential project participants and sources of financing for two separate projects. WTC is also looking to form partnerships with existing independent power developers to further leverage its project development effort.

WTC is now seeking up to $5 million in additional funding to satisfy match funding requirements under its NREL and CEC contracts, hire additional staff, develop its initial windfarm opportunities, and establish strategic partnerships with potential suppliers and customers. A detailed Business Plan is available upon execution of WTC’s Confidentiality Agreement.

For further information, please contact:

Lawrence W. Miles, President
The Wind Turbine Company, Bellevue, WA 98004
425-637-1470 MilesLW@msn.com

Sanford J. Selman, Managing Director
Energy & Environmental Ventures LLC
Weston, CT 06883
203-227-4111 sselman@eeventures.com

CEC Energy Innovations ’99 Conference

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CEC Energy Innovations ’99 Conference
October 25-27, 1999, San Diego

The agenda alone fills 4 pages (see UFTO Note 24 October 99), so this note will cover some general themes and highlights. The original conference brochure is available online in pdf format, and Powerpoint presentations from the conference will be made available there in the near future: http://www.energy.ca.gov/research/PIER/EI99

I will be glad to provide additional contacts and information on any area of partcu lar interest.

————————————————————–
Our last major coverage of PIER appears in:
UFTO Note, 23 Nov 1998, “CURC Annual Conf. 11/98”
http://www.ufto.com/clients-only/uftonoteslist.html {password required}

————————————————————–

— Keynotes and Guest Speakers

– State Senator Debra Bowen (keynote) — California is still learning about life under restructuring. Concerns that G&T investment is insufficient. Legislative push for expedited siting, but supply side not the only answer–demand side measures cheaper and faster. Consumers get no price signal about time of use – need to “de-insulate” them from real costs.

– State Assemblyman Roderick Wright (keynote) — from poorest district in California. Dubious about restructuring bill (AB1890), as it addressed none of the root causes of high energy prices–though that was the primary motive in the first place. If taxpayer money is used for R&D or other energy programs, he needs to balance that against other needs, and be assured that his constituents actually benefit.

– Bill Reichert (luncheon speaker) .. from garage.com, a prominent Silicon Valley incubator of startups .. presented some hard truths about venture capital and technology business.

– Karl Rabago (banquet speaker), now with the Rocky Mountain Institute, recounted the message contained in Amory Lovin’s new book “Natural Capitalism”, which sees the mainstreaming of sustainability, eco-commerce, waste elimination, etc. as having a historical significance comparable to the Industrial Revolution.
http://www.naturalcapitalism.org/

>>>>>>>>>>>>>>>>>

— Public Interest Energy Research (PIER) Program

“The Nation’s Most Comprehensive Ratepayer-funded Public Interest Energy Research Program” is gradually maturing, as the transition projects are wrapping up (close-out funding of projects that IOU’s had in place prior to restructuring), and the various programs establish their goals and directions.

Provides funding to public and private entities for research, development and demonstration activities that advance science and technology not adequately provided for by competitive or deregulated markets. Funding is available for environmentally preferred advanced generation, renewables, end-use efficiency, environmental research and strategic research.
http://www.energy.ca.gov/research/index.html

PIER Program Manager:
Ron Kukulka, 916-654-4185, rkukulka@energy.state.ca.us

PIER is organized into 6 Areas, each with a designated manager.

– Renewables
George Simons, 916-654-4659, gsimons@energy.state.ca.us

– Environmentally-Preferred Advanced Generation (EPAG)
Mike Batham, 916-654-4548, mbatham@energy.state.ca.us

– Residential and Commercial Buildings
Nancy Jenkins, 916-654-4739, njenkins@energy.state.ca.us

– Industrial / Agricultural / Water
Ben Mehta, 916-654-4044, bmehta@energy.state.ca.us

– Energy-Related Environmental
Kelly Birkinshaw, 916-654-4542, kbirkins@energy.state.ca.us

– Strategic Science and Technology
Tom Tanton, 916-654-4930, ttanton@energy.state.ca.us

Each program briefly presented its 1999/2000 Funding Proposal, based on their respective Issues, Mission and Objectives, and indicated amounts going to sole source or collaboratives/interagency, to competitve RFPs, and to memberships (e.g. EPRI, GRI, etc.) In each area, with total budgets ranging from $9 to $15 Million, some contracts are already approved, some are in negotiations, and some have not yet been initiated.
(I have prepared Word docs with the details that were presented, adapted from files provided to me by PIER. They will be posted on the UFTO website. Let me know if you want them in the meantime.)

———
Energy Innovations Small Grant Program

This program provides grants of up to $75,000 to small businesses, academics, small non-profit organizations and individuals to prove the feasibility of research and development concepts relating to PIER objectives. It operates like the federal SBIR programs, but with a considerably faster solicitation and award cycle.

Philip Misemer, 916-654-4552 pmisemer@energy.state.ca.us
http://www.energy.ca.gov/research/innovations/index.html

– Synergy with other Programs
Calif Board for Energy Effic oversees $280M/year
[buydown of renewables implementation]
Calif Utility Research Council (future role is uncertain)
Calif PUC – Doesn’t have a role, and doing an excellent job at not
doing anything about R&D — Utilities haven’t requested in rates.
EPRI
GRI

>>>>>>>>>>>>>>>>>

Transferable Knowledge from Other Forums (Tuesday)

– Lessons Learned in NREL Industry Growth Forums
Lawrence (Marty) Murphy, NREL,
303-275-3050 lawrence_murphy@nrel.gov
NREL periodical ly sponsors Industry Growth Forums, intended to help aspiring, start-up, or expanding renewable energy businesses. The next Forum will be held in early year 2000, in the Seattle area, and highlights will be provided here as details are defined. For more details on Forums as well as the many valuable lessons learned download the document, “NREL Industry Growth Forums Lessons Learned” June 1999, NREL/MP-720-25870 (PDF 369 KB).
http://www.nrel.gov/technologytransfer/pdfs/industry_growth.pdf

Also see:
http://www.nrel.gov/technologytransfer/bfpartners.html
http://www.nrel.gov/technologytransfer/resourceguide.html

– Where We Are and Where We’re Going
Janet Joseph, NYSERDA
518-862-1090 jj2@nyserda.org
Summarized the program, as the only other “public benefit” state level R&D program besides PIER.

– Gaining Market Acceptance of Innovative Technologies
Keith Davidson, Onsite Sycom Energy Corp.
760-710-1712 kdavidson@onsitesycom.com
A good overviewof “innovation” as the term applies to distributed generation and combined heat & power (CHP), with a review of Tecogen’s experience in the early ’80s.

– Building Bridges Connecting Research Results to Consumer Benefits
(Wednesday)

Mohawk Research Corp.
Marsha Rorke, 301-762-3171, mohawkresearch@email.msn.com
Sam Westbrook, 206-780-8269, kands@nwlink.com

Summarized in 20 minutes the contents of a 3-4 day workshop that Mohawk has given over 50 times to personnel at national labs and elsewhere who want to pursue commercialization of lab technology. Key points include recognition that various stages of a development or company require very different skill sets and kinds of people, and the entrepreneur should be clear on when he plans to pass the reins to others. Also, a “commercialization plan”, focused on what it is that you are going to make and sell, is different from the business plan, which comes later and says how you’re going to do it.

The workshop textbook is: “From Invention To Innovation,” 1999, DOE/GO-10099-810. For a copy, email Sally_Evans@nrel.gov (remember to include your mailing address.) Or call 202-586-1478 to receive a free copy as well as information on DOE’s Inventions and Innovations Programs.
An earlier (full text) version is available at:
http://iridium.nttc.edu/assist/inventions/inv2inn.html

Ken Gudger, Global Energy Partners
Jerome Foster, Pentech Energy Solutions
Jeff Colborn, Metallic Power, Inc.

Leadersof three startups, each at a different stage, spoke about their experiences and how they went about developing and pursuing their business plans. Some memorable phrases:
“Get a customer before you quit your day job.”
“Be sure the customer understands (what you’re selling), trusts
that you can deliver, and has the will to do his part.”
“As soon as you take a dollar from anybody, you’re working for them
[so don’t be so hung up about control].”
“Be honest about yourself, and what role is appropriate for you.”

>>>>>>>>>>>>>>>>>

PANEL SESSIONS
On the second day, pane l sessions were held in parallel for each of the PIER subject areas, so one had to choose which ones to go to. Many of the presentations will be put up on the PIER website in due course.

Morning — Renewables; EPAG; and Buildings
Afternoon — Food/Ag/Ind; Strategic; and Environment

Most of the panel presentations were reviews of completed or ongoing PIER-funded projects, or other related programs. There was also a poster exhibition with two dozen displays on other PIER sponsored work.

For details on all projects:
1998 Annual Report – PIER Program, P500-99-004, March 1999
http://www.energy.ca.gov/reports/500-99-004.html
(hardcopy also available)

=========

Panel I – Renewable Energy Technology

I.A. Making Renewables Cost-Competitive
Larry Berg, Larry Berg & Associates
Steve Gatto, BCI

I.B. Renewables as Distributed Generators
Merwin Brown, NREL
Thomas Hoff, Clean Power Research
Henry Zaininger, Zaininger Engineering

I.C. Non-energy Benefits of Renewables
Nancy Rader, Nancy Rader Renewable Energy Consulting
Dan Shugar, PowerLight Corp
Loyd Forest, TSS Consulting

=========

Panel II – EPAG for Distributed Generation (DG)

II.A. Energy Providers: Planning to Use EPAG in DG Applications?
Al Figueroa, San Diego Gas & Elec and CURC
Roland Risser, PG&E
David Berokoff, SoCalGas
Mike Burke, NewEnergy

II.B. What are the Future Product RD&D Needs for EPAG Mfgs.
George Wiltsee,* Capstone Turbine
Mark Skowronski, Allied Signal
Ron Wolk, Wolk Integrated Technical Services
Jim Schlatter, Catalytica

II.C. What are the Current and Planned R&D Programs in DG?
Andy Abele, S. Coast Air Qual Mgt District
Scott Samuelsen, National Fuel Cell Research Center, UC Irvine
Daniel Rastler,* EPRI
William Liss, GRI
Abbie Layne, U.S. DOE
[Adv Turb.; Indust Technol, etc. – Major workshop Nov.8-10]

=========

Panel III – Building End-Use Energy Efficiency

III.A. Technologies and Strategies for Buildings in Hot Inland Climates
Lance Elberling, PG&E
Randy Folts, Pulte Homes Corp
Malcolm Lewis, Constructive Technologies Group, Inc.

III.B. Drivers for Energy Efficiency
Cliff Federspiel, Center for the Built Environment, UC Berkeley
Doug Mahone, The Heschong Mahone Group
[Daylighting Improves Productivity]
Gregory Thomas, Gregory Thomas and Associates

III.C. How Energy Efficiency Can Affect Affordability and Property Value
Eric Haftner, ELH Development
[Comparative investment qualities of energy efficiency measures]
Rob Hammon, ComfortWise
Greg Watson, ICF Consulting
[Homeowners and Energy Efficiency: Rational?]

=========

Panel IV – Food/Agriculture/Industrial/Water Energy Efficiency

IV.A. Water: Issue of the New Millennium
Keith Carns, EPRI
Jeff DeZeller, Metropolitan Water District
Lory Larson, SoCalEdison
Greg Leslie, Orange County Water District

IV.B. Innovations in Food and AgriculturalProduction Systems
Ken Solomon, CalPoly San Luis Obispo Univ
Alan Pryor, SoilZONE Inc.
Dee Gram, R and E Enterprises
Sharon Shoemaker, Calif Inst Food & Agric Research (CIFAR), UCDavis

=========

Panel V – Strategic Research

V.A. Feet Firmly Planted on the Ground – Near Term Benefits
Joseph Eto, Lawrence Berkeley National Lab
Art Iverson, Spinel Power Technology
William “Woody” Savage, PG&E
V.B. Eyes on the Stars – Incorporating the Long View
Alexander Glass, Executive Director, BARTA
Dave Hawkins, Cal ISO
Dave Lema, Special Advisor to the Governor
Gail McCarthy, EPRI

=========

Panel VI – Energy-Related Environmental Research

VI.A. Solutions to Current/Expected Environmental Issues
Sonja Mahini, EPRI
Vince Mirabella, SoCalEdison
Don Rose, Sempra Energy
VI.B. A New Perspective: New Approaches to Issue Resolution
James Cole, Univ of Calif President’s Office
Paul Chu, PISCES, EPRI
Norman Miller, Lawrence Berkeley National Lab
Kelly Birkinshaw, CEC

Calif. Interconnection Workshop Dec 6

/0 Comments/in , /by

Just received this note a few minutes ago from Jairam Gopal, the head of CADER.

It appears that California is gearing up to follow in the footsteps of Texas and New York, and do something about interconnection requirements.
————————————————————–

Subject:  Hello everyone:
Date: Fri, 12 Nov 1999 10:21:22 -0800
From:  “Jairam Gopal” <Jgopal@energy.state.ca.us>

Hello everyone:
Please see the CEC Web site at:

http://www.energy.ca.gov/distgen/notices/index.html

for the following posted documents:

1) CEC’s Nov. 3 Order Instituting Investigation on Interconnection issues.
2) Siting Committee’s notice of first interconnection workshop to be  held on December 6.

As you are aware, this OII follows the CPUC Decision of the earlier proceeding on Distributed Generation and Distributed Competition.

The CEC will lead the proceedings on Interconnection Issues and will kick off the process with the above mentioned workshop on December 6, 1999. If you are on the service list of the earlier CPUC proceeding, you should receive a hard copy of the Notice by mail.

Jairam
Chair, CADER
_______________________
Jairam Gopal
(916) 654-4880  (tel)
(916) 654-4753 (fax)
e-mail:   jgopal@energy.state.ca.us