Quantifying the T&D Benefits of Distributed Energy in Ontario

In Ontario, there is growing recognition that Distributed Energy (DE) will become an increasingly important element of the province’s power system. Recently, a number of studies have been carried out in other jurisdictions to develop and demonstrate methods that strive to develop the business case for DE. These involve quantifying both benefits and costs of such installations, taking into account factors ranging from environmental implications, to changes in the way the electrical infrastructure is planned and operated. For DE to be a viable part of the overall solution in Ontario, an acceptable methodology for addressing the cost and benefits of each DE installation needs to be established, that can be used by system planners to compare the value of DE against more traditional T&D investment. This would also contribute to the policy and regulatory framework needed to provide appropriate incentives or compensation for DE.

Rather than immediately applying pre-existing tools or methodologies to the Ontario situation, without regard to Ontario’s unique characteristics, an appropriate first step is to hold a workshop with the most important Ontario stakeholders, balanced with some representatives from other jurisdictions. The central focus of the workshop will be to explore practical and cost-effective methodologies that can determine the value that clean DE (emphasis on CHP and non-diesel technologies) can bring to the planning and operation of distribution and transmission systems, with one of the main benefits being T&D upgrade deferral. The goals are to discuss: what has been done in other jurisdictions; what initiatives have already been launched in the province itself; and to identify specifically how federal funding could best be used to help move things forward.

Workshop Themes:

Developing the business case for DE with specific focus on deferral of T&D upgrades

What is the impact on the local distribution company; why should they integrate DE?

What are the required policy and regulatory measures and how do we put them in place?

(Full Program)

Presentations

Overview of the day’s activities
Mark Tinkler, Emerging Energy Options Inc. – Session Facilitator

Welcome and Introductory Remarks
Barry Beale, Director, Conservation and Distributed Energy Branch, Ontario Ministry of Energy

Workshop Context and Objectives
Chad Abbey, Project Manager – DER Grid Integration, Natural Resources Canada

Quantifying the T&D Benefits of DE: Needs and Opportunities in Ontario
Cliff Poyton, Manager – Clean Energy, Ontario Power Authority

Ontario LDC Perspectives – DE activities, associated benefits, perceived needs
- Kyle Rees, Manager – Distributed Energy, Toronto Hydro
- Michael Angemeer, President and CEO, Veridian
- Patrick Guran, Chief Energy Conservation Officer, PowerStream
- Kevin Whitehead, Director – Engineering, Whitby Hydro
- Ravi Seethapathy, Manager – Distributed Generation, Hydro One

Tutorial

(Presentation)

In 2005/06, two major cost/benefit studies of DE were undertaken for state government entities, in Massachusetts and in California. The first study was done for the Distribution Planning Working Group of the Massachusetts DG Collaborative, to rigorously test the hypothesis that “DE contributes value to distribution planning and meets customer needs”, and that business and regulatory models can be identified which result in overall net benefits greater than costs for all stakeholders. In California, the California Energy Commission and the US Department of Energy wished to develop broad planning-area methodologies that system planners and policy analysts can employ to assess the value of DE on a comparable basis with traditional T&D investments, based on an approach that monetizes DE value across a spectrum of potential utility benefits.

Stan Blazewicz and Gene Shlatz of Navigant Consulting led the team that completed the work in both Massachusetts and California. Charlie Salamone, formerly Director of Distribution Planning, NSTAR and Tom Dossey of Southern California Edison, were instrumental in providing the utility perspectives essential to these studies.

Speakers • Massachusetts DG Collaborative: Approach and Results – Navigant Consulting