Meeting #43: Rate Design for Distributed Energy Resources

Tuesday, September 13, 2016
10:00am – 3:15pm ET
PECO, Energy Hall
2301 Market Street
Philadelphia, PA


This meeting discussed and reviewed the rate design manual prepared by a subcommittee of the National Association of Regulatory Utility Commissioners (NARUC) and presented at the NARUC summer meeting in Nashville and explored areas that may be particularly useful in MADRI. This was followed by a deeper dive into rate design options in the MADRI states with a focus on the treatment of distributed energy resources. Although the discussion focused mostly on distributed generation, we also heard about a new approach for procuring demand response.


9:30 – 10:00am
Networking with attendees

10:00 – 10:15am
The Honorable Betty Ann Kane, Chairman, DC Public Service Commission
Janine Migden-Ostrander, Regulatory Assistance Project

10:00 – 10:15am
The NARUC Subcommittee Rate Design Manual
Daniel Cleverdon, DC Public Service Commission: Overview of Draft Manual on Distributed Energy Resources Compensation
In this session, Mr. Cleverdon highlighted the key areas of interest to MADRI states with respect to this report. This was followed by a Q&A discussion of the report. Review the report here.

11:15am – 12:15pm
Designing Rates with Distributed Energy Resources in Mind: Presenters
Daniel Cleverdon, DC Public Service Commission: Distribution Rate Design Proposal
Jim Lazar, Regulatory Assistance Project - remote: Rate Design with Distributed Energy Resources
Alan Cohn, PECO: Rate Design with DER in Mind

This session provided an overview and critique of the various trends in rate design currently being considered across jurisdictions relevant to distributed energy resources. It looked at options for how distribution costs could be recovered, identifying peak load contribution and non-coincident peak demand; how the theoretical underpinnings of a rate design can be translated into a practical application; and, how to change from the current paradigm (what are the steps and what should commissions do now to move forward). This also included a case study of what one MADRI utility is doing in this area and presentation of a new rate design proposal which focuses more on kilowatt charges for coincident peak demand than on volumetric rates. The session also focused on valuing the benefits of distributed energy resources that should be considered in determining rates.

12:15 – 1:00 pm

1:00 – 2:15pm
Designing Rates with Distributed Energy Resources in Mind: Responders
Joe DeLosa, Delaware Public Service Commission: Distribution Rate Design: A Response
Tanya McCloskey, Pennsylvania Office of Consumer Advocate
Matt McCaffree, Comverge

Group discussion
The invited respondents offered their own reflections on the rate design presentations. The goal was to present additional perspectives on the issues and ideas raised by the morning panels. Following the respondents' remarks, the floor opened for a broader discussion of DER rate design.

2:15 – 3:00pm
A New Approach to Procuring Demand Response Resources
Rachel McMahon, California Public Utilities Commission - remote:

Group discussion
In our final session of the day, we heard about an innovative program in California that uses auctions to procure demand response resources. Group discussion of this idea and other innovative ideas for procuring demand response followed.

3:00 – 3:15pm
Wrap-Up, Adjournment
The Honorable Betty Ann Kane, Chairman, DC Public Service Commission
Janine Migden-Ostrander, Regulatory Assistance Project