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Innovative Renewable Energy Procurement Models

Innovative Renewable Energy Procurement Models

Utilities across the electricity sector are engaging in innovative clean energy purchasing models in order to meet increasing customer demand. What are some examples of these innovative models and how do they work? In what context are these models successful? What are some best practices regarding marketing and implementation? Join representatives from Puget Sound Energy, WGL Energy, and CRS for the first in a series of interactive webinars to explore the options. Participants will learn how:

• energy companies are developing new products to expand options for customers
• offsite solutions are fulfilling customer demands for solar
• utilities are educating customers on renewable energy purchasing options

• Robin Cunningham, Green Products Specialist, WGL Energy
• Heather Mulligan, Market Manager, Puget Sound Energy
• Michael Leschke, Green-e Verification Manager and Senior Analyst, CRS

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  1. © 2017 Center for Resource Solutions

  2. © 2017 Center for Resource Solutions A nonprofit creating policy

    and market solutions to advance renewable energy since 1997 AREAS OF FOCUS: - Policy and expert assistance work - Education and support for renewable energy markets - Certification services
  3. © 2017 Center for Resource Solutions Consumer protection and certification

    for voluntary renewable energy purchases
  4. © 2017 Center for Resource Solutions WEBINAR AGENDA 1. Innovative

    Utility Renewable Energy Programs: Pugent Sound Energy 2. Solar Electricity Supply Agreement (SEA): WGL Energy 3. Q&A
  5. Innovative Utility Renewable Energy Programs July, 2017

  6. 6 Puget Sound Energy Innovative Utility Renewable Energy Programs •

    Headquartered in Bellevue, Washington • Serving 11 Counties in the Pacific Northwest • 1.05 million Electric Customers • 725,000 Natural Gas Customer
  7. 7 Customer choices for renewable energy EXISTING GREEN POWER PROGRAM

    ••REC purchases ••43,000 customers ••residential, commercial, municipal ••Large Volume Rate BULK REC PURCHASES • Excess PSE RECs • 10,000,000 kWh • large business GREEN DIRECT • Long-term partnership with PSE for dedicated energy resources • large commercial, municipal SOLAR CHOICE ••Solar RECs from central plant with high productivity ••residential and small commercial Green Power Program – Retail RE
  8. 8 Solar Choice A new offering from PSE designed for

    electric customers to support solar energy generated by independent NW producers New: Solar Choice § Just like with PSE’s Green Power program, energy is generated at a separate location and added to the grid on customer’s behalf § For as little as $5 (or in blocks of 150 kwh) more a month, customers can match a portion of their power usage with renewable energy § Initial launch based on two projects in Washington and Idaho Innovative Utility Renewable Energy Programs § Designed based on extensive customer research § Launched in April 2017 with 2800 blocks § 2400 blocks sold, to date
  9. 9 Talking to Corporate Customers Energy that reflects customer values

    Reduced carbon footprint Increased renewable energy development Connection to a specific resource A hedge value with known future energy costs to manage budgets Customer can promote increased sustainability
  10. 10 New: Green Direct Green Direct creates a new partnership

    between PSE and Customers New Resource – making a difference Cost Competitive – green power priced fair to system power Long Term Price – for a long term resource Utility-Based – no hassle, reliable, safe PSE created Green Direct in response to Customer requests
  11. 11 Green Direct Billing Numbers are for illustrative purposes only

    and not final
  12. 12 Credits and Charges Credit Included: • Energy-Related Power Costs

    Not Included: • Demand-Related Power Costs • T&D • Billing, Meters, Meter Reading, Customer Accounting and Services Charge Included: • Cost of Energy and RECs • Losses and Taxes • Billing system updates • Annual reporting of renewable energy certificates, etc
  13. 13 Green Direct Results Innovative Utility Renewable Energy Programs •

    Phase I is sold out as of June 30th • 130 MW under contract and scheduled to come on line in 2019 • 21 Customers subscribed o 4 Corporate o 1 University o 2 County Governments o 11 City Governments o 3 Other Government • Planning has begun for Phase II
  14. 14 • The renewable energy market is evolving rapidly •

    Customers – of all sizes -- want choices • One size does not fit all • Partner with your stakeholders Thank you What Have We Learned
  15. Innovative Renewable Energy Procurement: Solar Electricity Supply Agreement (SESA) •

  16. COMPANIES OF WGL 1 6 16

  17. WGL Energy is a leading source of efficient and environmentally-friendly

    energy solutions for customers across the United States, provided by: WGL Energy Services WGL Energy Systems & WE MAKE ENERGY SURPRISINGLY EASY
  18. WGL Energy Systems designs-builds, owns and operates distributed generation and

    energy efficiency solutions that deliver financial, operational and carbon reduction results for commercial customers throughout the United States. DISTRIBUTED GENERATION SOLAR POWER COMBINED HEAT AND POWER FUEL CELL TECHNOLOGY ENERGY EFFICIENCY WGL ENERGY SYSTEMS
  19. WGL Energy Services is one of the most respected energy

    suppliers in the Mid Atlantic serving commercial, government and residential customers in Delaware, Maryland, Pennsylvania, Virginia and Washington D.C. WGL ENERGY SERVICES NATURAL GAS ELECTRICITY WIND POWER SOLAR RECs CARBON OFFSETS
  20. Current offsite renewable options 2 0

  21. Community solar + virtual net metering • Utility-managed • Growth

    is capped • Policy dependent • Nuanced Rules • Size and subscriber limitations • Geographic limitations
  22. Utility green tariffs Credit: World Resources Institute

  23. Range of offsite renewable structures Community Solar Virtual Net Metering

    Virtual PPA Everything in between Green Tariff
  24. WGL Energy SESA Options 2 4

  25. SESA offering #1: “SOLAR PORTFOLIO” Benefits -Locking in a long

    term rate - Can move accounts in and out of the solar project each time you renew the brown power contract. - The termination value is favorable as it is only the difference between your rate and the rate we can sell the output at termination. Rate: market Supplier: TBD Term: 1 -3 years Rate: 6.5 cents fixed per kWh Supplier: WGL Energy Term: 20 years Assumptions: -Annual estimated usage of 10,000,000 kWh - 1.5 MW of offsite solar ( or 2,000 MWh per year) - WGL Energy supplies additional load in shorter terms (1-3 years)
  26. SESA offering # 2: “Flexible solar” Location Marginal Price +

    adder (LMP) Solar Settlement (bill or credit) Buy power as usual Case 1: LMP exceeds contracted solar price ($65/MWh). Example: LMP averages $70/MWh and MOM’s is credited $5/MWh generated that month ($65 - $70 = $5/MWH bill credit). Case 2: LMP is less than contracted solar price ($65/MWh). Example: LMP averages $60/MWh and MOM’s Bank is billed $5/MWh generated that month. ($65 - $60 = $5/MWh charge).
  27. SESA offering 3 : “Flexible solar + block and index”

    12am 6am Noon 6pm 12am Load (MW) Fixed Price Block Market Index Price 12am 6am Noon 6pm 12am Load (MW) Flexible Solar (Offsite) • Fixed price blocks secure baseload power at very low rates • Peak daytime use priced at a market index • Flexible Solar (offsite) structured to match peak load, hedging market risk
  28. Case study – offsite solar • 1.5 MW • 20

    year term • Robust sustainability Program • Flexible Solar Structure
  29. Case study – monumental sports • 3.5 MW • 20

    year term • Green Sports Movement • Flexible Solar Structure
  30. Benefits and environmental claims

  31. benefits ▶ Provides a unique solution for organizations that can’t

    support an onsite solar installation ▶ Allows for organizations to off-take from a larger project, which takes advantage of economies of scale ▶ Organizations can choose to off-take a portion of output from the offsite project ▶ Provides organizations the flexibility to move different accounts into or out of the solar portion of contract ▶ Stability against future price fluctuations
  32. Price stability + hedge against volatility 0 100 200 300

    400 500 600 700 800 1/1/2005 1/1/2006 1/1/2007 1/1/2008 1/1/2009 1/1/2010 1/1/2011 1/1/2012 1/1/2013 1/1/2014 1/1/2015 Daily Average LMP Solar Price Fixed
  33. Common pitfalls and problems ▶ In order to maximize financing

    for solar projects, solar renewable energy certificates (SRECs) from the project are often sold separately from the generated electricity ▶ This can lead to confusion when it comes to making environmental claims ▶ Different solutions for obtaining green attributes (RECs) come with their own complications
  34. Solutions and best practices ▶ Explain mechanics of environmental benefits

    and claims from the beginning ▶ Offer multiple options for how the customer can obtain environmental benefits ▶ Point customer towards resources that can help them understand claims ▶ Include contract provisions that provide the opportunity to review public facing materials such as press releases
  35. Ftc green guides ▶ Avoid unqualified renewable energy claims ▶

    Specify type of renewable energy being used ▶ Specify exact amount of renewable energy used, either in actual volume or as a percentage of total usage ▶ Maintain records of renewable procurement methods for substantiation
  36. questions

  37. Common pitfalls and problems Thank you for joining us! A

    recording of this webinar will be archived at resource- solutions.org/events