Details for: PGE Comments on Draft Resolution E-4863.pdf

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Erik Jacobson
Regulatory Relations

Pacific Gas and Electric Company
77 Beale St., Mail Code B23A
P.O. Box 770000
San Francisco, CA 94177
Fax: 415-973-1448

July 31, 2017

Energy Division Tariff Unit
California Public Utilities Commission
505 Van Ness Avenue
San Francisco, CA 94102

Comments on Draft Resolution E-4863

Dear Energy Division Tariff Unit:
Pacific Gas and Electric Company (PG&E) respectfully provides its comments on Draft
Resolution E-4863 (Draft Resolution), which would approve four PG&E proposed new
Electric Program Investment Charge (EPIC) projects and would deny two. PG&E
provides the following comments for consideration based on both overarching
comments made in the Resolution, as well as the approval decision on each project.
PG&E Disagrees with the Draft Resolution’s Proposal to Find that Some of
PG&E’s New EPIC Projects Are Not Needed Immediately
PG&E appreciates and agrees with the Commission’s criteria for approval of new EPIC
projects between triennial EPIC proceedings, which balances the need to provide
flexibility and avoid delays in implementation of worthy EPIC projects that could provide
clean energy and other grid and customer benefits, with the need to provide consistent
periodic review of overall EPIC program plans and budgets. However, PG&E
respectfully disagrees with the Draft Resolution’s finding that the potential value of new
projects is a secondary criterion and instead that “Immediacy is a significant limiting
principle.” 1
As discussed in PG&E’s reply to ORA’s protest of Advice Letter (AL) 5015-E, 2 research,
development and demonstration (RD&D) is a fast-moving area, which requires EPIC
Administrators to be nimble and flexible as they manage their respective portfolios if
they are to help drive the innovation needed in California to meet the State’s
aggressive, industry leading energy and environmental policy goals. The main purpose
and justification for establishing the Tier 3 Advice Letter “New EPIC Project” review
process was to allow reasonable time for interested stakeholders to evaluate projects
proposed based on the project’s merits, not to restrict new projects from being added.

Compare Draft Resolution E-4863, Finding 15, to D.15-09-005, Ordering Paragraph 3.
PG&E’s Reply to the ORA Protest of Advice Letter 5015-E, March 9, 2017.


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PG&E Comments on Draft Resolution E-4863 -2- July 31, 2017 Unnecessarily restricting the proposal of new EPIC projects to only once every three years is simply not in line with the rapidly changing technology landscape, the expedited priorities in California energy and environmental policies, nor customer expectations of the new and innovative services PG&E should enable. For these reasons, PG&E requests that the Draft Resolution be revised to find that the potential value of a new EPIC project should be considered as important a criterion as immediacy. PG&E also requests that the Draft Resolution be revised to find that PG&E Projects 2.32, 2.33 and 2.35 satisfy the “immediacy” criterion when balanced against the “potential value” criterion for new EPIC projects. However, alternatively, as further described below in PG&E’s comments on the merits of each proposed project, PG&E requests that the three projects that were denied 3 due to the Commission’s draft analysis that the projects fail to meet urgency requirements for expedited review through the Tier 3 Advice Letter process be considered for approval as stated in PG&E’s EPIC 2018-2020 Investment Plan Application (A.) 17-04028 (EPIC 3). For clarity, these projects would be re-numbered as outlined below for consideration in the EPIC 3 Application: Project Name Electric Load Management for Ridesharing Electrification Service Issue Identification Leveraging Momentary Outage Information Call Center Staffing Optimization Advice Letter 5015-E Project Number EPIC 3 Application Project Number 2.32 3.42 2.33 3.43 2.35 3.44 Impact on EPIC 2 Projects On Hold The Draft Resolution’s Finding 14 indicates that ten of PG&E’s EPIC 2 projects which are presently on-hold will not move forward, in order for the proposed projects to proceed with sufficient and available funding. While it is necessary to ensure there is available project funding for the new proposed projects, the CPUC EPIC decisions do not provide that projects not yet prioritized and/or on hold must not move forward in the future. The Draft Resolution should be revised to clarify that PG&E has proposed that these ten projects would not move forward in order to help ensure adequate funding would be available for the six proposed projects in compliance with the total authorized EPIC 2 funding; reiterating that the EPIC program criteria does not require that the projects themselves not move forward if funding is available. The Administrator remains accountable for assuring that both the program stays within its overall funding and that meaningful value is derived from the projects that move forward. 3 Project 2.32 Electric Load Management for Ridesharing Electrification; Project 2.33: Service Issue Identification Leveraging Momentary Outage Information; and Project 2.35 Call Center Staffing Optimization.
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PG&E Comments on Draft Resolution E-4863 -3- July 31, 2017 Comments on Draft Resolution – Project 2.31 Aggregated Behind-the-Meter Storage Market/Retail Optimization Ordering Paragraph (OP) 1 provides that Project 2.31 is approved, conditioned upon PG&E’s satisfaction of Project 2.31’s competitive procurement waiver requirements. However, in response to the proposed participating vendor’s decision to not proceed with the EPIC project and as PG&E informally notified Energy Division, PG&E is withdrawing its request for the approval of this project, due to notification by the vendor that the Advice Letter approval timeframe has resulted in the vendor no longer being able to move forward with the project. Comments on Draft Resolution – Project 2.32: Electric Load Management for Ridesharing Electrification OP 3 of the Draft Resolution would reject Project 2.32 for the following reasons: 1. Appearance of overlap with SDG&E’s proposed, but not yet approved, Taxi/Shuttle/Rideshare project, as proposed in SDG&E’s Senate Bill (SB) 350 Transportation Electrification Application, 4 and 2. Failure to meet the requisite showings for new projects that arise between EPIC triennial reviews. 5 PG&E respectfully disagrees that Project 2.32 duplicates the proposed SDG&E SB 350 project, and has received explicit confirmation from SDG&E that these projects are aligned in coordination and not duplicative of each other’s methods and expected outcomes, as well. In fact, deeper analysis reveals that the projects are complementary, yet distinct, in the use cases that they seek to test. As proposed, SDG&E’s project would use its proposed Public Charging Grid Integrated Rate to incentivize taxis and ridesharing companies, also known as Transportation Network Company (TNC) providers, such as Lyft or Uber, to utilize charging stations. This is “passive demand management,” driven by incentives present in the existing utility rate structure. PG&E's proposed Project 2.32 would partner with TNCs to send communications for availability of charging stations based on various grid scenarios. This is “active demand management” and will help customers, stakeholders and utilities understand rideshare charging behavior in response to more active demand signals. PG&E will work with the participating TNCs to develop strategies and tactics for phasing or shifting rideshare charging load that is occurring during high cost hours or times of local grid constraints. These strategies and tactics could include rate design but would also explore pro-active messaging and other signals that are beyond what is proposed in SDG&E’s Grid Integrated Rate and therefore present a uniquely compelling technology demonstration 4 5 Draft Resolution E-4863, Finding 24. Pg. 30. Draft Resolution E-4863, Pg. 24.
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PG&E Comments on Draft Resolution E-4863 -4- July 31, 2017 opportunity to specifically target the rideshare use case. As described in AL 5015-E, the ride sharing market is a new and rapidly growing sector. Its combination with electrification is even more nascent and there is much to be learned, understood and incorporated into Utility processes to potentially influence the growth of the market across PG&E and throughout California on behalf of customers. There are additional potential long-term benefits that this project may ultimately support Disadvantaged Communities (DACs), which is a focus of California Senate Bill (SB) 350, Assembly Bill (AB) 2672, Decision (D.) 17-05-014 6 and D.16-12-065. 7 D.17-05-014 indicates “Pursuant to SB 350, all three utilities are required to address disadvantaged communities in their (Electric Vehicle Charging Infrastructure Pilot Program) proposals to accelerate transportation electrification” (pg. 31). As stated in D.16-12-065, the IOUs have committed to at least ten percent of the charging stations being located in DACs and PG&E has agreed to increase the target share of charging stations deployed in DACs to 15 percent with a stretch goal of 20 percent for disadvantaged and low-income communities. 8 While SB 350 does not apply any DAC mandates or criteria to EPIC projects, under this proposed EPIC project 2.32, PG&E can potentially support customers residing in disadvantaged and low-income communities by working directly with TNCs that enable access to electric vehicles for these communities. Part of this project’s assessment may involve determining the drivers’ location, duration and frequency of driving the vehicles and the potential benefits in disadvantaged and/or lowincome communities. PG&E has responded above (pp. 1-2) to the second reason for denial, lack of justified urgency for project approval consideration within triennial plans. To further articulate the urgency of this project, EPIC project 2.32 may inform regulatory proceedings while the policies related to transportation electrification and supporting technologies continue to be shaped, including those related to SB 350. Additionally, as previously indicated in AL 5015-E, at least one TNC in San Francisco is currently in the process of deploying electric vehicle rental program with electric vehicle manufacturer(s). This program with TNCs is ramping up in EV adoption among drivers, and starting the EPIC project now may enable PG&E to influence how those vehicles are charged. Furthermore, AL 5015E describes the needed urgency and potential value of the project in compliance with the Commission’s “new EPIC project” criteria. 6 7 8 Order Instituting Rulemaking to Identify Disadvantaged Communities in the San Joaquin Valley and Analyze Economically Feasible Options to Increase Access to Affordable Energy in those Disadvantaged Communities. In the Matter of the Application of Pacific Gas and Electric Company for Approval of its Electric Vehicle Infrastructure and Education Program (U39E). Decision 16-12-065, Finding 12. Pg. 78.
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PG&E Comments on Draft Resolution E-4863 -5- July 31, 2017 Comments on Draft Resolution – Project 2.33: Service Issue Identification Leveraging Momentary Outage Information OP 4 of the Draft Resolution would reject Project 2.33. The primary reason for this denial was due to lack of justified urgency for project approval consideration within triennial plans. As also discussed above, PG&E reiterates the needed urgency and potential value of the project as described in AL 5015-E. Comments on Draft Resolution – Project 2.34: Predictive Risk Identification with Radio Frequency Added to Line Sensors OP 5 of the Draft Resolution would approve Project 2.34. PG&E is supportive of the Draft Resolution’s approval of this project, and will immediately begin executing the project upon receipt of the Final Resolution E-4863. Comments on Draft Resolution – Project 2.35: Call Center Staff Optimization The text of the Draft Resolution specifies that Project 2.36 should be rejected, including the following rationale for disapproval: Section Requirement f), Other Requirements Applicable to EPIC Projects: “Project 2.35 reduces understaffing and overstaffing at call centers, and improves customer experience, but does nothing to strengthen or improve the electric system.” 9 Additionally, Finding 25 of the Draft Resolution finds that, “Project 2.35 does not fall within any category of the electricity system value chain.”10 PG&E disagrees with the Draft Resolution. Contrary to the Draft Resolution, the project maps to the following electricity system value chain for benefits to utility customers: “Grid Operations / Market Design.” As described in AL 5015-E, the project is expected to open a significant opportunity to make operational efficiencies through this new learning algorithm, which leverages existing approaches in a new and novel way. At full scale, the project anticipates benefits to reduced customer costs and improved customer satisfaction for over one million customers. Leveraging emerging technology funds to support reduced customer costs is also an outcome that supports assistance and more efficient services that benefit Disadvantaged Communities (DACs), a priority for California’s clean energy policies under SB 350. Leveraging call center data not only supports customer affordability goals, but it can also be leveraged to improve grid planning efforts. Such call center data and the 9 10 Draft Resolution E-4863, Pg. 24 Draft Resolution E-4863, Pg. 30; Upon communication with the CPUC staff on Monday July 10, 2017, Staff confirmed that their intent was to deny this project.
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PG&E Comments on Draft Resolution E-4863 -6- July 31, 2017 predictive information generated can be an additional data point to inform where reliability improvements could be made. This is an approach that may benefit grid planning and operations, which further supports the rationale to mapping to the proposed electricity value chain: Grid Operations / Market Design. For these reasons, PG&E requests that the Draft Resolution be revised to approve this project or alternatively to confirm that it may be considered in PG&E’s EPIC 2018-2020 Triennial Plan. Project 2.36: Dynamic Rate Design Tool OP 7 of the Draft Resolution would approve Project 2.36. PG&E supports the Draft Resolution’s approval of this project and will begin executing the project upon receipt of the Final Resolution E-4863. Conclusion PG&E appreciates the opportunity to provide comments on the Energy Division’s draft Resolution E-4863 and respectfully requests that the Commission adopt it with the changes described in these comments. Respectfully submitted, /S/ Erik Jacobson Director, Regulatory Relations cc: Edward Randolph, Director, Energy Division David Huang, Energy Division Melicia Charles, Energy Division Service List A.14-05-003
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