BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR...
Transcript of BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR...
![Page 1: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/1.jpg)
BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz, Institute for Sustainable Futures Australian Utility Week, Sydney, November 24th 2015
![Page 2: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/2.jpg)
OVERVIEW Historical context
The project (Facilitating local network charges and Local Electricity Trading**
Valuing local energy: the concepts
**formerly known as Virtual Net Metering
![Page 3: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/3.jpg)
CONTEXT
![Page 4: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/4.jpg)
HISTORIC POINT OF TRANSFORMATION
isf.uts.edu.au
Centralised electricity supply falling, already peaked?
Rooftop solar PV Energy efficiency
Behaviour change (price effect)
ANNUAL ENERGY FORECAST FOR THE NEM (June 2014 NEFR)
![Page 5: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/5.jpg)
TODAY: HIGHLY CENTRALISED NETWORK
![Page 6: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/6.jpg)
THE FUTURE: DECENTRALISED NETWORK
![Page 7: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/7.jpg)
…WITH FAR MORE LOCAL ENERGY
Local Energy
![Page 8: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/8.jpg)
POSSIBLE OUTCOME - THE DEATH SPIRAL
![Page 9: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/9.jpg)
POSSIBLE OUTCOME : MUTUAL BENEFITS
• Reduced transmission and distribution losses
• Potential to save money on network investment
• Emissions reduction
• Increased resilience of system
• Technical network services
• Provides local generators access to bigger markets
• Keeps high level of reliability
• Allows local generator to run system for maximum efficiency
• Supports technical requirements of consumers
![Page 10: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/10.jpg)
THE PROJECT: FACILITATING LOCAL NETWORK CHARGES AND LOCAL ELECTRICITY TRADING** ** VIRTUAL NET METERING (VNM)
![Page 11: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/11.jpg)
PARTNERS: A BROAD COALITION
isf.uts.edu.au
PROJECT LEAD
MAIN SPONSOR
CITY OF SYDNEY
Networks NSW Energy Australia
Electricity Retailers Association Electricity Networks Association
Clean Energy Council Coalition for Community Energy
![Page 12: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/12.jpg)
Objective: To facilitate the introduction of local network charges & Local Electricity Trading**
WHAT ARE WE DOING?
Five case studies, or “virtual trials” A recommended methodology for calculating local
network charges An assessment of technical requirements and
indicative costs for Local Electricity Trading Economic modelling of benefits & impacts Increase stakeholder understanding and support for
rule change(s) ** also called Virtual Net Metering or VNM
![Page 13: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/13.jpg)
THE TRIALS WINTON - FRINGE OF GRID
Tech Geothermal Network Ergon Energy Retailer Ergon Energy Model One One
BYRON Tech PV Network Essential Retailer Model Council 1 1
WILLOUGHBY Tech Cogen Network Ausgrid Retailer Energy Australia Model Council 1 1
MOIRA/SWAN HILL Tech PV Network Powercor Retailer AGL Model 1 Many
WANNON WATER Tech Wind Network Powercor Retailer AGL Model 1 1 & 1 2
![Page 14: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/14.jpg)
LGNC RULE CHANGE PROPOSAL Submitted in July 2015 by City of
Sydney, Total Environment Centre, and the Property Council of Australia
Local network charges achieved via a CREDIT TO GENERATOR
Objective of our project to support the proposal
Expect consultation in Feb/ March 2016
![Page 15: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/15.jpg)
VALUING LOCAL ENERGY :
LOCAL NETWORK CHARGES AND LOCAL ELECTRICITY TRADING
![Page 16: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/16.jpg)
THE PROBLEM DGs sell at wholesale and buy back at retail prices, including
full network charges
Strong incentive for customers (and product developers) to focus “behind the meter” & reduce grid consumption
Perverse incentive to duplicate infrastructure
Sub optimal sizing of generators and little incentive to supply grid services
Increases costs for consumers left using only grid electricity, as infrastructure costs are recouped from smaller sales volume
![Page 17: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/17.jpg)
THE CONCEPTS
Local network charges: reduced tariffs for electricity generation used within a defined local network area
isf.uts.edu.au
affects this part
affects this part
$ network charges
$ energy costs
$ retail
TYPICAL MAKEUP OF ELECTRICITY BILL
Local Electricity Trading”** requires netting off generation from one site at another site on a time-of-use basis, so that Site 1 can ‘sell’ or assign generation to nearby Site 2
** also known as VNM
![Page 18: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/18.jpg)
Local Energy
NETWORK CHARGES - WHAT HAPPENS NOW
Current network charges for local energy
![Page 19: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/19.jpg)
PHYSICAL ELECTRICITY FLOWS
Uses 150 MWh
Imports 50 MWh Generates 110 MWh
Exports 10 MWh
Uses 100 MWh Imports 100 MWh
.. but maintained here
![Page 20: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/20.jpg)
MONETARY FLOWS
Uses 100 MWh Imports 100 MWh
Uses 150 MWh Imports 50 MWh
Generates 110 MWh Exports 10 MWh
CURRENT NETWORK CHARGES
![Page 21: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/21.jpg)
MONETARY FLOWS
Uses 100 MWh Imports 100 MWh
Uses 150 MWh Imports 50 MWh
Generates 110 MWh Exports 10 MWh
Local Generator Network Credit
LOCAL NETWORK CHARGES
![Page 22: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/22.jpg)
CURRENT ENERGY PURCHASE
Uses 150 MWh
Imports 50 MWh Generates 110 MWh
Exports 10 MWh
Uses 100 MWh Import 100 MWh
100MWh
SITE B purchases 100MWh of electricity from retailer
![Page 23: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/23.jpg)
LOCAL ELECTRICITY TRADING
Uses 150 MWh
Imports 50 MWh Generates 110 MWh
Exports 10 MWh
Uses 100 MWh Imports 100 MWh
Site B purchases 90MWh from Retailer 10MWh generated at SITE A is “netted off” at SITE B
![Page 24: BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY … · BUILDING A LEVEL PLAYING FIELD FOR DISTRIBUTED ENERGY WITH LOCAL NETWORK CREDITS AND VIRTUAL NET METERING Jay Rutovitz,](https://reader033.fdocuments.net/reader033/viewer/2022052719/5f066e5f7e708231d417f5c4/html5/thumbnails/24.jpg)
http://bit.do/Local-Energy
Stay in touch – project website & sign up for newsletter
or email: [email protected]