Rate Design for a Carbon Free Future

November 16-17, 2021 | Online ::

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“EUCI has once again offered courses that are relevant and insightful.” – Deputy Director General, Office of Utilities Regulation, Jamaica

“This conference was informative and helpful in bringing together members of different backgrounds within the industry to share their observations and findings as it related to the changing environment in which utilities operate. The event length was also just right!” – Staff Rates Analyst, PSEG

Utilities continue to see their industry being dramatically transformed on a year in and year out basis. Renewable portfolio standards, non-utility generators of renewable electricity, net metering, behind-the-meter storage, and other distributed energy solutions have drawn revenues and customers away from traditional utilities and created a mismatch between electricity rates and utilities’ costs. In the long term, policy, and technology trends, largely spurred by decarbonization, will continue to motivate customers to decrease their dependence on traditional utilities. To retain customers, and to secure the utilities’ role in the future, they must design rates that will enable a stable transition to less carbon-intensive sources.

As the progress towards a lower-carbon, customer-centric electric-power industry continues, a critical element needed for this transition is innovative rate design. Utilities must continue to align rates with system-wide costs, encourage flexibility, and address customers’ differing needs.

EUCI’s 19th Annual Rate Design conference brings together perspectives regarding a carbon-free future including customer adoption of solar, energy storage, EVs and other distributed energy resources (DERs).  Leaders in the utility rate design field — providers, regulators, and industry experts — will address these current industry trends.

Learning Outcomes

• Explore rate design options for addressing higher penetrations of distributed generation as we move to a carbon free future
• Review how performance-based regulation (PBR) compares with other regulatory methods, and how PBR can be used to further decarbonization goals
• Hear a regulatory perspective on how the evolving transportation sector is a big opportunity to reduce pollution
• Discuss how utilities can address and deal with the need for continuous rate cases
• Explore how revenue decoupling has helped utilities with extreme weather patterns and managing the pandemic
• Discuss the potential unintended consequences of certain rate designs
• Explore new offerings for the customers of tomorrow including EV rates, demand charges and solar

 

Tuesday, November 16, 2021 : Central Time

 

9:00 – 9:10 a.m. :: Conference Overview and Introduction of Conference Chairs

9:10 – 9:15 a.m. :: Opening Remarks: Setting the Tone for the Conference

Conference Co-chairs:

Rick Starkweather, Partner, ScottMadden, Inc.

Dan Hansen, Vice President, Christensen Associates Energy Consulting, LLC

9:15 – 9:20 a.m. :: A Word from our Sponsor

Tim Ballard, Director, Revenue & Rate Design, Utilities International

9:20 a.m. – 1:00 p.m. :: Session 1: Regulatory Models to Take Us into the Future (Includes a 20-minute break sponsored by Utilities International)

Opening Address: The Future of Georgia is Electric

When you think about the latest clean energy trend, you may think of power plants or manufacturing facilities using solar, wind, or batteries? Good guess, but it may surprise you that the transportation sector is our greatest opportunity to reduce pollution in the United States. In this session, here about the future of Georgia from PSC Commissioner Tim Echols who has a passion for electric vehicles.

Tim Echols, Georgia, Commissioner, Georgia Public Service Commission

Emerging Regulatory Models and Rate Designs for Decarbonization

The century-old regulatory model of electric utilities is in a state of transformation due to rapidly proliferating changes, including demands for a decarbonized grid, the expansion of distributed energy resources, a growing need for resiliency, and new expectations for customer choice. Increasingly, electricity sector leaders and stakeholders are responding to these shifts by proposing reforms that can better equip utilities to meet these evolving needs and expectations.

This opening segment will examine how emerging ratemaking and rate design approaches can better foster a clean, reliable, and equitable energy economy, creating a win-win-win for utilities, ratepayers, and the environment.

Cara Goldenberg, Manager, Carbon-Free Electricity, Rocky Mountain Institute (RMI)

 

Why Annual Performance-Based Formula Rates Make Sense

In this presentation, Dr. Hemphill will describe the historical basis of performance-based formula rates, Illinois’ recent experience with formula rates, and how formula rates are related to other regulatory methods such as multi-year rates.

Ross Hemphill, President, RCHemphill Solutions, LLC (former VP, ComEd)

Karl McDermott, Professor of Economics, University of Illinois – Springfield

 

Multi Year Rate Plans and Lessons Learned

In several jurisdictions around the country, public utility commissioners are considering changes to existing regulatory frameworks.  These changes include the use of future test years, multi-year rate plans, and the inclusion of performance metrics to further incentivize utility behaviors to improve system resiliency, customer satisfaction, and to support state energy policy goals.  Learn from one utility’s experience working with commission staff and other stakeholders as the first participant in a multi-year rate plan pilot in Maryland.

Jason Manuel, Manager, Revenue Policy, Baltimore Gas & Electric

11:15 – 11:35 a.m. :: Sponsored Break from Utilities International

Using PBR to Help Achieve Decarbonization Goals

In this presentation former Alberta Utilities Commissioner Chair Mark Kolesar will describe performance-based regulation (PBR), how it compares with other regulatory methods, and how PBR can be used to further decarbonization goals.

Mark Kolesar, Expert in Public Utility Regulation, Kolesar Buchanan & Associates, (former Chair, Alberta Utilities Commission)

Panel Discussion: Changing Regulatory Models – A Path to the Future?

This panel discussion will allow conference attendees to ask specific questions of the presenters in Session I and to discuss the potential for the evolution of regulatory models in their own jurisdictions.

Moderator:

Ross Hemphill, President, RCHemphill Solutions, LLC (former VP, ComEd)

Panelists:

Tricia Pridemore, Georgia, Commissioner, Georgia Public Service Commission

Mark Kolesar, Expert in Public Utility Regulation, Kolesar Buchanan & Associates, (former Chair, Alberta Utilities Commission

Jason Manuel, Manager, Revenue Policy, Baltimore Gas & Electric

Karl McDermott, Professor of Economics, University of Illinois – Springfield

1:00 – 1:45 p.m. :: Lunch Break

1:45 – 4:45 p.m. :: Session II: Revenue Decoupling (Includes a 20-minute break sponsored by Utilities International)

 

How Decoupling has Functioned During the Pandemic vs Previous Years

Portland General Electric is beginning its second decade with revenue decoupling. In this presentation, Rob Macfarlane and Chris Pleasant will describe PGE’s experience with the mechanism, including the effect of the pandemic on decoupling deferrals.

Rob MacFarlane, Manager of Pricing & Tariffs, Portland General Electric

Chris Pleasant, Senior Regulatory Analyst, Portland General Electric

 

Revenue Decoupling and PSE&G’s Clean Energy Future Program

PSE&G will describe how its recently approved revenue decoupling mechanism fits into its Clean Energy Future program, which includes $1 billion in energy efficiency programs, an Energy Cloud program that will help transform PSE&G into a smart energy services company, and electric vehicle initiatives targeted at improving EV charging infrastructure.

Mike McFadden, Director of Electric & Gas Sales and Revenue Forecasting, PSE&G

3:00 – 3:20 p.m. :: Sponsored Break from Utilities International

Otter Tail Power’s Decoupling Journey

Otter Tail Power was ordered by the Minnesota PUC to study an intervenor group’s proposal concerning the applicability of a decoupling mechanism to all customers except those on market-based rates. This case study describes the background of that evaluation and how the results led to the proposal made in Otter Tail’s current Minnesota rate case.

Brian Boss, Pricing Analyst, Otter Tail Power Company

 

Fixed Cost Recovery and Load Variability. How Exogenous Events and Technology Can Impact Load

In this presentation, Jordan Prassinos with Idaho Power will talk about some of the forecasting initiatives at Idaho Power and will provide an overview/deep dive on the following topics:

• Overview of the FCA history and high-level mechanics
• Pandemic impacts by class and how they are handled with forecasting
• Extreme weather events and role of weather probability modeling
• Decarbonization impacts from energy efficiency programs and other breakthrough technologies

Jordan Prassinos, Load Research and Forecasting Manager, Idaho Power

Paul Goralski, Regulatory Consultant, Idaho Power

 

Panel Discussion: Revenue Decoupling – the Right Solution?

This panel discussion will allow conference attendees to ask specific questions of the presenters in Session II and to discuss the advantages and disadvantages of revenue decoupling.

Moderator:

Dan Hansen, Vice President, Christensen Associates Energy Consulting, LLC

Panelists:

Jordan Prassinos, Load Research and Forecasting Manager, Idaho Power

Paul Goralski, Regulatory Consultant, Idaho Power

Brian Boss, Pricing Analyst, Otter Tail Power Company

Mike McFadden, Director of Electric & Gas Sales and Revenue Forecasting, PSE&G

Rob MacFarlane, Manager of Pricing & Tariffs, Portland General Electric

Chris Pleasant, Senior Regulatory Analyst, Portland General Electric

 

Wednesday, November 17, 2021 : Central Time

 

9:00 a.m. – 12:00 p.m. :: Session III: Pioneering Rate Design (Includes a 20-minute break sponsored by Utilities International)

Plug-in EV rates at Georgia Power for Beneficial Electrification and Decarbonization

In this presentation, Seth Blocker from Georgia Power will provide a summary of current residential and commercial EV rate offerings at the company. The presentation will also highlight the Company’s other programs and activities in the Georgia market that are designed to encourage the transition to electrified vehicles.

Seth Blocker, Pricing Design Manager, Georgia Power

 

The Changing Marketplace at TVA:  TOU, Grid Access Charges and Commercial Rates for EV Charging

In response to the changing electric marketplace, TVA is working on a multi-year process to change its rate structure to ensure the safety, reliability, and resilience of the electric system for the business customers and local power companies serving the 10 million people in the Tennessee Valley. Discussion topics will include:

• TVA’s wholesale rate structure – Seasonal Time of Use Demand & Energy with a Grid Access Charge
• Retail examples of optional and mandatory TOU and mandatory demand charges
• Commercial EVC rate structure aimed at supporting the expansion of electric vehicle charging infrastructure

Jay Erickson, Manager, Retail Rate Design and Administration, TVA

10:10 – 10:30 a.m. :: Sponsored Break from Utilities International

New Bundled Offerings for the Grid and Customers of Tomorrow

This presentation will share Duke Energy’s new framework that treats self-consumed solar, paired with demand response as an energy efficiency initiative and will include other rate design innovations in dynamic pricing.

Lon Huber, VP, Rate Design and Strategic Solutions, Duke Energy 

 

From Load Factor Adjustment (LFA) to Mandatory Demand Charges at IREA

IREA has had two residential demand rates that have been in place for many years, and the Load Factor Adjustment that applies a small demand charge on peak demand if the customer’s monthly load factor falls below one half of the average for that customer class. IREA is moving away from the LFA to a mandatory demand charge. In this presentation, learn what lead to this decision and address these questions and more – How does demand differ from energy? How do you calculate the service, energy, and demand charges?

David Stowe, Rates Analyst, CORE Electric Cooperative

 

Panel Discussion: Pioneering Rates Recap

This panel discussion will allow conference attendees to ask specific questions of the presenters for discussion related to the Pioneering Rates session

Moderator:

Rick Starkweather, Partner, ScottMadden, Inc.

Panelists:

David Stowe, Rates Analyst, CORE Electric Cooperative

Lon Huber, VP, Rate Design and Strategic Solutions, Duke Energy 

Jay Erickson, Manager, Retail Rate Design and Administration, TVA

Seth Blocker, Pricing Design Manager, Georgia Power

12:00 p.m. :: Conference Concludes

Performance Based Regulation (PBR) to Respond to Customer Needs

Wednesday, November 17, 2021

The way we generate, distribute, consume, and pay for power today has been slowly evolving over the past decades. Customers are generating some of their own power, advanced metering structures allow for more sophisticated rate design, and large industrials—and even some residential customers—can actively adjust their demand in reaction to price signals and peak events. Utilities, for their part, continue to look for ways to recover enough revenue to provide a reasonable return for shareholders. As a result, some states are looking at alternative ratemaking approaches, including performance-based regulation (PBR), to incentivize utilities to respond to changing customer needs, encourage consideration of third-party options, reduce the frequency of rate cases, and decouple cost considerations from load changes.

This workshop on PBR will examine the principles of sound ratemaking, how regulatory objectives can impact the various alternatives, and elements of successful PBR mechanisms. The implications of PBR in the current pandemic environment will also be explored.

Learning Outcomes

• Explore the history of Performance Based Regulation (PBR) and how it is different than traditional ratemaking
• Review the different types of PBR including performance incentives and indexed caps
• Discuss the current environment of accommodating distributed energy, which is prompting the need for change
• Hear why some regulators are looking at new PBR-like mechanisms because of these changing needs
• List the steps and options for implementing PBR
• Review several case studies
• Discuss how the pandemic affected utilities and how PBR can help address these issues

 

Agenda

What is PBR and in What Ways is it Different from Traditional Ratemaking?

• History of PBR
  • First implemented in 1990s, but was replaced with the advent of multiyear plans/decoupling
  • Lessons Learned: what worked and what did not
• Types
  • Performance incentives
  • Indexed cap – e.g., price cap, revenue cap, revenue per customer cap
  • Benchmarking
  • “Menu of options”
• Pros and cons of each

Current Environment – What is Prompting the Need for Change?

• Consumer preferences are changing
• Regulators are implementing new incentive metrics that encourage sustainability and promote interconnection
• Increasingly, utilities will need to further demonstrate that capital investments have had a positive impact on customers, beyond traditional reliability measures

Steps and Options for Implementing PBR

• Design considerations
  • Goals & objectives
  • Outputs and outcomes
  • Quantifiable and measurable metrics

Case Studies

PBR and the Pandemic

• How has the pandemic affected utilities and how can PBR address those effects?

Conclusions and Takeaways

 

Instructors

Rick Starkweather, Partner, ScottMadden, Inc.

Rick Starkweather has been a management consultant for almost 30 years and is a leader in ScottMadden’s regulatory practice. His areas of expertise include strategic and business planning, budgeting and forecasting, regulatory compliance and rate case support, and organizational and operations improvement. Prior to joining ScottMadden, he was a consultant with Deloitte Consulting. He also has experience in the healthcare and chemical industries and helped lead the start-up of two companies. Mr. Starkweather received a B.S. in mechanical engineering from Northwestern University and an M.B.A. from the University of Chicago Graduate School of Business. He is also a Certified Measurement and Verification Professional (CMVP) and Certified Energy Auditor (CEA) through the Association of Energy Engineers.

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Mark Meitzen, PhD, Senior Consultant, Christensen Associates

Mark Meitzen is a Senior Consultant at Christensen Associates, where he has been employed since 1990. Dr. Meitzen is currently serving as principal investigator on NCFRP24, Preserving and Protecting Freight Infrastructure and Routes. He was a principal author of the November 2008 Christensen Associates’ study of the U.S. freight railroad industry commissioned by the Surface Transportation Board. He was also the project manager and one of the principal authors of Christensen Associates’ supplemental report to the STB on railroad capacity and investment issues. Dr. Meitzen has expertise in the economic analysis of network industries including telecommunications, railroad, electricity and postal. In addition to the recent STB study, his work in the railroad industry includes analysis of railroad mergers and application of the STB’s Constrained Market Pricing standards, including its Stand-Alone Cost methodology.

Dr. Meitzen also serves as an economic expert in regulatory proceedings on incentive regulation, pricing and economic costing matters. He also has experience in civil litigation matters as an expert witness on antitrust, intellectual property and employment issues. Prior to joining Christensen Associates, Dr. Meitzen was a corporate economist at Southwestern Bell Telephone Company and was an assistant professor of economics at Eastern Michigan University and the University of Wisconsin-Milwaukee.

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Nick Crowley, Economist, Christensen Associates

Nicholas Crowley, MS (University of Wisconsin–Madison) is an Economist. Mr. Crowley’s professional work is primarily with natural gas pipeline and electricity regulation, including wholesale and retail markets. For electricity, he has participated in numerous costing and pricing projects, which involve computational analytics and econometrics, performance-based ratemaking, marginal cost estimation, total factor productivity estimates, and load response with respect to efficient time-of-use tariff options within retail markets. Mr. Crowley’s analyses and study results have been summarized in major reports and formal studies filed with regulatory authorities in Canada and the U.S. Prior to joining CA Energy Consulting, Mr. Crowley was an economist with the Federal Energy Regulatory Commission, where his work experience was concentrated in natural gas pipeline regulation and assessment of electricity markets. Mr. Crowley was also involved in FERC’s performance-based regulation of oil pipeline rates.

• Tim Ballard, Director, Revenue & Rate Design, Utilities International

• Seth Blocker, Pricing Design Manager, Georgia Power

• Brian Boss, Pricing Analyst, Otter Tail Power Company

• Jay Erickson, Manager, Retail Rate Design and Administration, TVA

• Cara Goldenberg, Manager, Carbon-Free Electricity, Rocky Mountain Institute (RMI)

• Paul Goralski, Regulatory Consultant, Idaho Power

• Dan Hansen, Vice President, Christensen Associates Energy Consulting, LLC

• Ross Hemphill, President, RCHemphill Solutions, LLC (former VP, ComEd)

• Lon Huber, VP, Rate Design and Strategic Solutions, Duke Energy

• Mark Kolesar, Expert in Public Utility Regulation, Kolesar Buchanan & Associates, (former Chair, Alberta Utilities Commission)

• Jason Manuel, Manager, Revenue Policy, Baltimore Gas & Electric

• Karl McDermott, Professor of Economics, University of Illinois – Springfield

• Mike McFadden, Director of Electric & Gas Sales and Revenue Forecasting, PSE&G

• Rob MacFarlane, Manager of Pricing & Tariffs, Portland General Electric

• Chris Pleasant, Senior Regulatory Analyst, Portland General Electric

• Jordan Prassinos, Load Research and Forecasting Manager, Idaho Power

• Tricia Pridemore, Georgia, Commissioner, Georgia Public Service Commission

• Rick Starkweather, Partner, ScottMadden, Inc.

• David Stowe, Rates Analyst, CORE Electric Cooperative

 

We will be using Microsoft Teams to facilitate your participation in the upcoming event. You do not need to have an existing Teams account in order to participate in the broadcast – the course will play in your browser and you will have the option of using a microphone to speak with the room and ask questions, or type any questions in via the chat window and our on-site representative will relay your question to the instructor.

• IMPORTANT NOTE: After November 30 you will not be able to join a Teams meeting using Internet Explorer 11. Microsoft recommends downloading and installing the Teams app if possible. You may also use the Edge browser or Chrome.
• You will receive a meeting invitation will include a link to join the meeting.
• Separate meeting invitations will be sent for the morning and afternoon sessions of the course.
  • You will need to join the appropriate meeting at the appropriate time.
• If you are using a microphone, please ensure that it is muted until such time as you need to ask a question.
• The remote meeting connection will be open approximately 30 minutes before the start of the course. We encourage you to connect as early as possible in case you experience any unforeseen problems.

REGISTER NOW FOR THIS EVENT:

Rate Design for a Carbon Free Future

November 16-17, 2021 | Online

Buy 4 in-person seats and only pay for 3! For this event every fourth in-person attendee is free!

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RELATED WORKSHOPS:

Performance Based Regulation (PBR) to Respond to Customer Needs

November 17

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Your registration may be transferred to a member of your organization up to 24 hours in advance of the event. Cancellations must be received on or before October 15, 2021 in order to be refunded and will be subject to a US $195.00 processing fee per registrant. No refunds will be made after this date. Cancellations received after this date will create a credit of the tuition (less processing fee) good toward any other EUCI event. This credit will be good for six months from the cancellation date. In the event of non-attendance, all registration fees will be forfeited. In case of conference cancellation, EUCIs liability is limited to refund of the event registration fee only. For more information regarding administrative policies, such as complaints and refunds, please contact our offices at 303-770-8800

Credits

EUCI is accredited by the International Accreditors for Continuing Education and Training (IACET) and offers IACET CEUs for its learning events that comply with the ANSI/IACET Continuing Education and Training Standard. IACET is recognized internationally as a standard development organization and accrediting body that promotes quality of continuing education and training.

EUCI is authorized by IACET to offer 0.9 CEUs for the conference and 0.3 CEUs for the workshop.

Requirements for Successful Completion of Program

Participants must sign in/out each day and be in attendance for the entirety of the course to be eligible for continuing education credit.

Instructional Methods

Case Studies, Panel Discussions and PowerPoint presentations

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Upon successful completion of this event, program participants interested in receiving CPE credits will receive a certificate of completion.

Course CPE Credits: 11.0
Workshop CPE Credits: 3.0
There is no prerequisite for this Course.
Program field of study: Specialized Knowledge
Program Level: Basic
Delivery Methood: Group-Live
Advanced Preperation: None

EUCI is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be submitted to the National Registry of CPE Sponsors through its web site: www.nasbaregistry.org

 

 

Who Should Attend

This conference was developed for:

• Utility executives
• Corporate communication professionals
• Contact center management professionals
• Commissioners
• Commission staff
• Attorneys
• Regulatory affairs managers
• Pricing and load research managers
• Customer representatives and organizations
• Cost of service analysts
• Financial analysts
• Rate design, product development and customer strategy professionals

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