Pricing Distributed Energy Resources: The Canadian Challenge

April 30, 2020 | , ::

Canadians are beginning to explore site generation, and their utilities are facing the need to support them with connection services and supportive rates. While distribution costs are going up, sales revenues are going down. 

This webinar reviews why distributed energy resources (DER) creates this dilemma. We will review how Canadian utilities currently price DER, via net metering and net billing. We will then focus on why these pricing structures fall short in the traditional tasks of revenue recovery and efficient pricing. Next, we will review the candidate alternatives to the existing pricing structures, including providing an overview of their strengths and weaknesses. These strengths and weaknesses will help us to conclude what designs can deliver a successful DER outcome:  recovery of fixed costs and pricing that produces cost effective investment in site generation for them and the system. 

Learning Outcomes

• Review the pricing challenges of distributed energy resources 
• Identify how Canadian utilities are currently charging customers with DER 
• Explore the core challenges of fixed cost recovery and efficient pricing: how much DER is cost effective? 
• Evaluate how other utilities are updating their DER pricing, moving away from net metering and net billing. What are the candidate alternatives and how well do they work? 

1. The DER Pricing Dilemma  
   • Why do current pricing regimes create controversy? 
2. Current DER Pricing in Canada 
   • What are utilities offering their customers? 
   • Why is the present a good time to review DER pricing? 
3. The Challenges of Fixed Cost Recovery and Efficient Pricing 
   • How do net metering and net billing price DER? 
   • What are their strengths and shortcomings?
4. What’s a Distributed kWh Worth? 
   • How do utilities view the cost impacts of an avoided kWh? 
   • How do customers view these cost impacts? 
5. Pricing Alternatives for DER 
   • How successful is each alternative in resolving the DER pricing dilemma? 
   • What designs are the current leading price designs and why? 

Bruce Chapman, Vice President, Christensen Associates 

Mr. Chapman is a Vice President at Christensen Associates Energy Consulting. He assists clients in the electricity and natural gas industries to improve their costing and pricing capabilities. Mr. Chapman advises clients in such areas of expertise as: cost-of-service analysis and rate design based upon both established regulatory and market-based principles; innovative rate design including demand response products, renewables pricing, fixed billing, and other market-based retail pricing products; load forecasting and load research analysis. Additionally, he has supervised the development of software required for the implementation and support of innovative retail products. 

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Pricing Distributed Energy Resources: The Canadian Challenge

April 30, 2020 | ,