INNOVATIONS IN GREEN

TARIFFS: SPRING 2017

IMAGE: FLICKR/ORAN VIRIYINCY

May 12, 2017

INTRODUCTION

Letha Tawney - Director Of Utility Innovation And

Polsky Chair For Renewable Energy, World

Resources Institute

Tom MacLean - Manager, Customer Renewable

Energy, Puget Sound Energy

Tim O'Brien - Economic Development Manager,

Omaha Public Power District

INTRODUCTION

Kirk Myers - Senior Manager, Sustainability,

Recreational Equipment, Inc.

Rachel Brombaugh - Energy Policy and

Partnerships Specialist, King County, WA

Megan Smith - Director of Climate and Energy

Initiatives, King County, WA

Energy BuyersUtilities

A utility energy product that replaces a customer’s standard resource mix

and monthly bill with locally-delivered renewable energy, typically at a

fixed price.

WHAT IS A GREEN TARIFF?

PROGRESSION OF GREEN TARIFFS IN THE US

http://www.wri.org/us-green-tariff-deals-chart

GREEN TARIFFS ARE DELIVERING RE

Nearly 435,000 tons of CO2 avoided annually

U.S. RENEWABLE ENERGY MAPWhere companies can buy renewable energy through the grid.

http://www.wri.org/us-re-corporate-buyers-map

MARKET-BASED RATE: OMAHA PUBLIC POWER

DISTRICT

SUBSCRIBER PRODUCT: PUGET SOUND ENERGY

http://www.wri.org/us-re-corporate-buyers-map

LEADING THE WAY WE POWER THE

FUTUREFOR WRI – INNOVATIONS IN GREEN TARIFFS:SPRING 2017

Tami Monroe, Division Manager – Business Analysis and Pricing

Jamie Freeman, Manager - Pricing

Tim O’Brien, Manager – Economic Development

AGENDA

• OPPD Overview

• Journey to Rate 261 M

• 261 M – Large Power – High Voltage

Transmission Level – Market Energy

• Q&A

CORPORATE OVERVIEW

• Publicly owned, business-managed electric

utility governed by an elected board of eight

directors

• Low rates and nationally recognized customer

service - No general rate increase planned

through 2021

• Serves a population of approximately 820,000

people (369,500 customers

• Ranks as the 12th-largest public power utility in

the U.S. in number of customers served

• Moving towards 50% renewables based on

2016 IRP

• Vision – Leading the way we power the future

JOURNEY TO RATE 261M

• Economic development partnerships – Targeting of data centers, bio solutions, and

advanced manufacturing

• 2015 Corporate Feedback– Schedule 261 - Large Power – High Voltage

Transmission Level

– Rider 499 – Green Sponsorship Program

• Feedback from the industry and cooperate buyers including Facebook & Yahoo

261M OVERVIEW

• Approved by OPPD’s board in

January 2017

• Modification of schedule 261

• Based on OPPD’s cost of service

model – recovering fixed costs

• Flexibility in how customers meet

their renewable energy goals

• Led to the attraction of

Facebook’s newest data center

location

261M OVERVIEW

• 20MW demand minimum at 161kV

• Customer owned substation

• OPPD provides retail service to the customer, including generation and system capacity, transmission and administration

• Components– Demand Charge + Customer Charge + (Energy = Hourly

Southwest Power Pool market Price)

• Renewable project is not required, a customer could use only market pricing

CUSTOMER RENEWABLE PERSPECTIVE

• Cost: energy component of their utility bill is based on hourly market price.

• Revenue: customers renewable asset produces revenue based on hourly market price.

• This revenue and cost offset, leaving the cost of the customers renewable asset. This, in concept, becomes the energy cost for their facility.

EXAMPLE

• Southwest Power Pool market price on May 12 at 11:00AM is $28/MWh.

• Customer is charged $28/MWh on their utility bill.

• Customer receives $28/MWh for the output from their renewable asset.

• “Net” energy cost is equal to the cost of the renewable asset.

• Customer has – Additionally with their renewable asset

– “Net” cost of their facility is aligned with the renewable asset

THANKS!

• Tami Monroe– Division Manager – Business Analysis and Pricing

– tmonroe@oppd.com

– 402-636-3067

• Jamie Freeman– Pricing Manager

– wjfreeman@oppd.com

• Tim O’Brien– Manager – Economic Development

– trobrien@oppd.com

– 402-636-3731

Leading the way we power the future

GREEN DIRECTVOLUNTARY RENEWABLE ENERGY

TARIFF

Thomas MacLean, PhDCustomer Renewable Energy Development

Renewable Energy Buyers’ Alliance WebinarMay, 2017

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PUGET SOUND ENERGY

• 6,000-square mile service territory

• 10 Washington state counties

• 1.1 million electric customers

• 800,000 natural gas customers

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OUR BUSINESS ENVIRONMENT

• Meager load growth• Increasing customer expectations

• Strong environmental/sustainability ethic• Tech savvy & online-oriented customers

• Mayors’ Climate Initiative

• Traditional vertically integrated utility• Carbon footprint larger than neighbors• “Strict Constructionist” regulators

(Washington Utility and Transportation Commission)

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CUSTOMER CHOICES FOR RENEWABLE ENERGY

UNDER RCW 19.29A.090

EXISTING GREEN POWER PROGRAM

(SCH 135, 136)

• REC purchases

• 40,000 customers

• residential, commercial, municipal

BULK REC PURCHASES

• Excess PSE RECs

• 10,000,000 kWh

• large business

GREEN

DIRECT

(SCH 139)

• Long-term partnership with PSE for dedicated energy resources

• large commercial, municipal

SOLAR CHOICE(SCH 135)

• Solar RECs from central plant with high productivity

• residential and small commercial

Green Power Program – Retail RE

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TALKING TO CUSTOMERS

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

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GREEN POWER PROGRAM DESIGN

40,000+ customers

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GREEN DIRECT REALITY

Utility

Customers

Renewable Energy Project

28

GREEN DIRECT BILLING

Numbers are for illustrative purposes only and not final

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GREEN DIRECT CHARGE

Cost of Energy and RECs

Annual reporting of Renewable Energy

Certificates for customers, WREGIS, Green-e

Billing system updates

LossesTaxes

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GREEN DIRECT ENERGY CREDIT

INCLUDED

Energy-Related Power Costs

NOT INCLUDED

Demand-Related Power Costs

Transmission and Distribution

Billing, Meters, Meter Reading, Customer

Accounting and Services

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GREEN DIRECT SUMMARY

Green Direct creates a new partnership between PSE and Customers

Contract commitment for 10, 15 or 20 years

Contract by location – but all locations not required

Energy will be delivered to PSE balancing authority area

Utility-Based: on-bill, reliable, safe and EES eligible

King CountyBellevueRedmondKirkland

SammamishMercer IslandPort of SeattleBainbridge Island

AnacortesBellinghamWWUSound Transit

TukwilaIssaquahSnoqualmieOlympia

Available to customers with 10 million kWh per year & Governments

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QUESTIONS?

Thomas.maclean@pse.com

SUBSCRIBER PRODUCT: PUGET SOUND ENERGY

http://www.wri.org/us-re-corporate-buyers-map

Please contact: Letha Tawney or WRI’s Global Energy Program

THANK YOU!