E Source Research Analyst, Jonathan Nelson, spoke at the 2012 spring conference hosted by the Advanced Load Control Alliance. In his presentation he provided detailed information on direct load control (DLC) survey results from North American utilities. For more information: http://www.esource.com/public/products/frs_edrp.asp

1. Hot or Not
DLC Program Benchmarks: How Do
You Compare?
Jonathan Nelson
Research Analyst, E Source
Advanced Load Control Alliance-Spring 2012
Meeting
www.esource.com Thursday, April 5th, 2012

2. Agenda
Overview and Preface
DLC Survey Results and Analysis
Musings on the Future of DLC
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3. Who is E Source
 Mission Statement: To advance the efficient and
environmentally sound use and provision of energy.
 Membership-based energy advisory service
 Utilities are our focus
 Unbiased research and analysis
 Fuel-neutral
 Product-neutral
 Vendor-neutral
 Program-neutral
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4. 2011 Heat Wave Rolls Across the U.S.
Source: National Oceanic and Atmospheric Administration
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5. Background: 2011 Regional Demand
Records
July Peak demand
 New electricity demand records: RTO (MW) Date
ERCOT, MISO, and PJM MISO 103,975 July 20, 2011
 Economic and emergency DR events PJM 158,450 July 21, 2011
initiated in Mid-Atlantic (e.g. BGE)
ERCOT 68,379 August 3, 2011
 NYISO and ISO-NE just barely missed
© E Source; data from ERCOT, MISO, PJM
their records.
August
 Lingering heat in southern states
 ERCOT sets another record
 Two DR events on the shoulders of the
month (August 4 and 24)
 Dallas news headline: ERCOT warns
of ‘high probability’ of rolling blackouts
as heat wave strains power grid
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6. DLC Member Inquiries
What kind of baselines
What are typical participation
are used in direct-load
rates for DLC programs?
control programs?
What vendors deliver and
manage DLC programs?
What kind of incentives do
utilities give to customers
participating in DLC programs?
What’s the mix between 1-way
and 2-way communicating
What are some typical figures technologies for DLC?
for load per customer in other
utility DLC programs?
What roles do enabling
technology and utility DLC
Can you provide attrition rates programs play in dynamic
from other DLC programs? pricing?
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7. 2012 DLC Benchmarking Effort
 Industry-wide
benchmarking analysis of
DLC programs
 Source to inform utilities on
trends in technology, DLC
program design and
performance
 Current sample includes data
from 23 utilities
 Data includes:
 Participation
 Load impacts
 Incentives
 Technologies
 Vendors
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8. Participation
Current Total Participants
Florida Power and Light 819,500
Xcel Energy (MN) 375,000
Pacific Gas and Electric 164,950
Xcel Energy (CO) 149,000
Louisville Gas and Electric 138,700
Duke Energy (NC) 123,000
Rocky Mountain Power 104,921
Commonwealth Edison 73,000
Progress Energy Carolinas 71,000
MidAmerican Energy 63,129
Duke Energy (IN) 51,000
Alliant Energy 48,000
Dakota Electric Association 46,400
KCP&L 41,433
Idaho Power 37,000
Dominion 35,146
PNM 32,177
SMECO 32,000
Vectren Energy 27,600
Wisconsin Public Service 25,500
KCP&L-Greater Missouri Operations 11,199
Hoosier Energy 7,100
Roseville Electric - City of Roseville 3,800
0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000
Current Total Participants (Res and SB)
Source: E Source
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9. Participation Rates
5,000,000
Residential Participation Rates 60.0%
50.0%
4,000,000
Total Residential Customers
Participation Rate
40.0%
3,000,000
30.0%
2,000,000
20.0%
1,000,000
10.0%
0 0.0%
Total Residential Customers Residential Participation Rate
Source: E Source
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10. Participation Rates
Small Business Participation Rates
500,000 30%
25%
400,000
Eligible Small Business Customers
20%
Participation Rate
300,000
15%
200,000
10%
100,000
5%
0 0%
Dakota
Xcel Energy Pacific Gas Louisville Gas Florida Power Vectren
PNM Electric
(MN) and Electric and Electric and Light Energy
Association
Eligible SB Customers 200,000 49,437 450,000 100,000 330,000 20,000 5,000
SB Participation Rate 7% 6% 1% 5% 6% 3% 28%
Source: E Source
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11. Participation Rates by Program Age
Residential Participation vs. Program Age
30 60.0%
25 50.0%
Participation Rate
20 40.0%
Program Age
15 30.0%
10 20.0%
5 10.0%
0 0.0%
Program Age (years) Residential Participation Rate Linear (Residential Participation Rate)
Source: E Source
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12. Incentives
Distribution of Incentive Methods
Monthly Bill Discount
4%
Non-Cash Incentive
One-time Enrollment
9%
Incentive
9%
Yearly incentive
39%
Monthly Bill Credit
39%
n = 23
Source: E Source
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13. Does Incentive Type Impact Participation
Rates?
Residential
Utility Incentive Type
Participation Rate
Louisville Gas and Electric monthly bill credit 17.4%
Idaho Power monthly bill credit 9.4%
Commonwealth Edison monthly bill credit 2.1%
Alliant Energy monthly bill credit 11.8%
Hoosier Energy monthly bill credit 2.6%
Vectren Energy monthly bill credit 21.1%
Dakota Electric Association monthly bill credit 48.0%
Duke Energy (NC) monthly bill credit 7.8%
Wisconsin Public Service monthly bill credit 6.7%
Xcel Energy (MN) monthly bill discount 33.2%
KCP&L no cash incentives 9.2%
KCP&L-Greater Missouri Operations no cash incentives 4.1%
Pacific Gas and Electric one-time enrollment incentive 3.5%
Duke Energy (IN) one-time enrollment incentive 7.5%
Xcel Energy (CO) yearly 12.9%
Rocky Mountain Power yearly 14.9%
PNM yearly 6.5%
Progress Energy Carolinas yearly 6.6%
Florida Power and Light yearly 20.0%
Dominion yearly 1.7%
Roseville Electric yearly 8.1%
MidAmerican Energy yearly 11.5%
SMECO yearly 23.5%
Source: E Source
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14. 14
$0
$10
$20
$30
$40
$50
$60
Commonwealth Edison
Louisville Gas and Electric
Vectren Energy
Idaho Power
Alliant Energy
Duke Energy (NC)
Monthly Bill Credit
Hoosier Energy
Incentive Amount
Wisconsin Public Service
Dakota Electric Association
Roseville Electric - City of
Roseville
Rocky Mountain Power
Florida Power and Light
PNM
Progress Energy Carolinas
Yearly Incentive
MidAmerican Energy
Residential Participation Rate (entire territory)
Dominion
Xcel Energy (CO)
Incentive amount probably doesn't matter so much!
SMECO
Do Incentives Impact Participation?
Source: E Source
0.00%
www.esource.com || © 2012 E Source
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
Penetration Rate

15. Participation Rates
 Take Away: One size doesn’t fit all
 Program participation rates depend on various factors
that are defined by individual utility needs and strategic
planning
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16. Load Impacts: Overall Program
Total Available Capacity (MW)
Florida Power and Light 999
Xcel Energy (MN) 395
Duke Energy (NC) 175
Louisville Gas and Electric 152
Xcel Energy (CO) 150
Pacific Gas and Electric 138
Commonwealth Edison 112
Progress Energy Carolinas 90
MidAmerican Energy 67
Idaho Power 47
PNM 39
SMECO 37
Alliant Energy 36
KCP&L 36
Dominion 35
Wisconsin Public Service 32
Vectren Energy 25
KCP&L-Greater Missouri… 11
Hoosier Energy 9
Roseville Electric 4
0 200 400 600 800 1000
MW Controlled
Source: E Source
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17. Load Impacts: kW per Participant
kW Controlled/Program Participant
1.80
1.60
1.40
kW Controlled
1.20 1.11
1.00
0.80
0.60
0.40
0.20
0.00
Utility
kW per Participant Average Source: E Source
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18. Marketing DLC Programs
 Basic is the mainstay
 Direct-mail and email are the most cost-effective
 Nearly as effective as traditional options (TV, print, radio,
telemarketing)
 Value Propositions that Motivate Customers
 Cash
 Convenience
 Ease of participation
 Serving the collective good
 Segmentation Matters
 Different customer segments are motivated by different
messages
Source: E Source
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19. Marketing and New Participants
Marketing Spending & New Participants
$2,000,000 35,000
$1,800,000
30,000
$1,600,000
25,000
$1,400,000
New Participants
Marketing Spending
20,000
$1,200,000
$1,000,000 15,000
$800,000
10,000
$600,000
5,000
$400,000
-
$200,000
$- Progres
(5,000)
Florida Louisvill Pacific
Rosevill Commo MidAme Xcel s
Alliant Power Idaho e Gas Gas Dominio
e nwealth rican SMECO Energy Energy
Energy and Power and and n
Electric Edison Energy (CO) Carolina
Light Electric Electric
s
Marketing Spending Last Year $15,000 $17,000 $30,000 $36,202 $43,916 $66,000 $184,680 $762,000 $1,319,4 $1,320,0 $1,770,0 $1,800,0
New Participants 1,200 300 5,000 574 8,163 13,312 6,156 20,140 17,057 24,890 19,000 32,000
Source: E Source
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20. DLC Vendors
Technology Vendor Utilities Using Vendor*
Cooper 13
Comverge 9
Honeywell 3
Aclara 3
Entek 1
Gridpoint 1
Tantalus 1
*Some programs use more than one
Source: E Source
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21. How Advanced Are They?
Real-time participation Web-enabled remote
Utility
verification? programming of devices?
KCP&L no yes
KCP&L-Greater Missouri Operations no yes
Xcel Energy (CO) no no
Xcel Energy (MN) no no
Rocky Mountain Power no no
PNM no no
Progress Energy Carolinas no no
Pacific Gas and Electric no yes
Louisville Gas and Electric no no
Idaho Power no no
Florida Power and Light yes, via power-line carrier no
Dominion no no
Commonwealth Edison yes, via customer's meter yes
Alliant Energy no no
Hoosier Energy yes, via power-line carrier no
Roseville Electric no no
Vectren Energy no no
Dakota Electric Association no no
Duke Energy (NC) no no
MidAmerican Energy no no
Duke Energy (IN) no no
Wisconsin Public Service no no
SMECO no no
Source: E Source
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22. What About Dynamic Pricing?
Customers can What kind of
Utility participate in dynamic pricing
dynamic pricing? program?
KCP&L yes TOU
KCP&L-Greater Missouri Operations yes TOU
Pacific Gas and Electric yes CPP, PTR
Commonwealth Edison yes HP
Source: E Source
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23. Musings On The Future of DLC
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24. Where Do We Go From Here?
 Most programs are still legacy programs
 Old technology + limited functionality = limited options
 New opportunities for DLC
 FERC Order 745: DR can compete with supply side
resources in electricity markets – PJM first to comply
(4/2/2012)
 Ancillary Services: Non-Spinning and Spinning Reserves,
Frequency Regulation (FERC Order 755)
 Requires more advanced programs and technology
 Rather than just shaving the peaks, DLC can be a robust
tool to meet routine demand needs.
 What needs to happen to get us there?
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25. For More Information
Jonathan Nelson
Research Analyst, Research, E Source
303-345-9164 jonathan_nelson@esource.com
Have a question? Ask our experts: www.esource.com/question
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