ML19329E284
| ML19329E284 | |
| Person / Time | |
|---|---|
| Site: | Midland |
| Issue date: | 09/01/1978 |
| From: | Baker K CONSUMERS ENERGY CO. (FORMERLY CONSUMERS POWER CO.) |
| To: | |
| Shared Package | |
| ML19329E285 | List: |
| References | |
| U-5306, NUDOCS 8006120584 | |
| Download: ML19329E284 (19) | |
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Consumers Power Company Experimental Bate Program In April 1977 Consumers Power Company initiated an Experimental Rate Program to investigate Time-of-Day Rates, Controlled Service and Heat Storage concepts. The attached copies of testimony in Case No. U-5306 before the Michigan Public Service Commission outlines the general plan of study. Field data collection is scheduled to end in December l$r79 Preliminary analysis has begun on the first few months of load study data. Final results of the field experiments will be available in 1980. [::- n,..Q' .n ?
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. .' l * ' D _ : *^ -- - n Rates & Rate Research Department September 1, Igr[8
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-4 STATE OF MICHIGAN-
-BEFORE THE MICHIGAN FUBLIC SERVICE COMMISSION f
.In The Matter of The Application ) +
of COUSUMEES POWER COMP.Erl For ) Authority to Conduct a Limited ) Case No U-5306 7 Time-of-Day. Rate Study and a )- l C_ontrolled Service Rate Study ) 4 ( Direct Testimony of 4
!! L Baker .
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K L BAKER 1 . Q. Please state your name and business address. 2 A. > tnneth L. Baker, 212 West Michigan Avenue, Jackson, Michigan. 3 'Q. By whom are you employed? . 4 A. Consumers Power Company. 5 Q. What is your position with Consumers Power Company? 6 . A. I am Supervisor of Rate Research. 7 Q. Will you state your educational background? 8 A. I graduated from the University of Michigan in 1960 with a Bachelors 9 Degree in Electrical Engineering. I received a Masters Degree in 10 Business Administration from Wayne State University in 1972. I have 11 also been a Registered Professional Engineer in the State of Michigan 12 since 1964, 13 Q. For what period of time have you been associated with Consumers Power
, 14: Company?
15 A. I have been associated with Consumers Power Company since 1960. 16 Q. What has been your business experience during that period? 17 A. Upon graduation from college in 1960 I was hired by consu=ers Power 18 Company in their Graduate Student in Training Program. Frca 1961 19 through 1962 I worked as an Engineering Assistant at the Company's 20 Karn-Weadock ElectricG ' enerating Plants at Essexville. 21 During the period from 1962 to 1968 I held the position of 22 Associate, Power Sales Engineer in the Flint Division and P wer Sales 23 Engineer in the Northwest Division at Traverse City. My primary 24 - responsibilities included the administration of' electric rates for ( 25 industrial and large commercial customers, and technical assistance
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1 to customers on electric energy applications. 2 In 1968 I returned to the co=pany's offices in Jackson as a 3 General Power Sales kngineer in the Gent.ral Office Marketing Depart-
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4 ment and subsequently held the position of General Power Services 5 Engineer frca 1972 - 1975 My duties included providing functional
'6 direction to the Company's Power Servic'e engineers in the field, 7 customer negotiations for transmission and sub-transmission facilities 8 to serve major loads and.the development of programs to encourage 9 energy ccuservation and impro've customer load factbr. In May 1975 10 I became Supervisor of Rate Research.
! 11 What are your duties as Supervisor of Rate Research? Q. 12, A. I supervise the planning and implementation of all activities of the i 13 Rate Research Department which include electric and natural gas load 14 research studies to determine load characteristics of the various 15 classes of custccers; special analytical studies related to rates 16 and surveys to obtain data on custccer characteristics and energy 17 applications. In addition the Rate Research Department assists 18 other departments such as Customer Service and Public Relations in 19 questionnaire design and sampling procedures for opinion and attitude 20 studies. . l 21 Q. What is your participation in this proceeding? 22 A. I'am sponsoring testimony and an exhibit in this proceeding regarding 23 two experimental studies consumers Power company is prepared to impicment. l 24 -Q. What are'these two studies? -
., . 25 A. Consistent with the Commission's Order dated January 23, 1975 in case N _
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3 1 No. U-45'76, Consumers Power Company is prepared to imple=ent a 2 limited time-of-day rate study and a controlled service rate study.
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'3' q. What is the objective of the limited ti=e-of-day study?
4 A. The objective is to gather and analyze data necessary for determining 5 the feasibility of using rate structures e=phasizing time-of-day pricing for all =ajor Consu=ers Power Cc=pany sec,ondary electric rate 7 classes and to assess the net benefits to be derived frc= such struc-8 tures with particular emphasis to shifting electric usage frc= peak-9 load periods to off-peak periods. 10 4 How do you propose to determine what custc=ers will participate in 11 the study?
..- 12. A. Samples of potential participants for each rate concept will be selected
( 13 randomly fre= the Cc=pany's files e= ploying sa=pling procedures developed 14 for load studies conducted by the Cc=pany. The sa=ples will be analyzed 15 to insure that all parts of the service area and al' levels of consu=p-16 tion are represente:1. When suitable lists of customers are developed, 17_ the custo=ers will be contacted to solicit their participation. 18 Participation will be voluntary. 19 q. Do you have before you an exhibit marked for identification and entitled 20 as follows: Exhibit A - (KB-1) Time-of-Day Study - 21 Proposed Sa=pling Schedule 22 A. Yes, I-have. 23 Q. Was Exhibit A - (KG-1) prepared by you or under your supervision? 24 A. Yes, it_was.
' 25 4 . Mr. Baker, would you please describe Exhibit A (KG-1)?
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. k 1 A. This exhibit shows the approximate number of sample customers proposed 2 for the field time-of-day experiments. The sample design is consistent 3 with established methods used by the Co=pany for load research studies.
4 Data frc= other current and past load research studies wil' be used as 5 a bench = ark for measuring any significant shifts in pattern of use that 6 =ay occur as the result,of the time-of-day rates under test. 7 The exhibit shows that plans call for a total of 755 customers 8 in the time-of-day rate test and 10 custc=ers in the Residential Heat 9 ' Storage Study. 10 The ti=e-of-day rate test will include only those sample custc=ers 11 who are currently on Secondary Electric Rates A, 3 and C. 12 Experimental Rate X-1 will be tested with three subsampics consisting ( 13 of 33 non waterheating and 55 waterheating residential custo=ers and 33
-14 large fam customers. The large fa m sample will be selected'at rando 15 from a list of fam custo=ers with annual consumption of 20,000 Ern or 16 = ore. This sample will be examined to assure that all major types 17 offam perations are represented.
18 Experi= ental Rate X-2 will be tested with two subsamples consisting 19 of 33 non waterheating and 55 waterheating residential custc=ers. The 2O_ rando= sa=ple selected will be analyzed to assure that it is statistically q. 21 similar to the residential subsa=ples in the Rate X-1 test, 22 Approxi=ately 200 co==ercial and industrial custo=ers currently on 23 General Secondary Service Rate B will be rando=ly selected for the field 24 test. One hundred will be placed on Rate X-4 and the re=ainder on 23 Rate X-3 Samples drawn for the test will be analyzed to assure that e 6
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'l a variety of co=ercial and industrial operations are represented.
2 The time-of-day rate test will also include a rando= sa=ple of 3 ce=ercial and industrial customers who are currently on Rate C. k Approximately 110 customers with demands in exc'ess of 100 kw will be 5 Placed on Rate X-8. Sa=ples of other Rate c custc=ers will be selected 6 in two groups of H8 each and placed on experimental rates X-6 and X-7 7 respectively. These sa=ples will also be evaluated to assure adequate 8 representation of various co=ercial and industrial operations. 9 The Residential Heat Storage Study will involve 10 new residential lo structures. Space heating service on Rate X-3 win be separately metered i n and controlled. Custe=crs will be selected on' an individual basis for y the heat storage test. 13 q. Why is the proportion of ce=ercial and industrial custe=ers considerably 14 larger than the proportion of residential custc=ers represented in the 15 rate experiments? 16 A. One of the primary criteria in lead study sa=ple design is tha variability 17 in use and load factor. Past. load studies conducted by the Co=pany have 18
.shown that residential customers tend to exhibit similar patterns of use 19 and can therefore be represented with a relatively small sa= ole. On the 20 other hand the electric energy use patterns of ce==ercial and industrial 21 customers are highly variable due to the differences in typ.es of business 4
22 and =anufacturing activities and operating hours. Consequently a rela-23 tively larger sa=ple size is required to adequately represent the electric 24 energy use patterns of co=ercial and industria$. custc=ers. O. Do you plan to offer any financial incentive to participants in the D
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o y-1 Time-of-Day rate experiments? 2 A. We are conside< ring an annual payment in the range of $30 to $50 to 3 each residential participant in the test. The purpose of this pay =ent 4 vill be to expedite the solicitation of customers for the test and to 5 help cc=pensate the= for the time and inconvenience necessary for 5 installing the test cetering and for several custp=er interviews 7 scheduled during the two year test period. A si=ilar incentive payment 8 =ay be considered for small ec==ercial and industrial custc=ers if 9 , difficulties are encountered in soliciting these participants for the 10 rate exper bents. 11 Q. How will you measure custc=er reaction to time-of-day rates? 12 A. i All participants receiving single phase se71cc will have two-rate 13 register ti=e-of-day =eters and load study recorders installed on 14 their premises. The two-rate register =eters will separately 15 record both on-peak and off-peak usage. The registers will be activated 16 bf ti=e clocks. The load survey recorders will provide continuous 17 time related usage data. Custo crs receiving polyphase service will 18 . have load study recorders only.. All participants will be billed on 19 the.ti=e-of-day rates for the entire test period. Data will be 20 collected for 24 months to provide sufficient time to =easure changes 21 in consu=ption patterns an:1 living styles, to insure perman'ence of 22 changes and to insure reliability of results. The Company will study 23 the data as it becomes available and ce= pare it with that obtained in 24 the 1976 electric syste= load study conducted by the Company and frc= 25 ,a continuous load study of 121 residential custo=ers on standard rates O e
7 e (- 1 to be maintained throughout the test period. In addition, participants 2 will be interviewed periodically to determine actions they are taking 3 t adapt to the rate (s), if these actions are temporary or long ter=, g and their opinions and attitudes toward time-of-day rate (s) including 5 any specific proble=s they =ay have encountered. 6 The interviews vill be conducted by an independent survey research 7 organisation. Extensive analytical work will be done to evaluate the g data obtained and deter =ine customer acceptance of time-of-day rates. 9 Q. Reference was made previously to an experimental electric storage heating 10 rate. How does this tie' in with the t1=e-of-day study you have been n describing? 3 A. The electric storage heatihg rate is si=ilar in purpose to the time-of-( 13 d"Y "*t** i* th"* it 18 d*81 8 "** * "hift 1 "d t ff-58"k h '"8-14 As a part of our study of time-of-day rates we plan to conduct a 75 test of residential electric storage heating. Electric storage 16 heating equip =ent is designed to store heat during off-peak periods 77 at night for use the next day. A typical heat storage device consists 18 f a highly insulated =etal enclosure containing a cera=ic =aterial 19 to store heat ene m . The equipment has the potential for shifting 20 significant loads to off-peak periods. 21 Q.
,, Would you please describe your plan for testing electric storage 22 heating equip =ent?
23 A. We plan to have storage heating equipment installed in ten single 24 fa=ily residences. The installations will consist of both individual 25 roc = units and several central storage heating installations. The e
8 i 1 equipment will be time clock controlled so that all heat,is stored 2 during an eight hour charging period between the hours of 9 p and 3 9 am. The equipment will charge fully in eight hours or less depending 4 on cutside te=perature. During the eight hour charge period, sufficient 5 heat is placed into the storage core to allow the heaters to maintain 6 correct room temperature for a period of 16 hours, after charging has 7 been completed. The heating charge level is automatically controlled. 8 Once the systen has been adjusted during initial installation, charging 9 will take place auto =aticany. The only electric energy the tu;its 10 require during the on-peak hours is a s=all c=ount used by 11 a discharge fan system which supplies heat to the room. Uniform 12 discharge air te=perature and individual roca temperature control is i 13 provided. 14 Q. . What limitations do you see to videspread adaptation of electric storage 15 heating? 16 A. Currently there are two principal ones. The first is high equipi::ent cost 17 which is estimated to be approxi=ately $3,500 for an average size residence. 18 This is about four to five times as much as the equipment would cost for a 19 standard baseboard electric heating system. This does not include installa-20 tion expense which would probably be comparable to the cost of installing 21 resistance heating. The second.14 itation is one involving. system design. 22 Since an installation has to store heat during the eight hour charging 23 period for use during the rest of the day, the system has to be oversized 24 in comparison with a conventional electric heating system. The average (' 25 , si::e storage heating installation would have an off-peak de=and in the i I . l
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1 36 to 40 kw range. If electric storage heating were to be utilized 2 extensively, it could require increasing the size of distribution 3 transfor=ers and portions of the distribution syste=. Distribution 4 syste= loading limits could restrict the nu=ber of heat storage installa-5 tions that could be allowed on a given distribution circuit. E:ctensive 6' utilization of electric storage heating could also create a new syste 7 peak which would occur at night. This actually happened at one ec=pany 8 in Ger=any. Storage heating has been used extensively in England, 9 Ger=any and other countries in Europe for a nu=ber of years so it is a 10 well established concept. 11 q. Who will pay for the storage heating equi;=ent that is to be used in .a 12 this test? A. Consumers Power Company will purchase the equip =ent needed and make the 13 lh necessary arrange =ents to have it installed in new hcmes. We plan to limit ur de: nstrati n test to new single family homes. After the test 15 16 is co=pleted, the customer will be given the opportunity to assume owner-17 ship of the equi;=ent or, if he prefers, we will have it recoved and 18 replaced with a conventional electric heating syste= at our expense. 19- 4 Do you plan to conduct a cost benefit. analysis in connection with the 20 study of ti=e-of-day rates? 21 A. Yes. At an appropriate ti=e, esti=ates of the probable costs and 22 benefits associated with the implementation of time-of-day rates will 23 be =ade. This will include the effect on custc=er accounting costs, i 24 customer service expense, metering equipment, electric syste= design
,3 and operation, fuel cost, and deferred plant investment. I i
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l 1- q. What is the esti=ated cost to conduct the ti=e-of-day study? 2 A. - The study has been designed so that the cost is expec+ed to be in line 3 with the a=ount determined as appropriate by the co==ission in its order k in Case U-4840. Specifically, the cost is estimated to be approxi=ately 5 $900,000. This figure does not include the cost of supervisory ti=e, 0 nor does it-include the cost of any previous syste: electric load studies 7 which will be used to establish a bench mark for measuring i= pacts of 8 alternate rate structures. 9 q. Would you please describe the controlled load study you plan to conduct? 10 A. The controlled Icad study involves an on-line experi=ent for centro 11ing 11 custo=er loads en a selected pri=ary distribution circuit utilizing 12 co==ercially available remote control equip =ent of proven design. The ( 13 equip =ent will probably use a one-way signal, although two-way signaling N devices have not been ruled out for the test. Plans call for a coded 15 signal to be inj2cted on the distribution circuit which will terminate 16 power to a given set of custo=cr =ajor loads. Different codes will 17 have the effect of shutting off different equipment. A subsequent 10 signal will be injected to re-energise the custo=er load. 19 q. What loads do you plan to control? 20 A. Loads to be controlled include water heating, air conditioning, and 21 space heating at both the residential and cc==ercial level. The 22 actual mix of controlled leads is dependent on the specific loads 23 available on the primary distribution circuit selected for the test.
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- The control system will also be used to operate the register switching 25 on a limited number of dual-register time-of-day =eters to be installed p >-m
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on selected residential custc=ers on the same primary circuit 2 Q. How =any customers do you plan to install control devices on? 3 A. 4 Plans call for the installation of control devices on appr oxt=ately 5 100 residential customers and 50 commercial . custocers As mentioned previously, the actual mix of both the loads and custccers is d 6! ependent on the circuit selected for the. test. 7 Sc=e customers on the test may have core than one load controlled. 8 Q. How do you plan to measure the ability of the system to def 9 loads? er custc=er 10 A. 11
' To determine the ability to defer customer loads, the e controll d oad, the total premise load and equipment response to coded 12 signal vill be ceasured.
13 These load data vill be used to develop custc=er load es. pro i These profiles vill then be compared with ones from previous l 14 oad studies and an upcoming air conditioning load study to ascertain oad the l 15 effect of the control system. 16 By simulating variation of these load data, the level of effectiveness by which daily nor mo thl 17 y system peaks can be centro 11ed vill be determined. 18 This analysis vill deter =ine both the magnitude and the probable redistribution of any o 19 loads. r all controlled - 20 $ 21 Finally the results of this test and analysis vill be u sed to develop 22 the basic specifications or criteria for nn ideal oper ti a onal control 23 system. , The system vill he,e to be one which can satisfactoril y accomplish 24 the various shifts f.centified in the simulation stage without introducing 25 any adverse effects and be acceptable to the customers affected . Q. Whac is the ti=e period in which the study is to be co d n ucted? e e Y
12 1 A. Deliveries of equip =,ent from various manufacturers constitutes a variable 2 as to the timing of the study. If all goes as planned, the study will 3 coc=ence during the first quarter of 1978. once started, the study vill 4 continue for twelve consecutive months. Analysis of the results should 5 then be co=pleted during 1979 6 . Q. Since the filing does not request an experi= ental control rate, do you 7 plan to co=pensate test customers for their participation in the study? 8 A. Ue are planning to pay, as an incentive, $2.00 per month per controlled 9 load to each test customer for their participation in the study. An 10 initial payment of $10 per custc=er vill be offered as an induce =ent to 11 ' recruit participants.
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, 12 Q. Who vill pay for the installation costs and equipment cost at the i
13 premise of each test custc=er? 14 A. The installation costs and equip =ent costs for all signal receiving - 15 equip =ent and controls vill be borne by the Company for all test 16 custo=ers. 17 Q. Do you plan.to interview test customers as to the effects of the 18 controls on their living styles and/or operations? , 19 A. We plan to retain an independent research' firm to interview test customers as to the effects of the control syste= on their lifestyles 20 21 and/or business operations. This phase of the studv vill ascertain 22-the level of discomfort-if any, or change in operations experienced due to the control system. 23 , 24 Q'
.. Does the study call for a cost benefit analysis of the load control 25 concepts being tested.
13 1 A. The study does include a cost benefit analysis of load control concepts. 2 The objective of this phase of the study is to estimate the probable 3 cost benefits associated with the imple=entation of a supervisory 1; control system. This step vill include the effect of load control on 5 such things as: customer service expense, metering and controlling 6 equipment costs, maintenance and testing expense, fuel cost, deferred 7 , plant invest =ent, and the potential impact of changes in load diversity 8 on existing system design and operation.
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9 4 Are there plans to evaluate different control systems? 10 A. The technical evaluation of various control systems is to be perfor=ed
.l.1 by the Company's Electric Distribution Engineering Department. This 12 vill be acco=plished by contacting utilities who have studied and/or
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13 installed such systems and by contacting vendors who manufacture or 114 have the capability to manufacture such systems. This step vill also 15 involve a literature search to review technical papers which have 16 been written on this subject. Information to be gathered vill cover 17 technical design and operating infomation; data on costs, serviceability 18 reliability, expected life; information relating to the application 19 tes of the equipment and co==unication media; and information 20 relating to the general adaptability of each system to the operating 21 environ =ent of the Company. Each system vill be evaluated based on 22 considerations which include at least the following: 23 a) Purchase' price of all ce=ponents i 2t; b) Installation, operating and maintenance costs 25 c) Expected component life and replace =ent costs
., '. . 14
(* 1 d) Transition time for implementation
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2 e) Reliability of the control system 3 f) Operational flexibility 4 g) Adaptability to the Co=pany's electrical system 3 configuration 6 h) Compatibility with time-of-day and/or automatic 7 meter reading 8 i) Co=patibility of expansion to control other loads 9 j) Adaptabilitytosupervisorycontroland/orautomation 10 f distribution system. 11 Q.' What is the projected cost of the controlled load study? 12 ' A. Tte projected cost of the controlled load study is expected to be in ( 13 line with the a=ount deter =ined appropriate by the Coc=ission in its 14 order in Case U-4840. More specifically, the esti=ated cost of the 15 , study is expected to he $300,000.00. This figure does not include 16 the cost of supervisory time nor does it include the cost of any 17 previous system electric load studies which will be used to establish 18 a bench mark for =easuring the controlled system's ability to shift load.- 19 20 21 . 22 23 24 es
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, a.
t STATE -OF MICHIGAN
- BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSIO i
) In The Matter of The Application ) *
.of CONSUMERS PCWER COMPAHY For )
Authority to Conduct a Limited ) ' Case'No U-5306 Time-of-Day-Rate Study and a ) Centro 11ed Service Rate Study ) ( Exhibits of K L Baker 8 k 6
. , Case No U-5306 Exhibit A- (KLB-1)
Witness K L Baker Date b' TIME OF DAY STUDY PROPOSED SA'eLEIG SCHEDULE Current Rate Current Code Proposed Rate No. In Sample A (RES) 000 (NON 'E) X-1 33' A (RIS) 001(WH) . X-1 55 A (RES) 000 & 001 (FARM) X-1 33 4 Sub Total A X-1 121 J A (RES) 000 (NON-WH) X-2 33 A (RES) 001 ('E) X-2 55 Total A 209 B (GEN S'ECOUDARY) 010 (COM'L) & 020 (eld) X-4 100 B (GEN SECONDARY) S/4iE AS ABOVE X-5 100 Total B 200
~ r (GEN SECOI:DARY) 011 (COM'L) & 021 (HQ) X-6 118
( 160 (COM'L) & 161 (ED)(CCM3 LT & .ra) C (GEN SEC0!DARY) S/41E AS A30VE X-7 118 C (GEN SECONDARY) SE S AS ASOVE X-8 110
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Totel C ' 346 TOTAL IN TD2 0F DAY STUDY 755 RESIDHITIAL HEAT STORAGE STUDY Current Rate Current Code Proposed Rate No. In Sa=le A-1 (RES) 030 & 031 (ELEC-SH) X-3 10 I i 1 l l
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