AUSenergy News Update: 11/13/2013
Nov 13, 2013

In today’s AUSenergy Update: The U.S. needs more natural gas fueling stations and PJM proposes changes in its real-time pricing mechanism and presents a proposal to FERC to ease the process for Demand Response registration.

Natural Gas Fueling Infrastructure Needed

Summary: The U.S. will have to recognize the need for a cross-country network of natural gas stations if the country is to take advantage of the low cost, clean-burning and abundant fuel.
AUS Comment:  There are approximately 250,000 natural gas vehicles on the road today. Most of them are owned by commercial and government fleets. Growth in CNG vehicle market is expected to grow.

PJM Changes Real-Time Pricing

Summary: Several stakeholders claim that Local Marginal Pricing (LMP) has been negatively impacted by demand response (DR) events for years. PJM cited the July 18th heat wave as an example. At that time, a DR event was called and a large influx of imports caused prices to crash.
AUS Comment: PJM proposed changing its real time pricing methodology to increase the revenue reserve requirements under certain circumstances, which could result in increased pricing. It is not yet clear what the changes would be.

PJM Wants to Streamline the Demand Response Registration Process

Summary: PJM is requesting that the Federal Energy Regulatory Commission (FERC) remove a provision that requires load-serving entities (LSEs) to perform the economic load response program (ELRP) registration process when customers register to take part in a demand response program. This process requires the LSE to verify that they are the applicant’s LSE, that there are no existing contractual obligations preventing participation, and to ensure that all laws and regulations are being followed. PJM argues that the electric distribution company (EDC) already performs these same functions and requiring LSEs to do so is not cost effective and slows down the DR registration time. Removing LSEs from the process would also make it easier for curtailment service providers to aggregate smaller customers.
AUS Comment: If FERC adopts PJM’s recommendation, the process for customers to enroll in demand response programs should be streamlined. Also, smaller customers will face fewer barriers to aggregation, which may help provide them with increased revenue.

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