Document ID: FERC-2005-0411-0001
Agency: ferc
Document Type: Notice
Title: Assessment of Demand Response Resources
Posted Date: 2005-11-09T05:00Z

[Federal Register: November 9, 2005 (Volume 70, Number 216)]
[Notices]               
[Page 68002-68031]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09no05-54]                         

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. AD06-2-000]

 
Assessment of Demand Response Resources

November 3, 2005.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of Proposed Voluntary Survey and Technical Conference.

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SUMMARY: Pursuant to the Energy Policy Act of 2005 (EPAct 2005) section 
1252(e)(3),\1\ the Federal Energy Regulatory Commission (Commission) is 
preparing a report, by appropriate region, that assesses demand 
response resources, including those available from all consumer 
classes. A voluntary survey and technical conference are proposed to 
obtain information that will assist in preparing and publishing this 
report.
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    \1\ Energy Policy Act of 2005, Pub. L. 109-58, Sec.  1252(e)(3), 
119 Stat. 594, (2005) (EPAct section 1252(e)(3)).

DATES: (1) Comments on the proposed survey questions should be filed 
December 5, 2005.
    (2) Requests to participate in the technical conference are due 
December 5, 2005.
    (3) Comments on the proposed technical conference topics are due 
December 19, 2005.

ADDRESSES: Comments may be filed electronically via the eFiling link on 
the Commission's Web site at http://www.ferc.gov. Commenters unable to 

file comments electronically must send an original and 14 copies of 
their comments to: Federal Energy Regulatory Commission, Office of the 
Secretary, 888 First Street NE., Washington, DC 20426. Please refer to 
the Comment Procedures section of the preamble for additional 
information on how to file comments.

FOR FURTHER INFORMATION CONTACT:
    David Kathan (Technical Information), Office of Markets, Tariffs 
and Rates, Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-6404, David.Kathan@ferc.gov.
    Aileen Roder (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-6022, Aileen.Roder@ferc.gov.

SUPPLEMENTARY INFORMATION: 1. Take notice that a survey on the 
saturation and penetration of advanced meters is being proposed and 
that a technical conference, with comments, on issues raised by the 
Energy Policy Act of 2005 (EPAct 2005) section 1252(e)(3) \2\ will be 
held. Comments on the survey are due by December 5, 2005. The date, 
location, and agenda of the conference will be announced in a 
subsequent notice. Those wishing to participate in the technical 
conference should notify Commission staff by December 5, 2005. Finally, 
comments on the demand response issues addressed in the statute are due 
by December 19, 2005. These comments will help inform the discussion at 
the technical conference.
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    \2\ Energy Policy Act of 2005, Pub. L. 109-58, Sec.  1252(e)(3), 
119 Stat. 594, (2005) (EPAct section 1252(e)(3)).
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I. Background

    2. Section 1252(e)(3) of EPAct 2005 requires the Commission to 
draft and publish a report, by appropriate region, that assesses demand 
response resources, including those available from all consumer 
classes. Specifically, EPAct 2005 requires that the Commission identify 
and review:

    (A) Saturation and penetration rates of advanced meters and 
communications technologies, devices and systems;
    (B) Existing demand response programs and time-based rate programs;
    (C) The annual resource contribution of demand resources;
    (D) The potential for demand response as a quantifiable, reliable 
resource for regional planning purposes;
    (E) Steps taken to ensure that, in regional transmission planning 
and operations, demand resources are provided equitable treatment as a 
quantifiable, reliable resource relative to the resource obligations of 
any load-serving entity, transmission provider, or transmitting party; 
and
    (F) Regulatory barriers to improved customer participation in 
demand response, peak reduction and critical period pricing programs.
    3. A survey is proposed to obtain the needed information on meter 
saturation and penetration. With respect to the other issues the 
Commission must address in the report, input from state regulators and 
members of the industry will enhance its ability to present a 
comprehensive and well informed

[[Page 68003]]

report. To acquire this input, the public is invited to submit comments 
on the demand response issues addressed by the statute and to 
participate in a technical conference we will hold to discuss those 
issues.

A. Voluntary Survey on Saturation and Penetration of Advanced Metering 
and Demand Response

    4. A voluntary survey is proposed on the use of advanced metering 
and demand response, because adequate information on this subject is 
not collected by other sources. For instance, the information collected 
by EIA-861 (Annual Electric Power Industry Report) form administered by 
the Energy Information Administration (EIA) includes aggregate 
information on energy efficiency and load management, but does not 
include any information on advanced metering. In addition, the 
information on load management collected by EIA does not provide 
sufficient information to help identify existing demand response 
programs or time-based rate programs.
    5. The Commission will conduct the survey using the Internet. The 
proposed survey is targeted towards respondents who directly serve end-
use customers. Respondents will provide their information for the 
survey to the Commission on an Internet web-based form and submit their 
responses electronically directly to the Commission.
    6. Because there are no standard industry definitions, Commission 
staff is uncertain about the best set of questions for obtaining 
information on the saturation and penetration of advanced metering. For 
example, given the various types of meters with advanced functionality, 
it may be difficult to unambiguously define advanced metering. Instead, 
we propose a survey that asks a series of questions concerning meter 
functionality. Information on meter functionality will better assist in 
developing a definition of advanced metering that can be used to 
accurately estimate regional saturation and penetration of advanced 
metering. A national survey of advanced metering should also prove 
useful for planning and benchmarking by market participants.
    7. While the focus of the survey is on advanced metering, the 
proposed survey also contains several questions requesting information 
on existing demand response and time-based metering programs. These 
questions are designed to collect program information necessary to 
obtain information on demand response programs in response to section 
1252(e)(3)(B) of EPAct. Furthermore, in recognition that different 
individuals or departments may be responsible for completing the 
metering and demand response information, the survey will be 
implemented as two Web-based forms (one on advanced metering, and one 
on demand response programs) \3\ to ease data entry.
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    \3\ Please note that due to the limitations of the Web-based 
survey tool, the demand response survey includes multiple questions 
per customer class to accommodate respondents with more than one 
demand response program per class.
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    8. The proposed survey is attached to this Notice as an Appendix. 
The public is requested to comment on the survey questions. In 
particular, the public should comment on whether the questions will 
elicit accurate information on advanced meters and demand response 
programs, or whether the questions should be modified or supplemented 
to better obtain information. In addition, we solicit input on other 
sources of information on advanced metering and demand response 
programs. Comments on the survey are to be filed by December 5, 2005 
and should reference this proceeding.

B. Comments and Technical Conference

    9. Industry input is also needed in order to gain an objective 
appraisal of the issues identified in the EPAct 2005, particularly 
those which require the strategic assessments of businesses, such as 
the potential for use of demand response as a reliable resource for 
planning purposes, steps taken to treat demand response equitably in 
regional transmission planning, and barriers to improved customer 
participation in demand response programs. Therefore, written comments 
are requested on the six general topics listed in the EPAct 2005 in 
accordance with this Notice's Section II, below.
    10. In order to provide a forum for discussion of these issues, a 
technical conference will be held to gather additional data and receive 
further public comment on the issues we will address in the report. The 
date of the conference will be announced in a subsequent notice. Those 
wishing to participate in the conference should contact David Kathan 
David.Kathan@ferc.gov or (202) 502-6404) by December 5, 2005 and 
should reference this proceeding.
    11. The conference will be open to the public, and pre-registration 
to attend is not required.
    12. FERC conferences are accessible under section 508 of the 
Rehabilitation Act of 1973. For accessibility accommodations please 
send an e-mail to accessibility@ferc.gov or call toll free 1-866-208-
3372 (voice) or 202-208-1659 (TTY), or send a FAX to 202-208-2106 with 
the required accommodations.

II. Comment Subject Areas

    13. Commenters may address any of the demand response and time-
based rate issues raised and/or identified in EPAct 2005 section 
1252(e)(3). Commenters are encouraged, but not required, to consider 
and address the following questions within each of the six EPAct 2005 
issues in their response. Comments on these issues are due by December 
19, 2005.

A. Advanced Metering and Communication Systems

     How should the Commission define advanced meters and 
communication systems for the purpose of reporting to Congress?
     Are advanced meters necessary to implement demand response 
and time-based rate programs? Can sufficient demand response be 
fostered from non-communicating, non-hourly meters?
     In general, what are the current saturation and 
penetration levels of advanced meters?
     Does the implementation of an advanced metering system or 
use of advanced meters reduce utility costs?
     What level of penetration is needed to achieve cost 
savings? For example, can advanced meters be used only for certain 
customer groups or would all customers need to use advanced meters to 
make their use cost effective?

B. Existing Demand Response and Time-Based Rate Programs

     Describe the type of programs being used and the benefits 
or detriments of each programmatic approach.
     How have these types of programs changed since the early 
1990s?
     Have demand response and time-based rate programs 
increased or decreased in recent years?
     Are demand response programs implemented by electric 
utilities available to all customers, or are they targeted to specific 
customer groups or geographic areas, e.g., load pockets or transmission 
constrained areas?

C. Annual Resource Contribution \4\ of Demand Response
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    \4\ For purposes of this notice and proposed survey, resource 
contribution is defined as potential peak reduction at time of 
system peak.
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     Describe in general the extent of resource contribution by 
demand response for the geographic area you serve or represent.

[[Page 68004]]

     Identify and describe the best available sources of 
information on the annual resource contribution made by demand 
response, by region.
     What problems exist in measuring resource contribution? 
Should the measurement be on the basis of enrollment or on actual 
quantities used?

D. Potential for Demand Response as a Quantifiable, Reliable Resource 
for Regional Planning Purposes

     What percentage of total resource requirements could 
demand response resources reliably provide?
     What is the current role of demand response resources in 
meeting regional resource adequacy requirements and ancillary services?
     Explain the risks of relying on demand response for 
resource adequacy. Do the risks differ depending on the type of demand 
response?
     What is the potential impact of demand response on overall 
energy usage?
     Can time-based rate programs or interruptible/curtailment 
rate programs be counted as capacity resources in regional plans?

E. Equitable Treatment of Demand Response Resources in Regional 
Transmission Planning and Operations

     What is the status of including demand response within 
regional transmission planning and operations?
     Have demand response resources been examined during the 
development of regional transmission plans, and to what extent?
     Do current North American Electric Reliability Council 
(NERC) standards and regional reliability council rules accommodate the 
use of demand response as an alternative to building more transmission 
infrastructure, building generating capacity, or generating/purchasing 
more power?
     In regional transmission operations, such as RTOs and 
ISOs, what demand response resources are currently available? Under 
what circumstances are these resources called upon and at what level 
(kWs/kWhs)?

F. Regulatory Barriers to Improved Customer Participation in Demand 
Response, Peak Reduction, and Critical Period Pricing Programs

     What wholesale and retail regulatory barriers exist to 
improving customer participation in demand response?
     What regulatory barriers exist to improving customer 
participation in innovative time-based rate programs, such as critical 
peak pricing?
     What are the drivers and disincentives to customer 
interest in participating in demand response or critical period pricing 
programs?
     Do start-up costs limit the number of participants in 
demand response programs? If so, how should this issue be addressed?
     Does jurisdictional uncertainty between state and federal 
regulation create barriers to demand response programs?
     Are there regulatory or other barriers to participation of 
third-party curtailment service providers in ISO/RTO demand response 
programs? Are current settlement and payment procedures adequate for 
participation by these third-party entities?
     Given that distribution companies may no longer own 
generation or be a supplier of last resort, has their incentive to 
provide demand response been reduced? If so, what alternative 
mechanisms or policies should be considered to provide incentives to 
these distribution companies to implement demand response?
     Do current retail rate structures, which are largely based 
on volumetric rates, create a disincentive for distribution company 
promotion and implementation of demand response? If they do, how can 
this disincentive be reduced?
     What are the drivers or disincentives to load-serving 
entities offering aggressive demand response programs?

III. Information Collection Statement

    14. OMB regulations require that OMB approve certain reporting, 
recordkeeping, and public disclosure (collections of information) 
imposed by an agency.\5\ Accordingly, pursuant to OMB regulations, 
notice is given to the public that (1) the voluntary draft survey that 
is attached as an Appendix to this Notice is proposed to be 
administered using the Internet and a web-based application to collect 
the information electronically, and (2) OMB is being asked for review 
and approval of the final survey under section 3507(d) of the Paperwork 
Reduction Act of 1995.\6\
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    \5\ 5 CFR 1320.10 (2005).
    \6\ 44 U.S.C. 3507(d) (2005).
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    15. Comments are requested on the efficacy of the draft survey in 
the Appendix to this Notice and the accuracy of the estimates made to 
measure the burden on respondents of completing the survey that are 
detailed below.
    16. This Notice has been submitted to OMB for review and clearance 
of the Notice's information collection requirements. OMB approval has 
been requested by December 19, 2005.

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                                                      No. of          No. of         Hours per     Total annual
                 Data collection                    respondents      responses       response          hours
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FERC-727, Demand Response and Time Based Rate              1,500               1               1           3,000
 Programs Survey................................
FERC-728, Advanced Metering Survey..............           1,500               1               1           3,000
                                                 -----------------
    Totals......................................           3,000               2               2           6,000
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    17. Total Annual Hours for Collection: The reporting burden for 
this survey is estimated at 6,000 hours.
    18. Information Collection Costs: The surveyed organizations 
collect all the information requested in FERC-727 and FERC-728 as part 
of their customary and usual business practices. Comments are requested 
on the cost of responding to FERC-727 and FERC-728. The average 
annualized cost for all respondents is projected to be $324,000 (6,000 
hours [multi] $54 per hour).
    19. Title: FERC-727, Demand Response and Time Based Rate Programs 
Survey and FERC-728, Advanced Metering Survey.
    20. Action: Proposed Information Collection. The respondent shall 
not be penalized for failure to respond to this collection of 
information unless the collection of information displays a valid OMB 
control number.
    21. Respondents: Business or other for profit, publicly-owned 
utilities, and electric cooperatives.

[[Page 68005]]

    22. Frequency of Responses: One-time implementation.
    23. Necessity of Information: On August 8, 2005, Congress enacted 
EPAct 2005. Section 1252(e)(3) of the EPAct 2005 requires the 
Commission to draft and publish a report, by appropriate region, that 
assesses demand response resources, including those available from all 
consumer classes. Commission staff has reviewed public information to 
determine the availability of saturation and penetration data on 
advanced metering with the regional specificity required by the EPAct 
2005. The review included an assessment of the EIA-861, which collects 
aggregate information on energy efficiency and load management. The 
EIA-861 does not include any information on advanced metering. 
Moreover, there are no publicly available saturation and penetration 
data on advanced metering at the level required by the EPAct 2005. The 
Commission is dedicated to establishing clear market rules to govern 
electric markets. The information collected through this survey will 
assist the Commission in carrying out its goal of developing robust and 
efficient energy markets.
    24. Internal Review: Internal review at the Commission shows that 
there is specific, objective support for the burden estimates 
associated with the information requirements. The Commission will 
review the data resulting from the survey to ensure that the survey 
results meet the congressional requirements of the annual report on 
demand response in EPAct 2005. This conforms to the Commission's plan 
for efficient information collection, communication, and management 
within the electric industry.
    25. Interested persons may obtain information on the reporting 
requirements of the survey by contacting the following: Federal Energy 
Regulatory Commission, 888 First Street, NE., Washington, DC 20426 
(Attention: Michael Miller, Office of the Executive Director, 202-502-
8415, fax: 202-273-0873, e-mail: Michael.miller@ferc.gov. To submit 
comments concerning the collection of information and the associated 
burden estimates including suggestions for reducing this burden, please 
send your comments to the contact listed above and to the Office of 
Management and Budget, Room 10202 NEOB, 725 17th Street, NW., 
Washington, DC 20503 (Attention: Desk Officer for the Federal Energy 
Regulatory Commission), fax: 202-395-7285, e-mail: 
oira_submission@omb.eop.gov).

    26. The ``public protection'' provision of the Paperwork Reduction 
Act \7\ requires each agency to display a currently valid OMB control 
number and inform respondents that a response is not required unless 
the information collection displays a valid OMB control number on each 
information collection. This provision has two legal effects: (1) It 
creates a legal responsibility for the agency; and (2) it provides an 
affirmative legal defense for respondents if the information collection 
is imposed on respondents by the Commission through regulation or 
administrative means in order to satisfy a legal authority or 
responsibility of the Commission. If the Commission should fail to 
display an OMB control number, then it is the Commission not the 
respondent who is in violation of the law. ``Display'' is defined as 
publishing the OMB control number in regulations, guidelines or other 
issuances in the Federal Register (for example, in the preamble or 
regulatory text for the final rule containing the information 
collection).\8\ Therefore, the Commission may not conduct or sponsor, 
and a person is not required to respond to a collection of information 
unless the information collection displays a valid OMB control number.
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    \7\ 44 U.S.C. 3512(2000); 5 CFR 1320.5(b)(2005); 5 CFR 
1320.6(a)(2005).
    \8\ See 1 CFR 21.35(2005); 5 CFR 1320.3(f)(3)(2005).
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IV. Comment Procedures

    27. Interested persons are invited to submit comments on the 
matters, issues and specific questions in this Notice. Comments should 
refer to Docket No. AD06-2-000, and include the commenter's name, the 
organization they represent, if applicable, and their address. Comments 
may be filed either in electronic or paper format.
    28. To facilitate review of the comments, we request commenters to 
provide an executive summary of their comments. Commenters also are 
requested to identify each specific question posed in this notice that 
their discussion addresses and to use appropriate headings. Commenters 
should identify additional issues they wish to raise separately.
    29. Comments regarding the proposed survey are due December 5, 
2005.
    30. Comments on the proposed technical conference topics are due 
December 19, 2005.
    31. Those considering participating in the technical conference 
should contact David Kathan within December 5, 2005.
    32. All comments related to this proceeding may be filed 
electronically via the eFiling link on the Commission's Web site at 
http://www.ferc.gov. The Commission accepts most standard word 

processing formats and commenters may attach additional files with 
supporting information in certain other file formats. Commenters filing 
electronically do not need to make a paper filing. Commenters that are 
not able to file comments electronically must send an original and 14 
copies of their comments to: Federal Energy Regulatory Commission, 
Office of the Secretary, 888 First Street NE., Washington, DC 20426.
    33. All comments will be placed in the Commission's public files 
and may be viewed, printed, or downloaded remotely as described in the 
Document Availability section below. Commenters on this proposal are 
not required to serve copies of their comments on other commenters.

V. Document Availability

    34. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through the Commission's Home Page (http://www.ferc.gov) and 

in the Commission's Public Reference Room during normal business hours 
(8:30 a.m. to 5 p.m. eastern time) at 888 First Street, NE., Room 2A, 
Washington DC 20426.
    35. From the Commission's Home Page on the Internet, this 
information is available in the Commission's document management 
system, eLibrary. The full text of this document is available on 
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or 
downloading. To access this document in eLibrary, type the docket 
number excluding the last three digits of this document in the docket 
number field.
    36. User assistance is available for eLibrary and the Commission's 
Web site during normal business hours. For assistance, please contact 
the Commission's Online Support at 1-866-208-3676 (toll free) or 202-
502-6652 (e-mail at FERCOnlineSupport@ferc.gov), or the Public 
Reference Room at (202) 502-8371, TTY (202) 502-8659. E-Mail the Public 
Reference Room at public.referenceroom@ferc.gov.

Magalie R. Salas,
Secretary.
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[FR Doc. 05-22295 Filed 11-8-05; 8:45 am]

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