November 19, 2024
Plan to Increase Solar Adoption and
Develop Additional Distributed
Energy Resources
Eric Cutter, Partner
Item 8.b
2 Table of Contents
Introduction and Objectives
Challenges and Opportunities
Solar Adoption and Rebate Trends
Solar and Storage Installation Rates in California
Net Energy Metering and Net Billing Tariffs
Technical Potential Analysis
Costs of Solar and Storage Systems
Scenarios
Key Results
Economic Analysis
Community Outreach and Engagement
Next Steps
3 Introduction and Objectives
Category 1
Develop Plan to Increase
Solar and Energy Storage
Penetration and Develop
Additional Distributed
Energy Resources (DERs)
Category 2
Dispatchable Capacity
and Demand Reduction
Calculation
Category 3
Cost-Benefit Analysis
10% of GWP customer solar and energy storage adoption by 2027 Additional dispatchable and peak load reduction capacity of 100 MW City Council Resolution of August 2022
4 Balancing Multiple Objectives
Delivering Grid
& Community
Benefits
Encouraging
Customer
Adoption
Managing
Cost-Shift &
Affordability
5 Opportunities
Challenges and Opportunities
Clean Energy Vision
• 60% RPS by 2030 (CA regulatory
requirement)
• 100% Clean Energy by 2035 (Glendale
goal)Transmission & Land Constraints
• Procuring new renewables outside of the
City
• Procuring new renewables within the City
IRP Planning Challenges
• Integrating renewables, retiring coal,
converting to hydrogen CT
• Maintaining system reliability
Maintaining leadership in
clean and renewable energy
Unlocking more local
generation
Reducing fossil generation
(Grayson Repower, etc.)
Challenges
6 Solar Adoption and Rebate Trends: 2001 - 2024
7 Solar Installations of California Utilities
Utility-level net metering solar and storage installation and customer count data collected and derived from EIA Form 861 2023 early release version: https://www.eia.gov/electricity/data/eia861/ City of Glendale
2027 Solar Adoption Target
NEM Installations as % of Total Electric
Customers
Selected CA Utilities (available in EIA 861 2023ER)
8 Energy Storage Installations of California Utilities
2027 Battery Storage Adoption Target
City of Glendale
Utility-level net metering solar and storage installation and customer count data collected and derived from EIA Form 861 2023 early release version: https://www.eia.gov/electricity/data/eia861/ Selected CA Utilities (available in EIA 861 2023 ER)
NEM Battery Installations as % of Total Electric
Customers
9 Rate
Increase
Net Energy Metering (NEM) and Net Billing Tariff (NBT) – Impacts on Equity Utility
Costs Not
Avoided
by Solar
Avoided by
Utility
Scale
Solar
Avoided
by
Customer
Solar
Not Utility
Costs
Utility
Costs
Avoided
by Solar
NEM 1.0
Cost
Shift
Solar Benefits
Environmental &
Societal
Energy, GHG,
Some Capacity
Some
Transmission &
Distribution
NEM 1.0 Bill
Savings
Rate
Increase
Utility
Costs Not
Avoided
by Solar
Utility
Costs
Avoided
by Solar
NBT
Cost
Shift
NBT Bill Savings
10 California’s NEM Cost Shift and Solar Adoption Post NBT Source: https://www.californiadgstats.ca.gov/charts/
NEM PV
Installations
Energy
Storage
Installations
Net Billing Tariff
11 Technical Potential Analysis
Not
Technically
Feasible
Not
Cost-
Effective
Not
Technically
Feasible
Not
Achievabl
e
Technical Potential
Theoretical maximum generation or capacity available
Economic Potential
Economically cost-effective according to
specific criteria
Achievable Potential
Practical estimate considering
real-world, policy levers, and
likelihood of adoption
Not
Technically
Feasible
Not
Cost-
Effective
12 Solar and Storage Technical Potential Capacity by Customer Sector Total # of
Units
# of Solar-
Suitable Units
Total PV
Capacity
(MW)
Total Battery
Storage Capacity
(MWh)
Total Battery
Dispatch
Capacity
(MW)
Single-Family 23,843 19,046 95 559 279
Multi-Family 61,201 49,130 86 216 108
Commercial & Industrial 9,474 7,491 132 115 57
* Statistics for solar-suitable buildings under E3 “mid-case.” Omits sites that could not be categorized.
Total # of
Units
# of Solar-
Suitable Units
Total PV
Capacity
(MW)
Total Battery
Storage Capacity
(MWh)
Total Battery
Dispatch
Capacity
(MW)
Owner 31,904 25,355 176 550 275
Tenant 62,588 50,299 137 339 169
Manager 26 14 0.05 0.39 0.20
13 Solar and Storage Technical Potential by Customer Sector Based on developable roof area, system size limits, site suitability, and other constraints
Note: These figures represent the theoretical maximum of solar and storage capacity under applicable policies and other constraints. In our adoption analysis, systems are sized based on customer needs. 95 MW
30%
5 kWdc/cust
86 MW
27%
2 kWdc/cust
132 MW
42%
18 kWdc/cust
Rooftop Solar
Potential in
Glendale
559 MWh
63%
29 kWh/cust
216 MWh
24%
4 kWh/cust
115 MWh
13%
15 kWh/cust
Battery Storage
Potential in
Glendale
14 Costs of Different Types of Solar and Storage Systems • Modeled Market Price (MMP) Benchmarks from NREL Q1 2023 Customer
Owned
Solar + Storage
Community
Solar +
Storage
Utility-Scale
Solar +
Storage
$4,700
$2,900
$2,10040%
120%
$/kW Cost
60%
15 Scenario 1: Continue NEM
Scenario 2: Targeted
LMI/DACs & MF Adoption
Scenario 3: Balanced
Scenario 4: High Adoption
Target Scenarios: Trade-offs of Adoption, Equity, & Costs NEM
Compensation
Additional
Incentives
Resolve
Split
Incentives
Provide
More Utility
Support
Program &
Incentive
Design
Address
Additional
Barriers
• Low and Moderate Income (LMI)
• Disadvantaged Communities (DACs)
• Multi-family (MF)
16 Other Utility Support
Pathways to Glendale’s DER Adoption Target
Best-case scenarios for evaluating the theoretical feasibility of achieving adoption targets
NEM Compensation Additional Incentives* Split Incentive S1
S2
Targeted LMI & MF
Adoption
S3
Balanced
S4
High Adoption
S5
Direct Install
NEM at retail rates
NBT at avoided costs
NEM at retail rates
NEM at retail rates
NBT above avoided
costs but below retail
rates
Federal and state
Federal and state, utility
direct install for
LMI/DAC MF customers
Federal and state, and
direct install for MF renter
LMI/DAC customers
Federal and state, 5-yr
payback utility incentive
for all MF customers
Federal and state, 7-yr
payback utility incentive
for LMI/DAC MF
buildings
Persist
Optimistic outlook on
enhanced community
outreach and support,
along with improved
permitting processes
starting early 2025
Optimistic outlook on
split incentive being
resolved or mitigated
by off-site solar or
other financing
solutions starting
early 2025
S0
Business as Usual
NEM at retail rates Federal and state Persist At the Current Level Persist At the Current Level
Evaluate Adoption Strategies ReferenceHypothetical
Feasibility
*Additional incentives is a general representation of all types of incentives including potential upfront incentives and performance-based incentives offered by GWP. Assuming receipt of GWP incentives requires customers dispatch battery storage against utility signals to maximize community benefits.
Continue Current NEM
17 Scenarios are shaped by stakeholder inputs, policy directions, and the balancing of multiple GWP objectives.
Each proposed program portfolio should be evaluated based on its effectiveness in addressing these values from various perspectives.
Scenario Evaluation Approach
Encouraging
Customer
Adoption
Delivering
Community &
Grid Benefits
Managing
Cost-Shift &
Affordability
Balancing Multiple
Objectives
Adoption Ratepayer
Impact
Rate & Bill
Impact
Distributiona
l Equity
Impact
Others
Key Scenario Performance Metrics
18 Key Results: Bill Savings and Utility Incentive Levels by Scenario Variations in customer segments may lead to a range of outcomes NEM Compensation 2025 Level
($/kWh)
Additional Incentives* 2025 Level ($/W) S1
Continue Current NEM
S3
Balanced
S4
High Adoption
S5
Direct Install
NEM at retail rates
NEM at retail rates
NEM at retail rates
NBT above avoided
costs but below retail
rates
Federal and state
Federal and state, utility
direct install for all MF
renter LMI/DAC
customers
Federal and state, 5-yr
payback utility incentive
for all MF customers
Federal and state, 7-yr
payback utility incentive
for LMI/DAC MF
buildings
S0
Business as Usual
NEM at retail rates Federal and state
Evaluate Adoption Strategies ReferenceHypothetical
Feasibility
.
0.13-0.28
0.00 0.11-0.22
0.06-0.25
0.13-0.28
0.00 0.13-0.28
0.00 N/A
N/A
0.00 0.00
1.3-1.5
1.4-1.5
1.0-1.2
1.7-1.8
0.00 0.00
S2
Targeted LMI & MF
Adoption
NBT at avoided costs
Federal and state, utility
direct install for
LMI/DAC MF customers
0.09-0.19
0.08-0.28
2.6 1.65
N/A
N/A
19 Additional Incentives NEM Compensation
Key Results: Adoption Level, Equity, and Access by Scenario Adoption scenarios represent an upper bound of how much adoption we can expect S1
Continue Current NEM
S3
Balanced
S4
High Adoption
S5
Direct Install
NEM at retail rates
NEM at retail rates
NEM at retail rates
NBT above avoided
costs but below retail
rates
Federal and state
Federal and state, utility
direct install for all MF
renter LMI/DAC
customers
Federal and state, 5-yr
payback utility incentive
for all MF customers
Federal and state, 7-yr
payback utility incentive
for LMI/DAC MF
buildings
S0
Business as Usual
NEM at retail rates Federal and state
Evaluate Adoption Strategies ReferenceHypothetical
Feasibility
2) Percent of total adoption that occurs in each customer group
S2
Targeted LMI & MF
Adoption
NBT at avoided costs
Federal and state, utility
direct install for
LMI/DAC MF customers
2027
Customer
Adoption1
9.6 %
60 MW
1.5 %
5 MW
11.6 %
58 MW
2.7 %
7 MW
11.8 %
59 MW
2.1 %
6 MW
15.8 %
70 MW
2.0 %
6 MW
5.2 %
39 MW
0.8 %
3 MW
10.0 %
48 MW
10.0 %
10 MW
2027
Equity & Access2 MF Renter
LMI
5% 12% 11%
0% 11% 11%
MF Renter
LMI
10% 10% 16%
13% 22% 18%
MF Renter
LMI
44% 46% 42%
56% 58% 54%
MF Renter
LMI
41% 43% 37%
55% 59% 54%
MF Renter
LMI
51% 52% 40%
72% 67% 47%
MF Renter
LMI
51% 54% 53%
92% 93% 93%
1) Theoretical modeled economic adoption
20 Economic Analysis: Cost Tests
Total Resource Cost (TRC)
Participant Cost Test (PCT)
Utility Cost Test (UCT)
Ratepayer Impact Measure
(RIM)
Societal Cost Test (SCT) Society as a whole
City of Glendale
Will utility costs increase
or decrease?
Will utility rates increase
or decrease?
Net benefits for customer
installing PV?
21 Economic Analysis of Scenarios: Cost Test Scores
S1
Continue Current NEM
S2
Targeted LMI/MF
Adoption
S3
Balanced
S4
Widespread Adoption
Participant
Cost Test
2.25 2.16
3.04 3.04
Ratepayer
Impact
Measure
0.28 0.45
0.39 0.29
Societal Cost
Test
1.87 2.09
2.11 2.17
≥ 1.0
22 All scenarios have annual net ratepayer costs that increase GWP rates due to accelerating DER adoption
Annual Net Ratepayer Costs
S4
S2
S3
S1
23 • 20-44 MW
• Cumulative by 2027
• Best-case adoption
forecast across all
scenarios that will
be further limited by
real-world barriers
• 100-152 MW
• Cumulative by 2027
• Best-case adoption
forecast across all
scenarios that will
be further limited
by real-world
barriers
Nameplate vs. Effective Peak Dispatchable & Peak Load-Reducing Capacity
DER Nameplate
Capacity
DER Effective
Capacity
DER Effective Load
Carrying Capacity
Peak
Dispatchabl
e
Peak Load
Reducing
•LDEV VGI: Light-Duty Electric Vehicle Vehicle-Grid Integration - excluded due to its relatively low deployment level projection in the near term
•Energy Efficiency: peak saving forecasts are available from the GWP IRP, which are assumed to already account for capacity contributions
Customer
Solar
Customer
Storage
LDEV
Managed
Charging
Res & Com
Demand
Response
Energy
Efficiency*
LDEV VGI*
Achieving 100 MW additional effective capacity, considering DER’s ability to reduce GWP system peak demand, will require approximately 200-300 MW DER nameplate capacity coming online by 2027 24 Community Outreach and Engagement
Stakeholder Participation
Meeting 1
Wednesday,
February 28th
In-Person
Meeting 2 Saturday, March 2nd In-Person
Meeting 3 Monday, March 11th Zoom Webinar
Meeting 4 Wednesday, May 15th In-Person
Meeting 5 Thursday, May 30th In-Person
Community Outreach
ü Two bill inserts & direct mail reminders
ü Dedicated webpage
ü Press releases
ü Social media posts
ü Email and text message blasts
25 Environmental Justices & EquityUnderstanding Barriers to DER Adoption Community Outreach and Engagement
26 Community Outreach and Engagement
Community Meeting #5Community Meeting #1Glendale Local Press Coverage
Presenter: Jun Zhang Presenter: Eric Cutter
27 Findings: Achieving the adoption goals by 2027 is not feasible Achieving a goal of 10% customer solar adoption by 2027 is not feasible. The goal is theoretically feasible by 2030 with a significant increase in utility costs and effort, but real-world barriers remain.
Achieving a goal of 10% customer storage adoption in the near future is not feasible.
Achieving a goal of 100 MW of reliable peak load reduction with DERs is not feasible.
Recommendations
§ Set an adoption goal in terms of MW of installed capacity rather than a percentage of customers. § Perform additional analyses of realistically achievable potentials for customer-owned, community, and utility-scale solar and storage.
§ Develop an integrated resource plan with the potential and MW targets for each resource type.
Industry studies suggest that achievable potential is 20%-40% of the technical potential.
28 Findings: Adoption of customer-owned solar and storage increases GWP rates
The scenarios achieving 10% solar adoption would result in a projected net cost of $23-$45 million to GWP ratepayers from 2024 to 2027.
§ Implement a Net Billing Tariff to reduce the cost shift. § Develop and implement non-bypassable charges and fixed customer charges to reduce the cost shift. § Evaluate the cost and feasibility of changes to GWP’s billing and metering systems needed to implement a Net Billing Tariff.
The resulting rate increase would be 6-11% by 2030, with a low- and moderate-income (LMI) customer monthly bill increase of $4-$6.
Recommendations
29 Recommendations and Next Steps
November 19, 2024
City of Glendale City Council
Ruzan Soloyan – Clean Energy Officer
City of Glendale Water & Power
GWP Customer Survey (Over 2,000 Customer Responses)
Top Priorities of GWP Customers
Customer Quotes
“How much will the bills of those of us who decline to install solar go up in order to implement these plans? Assuming that they, like the trash collection fees, will go up, how much of those funds will actually be spent on "green" technology vs. to pay consultants and private contractors?.” “My concern is reliable, affordable
and locally generated electricity so
my bills stop going up and in case of
a natural disaster our power is not
interrupted.”
30 “Utility rates
should not
increase to
achieve these
goals.”
“This should not by any means raise
rates for tenants who can’t have
access to this or forced to pay more in
electricity when landlords keep raising
rates like we are all making money
when the truth is a lot are scraping
by.”
Residential Single-Family Solar Installations and Projections Number of Systems
percentage of ADOPTION RATE
2001-2002
2002-2003
2003-2004
2004-2005
2005-2006
2006-2007
2007-2008
2008-2009
2009-2010
2010-2011
2011-2012
2012-2013
2013-2014
2014-2015
2015-2016
2016-2017
2017-2018
2018-2019
2019-2020
2020-2021
2021-2022
2022-2023
2023-2024
2024-2025
2025-2026
2026-2027
2027-2028
2028-2029
2029-2030
0 1,000
2,000
3,000
4,000
5,000
6,000
7,000
0%
5%
10%
15%
20%
25%
30%
Cumulative Number of Solar Systems Customer Adoption Rate 31 Solar Adoption Projections in Glendale by 2030
Customer
Class
Number of
Connections
Current Generation
Capacity (MW)
Projected Generation
Capacity (MW) by 2030
Residential Single Family 24,234 18.1 35
Non-Residential 9,869 11.2 15
Total Customer Owned Solar 87,281 29.3 50
Utility Owned Solar (Phase 1 & 2) - 0 8*
Power Purchase Agreements - 0 2*
Total Solar Capacity - 29.3 ~ 60**
Additional Achievable Energy Efficiency
Savings on Peak (Proposed Programs) - - Additional analysis pending for proposed EE programs
* In Progress
** 15% of Forecasted (380 MW) Total Peak Demand
32 Proposed Programs
1. In-System Solar Power Purchase Agreement (PPA) Program • Proposed launch in November 2025
• Guarantee long-term rate and better understanding of ROI • Looking at providing location-specific incentives for using underutilized space 33 2. Comprehensive Residential Energy Efficiency Rebate Program • Proposed launch in August 2025
• Offer more rebates for energy efficiency measures to support the adoption of distributed energy resources.
• Lower upfront costs could help customers adopt above-code technology.
3. Comprehensive Energy & Water Assessments, Installations & Concierge Services • Proposed launch in January 2026
• Offer comprehensive energy & water assessments & direct installations • Provide concierge services to identify additional incentives and tax credits
Recommendations
1. Accept the findings of the E3 study to inform GWP’s strategic direction.
2. Amend Resolution No. 22-125 as follows to support affordability and reliability of energy services:
• Implement a target of 60 MW of solar generating capacity by 2030 in lieu of 100 MW peak dispatchable capacity, which was determined to be infeasible by the E3 study • Approve the development of the following programs to enhance energy efficiency and reduce peak demand:
• In-System Solar Power Purchase Agreement (PPA) Program • Comprehensive Residential Energy Efficiency Rebate Program • Comprehensive Energy and Water Assessments, Installations, and Concierge Services
3. Approve the amendment to the existing PSA with E3 to increase the total amount by $52,330, to a new total not to exceed amount of $388,205.
34 Questions?
35