The document summarizes a forum on integrated systems planning held on December 3rd, 2018. It includes introductions from various participants and organizations involved in energy and environment issues. The forum discussed Phase I and Phase II of the e21 initiative, which aims to have proactive stakeholder engagement on regulatory issues to reduce costs and improve outcomes. Specific topics discussed included improving utility resource planning, key questions around building a reliable and affordable low-carbon grid, and the role of the Minnesota Public Utilities Commission in grid modernization efforts.

1. E21 Forum: Integrated
Systems Planning
December 3rd, 2018
Wi-Fi Network: WALKER_GARDEN
No password required, follow on-screen prompts
e21

2. WELCOME
TREVOR DRAKE
GREAT PLAINS INSTITUTE

3. INTRODUCTIONS
AUDREY PARTRIDGE
CENTER FOR ENERGY AND ENVIRONMENT

4. MIKE BULL
DIRECTOR OF POLICY AND EXTERNAL AFFAIRS,
CENTER FOR ENERGY AND ENVIRONMENT

5. Phase I: Founded in 2014
Conveners: Project Team for Phases 1 and 2:

6. Analog & Manual
Centralized
One-way flow
Cleaner
More Distributed
Multi-directional
Little consumer
choice
More consumer
choice
Digital & Automated
e21 = Response to Changing Electric System

7. e21’s Distinguishing Features
Proactive Multi-interest &
Collaborative
Voluntary
Done in advance of crisis
Agreement could reduce
transaction costs & improve
outcomes
Consensus-oriented
Safe space outside of
formal regulatory process
Arose from mutual interest
among participants
Opportunity for diverse
interests to travel
common learning curve

8. Phase I (2014): Broad Consensus
MN Regulators Should Be More Proactive In
Addressing Key Issues
Regulatory Process Must Evolve
Early and Sustained Stakeholder
Engagement is Critical
Utility Business Model and Regulatory
Framework Must Evolve

9. Phase II (2015-16): Three Focus Areas
Performance-Based
Compensation
Integrated Systems
Planning
Grid Modernization

10. MN PUC-Initiated Investigations
• Grid Modernization2015
• Advanced Rate Design2015
• Distribution Interconnection2016
• Performance Metrics/Incentives2017
• Transportation Electrification2018

11. Improving Resource Planning
Utility
Resource
Planners
Clean Energy
NGOs
State Regulatory
Staff
Customer
Advocates
Renewable
Developers
Academics
Integrated Systems
Planning Working
Group

12. Improving Resource Planning
Early, Proactive Stakeholder Engagement
• Seek stakeholder input re: Assumptions, Scenarios, Sensitivities as
part of plan development
Biennial Planning Conference
• Share best practices and planning innovations
• Resolve cross-utility issues

13. Improving Resource Planning
Improve Modeling Capability
• Evaluate other planning modeling software to supplement or
replace Strategist
Emphasize System Approach
• Transition to a more “End to End” analysis, furthering incorporating
load-side resources into our resource planning

14. Key Questions
• How to Create the Grid We Need – Reliable, Flexible, Resilient
• How to Keep Costs Affordable for Customers
• How to Treat Load as a Serious Resource
• How to Best Address Needs of Plant Communities and Workers
• What is the Role of Natural Gas

15. Three Keys to a Healthy Low Carbon Economy
Maximize
Efficiency
Decarbonize
Electricity
Strategic
Electrification

17. MATTHEW SCHUERGER
COMMISSIONER,
MINNESOTA PUBLIC UTILITIES COMMISSION

18. Matthew Schuerger, Commissioner
Integrated System Planning:
A Regulator's Perspective
December 3, 2018

19. Topics
• Rates & Costs, Transition to Date, Challenges Ahead
• Renewables Integration – Regional Grid & Markets
• Emerging Issues – Grid Services, Flexibility, Electrification
• Modernization – Distribution Grid & Retail Rates
• Looking Forward – Planning for an Integrated Grid

20. Competitive Electricity Rates
Average Retail Price
Source: U.S. Energy Information Administration, EIA-861, 10/12/18
Average price of electricity to consumers is a weighted average of total consumer revenue (energy, demand, fuel adj., riders, etc) and total sales across all sectors.
6.00
7.00
8.00
9.00
10.00
11.00
2013 2014 2015 2016 2017
Centsperkilowatthour
Midwest Minnesota
United States Michigan
Wisconsin North Dakota
South Dakota Iowa
Kansas

21. Affordable Electricity Costs
Average Residential Monthly Bill
Source: U.S. Energy Information Administration, EIA-861
$80
$90
$100
$110
$120
$130
2013 2014 2015 2016 2017
DollarsperMonth
Minnesota Midwest United States

22. Trends in MN Economic Growth, Electricity Use, and
Emissions
Sources: U.S. Energy Information Administration
U.S. Bureau of Economic Analysis

23. Integrated Resource Planning
Framework to Date
Size,
Type, &
Timing
DSM
Alternatives Forecast
Existing
Generation
Rate
Increase
Approved
Forecast
Adjustments
Finance
Adjustments
Assign Costs
Design
Rates
Specific
Facility
Approved
Forecast
Alternatives
Environment &
Socioeconomics
Siting/Routing
Approved &
Constructed
Public
Participation
Alternatives
Environmental
Review

24. Wind and SolarMN Wind Capacity
as of September 2018
MN: 3700 MW
Source: MN Department of Commerce

25. SolarMN Solar Capacity
as of September 2018
Source: MN Department of Commerce

26. Minnesota Generation Fleet Transition
Experience to date: 1990 - 2017

27. Minnesota Electricity in Transition
Current Plans: 2017 - 2030
2017
* New natural gas plants added (3 intermediate combined
cycle plants and 2 peaking combustion turbines) and new
renewables added, per MN IOU IRPs & announcements.
2030*

28. Minnesota Generation Fleet Transition
Upcoming: 2020 - 2040

29. Grid integration of large amounts of wind generation the
upper Midwest began in the early 2000s:
Several Minnesota-centric grid integration studies (2001, 2004,
2006, 2009, 2014), focused on operating reliably and economically
with large amounts of variable renewables
Study methods/models and depth of collaboration evolved as
understanding of challenges developed.
Today, the regional grid is planned and operated differently;
new approaches and tools; improved market rules.
Integration of Variable Renewables
Minnesota Experience

30. Integration of Variable Renewables
Lessons Learned
Reducing Wind and Solar integration impacts
– Large, liquid, fast markets;
– Large balancing area with a strong grid; and
– Forecasting wind generation day-ahead
Midwest experience integrating wind
– Variability is mitigated by geographic diversity;
– Wind contributes to resource adequacy;
– Market rules have evolved to require fuller wind participation.
Wind and solar generators are power plants
– Are Dispatched; Ride through disturbances; Provide reactive power;
Capable of fast and accurate ramping and active power control.

31. Essential Reliability Services (NERC)
The changing resource mix motivates us to evolve our
planning:
- Less coal, more renewables, more demand response, more gas;
- How will this affect grid attributes that we don’t explicitly plan for
today?
Core grid services include:
- Voltage control;
- Frequency support;
- Ramping capability.
These essential reliability services can and increasingly will
come from a range of resources.

32. Flexibility Supply Curve
Source: NREL, “The Role of Energy Storage with Renewable Electricity Generation”, Paul Denholm et al., January 2010
Flexible load as a resource and the robust regional grid & markets
are key to enabling the evolving resource mix.

33. U.S. National Electrification Assessment – 2015 to
2050
For more information on EPRI’s Efficient Electrification Initiative:
https://www.epri.com/#/pages/sa/efficientelectrification

34. MN Grid Modernization
❖ Maintain and enhance the safety, security, reliability, and
resilience of the electricity grid, at fair and reasonable costs,
consistent with the state’s energy policies;
❖ Enable greater customer engagement, empowerment, and
options for energy services;
❖ Move toward the creation of efficient, cost-effective, accessible
grid platforms for new products, new services, and opportunities
for adoption of new distributed technologies;
❖ Ensure optimized utilization of electricity grid assets and
resources to minimize total system costs;
❖ Facilitate comprehensive, coordinated, transparent, integrated
distribution system planning.

35. Integrated Distribution Planning
Source: De Martini - ICF, Integrated Distribution Planning, August 2016. Prepared for the Minnesota PUC.

36. MN PUC Modernization Dockets
• Interconnection Process (2018)
• Technical Standards (2019)
Interconnection
Standards
• Distribution Planning (2018)
• Grid Upgrades - AMI/ADMSDistribution Grid
• TOU/Critical Peak Pricing
• EV Infrastructure and RatesRate Design
• Xcel Multi-Year Rate Case
• Metrics/Incentives
Performance
Considerations

37. Evolving Electric Grid
The grid is at a time of significant change, as:
• Large infrastructure ages;
• Consumer demands evolve;
• New technology costs fall.
=> Decarbonization, Decentralization, Digitization
Distribution will need updated planning & investment;
Regional transmission will continue to be vital; and,
Resource planning must evolve to identify and capture benefits for consumers of an
increasingly integrated system.
Tomorrow’s integrated grid will optimize and extract value throughout the system:
• will be more distributed and flexible;
• will operate resiliently;
• will be reliable, affordable, and cleaner.

38. Thank you!
Matthew Schuerger, Commissioner
Matt.Schuerger@state.mn.us

39. FORUM WILL RESUME AFTER THE
BREAK

40. PANEL
WHAT GRID SERVICES WILL BE
REQUIRED BY A 21ST CENTURY
ELECTRIC SYSTEM, AND WHAT MIX OF
LOW CARBON TECHNOLOGIES AND
APPROACHES CAN PROVIDE THOSE?

41. SMALL GROUP
DISCUSSION

42. IDENTIFY TWO THINGS
THAT WOULD NEED TO
BE TRUE TO DEEM THE
CURRENT ROUND OF
RESOURCE PLANNING A
SUCCESS

43. OPEN DISCUSSION