This document summarizes strategies for EWEB, Eugene's electricity provider, to transition to a more distributed and renewable electricity system as outlined in the book Reinventing Fire. It discusses implementing distributed generation through solar incentives and potentially a feed-in tariff. It also discusses establishing microgrids, time-of-use billing to shift demand, improving customer education and bills to encourage conservation, and using the Green Power grant fund to increase solar incentives. The overall goal is to increase distributed renewable energy, reduce risks from outages, and lower costs and environmental impacts.

1. ELECTRICITY IN
EUGENE
Pam Birkel, Ben Farrell, Sven Gatchev, Mike Hatchadorian,
Meghan Nelson & Tristan Sewell
Reinventing Fire
Memo
February 4th, 2013

2. EXECUTIVE SUMMARY
Today’s electricity generating infrastructure in the US produces 40% of our carbon
emissions, resulting in financial expenditures of $100 billion in health impacts, $160 billion
from blackouts and power outages, and imposing countless other impacts on our society
through additional pollution and improper land use practices
(www.rmi.org/impact_bringing_clean_competitive_solar_power_to_scale).Numbers like
these lead any rational person to ask; isn’t there a better way? In fact, there is a better way
and it is well within our reach. The vision laid out in Reinventing Fire is one of a world
where the risks and environmental costs associated with electricity generation have been
all but eliminated through the widespread use of distributed renewable electricity sources
and by capitalizing on advances in smart grid technology. Shifting away from dirtyenergy
sources to renewable energy sources is a necessity in order to minimize our environmental
impact, combat human induced climate change, and help drive down the health costs
associated with electricity generation. By adding distributed power production and smart
grid technology to this mix, we can simultaneously reduce risk and increase the overall
efficiency of our power system by greatly decreasing transmission losses and changing the
way we use power. EWEB is currently an industry leader in the utilization of renewable
energy sources and now has the opportunity totake the lead in adopting the use of
distributed generation and smart grid technology. While making this monumental shift
will not be without its challenges, it is a necessary shift and one that will have extensive
long-term benefits on the city, state, and national level.
RISK MANAGEMENT
Lovinset al describe risks to the steady U.S. power supply; they include risk of cyber-
attacks and physical attacks on centralized power plants and transmission systems, as well
as risk from extreme weather events (see figure).All of these have potential to interrupt our
normally consistent power delivery system. Power outages also bring financial risk for the
utility and for the customer. This section will show that by introducing distributed power
generation and micro-grids to our power infrastructure we can add flexibility to the system
which will, in turn, lower physical and financial risk.
Distributed Power Generation
Distributed power can be customer- or community-owned, but it could also be utility owned
and/or operated. The Business Models section of this paper explores how EWEB might
branch out into distributed power. Benefits to distributed power are avoidance of
transmission loss, and reduced financial risk for the utility in that small local units are
modular, have short lead times and can be pin-pointed to the locations of greatest use
(Lovins p. 207). Distributed power will also reduce customer financial risk from power
outages.
Micro-grids
Micro-grids are “subsets of the electric grid that have enough generation, storage, and
intelligence to operate independently of the larger grid if it fails, but normally in
collaborative interchange with it” (Lovins p. 206). Micro-grids can work in communities, in

3. concert with distributed power generation. Micro-grids will require a smart grid so that the
local micro-grid can determine when to disconnect itself from the larger grid when it
recognizes risk to its power supply. The beauty of micro-grids is that they can enjoy the
benefits of the larger grid, but maintain only local power when it is advantageous. Lovins
cautions that smart grids will bring increased risk of cyber-attacks and suggests building
defense against them as fundamental to the adoption of micro-grids which rely on the
smart grid.
Lovins outlines how energy storage can be an important component of these microgrids.
Storage can help levelize the risks of intermittent power supply by storing power when
there is over-abundance and releasing power when needed, for example, when the sun goes
behind clouds or the wind calms. There are numerous other types of energy storage being
explored, such as new battery flywheels, and capacitors. Lovins recommends advanced
battery technology for distributed generation and microgrids. The current race for battery
technology is at a fever pitch, with Bill Gates and other big investors, major universities,
and corporations all involved in technological development. Non-toxic, inexpensive batteries
appear to be only a few years away.
Flexibility
By incorporating distributed power and microgrids into our energy infrastructure we
incorporate flexibility. Flexibility will allow us to use centralized electricity production
when advantageous and to disconnect and rely on localized power when necessary or
desirable.This flexibility will decrease risk of power outages and this, in turn, will minimize
our financial risk related to outages.
BUSINESS MODELS AND FUNDING OPTIONS FOR EWEB

4. Streamlining the process for private or 3rd parties to create energy infrastructure
for own use can free up maintenance resources.
A reconsideration of EWEB’s current business model can include the management of locally
owned production rather than its ownership. These types of agreements are most suitable
with hospitals, higher-ed institutions, large manufacturing companies, and even
neighborhood co-ops. Eugene presents a fertile opportunity as the UO and LCC play a
pivotal role in the energy supply/demand while developments with the incoming VA
hospital and the new RiverBend hospital can offer further possibilities. In addition, EWEB
should provide for policy support and provisions of cutting the "red tape" in the application
and approval process of select distributive energy technologies. Germany for example, after
having implemented such policy the cost of PV installation is now 56-67% less than that in
the U.S. proving that much of the initial expense comes from "soft" rather than "hard" costs.
Green Power Program- Reviewing the further potential of the $100,000 Grant
The development of guidelines promoting the resiliency of the Eugene’s community and its
power grid can produce further benefits from the Green Power Fund, assisting with the
financing of distributive power projects. The fund can still providecapital to nonprofit
organizations but more specifically for projects encouraging the distributive electricity
model, thus adding financial and single energy-source risk mitigation. Currently, a number
of grant applications are seeking research funding, but while R&D is an important part in
reaching the energy goals set forth by EWEB and other experts, the best use of the fund
would be in the proposed systematic approachabove.1
1
http://www.eweb.org/greenpower/grants

5. Aggregating and better capturing the financial benefits of a Distributed Power
system.
There are a number of benefits in considering Distributed Power generation, but a number
of them have an associated financial benefit that should also be acknowledged when
considering ways to fund grid enhancements.
● While the cost of electricity from Photovoltaics (PV), in one instance, may be the
highest of all options, these prices compete with the pricier end-user price rather
than wholesale prices. This can be achieved by minimizing the per kWh distribution
charge for networks when using their own generated energy.
● The minimization of transmission losses, typically between 5 -7% and potentially
reaching upwards of 14% when most expensive peaking power is needed, presents
easy to calculate savings2 (Fig. 1).
● Nearly 99% of power outages occur in the transmission process3, loss of productivity
due to wide disruptions can be spread across the distributed power network.
● Lastly, while price of NG is currently at an all-time low, historically, projections
have never proven to be accurate. Thus significant investments in NG facilities and
their operation costs can be largely hedged through the integration of renewable
sources within a distributed power system.
4
2Lovins, Amory .Reinventing Fire: Bold Business Solutions for the New Energy Era. Print.
3Lovins, Amory .Reinventing Fire: Bold Business Solutions for the New Energy Era. Print.
4Lovins, Amory. "Hot Air about 'Cheap' Natural Gas."ThinkProgress Climate Progress.N.p., 07 09
2012. Web.Web. 1 Mar. 2013.

6. TIME OF USE
A considerable amount of generation, transmission and distribution resources constructed
are used for only a small percentage of the total hours in a year to meet peak demands. The
intended result of time of use (TOU) is to create a relatively even demand on the power grid
while increase flexibility and resiliency. Investment in programs that shift demand from on
peak to off peak times can help utilities to meet growing demand with less generation,
transmission and distribution resources5.
PGEs Residential TOU Model:
PGE has offered its residential customers a TOU rate option since November 2001. PGE is
required to offer a market-based rate to customers by state law, and the TOU program
satisfies that obligation6. Participation in PGEs residential TOU program is completely
voluntary. Customers may enroll at any time, but must remain enrolled for a minimum of
one year. Customers are protected from paying more than 10% above what they would have
paid on the normal rate schedule for their first year of enrollment7. This reduces risk to the
consumers. The TOU rate schedule charges customers a range of prices during on-peak,
mid-peak and off-peak periods of the day and week. Table 3.2 and 3.3 provide the rate
schedule for PGE and for PacifiCorp. PGE has made available a time of use calculator on
their website that allows people to estimate what, if any, cost savings they may see by
switching to the program.
5Kannberg LD, Chassin DP, DeSteese JG, Hauser SG, Kintner-Meyer MC, et al. 2003.GridWiseTM:
The Benefits of a Transformed Energy System, Pacific Northwest National Laboratory, Oak Ridge,
TN. Available: http://www.gridwise.pnl.gov/docs/pnnl14396.pdf
6Fairchild J. 2002. Public Utility Commission of Oregon Staff Report Public Meeting Date: July 9,
2002.ed. PA Committee: Oregon Public Utilities Commission. Available:
http://www.oregonjobs.org/PUC/meetings/pmemos/2002/070902/reg3.pdf
7PGE. 2004. Analysis of the Load Impacts and Economic Benefits of the Residential TOU
Rate Option, Portland General Electric

7. TOU Barriers:
The barriers of a TOU program includes risk of revenue loss, inefficient data management,
the inability of utilities to gain cost recovery on investments, differing regulations across
state boundaries, uncertainty with regard to technical risks such as smart meters and
billing, electric utilities buying practices, and the customers or service providers aversion to
change. Low participation rates among utility customers have also created high costs and
resulted in low levels of financial benefit for the implementing utilities. Customers who
participate in demand response programs accept a higher level of risk than those on flat
rate schedules by exposing themselves to some of the variance in electricity price
throughout the day 8.
Overcoming TOU Barriers:
Utilities should be provided with a measure of security about receiving cost recovery for
smart meter roll outs. Second, utilities must find ways to reduce or eliminate the service
charge for smart meters to its TOU participants. This may be accomplished by
implementing a smart meter service for all residents. Customers who participate in TOU
should not be charged more than non-participants, which PGE has illustrated in their
program. Providers should more accurately charge non-participants for the costs that they
impose on the electric system as well. Consumer education would help overcome barriers
by increasing participation in the TOU program which in effect reduces power costs for all
customers9.
SMART BILLING
8Faruqui A, Wood L. 2007. Quantifying the Benefits of Dynamic Pricing in Mass Markets, The
Brattle Group prepared for The Edison Electric Institute, San Francisco, CA.
9 1. Fairchild J. 2002. Public Utility Commission of Oregon Staff Report Public Meeting Date: July 9,
2002.ed. PA Committee: Oregon Public Utilities Commission. Available:
http://www.oregonjobs.org/PUC/meetings/pmemos/2002/070902/reg3.pdf

8. EWEB can drive users to greater savings through a more accessible bill template that
clearly displays a month-to-month comparison, contrasts the customer to the EWEB
average, estimates cost per usage category, and communicates potential savings
opportunities. Eugene is known to be a particularly conscious community, but there are still
those who are less ecologically concerned than economically motivated. By displaying the
most relevant and impactful information to its customers each month, EWEB presents a
greater motivation for change. To use the saying, people manage what they measure, and
EWEB should make its best effort to facilitate best practices in its customers.
Consumers are sensitive to self-comparisons, which would empower a month-to-month
comparison, but comparing themselves to an average adds competition. Similarly, including
a quick statistic on the impact of paper billing might further motivate a shift to paperless.
EWEB should consider incentivizing this choice if it is a serious goal. Bills can also promote
further opportunities for savings, earning rebates, and other estimates like potential
savings from switching to CFLs or LEDs for lighting. If paperless billing holds further
analytical benefits over paper bills, curiosity instilled in these statistics will act as a
springboard. Something is also to be said for simplification; boiling down the necessary info
and conveying it in an accessible and attractive manner will make energy bills a more
pleasant experience for customers.
After EWEB achieves greater paperless penetration, a detailed and helpful web portal and
mobile application will encourage greater efficiency practice. Paired with smart meters, an
advanced web interface could alert users of abnormal usage patterns, create detailed
analysis and comparisons, and motivate a greater change to TOU pricing. It would pave the
way for future implementation of demand management via remote mobile application and
other automation integration. EWEB’s new online experience should alert customers of
rebate opportunities and provide more detailed analysis of potential savings through usage
calculators10. Other tools could include mapping to CFL recycling11and other consumer
resources necessary for promoting efficiency.
In many ways, these solutions to energy bills are more accessible to Eugene’s college-age
population, which has a high occupancy turnover rate with many first-time bill payers. This
combination makes efficiency awareness more important, but also effective because college
students are more cost-concerned and environmentally aware than the greater population.
EWEB is missing a crucial opportunity in not targeting this demographic more pointedly.
10http://www.portlandgeneral.com/residential/your_account/energy_tracker/default.aspx
11http://pse.com/accountsandservices/YourAccount/Pages/Online-Services.aspx

9. INCENTIVES
One way that EWEB currently fosters the growth of distributed energy generation is
through their solar incentive programs. The growth of distributed power generation,
especially renewable, is very much in line with the view of the future presented in
Reinventing Fire and we strongly encourage EWEB to continue to expand this program. We
spoke with a pair of solar professionals, one local and one non-local to get their opinions on
the structure and effectiveness of solar incentive programs. Both confirmedthat the more
incentive money available results inincreased solar installations. The current financial
situation leaves EWEB looking for ways to cut costs, rather than increase costs. However,
we see the Greenpower Grant as a potential source of additional funding for the solar
incentive program. According to EWEB’s website the Greenpower Grant program “is
designed to fund high-impact projects and programs that drive advancements in renewable
energy for local customers, with emphasis on EWEB products, resources and
priorities.” What better way to do this than to encourage the development of more
distributed renewable energy sources on the residential level? While it is difficult to argue
on the side of reducing funds from local non-profits, the goals of the Greenpower Grant
would still be met by pouring the funds back into increased solar incentives for residential
projects. One additional suggestion made by the solar professionals was to have a
consistent set of warranty requirements on all solar installations. This would create amore
efficient marketplace and would encourage fair competition within the market.When
looking at strategies for EWEB to truly innovate and be a leader in the growth of renewable
distributed energy generation, a feed-in-tariff was also discussed. Any FIT would require
carefully crafted procedures to ensure that it produced the desired effects. One
consideration would be structuring the FIT for smaller solar systems (i.e. for systems 20
kW and smaller). This would encourage more distributed solar growth, rather than just
adopting similarantiquated centralized model for solar generation. If the FIT was scaled to
apply to large solar generating facilities, it would not address the issue of distributed power
generation vs. centralized power generation. Moving toward renewables is beneficial for
society regardless of scale; however, an increase in distributed renewable energy generation
is the vision that we want to push towards and tailoring a FIT to encourage this growth
would be most ideal.
CUSTOMER EDUCATION
Customer education is a crucial component for utility providers. Increased awareness
facilitates company transparency, deeper understanding of energy production and
consumption and a cohesive relationship between providers and customers. EWEB’s
current customer education strategy concentrates on the value of educating youth about
electricity, safety, conservation and renewable energy and water resources12. While these
initiatives play a vital role in fostering long-term sustainable behavior, they do not address
direct short-term goals.
Attempts to hold community workshops have often failed to generate significant
participation. In order for collaborative information sharing to be successful greater
12 http://www.eweb.org/education

10. participation is necessary. Initiatives based on Community Based Social Marketing (CBSM)
strategies offer small-scale solutions for enhancing knowledge and encouraging efficient
behavior change13 . The five step process allows utility providers to identify the most
impactful behavior, solidify barriers and benefits, and develop specific behavior change
strategies. Utilizing CBSM tactics as a means of addressing positive behavior while also
discouraging less desirable behavior established visibility. Visibility allows awareness to
expand and takes advantage of social norms and social diffusion within the community for
increased adoption rates.
BioRegional North America is a non-profit organization who focuses on CBSM social change
projects nationwide 14 . Many tactics could be directly transferable toward expanding
EWEB’s customer education approach. Methods such as the implementation of sustainably
engaging property managers and the installation of smart metering and smart billing
systems can generate convenient small-scale adaptations with noticeable behavior changes.
Incentivizing energy efficiency and sustainable behavior change should create a mutually
beneficial relationship between consumers and producers. Similarly, opportunities for
growth within the University of Oregon’s student housing sector could also benefit from
social change tactics while contributing to the University’s Climate Action Plan Scope II
indirect emissions targets. Integrating sustainable behavior guidelines into new student
orientation programs, and providing supplementary resources that are easily accessible
within each residential hall could potentially reach a deeper audience.
CONCLUSION
As the population of Eugene continues to grow, the demand for reliable energy sources
inherently increases. In order to secure a dependable energy supply and reduce the risks
associated with electricity generation a shift toward distributed energy production is
necessary. By de-centralizing power production and implementing a system of two-way
flows utility providers have the ability to reduce transmission losses and financial
vulnerability, smooth out demand curves, and facilitate positive behavior change through
incentives such as TOU programs and smart billing tactics.
13 Doug McKenzie-Mohr, Fostering Sustainable Behavior, 2-11, www.cbsm.com (2008).
14 http://www.bioregional.com/about-us/around-the-world/bioregional-north-america/