ISO New England Demand Resource
Measurement & Verification Standards
Manual Overview
April 11, 2007
NAESB Development of DSM/EE Business Practices
Washington, DC
Henry Yoshimura
ISO New England
Discussion Topics
• What is the Forward Capacity Market (FCM) and
how does it work?
• Can Demand Resources participate in the FCM?
• What are ISO New England’s Measurement and
Verification requirements for Demand Resources
participating in the FCM?
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Forward Capacity Market Background
• The Forward Capacity Market (FCM) will be
used to procure capacity to meet New England’s
forecasted demand and reserve requirements
three years into the future.
– The design of the FCM resulted from a Settlement
Agreement signed on March 6, 2006.
– The Settlement Agreement was approved by the
FERC on June 16, 2006.
– Detailed FCM Rules were filed with the FERC on
February 15, 2007.
• Generation and Demand Resources may
participate in the FCM.
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Demand Resources in the FCM
• Stakeholders recognized that the Installed Capacity
Requirement can be met by increasing supply or
reducing demand.
• An extensive stakeholder process was used to develop
the rules for Demand Resource participation in the FCM
and to develop Measurement and Verification
requirements.
• Demand Resources are installed measures (i.e.,
products, equipment, systems, services, practices and/or
strategies) that result in additional and verifiable
reductions in end-use demand on the electricity
network in the New England Control Area.
– Such measures include Energy Efficiency, Load Management,
and Distributed Generation.
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Forward Capacity Auction Objectives
• The FCM uses a competitive Forward Capacity Auction
(FCA) process to determine which resources to buy, how
much to buy, and how much to pay.
• The FCA select a portfolio of Generation and Demand
Resources to meet Installed Capacity Requirements.
• All resources that clear the auction are paid the marketclearing price ($/kW-month), subject to performance
incentives and penalties.
• To encourage investment, new resources can receive a
long-term commitment (up to 5 years).
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Demand Resource Performance
• Different technologies – i.e., Energy Efficiency, Load
Management, and Distributed Generation – reduce load
in different ways.
– Passive versus active (i.e., dispatchable)
– Weather sensitivity
– Demand reduction versus energy output
• The FCM rules were developed to recognize the:
– Differences among Demand Resource types, and
– The needs of the system in meeting Installed Capacity
Requirements.
• Each Demand Resource type must reduce load so as to
reduce the need for generation capacity.
– Each of five Demand Resource types has a specific set of
performance hours across which load reductions would be
measured and verified.
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Qualification Package
• To qualify for the Forward Capacity Auction, the
resource must demonstrate that it is viable.
• Demand Resources must submit a Qualification
Package including:
– Project Description
• Minimum Project Size = 100 kW
• Must be located in a single Load Zone
• Source of Funding
• Customer Acquisition Plan and Critical Path Schedule
• Capacity Commitment Period Election
• Maximum 5 Years for New Capacity
• Measurement & Verification Plan
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Measurement & Verification Plan
• Measurement & Verification Plan describes the methods,
assumptions and measurements that will be used to
determine actual demand reductions during the
Commitment Period.
• Measurement & Verification Plan must comply with the
requirements in ISO New England’s Manual for
Measurement and Verification of Demand Reduction
Value from Demand Resources (M-MVDR).
• The NEPOOL Markets Committee approved M-MVDR on
February 22, 2007; the NEPOOL Participants Committee
is scheduled to vote on M-MVDR on April 13, 2007.
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M&V Standards Manual - Overview
• The M&V Standards Manual consists of the
following sections:
1.
2.
3.
4.
5.
6.
Project Description Requirements
M&V Methodologies
Statistical Methods
Measurement of Demand Resource Project Savings
Data Collection, Validation and Management
Reporting, Independence, Supplemental Information,
Project Organization
7. Real-Time Demand Response and Real-Time
Emergency Generation
a. Calculation methodology for demand response is the same as that
described in the present Load Response Program.
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Demand Reduction Value Calculation
Methodology
• Description:
– The Project Sponsor must describe in their M&V Plan how the
Demand Reduction Value during performance hours will be
calculated, including calculations for the Baseline and postinstallation electricity consumption.
• Requirements:
– Demand Reduction Value calculations must achieve at least
a 10% relative precision and an 80% confidence interval.
– Include aggregate electrical energy reduction (MWh) during
performance hours on a Load Zone basis.
– Identify the Baseline(s) used in the calculation, and make
adjustments to reflect operating conditions during performance
hours.
– Include formulas for calculating the Demand Reduction Value.
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Option A: Spot or Short-Term
Measurement with Stipulated Values
• Description:
– The approach is intended for DR projects where either performance or
operational factors can be measured on a spot or short-term basis
during pre- and post-installation periods.
– Demand Reduction Value is stipulated based on engineering
assumptions, analysis of historical data, or manufacturer's data.
• Requirements:
– Stipulated factor must not be subject to fluctuation over the performance
hours or Measure Life of the Demand Resource.
– Requires baseline measurement calculations.
– Project Sponsor must demonstrate a correlation between the metered
proxy variables and energy consumption (MWh) during performance
hours.
• Example:
– Measuring HVAC system temperatures and flow rates to calculate MWh
consumption using manufacturer’s equipment data.
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Option B: End-Use or System Interval
Metering
• Description:
– Demand Reduction Value is measured at the component or system level
using interval meters installed on the affected end-use.
• Requirements:
– The Project Sponsor must measure factors continuously during the
performance period and Measure Life of the resource.
– Requires baseline measurement calculations.
– Consideration must be given to the possibility of interactive effects that
may significantly alter loads on other end-use equipment.
• Examples:
– Measuring the MWh output of a Distributed Generator during
performance hours.
– Measuring the MWh consumption of a large electric motor.
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Option C: Whole Facility Metering
and Analysis
• Description:
– Demand Reduction Value is determined by studying overall energy use
in a facility and identifying the impact of the implemented measure on
total building or facility energy use patterns.
• Requirements:
– Interval metering of facility MWh consumption during performance hours.
– Requires baseline measurement calculations .
– Approach may not be appropriate if the Demand Reduction Value is
expected to be small relative to the total facility load, due to the small
“signal-to-noise” ratio.
• Example:
– Residential weatherization measures reducing air-conditioning load.
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Option D: Calibrated Simulation
• Description:
– Demand Reduction Value is determined using calibrated computer
simulation models of either a system or whole building energy
consumption to determine measure energy savings.
– Engineering simulation models (such as DOE-2) can model both
residential buildings (homes, apartments and condominiums) as well as
more complex commercial buildings.
• Requirements:
– Simulation models must be calibrated to actual kW and kWh data from
the site or process being examined.
– Requires baseline measurement calculations or simulation.
• Example:
– Installation of high efficiency HVAC and control systems in new
construction project.
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2,200
2,000
1,800
kW
Baseline Conditions
1,600
1,400
1,200
1,000
800
• Description:
600
1
2
3
4
5
6
7
8
9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24
Hour
Baseline
Adjusted
Actual
– A DR Project’s Baseline is an estimate of the amount of
electricity that would have been consumed during performance
hours had the DR Project not been implemented, all other
conditions remaining the same.
• Requirements:
– The Baseline methodology will be dependent on the proposed
DR Project and Demand Resource type.
– The Baseline must be based on measurement, or applicable
codes or standards.
– Baseline must be reflective of operating fluctuations as it
relates to the use of the equipment or practice over
performance hours and may include such things as production,
occupancy, weather dependant variables, equipment related
variables (load and efficiency).
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Measurement, Verification, Reporting of
Savings
•
•
•
•
•
•
•
•
•
Direct Measurement
Indirect Measurement
Statistical Sampling
Auditing
Testing
Independent Verification
Validation
Data Retention
Reporting
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Direct Measurement
• Description:
 Measurement of electrical demand (kW) that are used in the
calculation of equipment or facility electrical consumption.
• Requirements:
– The measurement of demand (kW) must use a true RMS
measurement device with an accuracy of at least 2%.
– Demand measurements for three-phase devices should be
conducted on all phases in order to account for any phase
imbalance.
– Data recorders shall be synchronized in time with an accuracy of
+/- 2 minutes per month.
– Distributed Generation must provide real-time metering for
determination of Monthly Demand Reduction Value.
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Indirect Measurement
 Description:
 Measurement of volts, amperes, temperature, flow rates or other
variables that are used in the calculation of equipment or facility
electrical consumption.
 Requirements:
– If alternative methods of measuring demand are proposed (i.e.
proxy variables, voltage, current, etc.) the calculated demand
(kW) values from the monitoring data should achieve an
accuracy of 2% on the calculated demand (kW).
– If the proposed methods rely on the measured current (amps)
and the nominal voltage, the power factor of the end-uses must
be included in the demand (kW) calculations.
– Instruments or transducers for the analog or digital measurement
shall conform to appropriate ANSI standards or equivalent.
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Monitoring Interval and Period
• Description:
– The Project Sponsor shall, describe in their M&V Plan the
monitoring frequency and duration for each monitoring parameter
and variable.
• Requirements:
– The duration and frequency of metering and monitoring must be
sufficient to ensure an accurate representation of the amount of
energy used by the affected equipment both before and after
project installation and during performance hours depending on
the Demand Resource type.
– The measurements must be taken at typical system outputs
within the time periods and frequency that shall demonstrate
coincidence with performance hours depending on the Demand
Resource type.
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Statistical Sampling
• Description:
– The Demand Reduction Value from multiple installations of similar
Demand Resources may be developed by sampling from the total
population.
• Requirements:
– Specify the population to be sampled,
– Samples must be sized and selected to achieve 80% Confidence ±
10% Precision, (t = 1.282)
– Describe the planned sample size, plus contingencies for attrition due
to metering equipment failure and the like,
– Show all calculations for determining the sample size,
– Describe the method for selecting sample points, and
– Describe the method for monitored the accuracy and precision of the
sample over the Measure Life.
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Evaluating the Sample Precision
• Description:
– During the first year of a DR project, a default value for the
coefficient of variation (c.v.) may be used. However, after
performance data has been collected, the Project Sponsor can
estimate the c.v. of the population based on the data from a
sample.
• Requirements:
– The precision of sampling studies shall be calculated based on
the new estimated sample c.v. calculated from the sample mean
and standard deviation.
– Minimum precision of 10% shall be met and sample numbers
shall be adjusted to correct for lower precision from using the
default c.v.
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Auditing
• Description:
– Project Sponsors will have the right, pursuant to the Market
Rules, to conduct an audit to demonstrate their Demand
Resource’s capability.
– The ISO reserves the right to conduct unannounced audits or
tests of a Demand Resource to verify its compliance with the
technical requirements as set forth in the Manual.
• Requirements:
– Audit must be conducted for a period of no less than two (2)
consecutive hours.
– Audits must be conducted under operating conditions that the
Project Sponsor would reasonably expect during performance
hours.
– The Project Sponsor must provide evidence that the audit was
conducted under such operating conditions.
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Testing
• Description:
– The ISO has the right to audit testing and calibration records, and
to order and witness the testing of metering and measurement
equipment installed pursuant to the Demand Resource’s
approved M&V Plan.
• Requirements:
– The Project Sponsor shall describe in their M&V Plan the
equipment that will be used to measure the monitoring
parameters and variables, including manufacturer’s
specifications and equipment calibration and testing plans.
– The Project Sponsor will be responsible for the expenses of the
meter testing.
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Independence
• Description:
– The M&V implementation shall not be biased by any financial
interest in the results or efforts resulting from the implementation
of evaluation recommendations.
• Requirements:
– The Project Sponsor shall demonstrate independence of the
entity implementing the pre- and post-installation inspections of
Demand Resource measures, such that the evaluation is
independent of the Project Sponsors design, management and
implementation.
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Data Validation
• Description:
– Data validation checks are designed to identify problems with data
collected from a measurement device and/or data recorder prior to
submitting the data to ISO New England.
• Requirements:
– Project Sponsors must perform, at a minimum, the following Data
Validation checks:
•
•
•
•
•
•
Time Check of the Meter and/or Date Recorder
Pulse Overflow Test
Sum Check
Spike Check
High/Low Usage Check
Meter Identification Check
– If data fails validation and/or is missing the Project Sponsor may
substitute estimated data. The Project Sponsor must record the
estimation algorithm used for each data element that is estimated.
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Data Retention
• Description:
– For Projects involving facilities producing ≥ 10 kW of Demand
Reduction Value, the Project Sponsor shall maintain records of
each facility served including, at a minimum,
•
•
•
•
•
The retail customer’s address,
The retail customer’s utility distribution company,
The utility distribution company account identifier,
Description of all measures installed, and
Monthly Demand Reduction Values.
– For Projects involving facilities producing < 10 kW of Demand
Reduction Value, the Project Sponsor has the option of
maintaining records of aggregated Demand Reduction Value and
measures installed by Load Zone and meter domain.
– All Project Sponsors must maintain data until the end of the
Measure Life, or until the Demand Resource is permanently DeListed or retired from the Forward Capacity Market.
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Project Reporting
• Description:
– The Project Sponsor shall describe in their M&V Plan how they
will prepare the reports required to comply with ISO New
England’s monthly data reporting requirements.
• Requirements:
– Monthly reporting shall consist of documents describing:
• Overall project status.
• Certification of measurement verification and compliance with
statistical significance.
• Deviations from the M&V Plan and actions taken to correct
deviations.
• Adjustments to Demand Reduction Value calculations (baseline,
decommissioning, delisting).
– All data as described in the M&V Plan including raw and
processed data.
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Questions and Discussion
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