Energy Independence and Security Act of 2007 - Section 532, Standard (16)

Integrated Resource Planning

Standard:

Energy Independence and Security Act of 2007 - Section 532, PURPA 111(d):

(16) Integrated Resource Planning

(A) Integrate energy efficiency resources into utility, State, and regional plans

(B) Adopt policies establishing cost-effective energy efficiency as a priority resource

Description of Standard:

"Integrated Resource Planning " (IRP) is a comprehensive planning process intended to systematically consider appropriate supply and demand resources to meet current and future load requirements. This PURPA standard is written to specifically address one aspect of IRP, integrating energy efficiency into utility plans and adopting policies that encourage cost-effective energy efficiency.

Energy efficiency is defined as plans or programs that allow consumers and utilities to use less energy without altering their behavior. Energy efficiency can be achieved at various levels of an electric utility:

Generation level: Generation providers can investigate cost-effective system upgrades to improve generation heat rates to increase efficiencies.
Transmission level: Transmission providers can investigate cost-effective system upgrades and new technologies to increase system efficiencies and reduce losses.
Distribution level: Distribution providers can investigate cost-effective system upgrades and new technologies to increase system efficiencies and reduce losses.
Consumer level: Consumers can achieve higher levels of energy efficiency through various methods including replacing existing energy-consuming devices with newer, more efficient versions, incorporating more energy efficient construction practices, etc.

Purposes and Goals of Standard:

Conservation of energy supplied by electric utilities
Optimal efficiency of electric utility facilities and resources
Equitable rates for electric consumers

Generation and Transmission Level:

SouthEastern Illinois Electric Cooperative, Inc. (SEIEC) signed a full-requirements power supply contract with Southern Illinois Power Cooperative, Inc. (SIPC), on December 8, 1959, and Supplement No. 4 of said contract was executed on September 23, 2008 extends the term of this full-requirements power supply contract until the year 2043. Therefore, SIPC is responsible for supplying the generation and transmission requirements of SEIEC. SEIEC is only one of six distribution cooperatives that own and

control SIPC. In addition, SEIEC only has four Board of Director positions on the twenty-four person SIPC Board of Directors. Lastly, SEIEC is the only one of the six distribution cooperatives that own and control SIPC that meets the requirements of the new federal standards. Therefore, SEIEC does not have the sole ability to control the operations of SIPC's generation and transmission facilities. Therefore, SEIEC is not in a practical position to be able to implement this standard directly pertaining to the generation and transmission activities. This portion of integrated resource planning is achieved by SIPC and not directly by SEIEC. At SEIEC's request, SIPC prepared its response to the Integrated Resource Planning standard which has been included in this report as Appendix A.

Management Recommendation:

Through active participation on the SIPC Board of Directors, SEIEC has and should continue to encourage SIPC to perform integrated resource planning and to maximize the efficiency of generation and transmission facilities that serve SEIEC. Integrated resource planning evaluates many different options for meeting future supply while meeting reliability needs and other objectives. Maximizing the efficiency of the generation and transmission facilities provides more economical energy solutions by using less generation fuels which also creates environmental advantages as well. Integrated resource planning and maximizing efficiencies create natural incentives for SEIEC to encourage SIPC to comply with integrated resource planning standards.

Distribution and Consumer Levels: In distribution operations, the Cooperative already integrates energy efficiency into the resource planning process in the distribution and consumer levels by performing the following functions/activities:

has and will continue to conduct feasibility studies to determine distribution system upgrades or new construction systems/practices that economically increase energy efficiency, increase reliability, reduce system losses and achieve lower costs to the members;
has and will continue purchasing distribution transformers based upon a loss evaluation study that economically reduces energy losses and lower costs to members;
has an off-peak rate available for commercial and industrial loads that allows for system demand reduction and higher efficiencies;
has a net metering policy that offers net metering and the purchase of additional energy output to allow development of small renewable distributed generation facilities;
has installed an AMR system that provides members with monthly energy usage and twelve months of historical energy consumption on a monthly basis. The AMR system is also capable of providing members with hourly energy consumption data at the member's request. Lastly, the AMR system is also capable of performing demand response programs. The AMR system has given members the ability to analyze and monitor energy consumption on a regular basis so they have the opportunity to better manage their energy consumption;
is working with members to improve their power factor thru the implementation of additional power factor correction devices to help improve system efficiencies.
provides rebates/incentives to members and contractors for purchasing and installing highly efficient geo thermal heating/cooling systems to promote energy efficiency;
conducts periodic energy efficiency and conservation seminars/workshops made available to members;
provides members with numerous sources of information regarding energy efficient construction practices, energy efficient appliances, energy conservation measures, etc.;
distributes the Illinois Country Living Magazine on a monthly basis to all members which contains numerous articles and energy efficiency tips for members;
provides energy conservation tools and energy efficient tips thru the Cooperative website;
provided over 8,000 compact fluorescent light bulbs to members to increase member efficiencies.

Management Recommendation:

SEIEC has and will continue to integrate energy efficiency as a priority resource in the integrated resource planning process. Integrating energy efficiency as a priority resource can provide more economical solutions for members by reducing distribution system losses, increasing energy efficient consumption by members and decreasing the investment necessary in the system.

Policy Recommendation:

Through active participation on the SIPC Board of Directors, SEIEC has and will continue to encourage SIPC to perform integrated resource planning in providing generation and transmission services to SEIEC. SEIEC has and will continue to include cost-effective energy efficiency programs as a priority resource in its distribution activities and plans. SEIEC has and will continue to assist members with integrating energy efficiency as a priority resource on the consumer side of the meter and continue to consider cost-effective programs designed to increase energy efficiency.