To: DAWG Team B
From: PG&E
Re: Load Profiling
Date: July 5, 1996



OUTLINE OF LOAD PROFILING ISSUES
(in the context of metering requirements)



1.0	METERING REQUIREMENTS


1.1	LOAD PROFILING OPTION FOR SMALL CUSTOMERS

  Although, interval meters permit direct customer responses to generation price
signals, requiring small customers to pay for the installation and use of an
interval meter may prove too high an economic hurdle for participation in
direct access.  DAWG has considered a load profiling option for small customers
as an alternative means of gaining access to the competitive generation market.

1.1.1	Load Profiling Defined

1.1.2	Basic Issues
		- Creating load profiles
		- Defining customer eligibility for load profiles
		- Settlements using load profiles

1.1.3	Creating Load Profiles
		- Use implied profiles from existing rate schedules
		- Develop load profiles for contiguous regions
		- Develop industry-specific or company-specific profiles
		- Forecasting error not an issue for load profiling

1.1.3.1	Issues
			- Statistical accuracy
			- Degree of litigation, complexity
			- Absence of pricing signals
			- Opportunities for gaming
			- Cost-shifting
			- Future adjustments to profiles
			- Load research requirements/cost of additional sampling
			- Data availability

1.1.4	Defining Customer Eligibility for Load Profiles
		- Breakpoint where customer size makes interval metering economic
		- Breakpoint where cost-shifting becomes too problematic
		- Demand-based breakpoint (i.e., 20 kW, 100 kW, 500 kW)
		- Leave open

1.1.4.1	Issues
			- Analysis of breakpoint methods
			- Opportunities for gaming
			- Cost-shifting
			- Future adjustments to profiles
			- Load research requirements
			- Data availability

1.1.5	Settlements Using Load Profiles
		- Schedule Coordinators must settle with ISO for imbalances
		- Aggregators must settle with UDCs and/or customers
		- Goal: provide best/cost-efficient estimates of supplier load responsibility
		- Load profiles should not increase cost-shifting between classes

1.1.5.1	Issues
			- Costs of imbalance allocations vs. costs of interval metering
			- Costs of imbalances vs. costs of improved load forecasting
			- Scaling profiles to fit actual loads
			- Billing calculations
			- Linkages to WEPEX metering policy
			- Linkages to phase-in and metering issues


1.2	INTERVAL METERING FOR ALL CUSTOMERS

  Interval metering is the most accurate way to affect direct access settlements.
It also allows customers to respond to hourly changes in power prices by
shifting their loads from higher priced time periods to lower priced time
periods, thus reducing the overall cost of power.

1.2.1	Interval Metering Defined

1.2.2	Basic Issues
		- Cost
		- Meter installation capacity
		- Technology selection
		- Crossover with operational needs
		- Raises prices to some customers
		- Unknown demand for interval meters


1.3	UPSTREAM METERING OPTION FOR SMALL CUSTOMERS

  Load profiling is not the most accurate way to affect direct access settlements
- only interval metering satisfies the highest standards for accuracy.  With
load profiles, customers' hourly loads are not directly measured, introducing
the potential for cost shifting, and removing the ability of customers to
respond to generation price signals. An alternative is to use metering points
between a set of individual customers and the transmission system to measure
hourly power use downstream of those points. Referred to as upstream metering,
this alternative, appropriately implemented, may serve to reduce ISO imbalance
costs and better assigned supplier costs.

1.3.1	Upstream Metering Defined

1.3.2	Basic Issues
		- Reducing cost shifting vs. not increasing from today's levels
		- Cost effectiveness
		- Improving settlement accuracy vs. allowing full customer choice
		- Net metering
		- Existing distribution system design
		- Potential wholesale status of meter operator


1.4	LOAD PROFILING AS A TRANSITION STRATEGY

  As technologies develop and costs of interval metering fall, it may prove to
be in California electricity users' best interests to move toward statewide
deployment of interval meters.  The question to resolve is what level of
investment in metering hardware and software produces the greater economic
efficiency for society.

1.4.1	Basic Issues
		- Long-term costs vs. benefits
		- UDC operational needs
		- Customer acceptance of two transitions