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Is Cogeneration Compatible with Utility Interests?

Is Cogeneration Compatible with Utility Interests?. William G. Jackson Jr. Director of Sales, Marketing & Economic Development Long Island Power Authority. Long Island Power Authority. Who are We? A New York State Instrumentality Not quite a Municipal Service Not a Cooperative

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Is Cogeneration Compatible with Utility Interests?

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  1. Is Cogeneration Compatible with Utility Interests? William G. Jackson Jr. Director of Sales, Marketing & Economic Development Long Island Power Authority

  2. Long Island Power Authority Who are We? • A New York State Instrumentality • Not quite a Municipal Service • Not a Cooperative • Not an Investor-Owned • LIPA is a State Authority serving approximately 1.1 million electric customers on Long Island, New York • Established in May of 1998, LIPA is one of the very few “Outsourced Utilities” • LIPA owns and operates the electric Transmission and Distribution System

  3. LIPA’s Customer Segmentation • Predominately a Residential Marketplace • serving 940,000 residential customers – • with today’s technology, not a prime Cogeneration Target • Commercial Marketplace • 128,000 accounts • 346 Major Accounts with revenues in excess of $500K/mo.

  4. LIPA Actual Peak Load June 26th @ 5 PM = 4,794 MW LIPA Weather Adjusted Peak (+21 MW) = 4,815 MW Compromise w/ NYISO on Peak Load (+41 MW) = 4,835 MW Agreement reached on 2004 LI Load Growth: 1.15% 2004 LIPA Peak Forecast = 4890 MW Long Island Generation Capacity = 4,000 MW Power LI CT Units = 400 MWs Freeport Unit = 71 MWs LI Import Capacity = 930 MWs Cross Sound Cable = 330 MWs Total LI Power Supply =5791 MWs LIPA’s Current Capacity Scenario

  5. How do Utilities View a Cogeneration Installation ? • IOU versus Public Power • Shareowner Value versus Customer Satisfaction • What’s the Potential Liability • Evaluation Factors • Social Responsibility • Fiduciary Responsibility • The 5 – 9’s Dilemma

  6. So, What’s at Stake? • Is the Sale of Every kWhr a Reward? • All Kilowatt-hours are NOT created Equal • What about Capacity • The Dreaded Stand-by Charge (SC-12) • What about the Loss of Asset Recovery? • Is this a Shared Expense? • If the Cogen Developer and the Cogen Customer doesn’t Pay, Who Does? • So now, Who owns the Customer?

  7. “Bubba Don’t Care” and Neither Does Mr. CEO The Customer’s Perspective Who Wants to be a Utility?

  8. LIPA’s Process for Approaching a Cogeneration Proposal • Becoming the Customer Advocate • LIPA evaluators are AEE Certified • Assessing and Auditing QF Status • Working with the NYS DEC • Questions We pose to Customer • Can you Use the Heat? • Is unit size based on Heat or Power Output Do You Wanna Make Electricity or Chocolate?

  9. LIPA’s Process for Approaching a Cogeneration Proposal

  10. LIPA’s Process for Approaching a Cogeneration Proposal

  11. WGJ’s Futuristic Perspective • Is Cogeneration a DG Opportunity • Can we Develop an Economic Market? • Are Customer’s willing to Bear any Risk? • How about the Cogeneration Developer? • What About Utility-Owned Cogeneration • Customer’s continually seek Peak Shaving • What do Cogeneration Companies Really Want to Do?

  12. Customers ARE interested in Cogeneration, BUT… Until we can make itETDBW “Easy to do Business With” Success will be Fleeting Summary

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