Institutional Barriers to Distributed Energy: Understanding and Overcoming
description
Transcript of Institutional Barriers to Distributed Energy: Understanding and Overcoming
![Page 1: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/1.jpg)
Institutional Barriers to Distributed Energy:Understanding and Overcoming
Chris DunstanInstitute for Sustainable Futures, UTS
21 November 2008
![Page 2: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/2.jpg)
I-Grid Research Program Structure
P1: Control Methodology
of DG
P2: Market & Economic
Modelling
P3: Optimal Siting & Dispatch
of DG
P4: Instit Barriers, Stakeholder
Engagement & EconomicModelling
P5: I Grid Social Impacts
P6: I Grid in New
Housing Development
P7:OperationalControl &
Energy Management
Management Committee
Economic regulatory barriers & Solutions
Business deliberation
on I Grid & DE
DANCE Model
D-CODE Model
CSIRO
InstitutionalBarriers
QUT UTS Curtin Uni UniSAUni of Qld Uni of Qld QUT
![Page 3: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/3.jpg)
Why study Institutional Barriers to DE?
![Page 4: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/4.jpg)
Global average temperature
![Page 5: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/5.jpg)
Permanent Arctic ice may disappear by 2030
![Page 6: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/6.jpg)
Scientist warn that if we do not quickly reduce greenhouse pollution, the melting of Greenland ice cp will be unstoppable and raise global sea level by 7 metres
![Page 7: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/7.jpg)
Problem Response
Politics demands
![Page 8: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/8.jpg)
A very senior Australian bureaucratonce said, when advising junior bureaucrats:
“as a bureaucrat, the most important thing you can do …
is to stop things from happening”
(not Sir Humphrey Appleby)
![Page 9: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/9.jpg)
Problem
“Market Failure”
Response
“Market Intervention”
Politics demands
Policy demands
![Page 10: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/10.jpg)
A licence to act.
"Climate change is a result of the greatest market failure the world has seen.” – Sir Nicholas Stern, Nov 2007
"the greatest market failure ever seen". – Prof Ross Garnaut, July 08
![Page 11: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/11.jpg)
“once we have an effective price on carbon through an Emissions Trading scheme, we can do away with a range of inefficient policies and programs…”
MRET, PV Rebate, EEOA, VEET, REES, NEET, etc,
![Page 12: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/12.jpg)
Barriers to Distributed Energy
“Non-Institutional” Barriers include:– Technical barriers– Economic (cost) barriers
Some Institutional Barriers (and market failures)1. Imperfect Information2. “Regulatory failure” and inefficient incentives3. External Costs excluded4. Inefficient pricing (not cost reflective)5. Split Incentives (landlord/tenant problem)6. High transaction costs7. Lack of access to finance8. Cultural norms9. Underdeveloped market for Distributed Energy
![Page 13: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/13.jpg)
Technology Barriers
Economic Barriers
Institutional Barriers
What it does
What it costs
What slows it down
Barriers to Distributed Energy
![Page 14: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/14.jpg)
“United States could reduce emissions by 31% to 46% by 2030”Distributed Energy is crucial to carbon abatement
![Page 15: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/15.jpg)
Institutional Barriers: A framework
Economic outcomes
Environmental/ Social outcomes
Technology Frontier
“Best practice”
Institutional Barriers
Current practice
![Page 16: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/16.jpg)
Disarray
Mispricing
Disinterest
Maladministration Impatience
Ignorance
Barriers to Distributed Energy: “The Seven D.E. Sins”
Confusion
Regulatory barriers
Cultural barriers
Lack of information
Split Incentives: landlord/ tenant etc
High discount rates
Externalities and price structures
![Page 17: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/17.jpg)
0
50
100
150
200
GridPower
Cogen GridPower
Cogen
Indi
cativ
e C
osts
($/M
Wh)
Carbon cost
Innovation risk
Negotiation cost & risk
Capital contributions
Standby charges
Retail etc
Distribution
Transmission
Fuel + O&M
Capital cost
Indicative Impact of Institutional Barriers on Costs
Current Costs
“Real” Costs
![Page 18: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/18.jpg)
Tool 4: Market transformation analysis
Demand0
Supply0
p0
q0 q1
Price
Quantity
Demand1
a
cccc Supply1
b
![Page 19: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/19.jpg)
Overcoming Institutional Barriers: “Moving the Market”
Push PullLi
ft
![Page 20: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/20.jpg)
Regulation Incentives
Information
The Policy Palette
Primary Instruments
![Page 21: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/21.jpg)
Facilitation
Pricing
Targets
Regulation Incentives
Information
The Policy Palette
+ Secondary Instruments
![Page 22: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/22.jpg)
Culture
Facilitation
Pricing
Targets
Regulation Incentives
Information
Facilitation
Pricing
Targets
Regulation Incentives
Information
The Policy Palette - “PIRFICT”
Coordination
![Page 23: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/23.jpg)
Regulation
> Mandatory Audits and Plans> Mandatory information disclosure> Minimum Energy Performance Standards
![Page 24: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/24.jpg)
Targets
> Mandated Targets (regulated)> Policy target (adaptive management)> Aspirational targets (report and review)
![Page 25: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/25.jpg)
InformationInformation
> Benchmarking> Performance labelling> Performance Reporting (no target)> Education and Awareness campaigns> Case studies
![Page 26: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/26.jpg)
FacilitationFacilitation
> High Level Commitment> Accreditation> Training> Audits, Advice and Assistance> Case Studies> Networking> Community Engagement
![Page 27: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/27.jpg)
Incentives
> Cash Rebates> Competitive Subsidies> $ support for Research and Development > Loans and Financial guarantees > Expedited Planning > Public recognition and awards> Prizes
![Page 28: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/28.jpg)
Pricing
> Price in Externalities (Carbon Tax)> Cost reflective tariffs> Dynamic Pricing> Fixed cost vs Variable Cost pricing
![Page 29: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/29.jpg)
Coordination
> Strategic Planning – Plan, Act, Report, Review
> Interagency and intergovernmental cooperation> Coordinating Agency
![Page 30: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/30.jpg)
Example: Residential Energy Efficiency
Reg Targets Info Facil’nFacil’n IncentivesIncentives PricingPricing
Building Shell BASIX NABERS, ACT Disclosure
Heat/Cool MEPS
Hot Water MEPS GGAS GGAS, NRET, CCF
Off peak tariffs?
White Goods MEPS Labelling
Lighting Incandescent ban
GGAS GGAS, VEET
Brown Goods 1W standby
![Page 31: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/31.jpg)
Conclusions
> Understanding institutional barriers important – for good policy and program design – to create a “licence to act”– to build the case for a suite of actions
> Not just about complementing Emissions Trading but also about making it work
> This analysis is a work in progress> Forthcoming Discussion Paper and Industry Forum
– Adelaide, 5 December
![Page 33: Institutional Barriers to Distributed Energy: Understanding and Overcoming](https://reader036.fdocuments.in/reader036/viewer/2022062315/56816093550346895dcfb9b6/html5/thumbnails/33.jpg)
Thank you.
For more information on the I Grid Research program:Web: www.igrid.net.au Tel: 02 9514 4950 (ISF)
Email: [email protected]