Weathering Future Storms with Utility-Led Service Offerings

No part of the United States is immune from the effects of climate change and natural disasters. Since 1980, the US has experienced 348 weather and climate disasters that have resulted in more than $1 billion of damages and costs. As the frequency, intensity, and cost of natural disasters increase, utilities are creating programs to offer customers enhanced energy resilience through Resilience-as-a-Service (RaaS). RaaS programs offer a lifeline to customers who would otherwise suffer from power outages caused by wildfires, hurricanes or other severe weather events. They can also offer an opportunity to improve electric system equity by providing greater grid reliability to lower-income and environmental justice communities.

Since 2019, Florida Power & Light (FPL), Georgia Power, and individual utilities operated by Entergy and Xcel Energy have received state regulatory approval to offer RaaS programs in their service territories. Targeted customer segments, customer payment models, and program design vary, but ultimately, these programs all focus on delivering resilience to customers while also increasing grid reliability and capacity during normal operations.

On March 22, SEPA held a joint meeting of three SEPA working groups –  Microgrids, Energy Storage, and Customer Programs – to better understand how utilities are designing RaaS programs. SEPA invited FPL, Georgia Power, and Xcel Energy to speak about their individual RaaS programs. These programs and Entergy’s “Power Through” RaaS program are summarized in the table below.

SEPA kicked off the March 22 meeting by introducing the RaaS concept, which can provide services while the grid is operating or when the grid is down. Additionally, RaaS programs are typically a partnership among utilities, customers, and third-party vendors. In most cases, the utility owns and operates the energy assets to provide resilience service to customers during emergency operations, as well as grid services during normal grid operations. These programs are typically funded by participating customers under a utility rider, tariff, or rate schedule. If utilities can demonstrate benefits to the entire rate base, regulators may authorize rate-recovery.

During the meeting, utilities identified customer demand for back-up power, extreme weather, the ability to generate extra revenue, and interest in carbon-free generation as key drivers for RaaS programs. The figure below indicates additional benefits of RaaS for customers, utilities, and developers or third parties.

Source: Smart Electric Power Alliance, 2023

There are several key issues to consider when developing a RaaS program. These include who will own, operate, and maintain the onsite assets during the duration of a project, how participating customers are charged, whether any program costs will be allocated to a utility’s rate base, and which technologies and fuels will be used. The figure below illustrates the interactions among RaaS customers, the utility, the grid, and ratepayers as a whole.

Source: Smart Electric Power Alliance, 2023

During the call, Xcel Energy laid out the differing finance and ownership structure and the responsibilities between the RaaS customer, Xcel Energy, and the vendor (see below). Ethan Trepp, the commercialization manager, for Xcel Energy’s RaaS program stated that “Xcel Energy is exploring RaaS to reach C&I customers who value backup power and we are excited to act as a trusted energy advisor to those customers”

Source: Xcel Energy, 2022

While some active RaaS programs utilize diesel or natural gas generators to provide back-up power to participants, Lawrence Berkeley National Laboratory (LBNL) provided a summary of their 2022 report; Evaluating the Capabilities of Behind-the-Meter Solar-plus-Storage for Providing Backup Power during Long-Duration Power Interruptions, which explained how energy storage and solar-plus-storage could provide backup power during long-duration power interruptions. As solar-plus-storage system costs continue to decline while utilities and their customers strive to achieve carbon-reduction targets, these systems will likely become more common. As RaaS programs gain popularity, SEPA will continue to identify and share early challenges, best practices, and lessons learned through its working groups and initiatives. The benefits of RaaS programs are a win-win for all parties involved.

Join us in Atlanta at Utility Conference as we host a Utility Resilience-as-a-Service (RaaS) 101: Intro to Program Offerings and Design workshop and a session on different resiliency-as-a-service program designs and customer and utility impacts.

SEPA members can log in and join at groups.sepapower.org. For more information on SEPA’s working groups, contact us at [email protected].

For more information on SEPA’s Microgrids Working Group see SEPA’s Microgrid Design Framework, SEPA’s Microgrid Playbook, and SEPA’s Multi-User Microgrid Tariffs Design report.

FPL’s Optional Supplemental Power Services (OSPS) Program | Georgia Power’s DER Customer Program
Entergy’s Power Through Program |Xcel Energy’s Empower Resiliency

Acknowledgments

We would like to recognize and thank Lance Haman of Georgia Power, Ethan Trepp of Xcel Energy, Frankie Sanchez of Florida Power & Light, and Galen Barbose of Lawrence Berkeley National Laboratory for presenting at SEPA’s Joint Microgrids, Energy Storage, and Customer Programs Working Group meeting. Additionally, SEPA would also like to thank Frank Magee of Entergy for his comments on Entergy’s Power Through Program.