 So good afternoon, thank you for joining us here. I hope we give you some interesting information. I know my colleagues here have some incredibly exciting data and case studies to share with you. But before we get to that, I want to take a moment and acknowledge the exciting time in the history of energy policy that we are all enjoying right now. Over the past decade, we've seen a truly breathtaking drop in the cost of renewable energy and the cost of energy storage, and the cost of computing power necessary to integrate both of those into a functional grid. At the same time, the impacts of climate change in California and around the world have gone from an if and when to a now and how. And then the voters in California have elected a deep bench of legislators who support tangible action on climate change, as well as a successive series of governors that support similar action. And this is not only in Sacramento. Over the past couple of months, we've had more than 50 local jurisdictions contact the Energy Commission and express an interest in adopting what's called reach codes. These are local building energy standards that exceed the state standard. This is almost an order of magnitude more local jurisdictions interested in such a code than we normally get in our three-year code change cycles. It can be exciting and a little bit hectic when the vectors of the market and politics point in the same direction. California already has some of the largest renewable energy generation facilities in the country and in the world. And over the past decade, we've seen a rapid decline in the cost. And that has resulted in a significant expansion in this state. In addition, in the last code change cycle for the building standards, we have required solar on new homes. This is the first time this has been done in the country. So we've had a number of renewable portfolio standards in California. And this has led to a significant increase in the generation of renewable energy in the state. And you can see here that we've reached all of those standards. We've reached all of those. We've met or exceeded all of those RPS standards. There are two bills that I'd like to highlight here before we get started. The first is SB 100, those passed last year. SB 100 puts us on the path, a new renewable portfolio standard path, 50% by 2026, 60% renewable energy by 2030, and 100% zero carbon by 2045. We are currently at 34% renewable and 51% zero carbon if you count our large hydro. In order to get our electricity grid is currently supported by natural gas spinning generation. It is critical for us to get to the next level. For us to get past 60%, we have to achieve new types of technologies. We have to extend the capacity of storage, and we have to integrate our demand side. I call this demand optimization. I especially like Marianne and her team developed a framework a couple of years ago. It's called shape, shift, shed, and shimmy. This framework represents the endpoint that we need to get to for the technologies that we need to implement. So the shape changes the shape of the load of the demand in a way that is essentially invisible to the utility in a way that is similar to the way demand normally works, but it changes the way that that demand behaves. The shift is active demand optimization where you tell various energy consuming technologies to behave in a certain way so that it supports the local distribution grid. Shed is a traditional type of demand response where in an emergency or in a critical situation you will curtail certain loads. And shimmy is a new type, a synthetic inertia. So this is short, minute, or second level demand side optimization to maintain the voltage and the frequency on the grid. We need all of these types of resources that can come from both existing technologies like batteries and from new technologies that some of you in this room might help implement. The second bill I'd like to cover briefly is AB 3232 that the legislature also passed last year. This commits California to addressing the carbon emissions from residential and commercial buildings, from all building stock. The legislature put us on a target of 40% below 1990 levels of carbon from building stock. This is a research bill. It specifies that the energy commission and all the other agencies involved will look at how to achieve this goal but it is on an incredibly short timeline. It requires the energy commission to report back to the legislature by next year and the year after and each year going forward until we get to these targets by 2030. So it's an incredibly short timeframe and it has a very high level of technical specificity about how we do this. So of high confidence this is gonna push us forward rapidly. It's not just new policy drivers that push us to adopt these technologies and move forward with a fully renewable grid. It's also some existing authorities that we have. One example is the energy emissions load management standards authority. When the energy commission was created in the 1970s, one of the, I think an elegant piece of legislation that was included in the Warren-Alfast Act was the ability for the energy commission to adopt standards for local utilities for programs of two different major kinds and one minor. The first is energy storage. So the energy commission has the authority to require programs for energy storage in each utility service territory. And the second is automation. Remember this is language that was created in the 1970s but it is remarkably applicable today. And the third area is kind of a minor area is we have the ability to provide recommendations on rates. We've already done this. I was the project manager of the previous load management proceeding back in 2008. We recommended time of use rates. The public utilities commission was fully on board with that and we are now adopting those a few years later than we had hoped but we're getting there. So this is an existing authority that the energy commission has that we intend to exercise in the near future to help move this forward. My point here is that the depth of support for the work that we have ahead of us to achieve a 100% zero carbon grid is deep in California. When President John F. Kennedy suggested we go to the moon within a decade, his goal wasn't to bring back rocks from the moon. His goal was to set a challenge before our society and to train an entire generation of scientists and engineers. Similarly, the goals in California for renewable portfolio standards for zero net energy homes, they aren't simply to generate renewable energy or to build homes that have zero net energy. They're to create the markets, to create the technologies to design and vet the programs that we need in order to implement this in the real world. California represents only 1% of global climate pollutants. We cannot do this alone. But our intent is to develop the programs and the technologies and the policies here so that we can export those around the world and get this done. So my colleagues here will tell you now how to do it. No pressure. So I'm Harish Kamath with Every Electric Power Research Institute. And I'm here to talk about some of the technologies that we are trying to implement to satisfy the challenge that Gabe and his colleagues have set forward for us. As Gabe said, these are huge challenges. And in fact, in many ways, they're more daunting than the challenges that we faced when we're going to the moon. Because the chips are down and some of the stuff is for real now. We have to do this. This is when we're dealing with climate change is one of the greatest challenges that our species has ever faced. And many of these technologies are absolutely necessary for addressing that. So that's really what we're trying to do here. As you can tell from just getting these slides up, technology can be a challenge. It doesn't always work seamlessly, even if we're prepared. And so we have to sort of wing it at times and actually start going forward. We don't have everything planned, but we can start. And as we get further down this road, we'll make more progress. So let me just start by saying that from a practical standpoint, we're already in the midst of a enormous transformation in the power system today. And you've heard the buzzwords as they go across. Digitization, decentralization, decarbonization. These are real things that are happening on the grid today. And I'll start with the last one, decarbonization. Again, it's a very important part of everything that we've done. We are seeing more renewables on the grid than we have ever had. They are increasing our exponential rate. And so we've seen wind and solar make huge strides in the last 20 years. Certainly that's not universal. The U.S. as a whole still only has about 5% renewables. But here in California, we've seen tremendous strides. In part because we're blessed with some great resources here, especially in terms of sun and a little bit of wind as well. But also because of some very visionary things that the people of California have done, partly through government incentives and other things, but also just through a willingness to try some of these new technologies and implement them. And that's not just at the power plant level, but also at the home level. And that comes into the second buzzword that we talked about, decentralization. When we're looking at these new technologies, we're not just looking at the supply side on the left side of this graph. It used to be that that was really simple. And it was all about control of the power plant. And all you had to do was control your power plant and move them up and down, and you could regulate the entire grid. Not anymore. Because we have more renewables, we have less control over the generation side. But then we also have more control downstream because we have sensors, we have ways of telling what's going on at the end of the grid that we never had before. We also have ways of affecting those things because we have local generation. We have things like smart inverters would go along with local generation with solar and with other DER, like local storage systems, home storage systems, V2G systems with plug-in vehicles, and so on. So we're looking at a new system that's really looking at that, has a lot of different options on it. I just wanna talk a little bit about some of the technologies that you hear about in this thing. And I'm gonna start with energy storage because energy storage is something that a lot of people talk about in terms of the macro. And one of the big hype things today, I'm gonna call it hype a little bit because you hear a lot about it, but it's poorly understood. We're talking about solar plus storage. So there's a lot of solar plus storage plants that are being deployed now. We've seen large scale solar plants that have storage along with them. And people look at the costs for some of those things and the announcements that come out very breathlessly that, oh my gosh, these things are incredibly low cost. And so we had a few years ago, systems that were installed in Hawaii and incredibly low rates at that time. We were looking at 14 cents a kilowatt hour in terms of its cost. And then later on, it actually came down to a little bit over 11 cents a kilowatt hour. That's pretty amazing for what we could do with solar plus storage. But that's even eclipsed by what you saw in the mainland where people started talking about four and a half cents at Tucson. And then in Colorado last year, people actually went to three cents. And now we're hearing about two cents per kilowatt hour for solar plus storage. That's at an incredibly low price. That's a lot cheaper than coal. That's a lot cheaper than gas. So how can you do that? How can we do that? Does this mean that we can just put solar and storage up there and manage the whole grid with it? Well, not quite. Because remember that the solar is only there when the sun is shining. And the storage that they're talking about for these is relatively small. So it does give you a little bit of control. It's great as part of a balanced breakfast, a balanced diet, as you might say. But we still need to have some more, some of those so reliable sources there. What this means is that when we see a lot of solar out there, we have a little bit of storage in there, we do need some gas and we need some other resources. We've got a path towards decarbonization here through these technologies that looks very low cost. So that's a great thing. We're not quite there yet. We're getting there. We're getting to the point now where some of these costs, even in places like Hawaii, which don't have the benefit of a huge grid around them, are at less than 10 cents a kilowatt hour. This was unthinkable 25 years ago. And so it's a great step forward. We still have a long way to go, but it's getting there. Another thing that you hear about today is that energy storage is gonna take the place of all the gas turbines out there, because energy storage is cheaper than gas turbines. That's not quite true. We are certainly seeing the price come down very rapidly, but combustion turbines still are quite a bit cheaper than batteries. So you're not gonna see this universally. Here in California, we have a special case. We have, well, we have great solar resource, and so the solar resource helps us during the daytime, and then during the night, we don't have a lot of load. So we really only have to take care of that evening time period, three or four hours. In a three or four hour case, batteries might actually make sense. But it's, and so here in California, we're actually looking at a place where you may not ever put another peak to plant. However, in the rest of the country, a lot of the other places, they don't have a lot of sun, they don't have the same kind of duct curve effects, and so you might not see this. But what you might see is that the cost of, again, over the next few years, storage is gonna come down, and so that if you have four-hour peaks, five-hour peaks, you might actually make sense. And it actually might make sense before that if you take it into account the other benefits of energy storage. So you might see that sometime before 2025, in a lot of the rest of the country, you will start seeing battery plants being placed simply because it is, again, part of a portfolio, and you might not need quite as much gas as you might otherwise do. So these are really interesting developments that we've seen. I wanna also talk about distributed energy resources. So this is an area that I've been working on quite a bit lately, and looking at customer assets as part of that. So a lot of people will tell you, well, customer assets make a great way of managing the grid. For example, if we have electric vehicles and we have a ton of electric vehicles out there, millions of electric vehicles, then we can use them in conjunction to manage the grid. And you can, except now you've got a grid asset that somebody might jump into and drive away. So you have to take it out into account. And how do you orchestrate that? How do you orchestrate millions of these systems? We're not just talking about dispatching individual systems, we're talking about orchestrating a huge number of them. And the thing we gotta remember is that some things are better at this than others. So if you've got a solar system on your roof, the solar system on your roof is a great thing because all you care about is this delivering energy. You're not really using it for anything else. So I as a utility can come in and say, hey, I'll take that energy off your hands and you'll be really happy about that if I give you a fair price. A battery is kind of like that. It's also just delivering energy, but you might want it for some backup energy. So it's a little bit less of a resource. And then when you get into some of these things, like especially a backup resource for your home, if you get into an EV, the primary use for EV is not to sell energy back to the utility. Primary use is for you to get around. So it's not as much of a grid resource as solar is. And then you get a thermostat the same way, and then you can go down the list all the way down to your TV. You don't buy your TV so that the utility can tell you to shut it off. So you're not gonna do that. So telling me that you're gonna use your TV as a grid resource is really a waste of time. That's not a grid resource. Where you really wanna look at are these things like thermostats, washing machines even, hot water heaters, and the kind of appliances that Mark will tell you more about in just a moment. My last step is to talk about how we're gonna orchestrate these things. So when we look at this from a utility perspective, we wanna be able to send the right signals to the endpoints so that those devices can actually know whether they're providing good services or not. And so this is really about the distributed energy resource management system, GERMS. This is the cutting edge of research in this area. And what this means is that the utility can send signals that it might be a price signal. It can send them out to aggregators if there are aggregators and the aggregators can talk to individual units so that they know what the price is and they can decide what to do. It can go out to microgrids if there are any and do local control over microgrids. And this is simply to make the whole system a lot easier because there's no way that the utility can dispatch millions of individual units when you're talking about in your own home having a thermostat, a water heater, a electric vehicle, a energy storage system, the solar on your roof, all communicating with the network at once. That can get very complicated. And so the whole idea is that we have these tools, we will have these tools that will be able to manage these things and actually be able to provide the same reliable, cost effective, safe and environmentally responsible power that you're used to getting. Thank you very much. Pleased to be here. It's the first time I've been here actually and being from South of California, not a Berkeley grad or Sanford grad, but from Cal Poly Pomona, so during school. What's interesting is that I run a program called Emerging Markets and Technologies. And emerging technologies have been around for awhile. We didn't, 10 years ago we didn't have iPhones, we didn't have smart thermostats and things and back in the 80s, with the Arab oil embargo, we were looking for new ways to control things because customers had air conditioners and they had pools and believe it or not, they had water beds back there too. So it's like, how can we manage these appliances and these things that were, they're using energy? And then over time, things changed, we didn't really, we had too much energy, we actually wanted to sell more electricity and then around 1999, 2000, something dramatically happened in California. It's called the California Energy Crisis and all of a sudden, we could not buy enough electricity. As a matter of fact, at that time, PGE went bankrupt and we almost did and we had to come up with a new way to give customers information and this is where this whole concept of pricing came along and that's where the term, that's where I learned in 2000, the term demand response and we knew about efficiency and we knew about managing loads but we didn't know that we had to now tell customers what the price of electricity was so that they could actually respond to it. So that generated in 2001, a whole bunch of programs. We went, great guns going, developed a lot of new things and in 2008, the economic crash happened and what that did was empty a lot of buildings in California across the country and our demand dropped and we really didn't need to manage loads anymore because it really wasn't a whole lot of load but what was coming up was solar and in 2010, 2012, the solar started growing and all of a sudden now, here we are getting close to 2020 and now we have too much of a good thing. So just as we did in 1980s, just as we did in 2000 and here we are, demand response to the rescue. So let's talk a little bit about what this challenge is. It's called over generation or oversupply and it's basically what Haresh and what we were talking about was that with solar, you can't manage it. You can't turn it off or maybe you can but you really can't dispatch it. You can't fire up a solar plant because the sun is shining. So we've gone from a couple of thousand megawatts to now 10,000 growing more and more and this is when electric supply exceeds the demand. It doesn't happen all the time. In California, we have a lot of air conditioners that ramp up in the summertime. We haven't reached our peak of over 40,000 megawatts but we might get there again and the solar is there to supply it but in the shoulder months of March and in October when there's not a lot of air conditioners running but the sun is still shining, that solar happens every month of the year. We come into a situation we called over generation and so here's your duck curve. What happens is during the middle of the day the solar generates enough power to satisfy most of the load during the summertime. In the winter months or in the fall months it actually can exceed that. Now what you're seeing on the bottom of the curve is what's planned. This is what is in the queue for the CEC's power plant. So we had 10,000 megawatts of solar last year. There is 23 megawatts in the queue and these are procurement, okay? These are what's being planned to be built out in the Carrizo Plain and other places like that. This does not take into account your neighbor's house who's putting in a 4KW program or deck or they're not putting in all these other things and the CEC this year has then mandated for next year to mandate solar for all new construction and that's not included in this graph. So, and we don't include all the other biogas and wind and geothermal as well. So what the market is doing, remember I'm emerging markets and technologies and what I look at the markets is that because this is excess on the wholesale market it's not considered economic so it is curtailed. So what you're seeing there is a graph of the megawatt hours that the wholesale market has been curtailing over time and at the far right is what is happening in the most recent months. Now this is antithetical to California's policies. We didn't put all this solar in to turn it off. We must find a way of either utilizing it or adjusting things or changing our market structure. So we have the economic dispatch, we have the self-scheduled cuts and so these are things that are happening beyond your electric bill. These are happening at the wholesale market and sometimes there's so much solar we export it to Arizona or to other states and so forth. So one of the things that I've been looking at and thanks to Haresh and others is that there are a lot of little grains of sand out there called pools and air conditioners and things like that but to fill the belly of the duck I need some big rocks. I can't be shoveling sand all day long. So we're looking at a program to engage the water sector which one water plant can be two, three megawatts which is several thousand customers to look at how they can deal with the over generation. So when you look at a gigantic power plant it's generating power during the middle of the day and a water plant which is pumping water like in the tachibies and so forth. They're using that energy but they use it in accordance with their needs to treat water or to supply water and then sometimes they can use the energy during the middle of the day but what's preventing them are the electricity rates. So the retail rates are not quite in alignment with that big duck curve and that's one thing we're getting closer to. So we have been doing a study for the last year in the last couple of years and we've asked water agencies, you know if electricity was free in the middle of the day as opposed to charging you what it is could you change your operations? And so I talked to the Coachella Valley Water District out in Palm Springs. They've got three dozen 300 horsepower pumps. Okay, that's a lot of load. That's a lot of air conditioners, a lot of pools and they can manage that in accordance with race. We look at other water districts that are treating Colorado River water and other things like that. So it's what we call operational flexibility and it's a component of the shape, shift, shed and shimmy of the family of demand response programs that we looked at. So it's kind of a dance move and basically asking the water agencies, you know if I came up with a different tune, could you dance and say, you know what, we're good dancers whether it's a waltz or a rumba, I know how to deal with it, okay? So what we're trying to do from our technology perspective is give them the chance to see how they can actually change their operations if we needed them to be the solar sponge to suck up some of that solar. Here's an example. On the top graph, you have a typical water agency and this is what they do. Their rates tell them that during the middle of the day your on peak tariff is gonna be expensive. So they stop pumping. They say, I've got a water tank, I'll fill it up, I'll keep it so full for water, for fire protection and then we're done. And then when the rate changes, I will go back to pumping again or treating with osmosis and things like that. At the bottom is a non-time of use rate period and they basically operate their pumps and whatever when they need to, okay? So when you have 10 megawatts and your electric bill is in the millions of dollars, you become very rate sensitive, okay? Most residential, small commercial customers don't have that. Their Verizon bill is bigger than their electric bill most of the time, okay? But these folks are very smart. They have automated SCADA systems and so forth. So if I could roll some of these 10, 20, 15 megawatt boulders into the belly of the duck, I think I can really help things out and make a difference there. In addition to that, there's also the issue of water storage and we've heard a lot about water in the last five or six years of the drought and so in Southern California, we have a lot of storage that brings in Colorado River water and the North not so much but the state water project moves a lot of water and they use a lot of energy. So perhaps they can be the answer that we can utilize for combining some of the generation. If I'm looking at 30,000 megawatts of solar down the road, I better start thinking big and looking at some of those contracts and see how we can do this. Now, it was interesting as one of the water guys explained to me that a water sort of basin is like a bathtub full of sand, okay? It has an impermeable basin around it and it's full of sand, you can just fill it full of water and then pull the water out whenever you need it. So there's a lot of those in California and I know that we wanna talk about the internet of things and smart thermostats and things like that, but when you're faced with a not to be ignored problem down the road, you sort of have to think big and hard to look at these things. We're also looking at refrigerated warehouses. They have thousands and thousands of square foot of frozen foods and things like that and they only need to keep things at zero degrees Fahrenheit. They say, well, can you go down to minus 10? Yeah, is it gonna affect the chocolates from Belgium? No, okay. So maybe we can use you as like a storage medium, okay? That's a lot of pools and hot water heaters that we cannot have to fuss with. So refrigerated warehouses, any type of storage media and of course there's more exotic technologies that we can look at. These are the things that we're examining not only with some of the grants that the energy commission is doing but also with EPRI too because they're good partners on that. And here's an example of the Will Springs Water Bank. It's something that can, I think it's, I think the total megawatt is something like 200 megawatts is what they anticipate that they can store and ship. So dams are not a good thing because they destroy the environment but under the ground he was showing me a picture of their, and I was like, well, there's nothing here. Of course not, it's underground, there's nothing to see. So that's something which we want to encourage and wanna look forward to. So in conclusion, I really think that when you look at a big challenge of too much of a good thing and you see the policy objectives down the road, you have to really think out of the box or out of the bathtub or something. And so one of the things we're looking at is getting involved with the sector. There's a lot of parallels between the electric grid and the water system. There's pressure, there's volume, they are smart people, they really want to work with California and doing the grid. So that's the partnership that I'm working on. And this is one example of one of the many things that we're trying to adjust and fill the belly of the duck. Okay, thank you. Questions for our panelists. I'm gonna ask the first question, but I'm sure there's questions from folks in the audience and we'd like you to use the microphone. So anybody who wants to ask a question if you could step up to the microphone. My question to you guys is what do you think the biggest challenge is? We all heard great ideas and visions about technology but quick comment, what do you think the biggest challenge is for us in the next five to 10 years? All three of you, I'd like to answer. Okay, your first one. Quick, look at this line, we gotta go fast. Okay. These are speed questions. Two major challenges that I'm really interested in seeing. Solutions two, number one is the environmental impacts of offshore wind. We just started an offshore wind proceeding. We're looking at that. California has one of the largest resources of offshore wind. Modern offshore wind is 30 plus miles offshore so it's over the horizon. You can't see it, the visual impacts that you see coming from the East Coast and other areas. No longer a serious issue but there's still concerns with impacts on whales and things like that. So huge resource potential in California that really needs to be investigated, moved forward as quickly as possible. And secondly, all the sand that Mark mentioned, I'm a big proponent. We have 13 plus million hot water heaters for residential consumers in California. Each one of those can be converted. Right now they're generally natural gas. If you convert those over to a heat pump hot water heater with a mixing valve so that it can be overheated and it has no risk of scalding. The hot water heater manufacturers have already committed to bring to market whatever we feel is appropriate. We just need to figure out how to aggregate those and present a useful resource to the grid. Everybody has hot water and so it's a huge amount of thermal, potential thermal storage. Similarly, buildings themselves can be used as thermal storage, similar to the refrigeration that Mark mentioned. We're working on it. Yeah, I'll be brief too. I think there are two major challenges from the technology side. One is just simply keeping up with the need. Coming from the policy end and regulatory side and the social desire for change. Our grid is changing very, very quickly. Keeping up with that in terms of technical investment and making sure that we have the technology for it, making sure that that technology is deployed and that we can still maintain the level of reliability that people have come to expect and low costs is quite a bit of a challenge. I think that along with that is separating the wheat from the chaff. There's a lot of stuff out there that claims to be ready for prime time or is actually ready for deployment or that can make a difference. And a lot of it doesn't. And testing it out, making sure that it works, looking at some of these ideas and it's not always the most outlandish ideas that are actually the hardest to implement. Sometimes it's something that looks relatively straightforward but is actually very difficult or challenging for one thing or another. Looking at that dispassionately and making sure that we're taking the most practical approach can always be a challenge. Technology will always be there and it'll always find a way to solve a problem but it's customer engagement. If we can figure out a way to get customers engaged and to develop and maintain that relationship, they are going to be our partners in the future for grid management. They're making their own electricity, they're storing it, they're driving it around in cars so we need to engage them and develop that. Great, thanks. Can you please say your name and affiliation? Yes, I'm Jonathan Livingston with Livingston Energy and Innovations and I wanna thank the panelists and the panel chair. For Horesh in particular, but anyone else who'd like to chime in, I'm gonna start with Epri. Epri is an organization which represents electric utilities across the spectrum in the United States. We're gathered here in California and as a number of speakers today have already pointed out, we're in a bit of a bubble in terms of how things are done here. I'm very interested in your saying a word or two about your experiences working in with utilities in the Midwest and the South which have different energy profiles in terms of sources and storage in particular. And are you seeing economic benefits or other types of benefits that are driving storage outside of communities like the coastal communities with their very enlightened energy policies? Super fast answer please, because we got a big line. Right, so let me just clarify that we don't represent utilities. We do work with utilities, but so we do see quite a bit of a difference. Things are different everywhere. That is not to say that there are not possibilities. If you look at the Midwest, the low-cost gas and lots of wind is very different from what we have here in California with sun and a favorable regulatory structure. In the South, it's quite a bit different because you have very large utilities actually that are interested in developing new technologies. So there's definitely a difference and the value propositions are different. That's not to say that there's no value proposition, it's just that we have to look at different technologies. Thanks. Please. Okay, so Farhad Bilawarian of the Australian Energy Market Operator, which is the equivalent of CASO here. Great presentations, thank you for that insight. My question is in relation to the energy transition, one of the issues we've been seeing in Australia is sort of away from the duck curve and just energy balancing, is all these system services that used to be delivered by thermal generation and now because you're seeing less and less of that generation and now not being delivered or you're having to force on generation when you ordinarily wouldn't, that's forced us to think about do we have the right market designs and economic frameworks? And I was just wondering whether you had views on that really to the whole panel. So what's the future of the economic framework and the market design for electricity? First, I think you hit the nail on the head there. It's the market design and the economic framework that will derive those services. We've demonstrated those services using air conditioning loads, using pumping loads, using lighting loads. We've proven, I think technically, that it's possible to provide those ancillary services, virtually the whole raft of ancillary services with those loads, but we have to have the market design in place in order to incentivize customers to do that. I agree with that. Yeah, I mean just, and sometimes trying to understand whether it's a market or trying to, other mechanisms might also be something that needs to be considered. California's just rolling out our time of use rates. 10 years ago, we suggested that they be put in place and it's taking a little while to get here, but we're just rolling those out and the utilities have already revised them over months, over just month periods, where they've revised them. And as Mark pointed out, they're still not quite matching up. And then of course, the needs of the grid are gonna change daily and you can't change the rates for consumers daily. So we have to move potentially to certain areas where we have transactive prices, where you have rapidly changing prices. You absolutely cannot involve a customer in that type of regime. It has to be automated and it has to be invisible to the customer so it does not reduce their quality of service or the satisfaction. So I have two heat pumps for space heating at my house. I have a third heat pump for hot water. I have a 10 kilowatt solar system and I just bought an electric car. And I'm also contemplating black storage system because I'm in a wild urban interface and the utility may be cutting me off and going forward in the future for possibly days at a time. What's missing in this picture is a sophisticated utility control system and tariff structure that best optimizes the use of these capital investments that I've made. So the utility is losing out. I'm losing out. Where do we stand on this? How long is it gonna take before there's a sophisticated system for taking advantage of all these capital resources that I've invested in? I suspect other people have too. So there are many such systems under development and under test. Utilities are looking at that and trying to implement them. And of course, I mean, there is some work that needs to be done on the market side as well to make sure that the structures are in place and the rates are in place to do that. And I'd be very interested in getting your name as a potential test site. Thank you. Yeah, that's good. In the 2019 building code, we just rolled out additional requirements for demand responsiveness, specifying an open source communication protocol for the first time, a specific communication protocol open ADR that'll go into effect in January 1st, 2020. They're optional for residential mandatory for some commercial HVAC systems and whatnot. Again, we're in a significant transition period. As I said, primarily when the vectors point in the same direction, it can get a little hectic. Do not understand, underestimate how significant a transition period we are in. All options are on the table and we need to use them all. Okay, Sally Benson, Stanford University. I really appreciated the remarks about partnering with the water system because they had very large controllable loads. So at Stanford, we have a fully electrified heating and cooling system and about 10 megawatts of a flexible load and with very large scale thermal storage as well. And last summer, we participated in the demand response program and it worked really great for everyone. We were flexing five megawatts and always succeeded. We also did some calculations specifically looking to operating in the middle of the day with the goal of reducing the carbon intensity of our power consumption and that looked great. I mean, we could really operate in the sweet spot when there's excess solar but our economic calculation showed that the demand charge was just gonna kill us and so that it was very, very expensive. So as you think about some of these really creative solutions, how are people thinking about working with customers to deal with the demand charge when there are all these other system benefits that could be achieved? Yeah, and that's basically rate design and there's probably half a dozen proceedings at the commission right now that have jurisdiction over our rate cases and our rate design. It's about cost of service. It's about getting the right signals to customers. And so as Gabe said, all of that is in play right now and as a matter of fact, we have some very innovative smaller rates that we've come up with for solar customers and for customers with batteries. So that is I think probably the walking that's getting started. We have only 20% of our energy is with residential so the rest of the gang with the larger loads will be coming into play. And it's a business. You have to be able to have revenue and sustain yourself but it is also an investor business that customers are part of that now. So the fact that you've learned how to dance, you've learned how to be flexible is strongly important and that's what we're trying to encourage and the rates will soon follow, I'm pretty sure. And let me just say, just to add that, I think a very important part of all of this is continued research to try to understand what those things can do. Demonstration projects, getting data that can go back and help the PUC make some of these decisions I think is very important. And that's gonna get worse because we are moving, as we move past 60% renewables and as we coincidentally decarbonize buildings, we're gonna move to a winter peaking load in California. So we're gonna have more and more excess generation. I prefer to call it idle generation rather than over generation but that's a nuance. We currently have a lot of natural gas facilities that operate for hours per year. We don't say that they're over-generated, we say they're idle because they're not using the fuel. But as an aside, if you haven't seen the new energy facility here at Stanford, it's impressive, they give tours. Next please. Hi, Paul Brussela with EDF, Electricity of France, World's Second Largest Utility and Big Renewable Developer and a big partner of EPRES, Hi, Hresh. I've led our research into transactive energy for a couple of years and I've viewed demand response as a big step in that direction. But what are your thoughts on transactive energy? Is it inevitable? How and if so, when will it come and what can we do to make it happen? I have a hundred homeowners in Westlake Village in Thousand Oaks in Southern California that are on a transactive energy pilot. Ed Casilets here, he's the architect of that. They are getting wholesale price signals from the market, they go negative. And when those price signals go negative, it's like, here's a signal, the electricity is negative, maybe you could run your pool a little faster or whatever. So it's here today. It's, you know, I mean, two years ago I was told, well, that's okay, let's figure this out. Now we can't get enough people that are interested in it. And this is not blockchain, it's not some type of cryptocurrency, it's basically just a peer to peer network and it keeps the utility whole through a subscription model. So it's something that is both practical and elegant. And I think that it's an imminent future model design. Now, I'll just add, I mean, yeah, I think that the technologies all there is not really something that's waiting for a breakthrough in blockchain or something like that. I think it's more about having enough data to understand whether it makes sense, you know, what are the benefits and having a regulatory process that allows it. And transactive energy is more, is basically just a large optimization problem. So we can pull in more than just the economic factors. You can look at the values that the individual designs. So solutions for transactive energy could be, I think, generalized to manage microgrids. Had a lot of opportunity to work with the healthcare industry in California over the last couple of years and they're being brought under the energy code. And one of the most interesting things for them is to consider microgrids for large hospitals, particularly in areas of the grid where they may be curtailed for long periods of time. And when you put a large healthcare institution on a microgrid, you have to learn how to balance that microgrid in a way to optimize how long it can stay islanded. And that comes down to balancing each individual load within the hospital and ensuring that the ventilator stays on versus the vending machine. And we're very proud of the fact that we got Alexa's vocabulary to better understand what demand response was in the problem. Okay, we're at our hour, but I think we can go a few minutes over. Because I think we started a few minutes late, so we got three more. Let's keep going. Thank you, Marianne. Allow me to ask this question and hi, Horace, everybody. And well, the question is how we can help the customer to realize the value of behind the middle DER, like this gentleman. And then California has been doing a great job, but we can be better. For instance, like SoundRound has awarded, in the early of this year, awarded the first capacity market for the aggregate home-level solar-plus storage at ISO New England, not California, right? How we can open more market products to engage customer, to engage behind the middle DERs. That's the first part of the question. Second part is, then in the future, we see a lot of behind the middle DERs. They participate in the wholesale or they can participate in the distribution level, but the electron is flowing in one system. For instance, if they participate in the ISO, they will go through distribution system, right? And what's the impact on distribution system? If they participate in the distribution service, then they may mislead the ISO load forecasting. How do we address this kind of future? Well, so as I said before, customers need to be part of the relationship. And we're doing a number of tests as they're going across the country, at least involved with a lot of those. We're doing a lot of them in California as well. So for a customer, they did not purchase a television or an air conditioner, like we talked about earlier, to bid into the market. This is the utility of that appliance, that that end use is food preservation, comfort, entertainment, those are the things they're asking for. But there is that opportunity. So how do we develop new models of demand response, new models of engagement? And that's through appropriate secure communications and proper pricing models and proper tariffs. So there's a possibility the price of electricity might even change to where you live, okay? As it's changing now towards the time of day. Those are all in play. And as those end uses grow, and as more of them becomes in different areas, that becomes more significant to the grid operations. So I think it is, again, emerging, but that's all in line and all in sight, very insightful question. That's a great question. And I think it's gonna become increasingly important. Certainly the utilities are all working over time to try to address exactly the issue that you mentioned about coordinating between distribution, transmission, the markets and everything else. And we'll see how quickly we can move to meet the need. Certainly I think an important part of all of this is going to be just a general understanding that this is something that needs investment and that needs engagement from all of the different stakeholders in this group. Some of what we see, unfortunately, is a maybe not a full recognition of just how difficult this challenge is in terms of being able to keep the lights on along with meeting our other goals of higher renewals penetration and so on. And sometimes I think people have planted a flag in the ground in terms of goals without considering all of those. And I want everybody working on this to print out and stick on the wall, customer satisfaction, quality of service. That should be number one, anytime they're dealing with customer engagement. We don't want anybody that's engaged in demand management or demand optimization to at any point in time have a reduction in their quality of service unless they have engaged in that fully voluntarily and they're getting suitably compensated for that. In general, it should be automated and invisible. Okay, we got two more, let's go fast. These are speed answers, you guys. Nicola Pio Malter from VMware. So I'm glad you mentioned the microgrid because we're in the process of building a microgrid on campus. And one of the things we wanted to demonstrate just as kind of an experiment is a transactive grid using some of the internal grid demand devices. Can you comment on data centers as a potential grid resource? Because obviously a huge consumer but more complicated than pumping water. Real quick, so I've seen some studies that show that data centers actually have a much higher tolerance for changes in temperature than traditionally assumed. I'm not just talking about cooling, I'm talking about changing the compute load. Yeah, virtualization, storage backup, yes. Just a quick answer, PG&E has a program. Southern California has a program. We have a data center of excellence. We've done studies on that. So it's like, talk to your rep. I want to be a part of a program. We need some public case studies. Yeah, I think there's some holistic analysis that can be done to look at all of those considerations. Virtualization along with looking at some of the other things. And I think one of our experts is right up here in the front row, so we can talk about this. That's a good question. In addition to virtualization, there's thermal capacity and then there's the pure electrical capacity because they all have massive backup systems. Great, thanks. Last one, last bananas. Hi, Mark Roost. If you use batteries to dodge demand changes, how will it change your management planning when you can get batteries for under $100 a kilowatt hour in two to three years? When consumers and CNI start putting up enough solar on roofs and canopies to serve over 95% of building and associated vehicle load needs via batteries with battery storage making that possible? Is this a combination of lightweight canopies, lightweight solar, low expensive solar and low expensive stationary storage batteries plus all electrified fleet? Sure, I mean, from our perspective, that's already happening. We're already seeing a great deal of deployment of those systems. And it's already starting to make an impact on the way that loads are managed. I think that in the long run, we have to look at that from a rates perspective and understand those changes have to be accounted for in any approach to the grid in the future. Well, if you really go for microgrids as a basic structure, those instead of investing more distribution and transmission invest more in microgrids and local distributed generation and storage and the total cost will probably be a lot lower. So there is a regulatory challenge here. Any of these innovations that we implement at the grid edge needs to trickle back into the utility planning process so that they're not installing hardware that is redundant with these solutions that are at the grid edge. So the, sorry. Yeah, go ahead, Mark. You can do the last comment and then we're gonna wrap it up. Sure, sure. So customers install solar to reduce their energy costs. They install batteries to reduce their demand costs. So these are somewhat cost mitigation issues, but you're right. Here's a great opportunity for the utility to reach a hand across the transformer and say, we wanna be a partner with you in managing your operations and you can help us. And I think that's when you now have systems that generate real power, instead of acting like loads, then that's really the benefit. So like we all said, that's you're all in play and they're all imminent and we are looking forward to figuring out the answers to these challenges. Okay, I wanna thank everybody. That was a great question to end the session on. Thank you for your attention and thanks for- Thank you.