Demand as an Active Actor Day 2, Item 1. Presented by: Flora Flygt XM Medellin, Columbia December 12-13, 2012

Transcription

1 Demand as an Active Actor Day 2, Item 1 Presented by: Flora Flygt XM Medellin, Columbia December 12-13,

2 Outline Introduction Demand Response Continuum Passive Demand Response Active Demand Response PJM DR Programs PG&E DR Programs Summary 2

3 Introduction Many different types of demand response in use in electricity markets in the U.S. Passive Demand Response Energy efficiency Time of use rates and real-time pricing Peak pricing Active Demand Response Manual, e.g., Interruptible loads Automated Ancillary Services 3

4 Introduction Demand Response Business Drivers Reliability Reduce demand on T&D system during peak times or G&T contingencies Clean Energy Reduce the use of peak-load generation units which are typically gas turbines Economics T&D Capacity defer capital projects for transmission lines and substations Energy market pricing hedge against high energy spot prices Provide Ancillary Services 4

5 Introduction - Background Levels and types of Demand Response vary greatly across the United States Energy efficiency programs have been in existence since early 1980 s Have reduced the demand for electricity Rebates and Direct Load Control Interruptible loads have been used since early 1980 s Large industrials, limited emergency use in response to a call from utility 5

6 Demand Response Continuum(1) 6 Source: Lawrence Berkeley Laboratory, Demand Response Research Center, Overview of Automated Demand Response, March 2011

7 Demand Response Continuum(2) Dynamic Pricing Active Passive Direct Load Control Fixed Rate Flat Rate Interruptible Inelastic Time of Use Voluntary Curtailment CPP, PTR Demand Automated Demand Response Real Time Pricing Energy Demand Management Elastic Source: Real-time Energy Management, Enterprise Integration of Meter Data, Tram, Primen Outlook, Consumer Risk Utility CPP: Critical Peak Price PTR: Peak Time Rebate

8 Passive Demand Response Energy Efficiency Energy efficiency programs aimed at manufacturers exist at the federal level, e.g., Energy Star programs Energy efficiency programs typically provide rebates for the purchase of more efficient appliances Lighting, refrigerators, air conditioners Currently states such as Michigan have mandated demand reductions from the utilities, 1% of sales per year Efforts have reduced demand significantly 8

9 Passive Demand Response Time of Use Rates and Real-Time Pricing Utilities have had Time-of-Use rates for decades Static higher pricing at peak times; customers adjust their usage Very few customers participate Real-time pricing has been discussed for decades Until now, the technology has not existed for consumers to be able to see and respond to prices in real time Concern about whether customers will participate Starting to see Critical Peak Pricing and more interactive opportunities for customers 9

10 Passive Demand Response Estimating Energy Efficiency Impacts Energy efficiency measurement and verification (M&V) standards have been developed Many utilities and third-party entities work in the energy efficiency program market, designing programs and measuring results Approaches work best when have current baseline to compare to Typically assume these savings continue into the future for some period of time Over time, it gets very difficult to determine how much energy efficiency is included in load forecasts Trying to measure what didn t happen 10

11 Passive Demand Response Impacts of TOU and Peak Period Pricing So few customers are on Time of Use rates that they do not have much impact on forecast Peak period pricing is still fairly new and is being supplemented by more active demand response 11

12 Active Demand Response Types Manual DR Building operators manually turn off switches and change set points at each device Labor intensive Poor reliability, poor repeatability Day ahead notification required Semi-Automated DR -pre-programmed DR strategies initiated by a person via centralized control system Better reliability, repeatability Hours ahead notification required Fully-Automated DR -pre-programmed DR strategies automatically initiated upon receipt of remote signal Most reliable & repeatable Sheds can occur within seconds 12

13 Active Demand Response: What s Needed? Inform Analyze Manage Settle Utility Usage/customer Price/rate signal Demand response verification Load reduction Market value Customer Value Signals Price/value Load/energy mgt Energy delivered Gen/Tx/wholesale/ISO Billing Under-recovery Consumer Individual usages Price/rate signal Price/benefit Historical trends Comfort/price Load/energy mgt Energy consumed Service(s) DR Aggregator Usage/customer Price/rate signal Market information Price/benefit Amount of product can produce Price/benefit Comfort/price for customers Verification Payment from market Payments to customers Energy Portal Rate Analysis Load Mgmt Sys Complex Billing Metering Information Infrastructure Communications Network(s) 13 Control Networks Metering Initial Source: Real-time Energy Management, Enterprise Integration of Meter Data, Tram, Primen Outlook, 2003

14 Automated Demand Response System Architecture Signaling Continuous, 2-way, secure messaging system for dynamic prices, emergency and reliability signals. One-way applications are under development. Client-server architecture Uses open interfaces to allow interoperability with subscribed systems Current system Uses Internet available at most large facilities Hardware retrofit or embedded software Many clients fully implemented with existing software 14 Source: Lawrence Berkeley Laboratory, Demand Response Research Center, Overview of Automated Demand Response, March 2011

15 Automated Demand Response Information Model 15 Source: Lawrence Berkeley Laboratory, Demand Response Research Center, Overview of Automated Demand Response, March 2011

16 Active Historical Demand Response Interruptible Loads and DLC Interruptible loads typically industrial customers sign up for reduced rates all year in return for being able to be called upon to reduce loads Limited number of times for a set period of time Loads were not called for years; when they were called upon many customers dropped out Direct Load Control residential customers water heaters and air conditioners Utility controlled when the customers water heaters and air conditioners were turned off Typically used on the peak day to reduce demand Customers should not see marked difference in service level Utilities need to be aware of the snap-back response; could create new peak 16

17 PJM Automated DR Programs Introduction 17 PJM Interconnection is a regional transmission organization (RTO) Coordinates the movement of wholesale electricity in all or parts of 13 states and the District of Columbia. PJM operates a competitive wholesale electricity market and manages the high-voltage electricity grid for more than 51 million people. Does not interact with end-use consumers. Planning process identifies improvements to the grid to ensure reliability and economic benefits on a system wide basis.

18 PJM Automated DR Programs Curtailment Service Providers Responsible for demand response activity for electricity consumers in the PJM wholesale markets. May be a company that solely focuses on a customer s demand response capabilities, a local electricity utility, an energy service company or other type of company that offers these services. Identifies DR opportunities for customers and implements the necessary equipment, operational processes and/or systems to enable demand response both at the customer s facility and directly into the appropriate wholesale market. Requires the CSP to have appropriate operational infrastructure and a full understanding of all the wholesale market rules and operational procedures. 18

19 PJM Automated DR Programs Options(1) Emergency demand response mandatory Mandatory commitment (referred to as Load Management Resources OR Interruptible Load Resources ILR AND Demand Resources DR ) called under supply shortage or expected emergency operations conditions Limited DR 10 days June-Sept, 6 hours/day Extended Summer DR all days May-Sept, 10 hours/day Annual DR all days of year, 10 hours/day Revenue received is based on Reliability Price (energy and capacity) at time and load reduction commitment Voluntary demand response receives revenue based on amount of energy reduced, no capacity 19

20 PJM Automated DR Programs Options(2) Economic DR programs Voluntary commitment to reduce load when the PJM price is higher than the Net Benefit Price Economic DR will replace a generator in the market Economic DR resource can also provide Ancillary Services Synchronized Reserves (the ability to reduce electricity consumption within 10 minutes of PJM dispatch) Day Ahead Scheduling Reserves (the ability to reduce electricity consumption within 30 minutes of PJM dispatch Regulation (the ability to follow PJM s regulation and frequency response signal) Participation becomes mandatory if your resource is chosen 20

21 PJM Automated DR Programs - Impact Nn In 2012, PJM expected 10,230 MWs of Demand Response and Energy Efficiency to help offset the summer peak Expected Summer Peak ~155,000 MWs 21 Graph Source: The Brattle Group, PJM Reliability Pricing Model Assessment, August 2011

22 Pacific Gas & Electric DR Programs - Introduction Pacific Gas & Electric is electric and natural gas company in California 141,215 circuit miles of electric distribution lines and 18,616 circuit miles of interconnected transmission lines. 42,141 miles of natural gas distribution pipelines and 6,438 miles of transportation pipelines. 5.1 million electric customer accounts. 4.3 million natural gas customer accounts. 22

23 Pacific Gas & Electric DR Program List Peak Day Pricing Base Interruptible Program Demand Bidding Program Optional Binding Mandatory Curtailment Plan Scheduled Load Reduction Program Permanent Load Shift SmartAC Aggregator Managed Portfolio Capacity Bidding Program Automated Demand Response Program 23

24 Selected PG&E DR Programs Peak Day Pricing Mandatory for medium and large business customers 9 15 Peak Day Pricing days annually plus addition time of use rates Customers who conserve during those times will save money 24

25 Selected PG&E DR Programs Base Interruptible Program The Base Interruptible Program (BIP) pays you an incentive to reduce your facility's load to or below a level that is pre-selected by you. This pre-selected level is called the Firm Service Level (FSL). BIP gives you 30 minutes advance notice, and pays you between $8.00/kW to $9.00/kW per month incentive. Receive a monthly incentive payment even if no events are called. Failure to reduce load down results in a charge of $6.00/kWh for any energy use above the Firm Service Level. Maximum of one event per day and four hours per event; maximum 10 events per month or 120 hours per year. May be called during a CAISO Stage 2 emergency, during a transmission system contingency, or when needed based on forecasted system conditions. 25

26 Selected PG&E DR Programs Demand Bidding Program Incentive to reduce your electric load when notified of a demand response event day by PG&E. Submit load reduction bids for a DBP event, which can be called on a day-ahead or day-of basis. For any event, you may elect to submit or not submit a bid. If you submit a bid, you can still choose to forgo reducing your electric load without penalty. Bids must be for minimum 2 hours and 50 kilowatts (KW) each hour. Incentive payments for load reduction achievement start at 50 percent of bids and cap at 150 percent for any hour of the event. No penalty for not achieving load reductions. 26

27 Selected PG&E DR Programs Optional Binding Mandatory Curtailment Customers who can reduce their electric load within 15 minutes of notification and achieve a 15 percent load reduction below their established baseline. PG&E sends text messages/ s giving customers the load (5-15%) that must be reduced and the start and end times of the DR event. No incentives; participating customers are exempt from rolling brownouts and blackouts 27

28 Selected PG&E DR Programs Curtailment Bidding Program Customers must make a load curtailment bid each month and work with aggregator. Operates seasonally from May 1 to October 31, 11 a.m. to 7:00 p.m., Monday through Friday. Day-Ahead Curtailment Maximum of one event per day, 24 per month Customer notified by 3:00 p.m. business day before Day-Of Curtailment Maximum of one event per day, 24 per month Customer notified 2 hours and 45 minutes before the curtailment hour begins 28 Incentives

29 Automated Demand Response Customers must have equipment capable of automatically receiving signals and making adjustments to usage using pre-programmed Demand Response strategies PG&E pays between $125 per kilowatt (kw) and $400 per kw of DR load reduction (dispatchable load) 60 percent of the total program incentive after verification of equipment installation and testing 40 percent when DR performance complete for 1 year 29

30 Example of Automated DR 130,000 Square Ft Office Building 30

31 Summary Many different types of demand response programs Passive demand response require planners and operators to forecast the impact on demand Gets more difficult over time More active DR, e.g., Interruptible loads and Direct Load Control, provide some control but require forecasting before and after and verification Automated DR, e.g., capacity bidding, provision of ancillary services provide more control to operators and put more risk on customers and aggregators to perform as a generator would Automated DR has become much more feasible in last 8-10 years with advances in telecommunications and computing 31

32 Questions?? 32