It’s a new year, folks, and time to learn from the ups and downs of the previous 12 months and set a course for a successful 2017. We spent some time at the end of 2016 working with Edison Foundation’s Institute for Electric Innovation (IEI) on a book titled “Thought Leaders Speak Out: Key Trends Driving Change in the Electric Power Industry.” Enbala’s contribution was a chapter exploring the future of distributed energy in a modern grid.
Ham and eggs. Abbott and Costello. Batman and Robin. Hey, there are a lot of great duos in the world, and here’s another one: building management systems and automated demand response (DR) designed specifically for small- to medium-sized companies.
What makes this a great combo?
CREATIVE FINANCING OPTIONS OPENS THE DER DOOR TO SMALLER BUSINESS CUSTOMERS
We all know the big guys – large commercial and industrial (C&I) customers – have been able to participate in wholesale markets thought demand-management programs for years. Now, small C&I customers are gaining this opportunity, too.
What gives? The financing.
The U.S. election is finally over, leaving some elated and others terrified. The last several months have been polarizing and contentious, and many feel that a Trump presidency is destined to bring uncertainty to the energy industry and endanger the goal many of us share of a more sustainable energy future.
Here are my thoughts on the key reasons why I believe that the distributed energy resources (DERs) market will continue to thrive, along with the march towards an advanced energy economy.
Right now, analysts see enormous growth ahead for solar-plus-storage systems. A report by IMS Research forecasts the market for storing power from solar panels – which was less than $200 million in 2012 – to reach $19 billion by 2017. And, it’s easy to see why.
After all, rooftop solar panels are more valuable to people if they can store the excess energy produced and prolong the benefits of the on-site generation capacity. Plus, the flexibility of battery energy storage makes it truly valuable. With a quick response time and precise controllability, batteries can provide a wide set of grid services, so they can deliver value to multiple participants in the power system, including end-use customers, distribution utilities and wholesale market operators.
If you’re like most people who’ve gone to a conference lately – or read this blog from its inception – you’ve already heard warnings about what could happen to grid voltage and stability when stray clouds waft over neighborhood solar arrays and block PV generation. The sudden drop of renewable power is what many people point to as the key challenge of variable generation resources.
After all, that’s why utilities are looking for ways to “firm” renewable generation, which is the process of backing variable resources up with some combination of fast-ramping power or demand-side management to jump in when power production subsides. But, while loss of power gets most of the attention, over-production is an equally daunting challenge for grid operators.
Today, October 5, is the inaugural Energy Efficiency Day 2016, and the perfect time to talk about what we are doing - in conjunction with our customers - to reduce traditional energy consumption and make the world a better place for ourselves, our children and our children’s children.
Energy Efficiency Day is a collaborative effort of regional and national organizations working to promote energy efficiency, including many that we strongly support. This includes the American Council for an Energy-Efficient Economy (ACEEE), Advanced Energy Economy, the Regional Energy Efficiency Organizations, Appliance Standards Awareness Project, E4TheFuture, Natural Resources Defense Council, and a very long list of cities, utilities, universities, associations and companies like ours who share a common mission with sustainability at its core. You’ll see most of us writing, tweeting and otherwise sharing our energy efficiency stories today – stories about using better technology and practices so that less energy is consumed to accomplish the same tasks, while continuing to keep homes and businesses comfortable.
Ten years ago or so, when utility workers first started talking about IT/OT convergence, conversations revolved around the wealth of data streaming into utility offices from advanced metering infrastructure and remote sensors.
With AMI, for instance, utility engineers could suddenly see consumption in 15-minute increments, allowing them to leverage that data for things like load studies and distribution-system transformer sizing. Utility managers could use the blink counts from advanced meters to direct tree-trimming crews, letting them know there was a pretty good chance wayward branches were causing momentary outages on a feeder. Or, they could use the last-gasp signals to more quickly triangulate an outage and dispatch restoration crews more efficiently.
IT/OT convergence is what happens when IT and OT drop the silo walls to unite systems such as outage management with front-end, field technology like advanced meters or distribution system assets. But, IT/OT convergence has begun to expand as generation assets begin to proliferate behind the meter, and IT systems will be needed to help accommodate and control these assets. The convergence is becoming more complex and all-encompassing, so here are a few pointers for utility mangers to keep in mind.
Last year, analysts at Gartner placed IT/OT convergence on their Top-10 list of trends affecting the utilities industry. Actually, it’s been in progress for nearly a decade but, now more than ever, IT/OT integration looms as a crucial utility move. What’s more, it is factors outside utility walls that are rousing such urgency. What are they? Look around your neighborhood. If you see a lot of rooftop solar panels, some of those factors are sitting right in front of you.
What’s more, GTM Research forecasts a 94 percent increase in new PV installations in the U.S. during 2016. Worldwide, Navigant Research says, “Annual installed capacity across the global distributed energy resource (DER) market is expected to grow from 136.4 GW in 2015 to 530.7 GW in 2024, representing $1.9 trillion in cumulative investment over the next 10 years."
What does this have to do with IT/OT convergence?
Raise your hand if you sometimes feel like Mr. Scott from the original Star Trek series, frantically trying to keep the engines roaring while the ship takes one phaser hit after another: If you did raise your hand, you’re not alone. There are plenty of reasons utilities might be playing the Mr. Scott role.
One is under investment in infrastructure, which was named as the top concern by 47 percent of utility executives who answered a Utility Dive survey late in 2015. Another is what the California Independent System Operator calls the Duck Curve. It shows how behind-the-meter solar installations are creating daytime over-generation on the California grid and, because rooftop solar quits generating power about the same time people come home and start using more of it, there are steep ramps at the end of the day.
Demand response programs could help utilities deal with these issues. But, utilities that are doing simple demand response are kind of like Star Trek’s Scotty. They’re just getting by, handling one crisis after another, giving it all she’s got, Captain. “I don’t think she can take any more!”