hyderabad cii tutorial b - virginia tech advanced … ·...

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Renewable Energy, Peak Load and Market Penetra9on Issues

Tutorial Prof. Saifur Rahman

Tutorial Prof. Saifur Rahman Virginia Tech, USA

IEEE PES ISGT 19-21 Oct 2010

Medellin, Columbia

Tutorial Prof. Saifur Rahman Virginia Tech, USA

CII 03 April 2012

Hyderabad, India

Part B

(c) Saifur Rahman 1

(c) Saifur Rahman

Tutorial B

Part 3: Demand Response Technologies •  Peak load characteris9cs •  Demand response and demand side management (DSM) •  Demand response technologies – supply side and demand side •  Performance of demand response technologies Part 4: Demand Response Planning and Opera9ons •  Sample demand response programs in opera9on •  Customer incen9ves and par9cipa9on •  Impact of demand response on the electrical load shape

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Changing Landscape for the Electric Utility

Load Dura9on Curve Dominion Virginia Power

(2010)

Peak load of 19,140 MW

Probability that peak loads exceed

16,000 MW is only 5% of the time

3,140 MW or 16.5% of peak load

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Peak load and its duration

•  In the US 20% of the load happens 5% of the 9me

•  In Australia 15% of the load happens 2.5 days in a year or less than 1% of the 9me

•  In Egypt 15% of the load happens 1% of the 9me

Potential Savings from Peak Load Reduction

US has an installed genera9on capacity of 1,000,000 megawaXs

20% or 200,000 megawaXs of genera9on capacity and associated transmission and distribu9on assets are worth over 300 billion dollars

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Impact of Peak Load

Hourly Loads as Frac9on of Peak, Sorted from Highest to Lowest

>25% of distribu9on and >10% of genera9on assets are needed less than 5% of the 9me ($100s of billions of investments)

Source: US Dept of Energy

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Basic Defini9ons

Peak Load Reduc,on Ac9ons taken to modify the level and paXern electricity consump9on of consumers during “peak hours” or periods of very high demand: • minimize the opera9on of expensive peaking units

• avoid transmission conges9on costs • defer the building of new genera9on and transmission capaci9es.

(c) Saifur Rahman 9

Basic Defini9ons, contd.

Demand Side Management (DSM) Ac9vi9es and incen9ve programs implemented and administered by u9li9es to modify energy consump9on and load shape of customers. These include: load control, load shibing, energy efficiency and conserva9on. Demand Response (DR) Demand Response can be seen as Demand Side Management but on the customer’s terms, i.e. , the customer decides on what loads to control and for how long, oben in response to a economic/price signals or special requests by u9lity.

(c) Saifur Rahman 10

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DSM Load Shape Objec9ves

Source: Primer on Demand-‐Side Management, World Bank Document CRA No. D06090, 02/2005 (c) Saifur Rahman 11

Demand Response Defini9on

Demand Response is the set of ac9ons taken by consumers to reduce their consump9on of electricity and/or increase their own produc9on of electricity in response to economic signals or dispatch requests.


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Demand Response Examples

Examples of Demand Response ac9ons include: •  reducing the duty-‐cycles of HVAC and water heaters,

•  shedding load or shibing electricity usage to off-‐peak hours and,

•  turning on the onsite back-‐up genera9on (diesel or renewables).

Demand Response is considered capacity, i.e., equivalent to a generator that can be dispatched by the u9lity to keep the grid in balance and maintain its reliability. (c) Saifur Rahman 13

Energy Efficiency as Demand Response Energy Efficiency (EE) measures, such as one-‐off installa9on of efficient devices and appliances as well as adop9on of efficient processes and systems that provide long-‐term and con9nuous reduc9on in electricity demand can be considered as a form of Demand Response.


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Energy Efficiency as Demand Response, contd.

EE measures require no ac9on by customer once installed. Examples include: replacing incandescent ligh9ng with compact fluorescent or solid-‐state ligh9ng, installing building automa9on, installing adjustable speed drives for electric motors used in HVAC and industrial processes. However, EE measures need to be updated to the best-‐available technologies every few years to qualify as Demand Response.


Benefits of Demand Response •  Demand Response is far cheaper than dispatching the peaking unit, oben a natural gas-‐fired turbine plant.

•  Demand Response can be dispatched and realized within 5-‐10 minutes as compared to the 20-‐30 minutes needed by a peaking unit turbine to ram up to full capacity.

•  Demand Response helps reduce transmission conges9ons and electricity price vola9li9es thus enabling power exchanges in the wholesale market from regions with surplus to regions with shortage and ensuring the reliability of the system.


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Benefits of Demand Response, contd.

• Demand Response, unlike peaking thermal units, does not emit greenhouse gases and can be considered as clean energy.

• Demand Response is more reliable than the capacity obtained from a single peaking power sta9on, as it can be sourced from a large and distributed popula9on.


Some major benefits of DR are: q  Saving in genera9on investment, deferring T&D upgrades

q  Energy efficiency

q  Facilita9ng renewable energy integra9on

q  BeXer equipment use (e.g. increase in load factor)

q  DR and Smart Grid: Smart Grid technologies (e.g. smart meter) facilitate DR

Benefits & Potential in the US Market


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Poten,al (US Federal Energy Regulatory Commission, FERC):

q  Exis9ng DR capability: Can reduce 4% of US peak demand (810,000 MW in 2009)

q  DR could shave about 32,000 MW off US peak load in 2010

q  Based on current industry best prac9ces: 9% US electricity demand can be saved

q  With improved DR: peak shaving could reach 14-‐20% of the peak

Benefits & Potential in the US Market, contd.


Types of Demand Response

Economic Response: Capacity available on a day-‐to-‐day

basis created through price signals to the consumer. Response is voluntary.

Reliability Response: Capacity on standby that can be called upon to maintain system reliability, also referred to as Con9ngency or Emergency Response. Response can be both voluntary and obligatory (direct load control, interrup9ble load etc.)

Demand Response can be broadly classified into two:


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Demand Response Enabling Technologies

Some technologies enabling the Smart Grid •  Distribu9on Automa9on •  Automated Metering Infrastructure (AMI) •  Home/Building Energy Management •  Programmable Ligh9ng and Load Controllers •  Embedded Controls and Communica9ons •  Home Area Networks (HAN) • Wide Area Networks (WAN) (c) Saifur Rahman 21

How is Demand Response Marketed? •  Demand Response capaci9es are considered same as genera9on capaci9es and are therefore being traded the same way, i.e., on day-‐ahead markets operated by power exchanges, RTOs and ISOs.

•  Aggregators can offer demand response capacity to the market. If cleared, customers will be paid the market clearing price.

•  Demand Response capaci9es now fetch, by rule, the market price for electricity, known as the loca9onal marginal price (LMP), when it is established to be cost-‐effec9ve to use them to cover for genera9on shortage. (FERC Order 745, Docket No. RM10-‐17-‐000)


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How is DR implemented?

DR Users •  Independent System Operators (ISO) •  Regional Transmission Orgs. (RTO) •  U9li9es

DR Sellers •  Residen9al •  Commercial •  Industrial

DR Aggregators or Curtailment Service Providers •  Enroll DR par9cipants •  Manage DR programs •  Revenue Sharing

EnerNoc NuEnergen Ameresco Comverge etc.


Example DR Programs in Opera9on (PJM) PJM System: Regional transmission

organiza9on (RTO) serving 17 u9lity zones.

Gen. Capacity: 180,400 MW Demand Response: 9,052 MW (2010-‐2011)

14,940 MW (2014-‐2015) Type: Combined EE, economic

and direct load control. Managed by: Third party

Curtailment Service Providers (CSPs),


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Example Demand Response Event Bal9more Gas and Electric, PJM

Source: 2011 Final Emergency Load Management (ILR/DR) and Economic Demand Response summary, PJM

About 2,300 MWs of Demand Response were invoked at LMP ranging $200-‐$500/MWh


Poten9al Peak Load Reduc9on aXained by Demand Response (by region and customer class, 2010)

Source: Based on Survey undertaken for the 2010 Assessment of Demand Response and Advanced Metering report by the Federal Energy Regulatory Commission


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Poten9al Peak Load Reduc9on aXained by Demand Response (by type of demand response and customer class, 2010)


Customer Incen9ves and Par9cipa9on U9li9es oben provide incen9ves en9cing customers to join demand response programs. Some examples:

U,lity Type Descrip,on

PG&E Technical Assistance and Technology Incen9ve (TA&TI)

Up to $125/kW of demand response to assist customers with investment in demand response and energy management technologies; Up to 75% of the demand response project costs

NYSERDA TA&TI Up to $100/kW Upstate and $200/kW Downstate to offset cost of equipment and technology; 75% of project cost

SDGE TA&TI

Up to $300/kW

SCE TA&TI

Up to $300/kW


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How can Demand Response Improve Acceptance of Renewables into the

Electric Power Grid?


PJM 13-‐Month Wind Generation

30 Source: PJM wind power statistics, 2011 (c) Saifur Rahman 30

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10700 MW Peak Saving

13700 MW Peak Saving w/ DR


16700 MW Peak Saving 22500 MW Peak

Saving w/ DR

Wind Power Output 34250 MW


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How can the Smart Grid Help?

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Peak load reduction, generator efficiency

improvements and DER integration are major benefits of the smart grid

Load control at the customer level can provide

significant peak load reductions

How to incentivize the customer? (c) Saifur Rahman 33

Smart Grid Definition

•  According to United States Department of Energy’s modern grid initiative, an intelligent or a smart grid integrates advanced sensing technologies, control methods and integrated communications into the current electricity grid.

34 (c) Saifur Rahman 34

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Power Plant Transmission

Distribution Home

Business End-use

Appliances

Starting and End Points of a Smart Grid

From Generator to Refrigerator


Electric Power & Communication Infrastructures

Central Genera9ng Sta9on Step-‐Up

Transformer

Distribu9on Substa9on Receiving

Sta9on Distribu9on Substa9on

Distribu9on Substa9on

Commercial

Industrial Commercial

Gas Turbine

Recip Engine

Cogenera9on

Recip Engine

Fuel cell

Micro-‐ turbine

Flywheel Residen9al

Photo voltaics

BaXeries

Residential Data Concentrator

Control Center

Data network Users

2. Information Infrastructure

1.Power Infrastructure

Source: EPRI 36 (c) Saifur Rahman 36

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Building Blocks of the Smart Grid

© Saifur Rahman


Smart Grid Projects in the United States

www.sgiclearinghouse.org


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References used

1.  hXp://siteresources.worldbank.org/INTENERGY/Resources/PrimeronDemand-‐SideManagement.pdf

2.  hXp://www.sidsnet.org/docshare/other/20070110DSMBestprac9ces.pdf

3.  hXp://en.wikipedia.org/wiki/Demand_response

4.  hXp://pjm.com/markets-‐and-‐opera9ons/demand-‐response.aspx

5.  hXp://www.energyadvantage.com/blog/2010/02/demand-‐response-‐demand-‐side-‐management-‐what’s-‐difference/

6.  hXp://www.pjm.com/markets-‐and-‐opera9ons/demand-‐response/~/media/markets-‐ops/rpm/20090406-‐dr-‐ee-‐in-‐rpm-‐

collateral.ashx

7.  hXp://pjm.com/markets-‐and-‐opera9ons/demand-‐response/~/media/markets-‐ops/dsr/dr-‐sympoisum-‐ii-‐proceedings.ashx

8.  hXp://www.ferc.gov/industries/electric/indus-‐act/demand-‐response.asp

9.  hXp://pjm.com/markets-‐and-‐opera9ons/demand-‐response/~/media/markets-‐ops/dsr/2011-‐final-‐energy-‐load-‐management-‐

and-‐economic-‐demand-‐response-‐summary.ashx

10. hXp://www.energyadvantage.com/blog/2010/02/demand-‐response-‐demand-‐side-‐management-‐what’s-‐difference/

11. hXp://downloads.lightreading.com/internetevolu9on/Thomas_Weisel_Demand_Response.pdf

12. hXp://www.pge.com/mybusiness/energysavingsrebates/demandresponse/ta9p/

13. hXp://www.hks.harvard.edu/fs/whogan/Hogan_Demand_Response_102909.pdf


Thank you

Prof. Saifur Rahman www.saifurrahman.org


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