Category Archives: Smart Grid

Changing Times for Electric Utilities

Source: Edison International

Source: Edison International

Two seemingly unrelated announcements drew much attention in the electric utility industry recently. First, the Edison Electric Institute (EEI) (the trade group for the U.S. electric utility industry) and the Natural Resources Defense Council (NRDC) jointly recommended changing how utilities should be regulated. Second, Duke Energy announced it will sell 13 Midwest merchant power plants. These announcements are actually related because they both result from the same dramatic changes affecting the electric utility industry. As Bob Dylan aptly noted, “the times they are a-changin’.” Regulators and other stakeholders must be prepared to address these changes.

Under the traditional business model, electricity usage grew steadily. Utilities built ever-larger plants to serve this growing load. The bigger plants were more efficient than existing plants, so the unit cost for electricity steadily declined. Utilities benefited by steadily increasing their revenues. Customers benefited from declining unit costs. For utility customers, it was like paying a lower price per gallon of gasoline every time you filled your tank.

But this traditional model is crumbling, due to several factors: Read More »

Also posted in Clean Energy, Demand Response, Dynamic Pricing, Renewable Energy, Utility Business Models | Tagged , , , , | Comments closed

Final Order from NYPSC on Con Edison Rate Case Reveals Especially Encouraging Language on Climate Change Directives

By: Elizabeth B. Stein, Attorney and Adam Peltz, Attorney

Source: Iwan Baan

Source: Iwan Baan

In Tuesday’s blog post, we discussed the recently concluded Con Edison rate case, its context, and its significance in advancing clean energy and grid resilience in New York. Today, we take a closer look at the final Order posted last Friday by the New York State Public Service Commission (the Commission) to uncover some of the more encouraging outcomes buried in this 300+ page document:

  • Con Edison agreed to various measures that allow for more distributed generation, i.e. on-site power generation, such as combined heat and power, rather than relying solely on power generation and distribution from the traditional, centralized grid. For example, Con Edison agreed to pay for some fault current mitigation, which enables distributed generation to be connected to portions of Con Edison’s grid where it would otherwise be prohibited, and agreed to develop an implementation plan for a microgrid pilot. Additionally, Con Edison agreed to treat customer-sited projects, including distributed generation, as integral parts of its system by considering them in its 24-month planning horizon. Because some distributed generation can operate in an ‘islanded’ mode, or separate from the main grid, and can thus continue operating in a power outage, distributed generation can play a critical role in improving resilience. Read More »

Also posted in Air Quality, Clean Energy, Dynamic Pricing, Electric Vehicles, Methane, Natural Gas, New York, Renewable Energy, Utility Business Models | Comments closed

New York’s Con Edison to Take New Measures Protecting Against the Effects of Climate Change

By: Elizabeth B. Stein, Attorney and Adam Peltz, Attorney

Source: Iwan Baan

Source: Iwan Baan

The New York State Public Service Commission (Commission) took a historic step late last week, unanimously approving an Order that requires Con Edison to implement state-of-the-art measures to plan for and protect its electric, gas, and steam systems from the effects of climate change. This announcement regarding the future of New York State’s largest utility comes as a welcome coda to local storm recovery and resiliency efforts that have been in the works for some time now.

On October 29, 2012, Superstorm Sandy clobbered the coastline of New York City. Homes were swept away or badly damaged as corrosive salt water flooded basements, while millions lost power. In one of the enduring images of the storm, an exploding transformer at East 14th Street caused the “city that never sleeps” to go dark below 40th Street and stay that way for the better part of a week. Read More »

Also posted in Clean Energy, Climate, Demand Response, Dynamic Pricing, Energy Efficiency, Energy Financing, New York, Utility Business Models | 1 Response, comments now closed

Preliminary Results Find Demand Response-Green Building Partnership is Off to a Great Start

LEED3

The preliminary results of the Demand Response Partnership Program (DRPP), a unique partnership launched by EDF and the U.S. Green Building Council (USGBC) in 2011, are now available in the 2013 DRPP Overview. Photo source: Harvard University.

Buildings account for 40% of our nation’s electricity use. In 2012, power plants spewed about 2 gigatons of global warming pollution into our air, which was about one-third of total U.S. emissions. That’s why EDF and the U.S. Green Building Council (USGBC) teamed up to launch the Demand Response Partnership Program (DRPP) aimed at increasing the participation from commercial buildings in host utility demand response (DR) and smart grid programs. Now, 2 years into the program, the preliminary results of this collaboration are available in our 2013 DRPP Overview.

DR is used to reduce energy use by rewarding utility customers who use less electricity during times of “critical,” peak electricity demand. Through DRPP, we leveraged relationships with the building community asking LEED projects to operate in low power mode when the grid is stressed. LEED ‘Pilot Credit 8: Demand Response’ has been developed as an incentive and implementation guideline.

This study evaluated three areas to measure the program’s success in 2013: Recruitment and outreach to potential participants, research and analysis of data from participants, and education about the DRP Program. A few key highlights are outlined in the Overview: Read More »

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Governor Christie Proposes New Energy Resilience Bank to Prevent Future Superstorm Blackouts

mary1New Jersey has proposed using federal Sandy relief funds to set up an Energy Resilience Bank that would fund projects to make the state’s energy infrastructure more resilient in the face of extreme weather events. The Bank is an innovative proposal that will help New Jersey prepare for the future in the wake of Superstorm Sandy, which destroyed thousands of homes and businesses, causing human loss and suffering that continues for many today.

Climate change increases the likelihood that New Jersey will continue to be buffeted by storms such as Sandy, which exposed and underscored the need to upgrade to a more resilient, low-carbon energy infrastructure when a third of the state lost power for nearly a week. The Energy Resilience Bank, which will be capitalized at $210 million, would help expedite this process, allowing the state to keep the lights on and residents safer during the next storm. Read More »

Also posted in Clean Energy, Energy Efficiency, Renewable Energy | 1 Response, comments now closed

Secretary Moniz Deems Austin’s Pecan Street ‘Very Impressive’

This commentary originally appeared on our Texas Clean Air Matters Blog.

EDF's Marita Mirzatuny with Secretary Moniz at Pecan Street's Pike Powers Labratory

EDF's Marita Mirzatuny with Secretary Moniz at Pecan Street's Pike Powers Labratory

Earlier this month, I had the privilege of presenting a short summary of EDF’s Smart Power Initiative to Dr. Ernest Moniz, the U.S. Secretary of Energy. As a group of over 30 people piled into the Pike Powers Laboratory (including the lab’s namesake), the Secretary made his way in, beelined for some coffee, and sat down to hear all about Austin’s innovative and collaborative energy “ecosystem.”

Present was the Mayor of Austin, Lee Leffingwell, various cleantech entrepreneurs sponsored by the Austin Technology Incubator (ATI), representatives from the State Energy Conservation Office (SECO), and the Governor’s office, among others.

Everyone had the opportunity to speak to the Secretary in a roundtable format about the work their particular company or group is doing to solve energy problems, and as EDF’s representative, I reported on our Smart Power work in Texas. Read More »

Also posted in Clean Energy, Demand Response, Energy Efficiency, Renewable Energy | Tagged | Comments closed

How Electric Vehicles are Strengthening the Texas Power Grid and Improving Air Quality

Marita Mirzatuny

This commentary originally appeared on our Texas Clean Air Matters Blog.

San Antonio’s Southwest Research Institute (SwRI) brings Texas the latest example of an intelligent, demand-side resource that can play an active role in the power grid and offset the use of fossil-fuel power plants. Late last month, SwRI announced that its innovative vehicle-to-grid system got the green light from the Electric Reliability Council of Texas (ERCOT), the grid operator, to participate in the state’s electricity market. This system is able to control the charging and discharging for a fleet of electric delivery trucks, meaning that when the supply of electricity struggles to meet demand, the intelligent vehicle charging system can simply stop charging (thus lowering demand). This technology will significantly increase grid reliability, thanks to its quick response time, and effectively deter the need for firing up another dirty power plant.

In order to avoid a blackout, the supply of electricity to the power grid must equal the electric demand from customers. Conventionally, this balance is maintained by power plants that remain on stand-by, ready to respond at a moment’s notice. Every hour of the day, ERCOT precisely controls these power plants to keep the grid balanced. In the process, a power plant has to rapidly increase or decrease its power output, which decreases its efficiency and increases its carbon and pollution footprint, much like an a car revving its engine. Read More »

Also posted in Clean Energy, Demand Response, Electric Vehicles, Energy Storage | Comments closed

Smart Planning for a Successful Smart Grid Roll-Out

John Finnigan PhotoBen Franklin famously said, “If you fail to plan, you’re planning to fail.”  This saying certainly holds true for smart grid deployment plans, which can cost utilities several hundred million dollars.  Given these high stakes, good planning is essential.

Many utilities have installed smart grids.  Currently, 25% of U.S. electricity customers have smart meters, a key component of the smart grid.  Some early deployments were rocky, but utilities have learned their lessons.  Utilities have incorporated these lessons learned in the planning process for more recent smart grid deployments.  A well-thought-out smart grid deployment plan should address the following topics: Read More »

Also posted in Utility Business Models | Tagged , , | 3 Responses, comments now closed

Freezing, Scorching, or Not, Texas Needs More Demand Response

This commentary originally appeared on our Texas Clean Air Matters blog.Final Images EDF-6524

As we thaw out this week from our most recent arctic blast, Texas’ inexperience with ice and snow has been met with Internet memes and jokes. But dealing with extreme temperatures causes serious strain on our current energy system and exacerbates our “energy crunch,” signifying that the available supply of electricity barely meets the demand for that power.

However, as is typical of Texas, last week our weather was quite pleasant – in the 70s – and strains on the system due to weather events weren’t too much of a concern. Yet the Electric Reliability Council of Texas (ERCOT), the state agency charged with managing the flow of electricity for most of Texas, alerted an emergency situation despite mild temperatures. To avert disaster, ERCOT initiated demand response, “ask[ing] customers to raise thermostat settings to 78 degrees, typically a summer response intended to reduce demand from air conditioners.” A single malfunctioning power plant caused the problem. ERCOT declined to identify the plant involved.

Much of this uncertainty and drama can be alleviated with demand response (DR), a novel approach to managing the grid system. Using smart power technology like smart thermostats, utilities can moderately adjust their customers’ energy use in real-time for a brief amount of time to meet the energy needs of all Texans. When energy demand is high, electric utilities can ask customers to voluntarily conserve energy in exchange for cost-savings and even payments. During the polar vortex earlier this month, CPS Energy, San Antonio’s municipal utility, saved about 77 megawatts (MW) of power through demand response programs – enough to power 32,725 homes.  Texas isn’t the only place where demand response is taking hold. Read More »

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Innovative Strategies for Utilities in the Face of Increased On-Site, Distributed Generation

Brad CopithorneLast year, the trade association for the utility industry, the Edison Electric Institute (EEI), published a whitepaper on the disruptive challenges facing the utility industry.  In summary, EEI’s thesis was that the existing utility business model (centralized, fossil-fuel based generation) is under threat from on-site, distributed generation as more customers switch to cleaner, and often cheaper, solar power.  The white paper poses an important question: How can utilities acquire the revenue needed to keep the electric grid humming and provide reliable power to all customers if a growing number of people are producing their own electricity?

In business, one of the most difficult problems that companies face is how to adapt a successful business model to technological or social changes that threaten that business model.  Wang, Unisys, DEC and Amdahl were all big computer companies in the 1970’s that clung to an obsolete business model in the face of distributed computing.  IBM and HP, on the other hand, adapted their business models and generally thrived.

Over the past year, we have seen several utilities tackling this challenge head-on by investing in distributed, renewable energy projects.  In September, I wrote about how NextEra and NRG were voluntarily developing solar investments and how Direct Energy and Viridian were investing in solar installations developed by SolarCity. Read More »

Also posted in Demand Response, On-bill repayment, Renewable Energy | Tagged , , | 3 Responses, comments now closed