Thursday, January 21, 2016

Restructuring Public Utility Industrial Demand Response.

in the



Industrial Demand Response


Mike Patrick Dahlke

If someone were to suggest the notion that until our entire American public electric utility grid is entirely reworked, our overall economic momentum will come to an unmistakably abrupt stop, would you believe them?

Let me suggest, that if you don't, you might want to think about picking up a good flashlight so that you can spend the next several years wandering around your neighborhood in the dark searching for everything that was once considered as being readily available, but, no longer is. Don't forget to use some very long life batteries in that flashlight by the way.

Industrial Demand Response is the notion of developing an extraordinarily complex system of information exchange as that information is crucial to the integration of a broad host of energy sources into what today can only be considered as a public electric utility network that is in desperate need of such integration.

As it might sound a bit odd to suggest that of all things, it is electricity or the lack there of that will ultimately serve to undermine every aspect of our domestic America economy, the fact of the matter is simple, electricity is essentially, the final measure of our nation's collective ability to work together to keep the lights on in every other industrial sector.

In other words, the economic success of America's cabbage industry is not about getting people to eat cabbage any more than the economic success of America's transportation industry is to distribute cabbage, or the economic success of America's agricultural industry is to grow cabbage. No, the economic success of all of these industries, is their collective ability to throw a switch that will turn on a light bulb so that whatever it is that anyone is doing with a head of cabbage can be done in the most efficient manner possible. As efficiency then is the issue, and, our collective ability to constantly define, or, redefine efficiency is what continues to bond us together as a functioning American industrial society, reshaping the manner we produce, manage, distribute and profit from as well as charge for our collectively efficient use of electricity is again, crucial to our economic survival. “Industrial Demand Response” then needs to be looked upon not necessarily from the point of view of how to more efficiently monitor and manage the use of our existing electric supply, but, how, through extraordinarily seamless information exchange, a broad host of new energy sources, and, an equally broad host of architectural as well as transit based endeavors bring the body of industries who deal with the cabbage into an entirely more dynamic economic relationship with electricity to begin with.

Please refer to the following lists:

“Barriers to Demand Response Programs and Recommendations for Overcoming the Barriers”
“A number of barriers need to be overcome in order to achieve the estimated potential of demand response in the United States by 2019. While the Assessment lists 25 barriers to demand response, the most significant are summarized here.

Regulatory Barriers. Some regulatory barriers stem from existing policies and practices that fail to facilitate the use of demand response as a resource. Regulatory barriers exist in both wholesale and retail markets.
  • Lack of a direct connection between wholesale and retail prices.
  • Measurement and verification challenges.
  • Lack of real time information sharing.
  • Ineffective demand response program design.
  • Disagreement on cost-effectiveness analysis of demand response.
Technological Barriers.
  • Lack of advanced metering infrastructure.
  • High cost of some enabling technologies.
  • Lack of interoperability and open standards.
Other Barriers.
  • Lack of customer awareness and education.
  • Concern over environmental impacts.”

The list above comes from this link: DEMAND RESPONSE which is a link to – Office of Electricity Delivery And Energy Reliability.

As it does, this list, which can be found on page 18 and 19 of this 254 page report, pretty much sums up what in fact this whole report is about, which is, how, through the inoculation of some rather sophisticated information management based technologies, our existing American electric utility grid would become that much more efficient as a result of doing so. But, as what I am talking about in this particular essay has to do with the much larger potential of integrating a wide variety of mixed energy based technologies into our whole national electric utility grid, the above list and associated report offered up by does not, in my opinion, seem to address the potential interaction of all of these mixed energy based technologies into either the grid or the tens of thousands of American communities that would benefit industrially and economically if in fact that grid was substantially diversified by those same sophisticated information technologies from the get go. Going further, as the above list characterizes the obstacles that are currently preventing an overall grid modernization nationwide, and, in fact these obstacles are valid, it is again, in my view, the narrowness of identifying the problems needing to be solved that is leading to the identification of such obstacles to begin with. In other words, the report has been crafted by people who are simply not thinking holistically and far enough outside of the box to grasp fully the total potential nature of 21st century electrical supply and demand.

idrcab (1)

Getting back to the cabbage conversation for a moment.

Let's say you are a cabbage farmer.

Let's say you and your family have been farming cabbage for the better part of the past 100 years.
Over the course of those years, what began as a very quiet ten acre rural farming operation located twenty miles away from a major metropolitan area is still a ten acre farm, you and your family are still growing cabbage, and, in fact, the electrical wires connecting the few outbuildings to the regional utility grid that provides electricity to that farm are the very same ones that were first installed one hundred years ago. Whereas the original electrical wires are there as are the original fuel tanks for the farm equipment, as is the original rain water cistern and original water well used to irrigate the crop are still there, the very quiet ten acre rural farm setting has long been replaced by urban sprawl as the serene and lightly traveled country road passing your farm has turned into a four lane suburban parking lot. While the farm was once surrounded by hundreds of acres of natural open space, today the farm might very well not be noticed at all due to the sheer volume of industrial and commercial as well as residential build out that has occurred via the passage of time. But, as all of this has occurred over the course of several decades, the manner in which electricity has been connected to all of this new build out is still more or less the same as it was when your family first built your farm's outbuildings 100 hundred years ago. In fact, not only is it the same wiring process, but, more than likely all of those additional wires are connected to the original source of electrical generation as well.

Knowing all of this and having to live with the fact that while your small farm has been absorbed into the abyss of what can now only be defined as urban sprawl turned to urban decay, you still grow cabbage because people still eat cabbage, and, of course, you still need to make a living even though the cost of doing so has becoming increasingly difficult due almost entirely to the fact that the infrastructure you must use to transport your cabbage on has become both increasingly congested and financially redundant to use as a result. As all you really want to do is to simply stay on the farm and grow cabbage, get the cabbage to market and repeat the process year in and year out, due to the overwhelming over growth of everything including the public electric grid; you are, just like everyone else, stranded in a late 20th century industrial graveyard with virtually no way out staring at a light bulb that was once considered to be the justification for building that industrial graveyard in the first place.

With our nationwide public electric utility grid in every bit the same state of structural decay as our nation's roadways, as our homes and neighborhoods are more or less in the same state of disrepair; the business models we have utilized for decades to originally build all of this stuff are themselves collapsing meaning, that collectively, as a nation, we have simply and entirely consumed every single industrial idea or angle that could possibly have been of use to us in our 20th century industrial lifetime.

While at the very end of our 20th century, a whole new industrial idea began to emerge and that idea was encapsulated within the framework of “information technology”,thus far in our 21st mixed energy based industrial generation it is only “IT” stuff that seems to be gaining any real financial headway whereas a massive amount in technological information pertaining to a substantially diverse new generation of American industries seems to be waiting on the sideline for the “IT” people to do their thing before America as a whole gets to do its thing, which of course is the task of rebuilding everything that fell apart in the 20th century.

Having said the above and shifting this conversation back to the topic of Industrial Demand Response and the role information technology can play in the management of existing electrical supply, the much more dynamic function of IT will be found in the role of integrating static (existing) electrical generation coming from say coal or gas with fluctuating electrical generation coming from renewable energy sources such as wind and solar. As some people seem to think that the marriage of these two different types of electrical power into the grid is crucial to the sustained growth and long term collective maintenance of the grid, I am of the belief that while such an accomplishment is essential for the whole retrofitting of our nations electric grid, such an endeavor does not address the whole retrofitting of our nations whole energy grid. Whereas our nations electric grid addresses electric need as such need pertains to our buildings, our nations whole energy grid pertains to the energy needs of everything else that exists outside of the building, and, in an awful lot of instances pertains to multidimensional energy use inside of a building as well.

A case in point here would be compressed natural gas used inside of a building to fuel either a piece of mobile industrial equipment inside the building or a vehicle that would leave such a building to deliver a component of a manufacturing process to another point along the path of that manufacturing process to another light manufacturing facility located down the road. Whereas the natural gas can be used to generate electricity to run the manufacturing equipment needed to make a specific part and is therefore considered to be an energy source managed by a public electric utility, due to the fact that it is as well a transportation fuel source, natural gas simply possesses the properties of regulatory duality meaning that again before one can realistically expect to fully define Industrial Demand Response, Industrial Demand Diversity must first be fully understood. As any given manufacturer will indeed require both the associated rate structure for and of the electric utility and the associated rate structure for and of the regional transportation authority are simply not mutually exclusive if in fact all technologies pertaining to the growth of advanced infrastructure models in these very much related sectors is not fully grasped.

This model very much applies to solar energy as well, but, in a much more consumer, and therefore, neighborhood based “touchy feely” manner, if you will.

In my view, while solar electrical generation is clearly enjoying extraordinary growth in the US, such growth would be considerably more if the product was marketed not simply as a cost effective alternative to conventional electricity but instead part of a retrofitting system of technologies that brought the architectural footprint of an entire home or a entire block of homes in a residential setting in any neighborhood fully up to any conceivable green energy building code in any town in America.
In other words, for a building to have the type of roof slope and direction to support the installation of an active solar electric array is one thing, that buildings ability to utilize active solar hot water arrays as well as additional passive solar technology in its overall design and construction is something that is is just as crucial to grasp if not more so. As the issue here is to both upgrade our nation's electric utility grid as well as reduce the load upon that grid, if economically clean and efficient electricity is entering into an economically dirty home or an equally redundant neighborhood of economically dirty homes, the drain on the electrical grid becomes quite obvious to the neighborhoods overall utility rate structure as well as overall real estate valuation.

Thus, when solar technology is enjoined with a system of retrofitting technologies that would include such entities as rainwater management on the outside as well as whole air purification technologies on the inside of the home (to name a few), the grid, if you will, becomes that much more “touchy feely” on one hand while becoming that much more intergratable on the other. As it is again the whole definition of Industrial Demand Response that is being sought, requiring both private and municipal sector electric powered water pumps to ultimately redirect rain water, rain water management as a new municipal public utility has along with its responsibility to mitigate flooding the need to purchase electricity for such mitigation management to work. As in this particular instance, battery back up technologies would be of considerable benefit, again advances in solar electric storage technology would serve the whole community energy grid perhaps more efficiently that say natural gas powered mechanical pumps might in the event of sustained torrential rains. Either way the subsequent industrial fail safes are in place and integrated into the appropriate utility which is again the purpose of Industrial Demand Response.

Below are links to two articles published I think just as recently as 1/19/16. These articles address the concerns the Nevada Public Utility Commission has with the growth of rooftop solar in the State of Nevada as well as the concerns three manufacturers of rooftop solar arrays; Solar City, Sun Run and Vivint who do business in Nevada have over the rate structures needed to assure that those who choose solar and those who do not have an equitable and fair cost sharing framework from which to operate in and from.

Nevada PUC May Be Setting State On Path Toward Grid Defection

What The New DNA Of Future Energy Markets Looks Like

As the gist of both of these articles is about rate structure, rate structure is determined by the overall cost of maintaining not singular aspects of the grid that may benefit some more than others, but, the cumulative cost associated with both the continued maintenance of the whole grid as well as the anticipated improvements the utility as well as the people in the state who rely on the insight of the utility as their representative, sees as being viable cost wise for the whole state in which that utility operates.

Based upon what I have been able to gather about the Nevada PUC decision , it would appear as if the Commission took the time to look at two different regulatory issues that it felt where more equitable for the few and less equitable for the many, and simply took the steps necessary to rectify the problem.

As under the old rate structure solar customers paid a fixed monthly charged of $12.75 per month, which was the same non solar customers paid, the new structure for solar customers only jumps to an initial $17.90 per month in 2016 and finally settles to $38.51 per month by 2020. whereas the rate for non solar customers stays at the current $12.75 monthly rate.

In addition, the rate that solar customers pay for grid-supplied power declines slightly from 10.8 cents per kWh in 2016 to 9.9 cents, while the rate they are paid for excess power delivered to the grid falls sharply from 9.2 cents to 2.6 cents, or from roughly the retail rate to the wholesale rate.
The new rates took effect on January 1, and—incredibly—will retroactively apply to all solar customers, even those who bought their systems under the old tariffs. (Such customers are typically grandfathered in.)

The new rate plan was a response to the complaints of the utility NV Energy, which has a monopoly in the state. The utility claimed that the old net metering tariff shifted roughly $16 million in costs annually from Nevada’s roughly 17,000 solar customers to non-solar customers.”

The above three paragraphs were extracted from the link below.

Nevada PUC May Be Setting State On Path Toward Grid Defection

Regardless of how one chooses to interpret the ruling however, there remains, across the board, in the solar industry, as well as the industries, old or new, that represent our whole future American electric utility provider framework potential, some rather persistent pauses or lapses in overall industrial logic as that logic pertains to the highly specific applications of certain technologies as compared to the equally specific applications of others. The understanding of the geographical nuances that exist in either the states or regions from which an established electric utility provider operates from within are an example of one such lapse in logic.

As it would appear to be pretty much a given that the state of Nevada, which is more or less drenched in sun, would be a natural landing spot for the rooftop solar industry, and, in fact it is, the larger fact is that the state of Nevada has been living with its sunshine and associated heat for one hell of lot longer than the solar collector has been around. With this being the case, the issue of cooling down Nevada has a considerably more sense of public electric utility urgency than the generation of electricity from a solar collector, particularly when one considers the fact that a state full of air conditioned buildings would squelch any possible solar storage model within seconds of turning the things on to begin with.

While all of the above is most certainly true, and, all of this demonstrates a certain lapse in logic as such logic pertains to building an “advanced public electric utility grid”, when considering geothermal energy, the advanced public electric utility grid suddenly turns instead into the “advanced public energy utility grid”. In the process of doing so, the cost of both maintaining and improving the original electrical grid diversifies as do the industries that have a very much direct financial relationship with the utility grid manager to begin with. Simply by replacing the word “electric” with the word “energy”, the grid finally becomes the mechanism from which all energy technologies can begin the process of entering into the realm of whole neighborhood based industrial, economic and environmental revitalization.

In relationship to geothermal cooling then, not only is the electric demand far less than conventional HVAC, but meeting the demand via highly specific Industrial Demand Response modeling enables a much more seamless load shifting dynamic between solar and more traditional, or, static fossil fuels all of which is accomplished on micro-grid frameworks that are statewide in connectivity but very much regional in demand and diverse by form base utility code design.

Here is a link to the International Ground Source Heat Pump Association.

As to the discussion of Distributed Energy Resources (DERs), whereas geothermal energy used as it is defined above for its cooling properties is in fact not an energy source, the collective municipal or neighborhood wide capacity of this technology in the state of Arizona or in any of a number of different states or geographical regions within conceivably all states, or, (at least such states that experience full four season climatic fluctuations) clearly suggest this technology has the capacity to become a nationwide public utility in every bit the same manner it has the capacity to become a mainstay industry standard in overall building design across virtually every construction sector in the country. Needless to say, as it does, the ease of which such holistic industrial functionality can be immediately woven into our overall national energy grid while simultaneously being woven into our national construction frame of mind is as simple as the manufacturing of a meter, that may or may not have the capacity to interact with an existing house electric meter currently in 2016, but more than likely could much sooner than later if in fact geothermal energy was so comprehensibly addressed in the first place.

Getting back to DERs.

Solar PV, battery storage, and other distributed energy resources (DERs) are becoming cheaper by the day.”

This quote comes from the article below:

Fixed Charges Don’t ‘Fix’ the Problem

Distributed Energy Resources (DERs) as they pertain to either solar or wind, have to be considered as valid, if, for no other reason than to acknowledge that at some point in time along the evolutionary path of our entire 21st century national energy grid, the ability to store power does become somewhat sensible and somewhat necessary.

Whereas beyond anything other than emergency situations, battery storage can and historically has been considered to be “well ok fine”, I have a flashlight for emergencies, but, beyond that, the only thing it is good for is playing flashlight tag, for the most part, integrating (DERs) into our broader national utility grid is pretty much viewed from within that same childlike, and, therefore hopelessly abstract and animated industrial as well as economic context. As such a viewpoint has in this author's opinion, prevented a far more sophisticated industrial dialogue from being brought front and center, I think that the reason this remains so is in fact related to misguided attempts to utilize battery storage capacity as a means, or, an attempt to place solar and wind energy in particular into the static architectural based fuel class of oil and natural gas as opposed to quite specifically placing (battery) storage technology into the highly evolved and multi-faceted transit based fuel class in which it (battery storage technology) actually belongs.

As in my view, until (DERs) are viewed for the only thing or mechanism they actually are, which is temporary but critical, mobility oriented storage capacity that enables high efficiency, light to medium duty, industrial cross functionality to flourish, our broader national energy grid will remain functionally illiterate. Transit based battery technology as such technology pertains to comprehensive neighborhood based public energy utility re-blueprinting then, is simply a means to intelligently transfer data from an individual solar array or neighborhood solar cluster to a neighborhood geothermal cluster to a neighborhood natural gas vehicle refueling network (cluster) to a neighborhood based electric vehicle charging network (cluster) to a neighborhood rainwater management grid (cluster) – all of which without the battery and the subsequent minimum charge the battery can actually hold would be virtually impossible to accomplish without.

Keeping in mind that anything with a battery attached to it has but two options and both options become useless once the battery can no longer be recharged. Keeping in mind as well that for a battery to be recharged it must have the ability to be attached to an architecturally anchored “static” power source. In turn, keeping in mind that whatever the vehicle it is that the battery is powering can only go so far before it must find another “static architectural place” to plug in to, both architectural places must possess the same multi-faceted transit based electrical charging inter connectivity capacities. In turn, when considering now in 2016 what appears to be substantial static based architectural limitations that are preventing this advanced utility based energy management dialogue from occurring , due to the fact that the power we are discussing that can enable this dialog to flourish is both battery and mobile, interchanging voluminous GIS information pertaining to both the cost of static architectural electrical charging in one place and the mileage traveled to justify the cost of charging for that transit based traveling expenditure to the next place coincides completely with the electricity, static or renewable being either generated and distributed in both places to begin with.

Once then, all of these cluster factors are known, intelligently transferred data from an individual solar array or neighborhood solar cluster to a neighborhood geothermal cluster to a neighborhood natural gas vehicle refueling network (cluster) to a neighborhood based electric vehicle charging network (cluster) to a neighborhood rainwater management grid (cluster) enables substantial economic growth in the entirely new 21st century industrial sectors associated with the subsequent “and quite significant” lateral expansion of the original 20th century electric and natural gas utility provider.

Getting back to the Nevada PUC decision then, the route this commission took in its demand for equitable financial reciprocity as such reciprocity was being challenged by the solar industry, was and is more than justified. The existing Nevada state public utility, regardless of whether or not such a utility can or should be considered as a monopoly, has, within its regulatory mandate, the responsibility to guarantee affordable and reliable electricity to Nevadan's. Whereas the “solar industry” has within it's technological dynamic, the capacity to substantially modify the nature of how electricity is generated, and, such electrical generational capabilities are indeed much healthier for all who occupy our earthly environment, such capabilities cannot be considered as being either affordable or reliable until solar energy technology is interfaced completely with a broad host of equally impressive energy sources and energy management technologies some of which are very old and some of which are quite new and just as exciting to develop as solar is. Either way, the benchmark for all such development remains the operational framework of the original public electric utility grid that should, within it's regulatory authority, have the capacity to modify that grid substantially and quickly to accommodate the speed of which new energy based generation and management technologies are coming on line.

Battery storage technology is a crucial link to the accomplishment of all of this, but, again only from within its ability to be mobile as opposed to being static. As perhaps a better term than mobile would be unplug-gable, the point is that if a solar array has been determined as being an integral part of a cluster of other energy management systems, it is essentially the capacity to store power derived primarily from solar that will in fact enable these other systems to perform at their best as intermittent energy demand fluctuates from either one system to another or from one form of peak demand to another.

An example of this would be a solar powered electrical system, (backed up by battery storage) that provides all power to a neighborhoodrainwater management grid during typical or moderate periods of rainfall. As it rains and the rainwater cisterns fill, a moderate amount of electricity would be required to send the rainwater through a basically gravity fed network of water storage cisterns. As such moderate solar power would come into use more so after the rain and after a few days without rain, battery stored electricity could be utilized to power the pumps that draw that rainwater from the cistern out on to the lawns and gardens that would need such rainwater during dry spells. A minimum amount of water managed by a minimum amount of “on demand solar electric power.”

On the flip side of a pleasant rainfall is the torrential downpour, which is the type of rain where rain drops are replaced with rain buckets (or barrels) for an extended period of time to the extent that the accumulation of water can cause tremendous damage to an entire neighborhood if in fact, all systems designed to prevent such damage, are not either in place, or, fully synchronized with one another. Either way, at the core of this synchronicity is the technological memory cell that needs constant power during periods when such power can be very much disrupted, if not gone altogether.

Somebody simply needs to be standing there with a very good flashlight powered by very good batteries until a more dominant power source can be restored or a secondary dominant power source more powerful than either solar or the battery can come on line and deal with the high level of water management torrential rains demand of a collective rainwater electrical or mixed energy management infrastructure to resolve.

Once again, it is the mobile battery to the rescue of the secondary dominant power source. As 21st century Industrial Demand Response simply demands response, secondary neighborhood based natural gas powered auxiliary electric emergency generation comes directly into play. For what can be an extended period of perhaps days until static power can be restored, the battery originally charged by solar power brings to the whole rain water management system the ability to simply communicate from within the framework of a very fluid, uninterrupted, neighborhood based infrastructure dynamic until the whole grid is once again online.

How utilities and regulators differ in their approaches to distributed energy.

Thanks for stopping by.

self awareness

Mike Patrick Dahlke

Curriculum vitae

Please take the time to visit some of my other essays.

1 comment:

  1. Hi there, we in Incite Energy believe in providing a transparent look into
    the ever-evolving market, while our experts design tailor-made solutions to
    deliver energy cost savings and increase efficiencies
    belive us !


Tell me what you think,
but, please think before you tell me.

Thank you.