Lecture at Univ of Florida regarding the transformation of the electric industry and the technical and operational issues from the integration of variable renewable and distributed energy resources at scale.
2. Policy is Spurring DER Adoption
Combined with accelerating improvements in DER technology price &
performance are creating opportunities for electric system efficiencies
2011 US State Renewable Policy
Source: EIA
2010 US State EE Policy
Source: ACEEE
Over 80% of US population under the equivalent of EU’s 20/20/20 Plan
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3. Solar PV is Reaching Tipping Point
SEPA Report:
• More than 1.2 million solar PV panels were installed
by the top 20 corporate solar users in US
• Walmart and Costco combined have more solar PV
on their store rooftops than all of the PV capacity
deployed in the state of Florida
2010
• The top 10 companies (by capacity) have
individually deployed more solar energy than most
electric utilities in the U.S.
$0.10/kWh installed by 2020
McKinsey & Co.
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4. DG Policy will change distribution design + operations
White House 2020 goal to increase total CHP in U.S. by 40GW (50%) to over 120GW
McKinsey forecast 200 GW of Solar PV in 2020
50 GWhs of Solar PV
115 GWhs of CHP
322 GWs Solar + CHP
= 3.2 MWs/circuit
100,000 Distribution circuits
(20% of US total)
Sources: SEPA, DoE, USCHP
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5. Hybrid Grid: Centralized
2025 Grid: Centralized & Decentralized
Conceptual Example: CA Utility System Peak at 30,000 MWs
Distributed Storage
3,000 MW
10% Adoption
Electric Network + Large
Traditional Gen & VER
Responsive Demand
4,500 MW
15% of Peak
Distributed Gen
10,000 MW
30% Adoption
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8. Customer Micro-grids: 2002-2014
Instrumented & Intelligent: Increased DER will require better state information
and decision support analytics
Customer
Self-Optimized
Micro-grids
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9. Virtual Power Plant: 2002-2020
Advanced Automation: Multi-direction and variability of DER power flows drive
circuit design changes, new grid components and control systems
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10. Distance & Temporal Considerations
Operational systems are challenged by increased span of control and
decreasing timing of information and decision and control responses
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11. Customer Experience Paradigm Change
Drives increasing real-time interdependency bet customer experience and
distribution operations that will redefine both
Richness
Customer
Experience
Co-creation
Transactive
Collaboration
Automated (advanced)
Context
Control
Intelligent
Distribution
Operations
Instrumented
2008
2010
2015
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13. Unlocking Latent DER – Pricing Structure Matters
Value Realization Requires Satisfying Multi-Party Requirements
Traditional “best efforts” programs are not
effective for most grid operations – need new
approach
Adapt Quality of Service Concept:
Availability (On/Off or Will be)
Guarantees (Firmness)
Auditability (Measurement & Verification)
Use of forward pricing structures to balance
customer needs for comfort and convenience
while providing firm resources for grid operations
Differentiated services may be bundled to keep
pricing simple – “good enough” is fine
Forward pricing structures also enable customer
side investments in enabling technology
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14. Current DR Pricing Schemes Don’t Scale
Multiple prices to distributed resources create multiple uncoordinated
feedback loops – plus opportunity to game pricing options
Source: P. De Martini
CAISO
Source: CAISO
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15. “Prices to Devices” Create Unacceptable Oscillations
Lessons to be learned from High Frequency Trading –
especially since this involves physical reliability not just market economics
High Frequency Trading
Source: Nanex
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18. Net Metering: Creating Clean Energy Divide
Any support mechanism for these technologies must be fair, efficient and
sustainable and preserve the interests of DER and non-DER customers alike
Issues:
Net metering shifts costs from DER customers
to non-DER customers (Customer avg income
SCE Net Metering Rate
adopting Solar PV in CA = $100k/yr)
Net metering rates are not linked to the cost of
DER technologies being promoted
Recommendations:
“Avoided cost” purchase rates based on the
costs that the utility clearly avoids by accepting
generation from distributed generators, or
market based price reflecting distribution
locational values
Retail rates should be modified so that all fixed
costs are recovered through an access charge
paid by all customers connected to the grid
Source: Edison International
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