More on the Model: are Utilities Planning for the Future or Hoping it Doesn't Come?

A few weeks ago I posted about threats to the traditional investor owned utility (IOU) business model and I'm still soaking in what EEI and others are saying. Since then, I:

• Attended a presentation on the future of renewables at MIT given by energy futurist Dr. Eric Martinot. You can download Martinot's full 2013 report HERE and follow his periodic updates HERE
• Also had a great conversation with another energy futurist, Chris Nelder, after reading his Greentech Media Article titled "Adapt or Die: Private Utilities and the Distributed Energy Juggernaut". Nelder's personal site is HERE
• Read THIS from Bloomberg, a name not normally associated with wild or starry eyed cleantech visions. Bloomberg analysts are predicting very strong gains with renewables comprising up to 37% of total power produced by 2030

I'm not a self proclaimed futurist, nor do I play one on TV or the Web. And I know if I was on a debate team, I could find plenty of arguments (e.g., low cost natgas, end of renewables subsidies, slow updake of EVs, etc.) for thinking it'll be business as usual for IOUs for decades to come.

Texas Rolling Black Outs and the Not-Yet-Smart Grid

Analyst Chet Geschickter of Greentech Media wrote a nice piece about the blackouts Texas experienced earlier this month. You might say, hey, weather-induced power outages aren't caused by security problems. To which I would reply, oh yeah? The brittleness of the grid is one of its most significant vulnerabilities ... one that we now have the means to repair, though not necessarily the will to do so in the short term.

So may we continue? Here's Chet:

Rolling blackouts are a last-resort load shed tool ... [but while] demand response provides more orderly demand cascading ... it is limited to a few businesses with discretionary power needs -- like refrigeration compressors in supermarkets. A hefty chunk of the business sector is more sensitive. 

Then he continues ...

The residential market has huge potential for both electricity and natural gas peak curtailment, especially if and when large-scale consumer Home Area Network (HAN) technology adoption occurs.

That's a big "if" ... and maybe even a bigger "when". Now let's turn to an actual official in the thick of this event in Texas, quoted in a piece from the Wall Street Journal:

Many users didn't know their power was coming down, and officials said they should have issued more alerts so customers could prepare."It is something we have never experienced before," said Trip Doggett, the grid operator's chief executive, adding that "dramatically more" plants shut at one time than ever before. 

The good news?

By turning to the use of rolling outages, the grid operator prevented a statewide blackout that could have lasted at least 50 hours, Mr. Doggett said.

The bad news? The detail that that grid operators either couldn't communicate with their customers en masse, or else forgot to. I'd bet on the former. The Smart Grid is, if nothing else, about improving efficiency of operations and customer experience via better communications throughout the system. Ahem (throat clearing sound) ... I said, better communications.

Photo credit: (Texas based) J-5 Electric

Demand Response: Refreshingly Effective

This one's short and sweet: demand response (DR) works. It may not be the answer to all our energy woes, but it afford-ably accomplishes what it seeks to accomplish, simultaneously reducing its customers' costs and emissions. In case you missed the recent heat wave recounted in the article (you were probably having one of your own), here's a good part:

When two power plants failed in ISO’s New England service region in late June, energy prices momentarily spiked to $1,000 per megawatt-hours. EnerNOC’s DemandSMART network sprang into action and ISO was able to meet demand and avoid a hit to its bottom line by reducing demand by 380 megawatts. According to EnerNOC, this was accomplished largely because of its network operations center, which remotely enlisted over 1,000 assets during a two and half hour dispatch and managed 500,000 data transactions to manage the situation in real-time.

More on this here, and even more now awaits folks with Earth2tech's premium subscription. As with other new forms of data-driven grid functionality, DR applications open new doors through which bad actors might enter. So far, though, it seems the DR folks at EnerNOC and elsewhere are running a tight (enough) ship.

Photo credit: liz west at Flickr.com

Temporarily Mismanaging Demand Management in Atlanta

We've been having a heat wave up in Boston this week, which makes us more empathetic about this recent snafu in Atlanta. With Smart Grid-like configurations, technology can be a force multiplier to achieve great new capabilities ... as well as amplify the negative consequences of human error. In this case, it was a relatively short loss of household AC. But I'm sure you get the point.

And how did folks happen to part of this demand management program in the first place? They responded to the following very reasonable Duke Energy entreaty to save some dough:

Why Sign Up - Depending on which Power Manager option you choose, you will receive a one-time credit of $25 or $35 on your bill just for signing up. You will receive a credit on your electric bill whenever we use the Power Manager device to turn your air conditioning unit off and then automatically back on. You are helping to preserve the environment and keep electric costs low by reducing the demand for electricity and delaying the need to build additional power plants in our region.

How the Program Works - Duke Energy will install a free load management switch next to your air conditioner on the outside of your home. This radio-controlled device will cycle your air conditioner off and on when demand is especially high. Depending upon the option you choose, your air conditioner is cycled off and then back on approximately one time each half hour, for the length of the cycling event. Cycling events will not normally exceed a four to six hour time frame and will not occur on weekends or holidays (except in a system emergency). To help keep you comfortable, the indoor fan continues to run to circulate air throughout your home.

Hopefully we'll get to make and learn from lots of small, relatively benign mistakes before the consequences become much greater. And become much greater they surely will ...