beyond the meter · pdf filereport: derek kircher at dte energy; henry yoshimura at iso-new...

Beyond the MeterDISTRIBUTED

ENERGY RESOURCES CAPABILITIES GUIDE

SEPTEMBER 2016

2 SEPA | A BEYOND THE METER SERIES REPORT

BEYOND THE METER SERIES

TABLE OF CONTENTS

I. THE DECENTRALIZING GRID ............................................................................................................................................3

II. INTRODUCTION TO DISTRIBUTED ENERGY RESOURCES ......................................................................................4

III. CAPABILITIES OF DISTRIBUTED ENERGY RESOURCES ............................................................................................6

§ A. ENERGY .........................................................................................................................................................................7

§ B. CAPACITY ......................................................................................................................................................................9

§ C. VOLTAGE REGULATION ........................................................................................................................................ 10

§ D. FREQUENCY REGULATION .................................................................................................................................. 11

§ E. LOAD FOLLOWING ................................................................................................................................................. 12

§ F. BALANCING .............................................................................................................................................................. 13

§ G. SPINNING RESERVE ................................................................................................................................................ 13

§ H. NON-SPINNING RESERVE .................................................................................................................................... 14

§ I. BLACK START ............................................................................................................................................................ 15

IV. FINAL THOUGHTS ............................................................................................................................................................. 15

AUTHORSRyan Edge, Research AnalystRyan joined SEPA in 2014 following a stint with Portland General Electric researching potential opportunities for advanced inverter functionality. He has since led the development of research reports on topics, including utility programs for key account customers, and advanced inverter functionality. He was also the project lead for SEPA’s 2015 annual utility survey and the corresponding Utility Solar Market Snapshot.

Nick Esch, Research AssociateNick joined SEPA’s research team in 2015 following an internship while obtaining his Master’s degree in Solar Energy Engineering and Commercialization at Arizona State University. He assisted with the 2014 and 2015 annual utility surveys and is the lead manager of SEPA’s Utility Solar Database. In addition to the research team, Nick has also worked as a member of SEPA’s advisory services team on multiple community solar engagements, assisting utilities with program design and customer research.

Erika H. Myers, Senior Manager, ResearchErika joined SEPA in 2015 and oversees all SEPA research products and provides expertise in solar, electric vehicles, and other distributed energy technologies. Prior to joining SEPA, Erika spent nearly four years as a consultant with ICF International and five years with the South Carolina Energy Office. She specialized in renewable energy, alternative transportation fuel policy and regulatory planning and development.

ACKNOWLEDGEMENTSSEPA would like to thank all of the contributors to this report: Derek Kircher at DTE Energy; Henry Yoshimura at ISO-New England; Jonathan Salsman at National Grid; Greg Adams, Juan Cardona, and Ernest Palomino at Salt River Project; and Carmine Tilghman at Tucson Electric Power. We would also like to thank the following SEPA staff for their contributions: Erin Birmingham, Dan Chwastyk, Ted Davidovich, Tanuj Deora, Bob Gibson, Vazken Kassakhian, K Kaufmann, and Mike Taylor.

COPYRIGHT© Smart Electric Power Alliance, 2016. All rights reserved. This material may not be published, reproduced, broadcast, rewritten, or redistributed without permission.

DISTRIBUTED ENERGY RESOURCES CAPABILITIES GUIDE 3

The Decentralizing GridThe U.S. electricity sector is undergoing a transition from a system based on large individual power plants to one in which distributed energy resources (DERs) play an increasingly significant role, with major impacts for electric grid operations. Specifically, as utilities continue to integrate more renewables and other DERs onto their distribution systems, they will also increasingly turn to these technologies for ancillary—that is, grid support—services now provided by power plants and other traditional grid assets.

While distributed technologies, used in isolation, may benefit individual customers and distribution feeders, in aggregate, they are able to offer the bulk power system many of the same grid support services that traditional resources provide. As such, portfolios of DERs should be viewed similarly to bulk power resources.

This guide describes how DERs can support a more flexible and efficient grid and evaluates technologies based on their abilities to provide energy, capacity, and ancillary services for both the distribution and bulk power systems.

Moreover, this guide seeks to bridge the gap between technical, systems-based thinking and the strategic, policy-based perspective necessary for resource planning. Ongoing growth in rooftop solar deployment is driving still more decentralization on the distribution system at the same time that state-level renewable portfolio standards are increasing reliance on intermittent resources for the bulk power system. As a result, grid operators will need greater resource flexibility to ensure they can reliably balance load and supply. By establishing DERs’ capabilities to provide grid services, this guide supports resource adequacy planning efforts.

Decentralization will continue with or without utilities’ endorsement. At the same time, utilities are uniquely positioned to determine the needs of the grid. This visibility enables the potential for them to optimize the grid benefits from interconnected DERs by directly controlling them or communicating grid conditions.

The following factors are driving DER growth:

n Customer awareness. A growing number of utility customers are demanding more choices for their energy needs and, at the same time, more effective, automated ways to manage costs. They are installing Wi-Fi-enabled thermostats, electric vehicle chargers, energy storage, and many other devices behind the meter.

n Lower cost solar power. The extension of the 30-percent federal investment tax credit1 is expected to continue the trend of successive price declines for photovoltaic (PV) modules and other system components.2

n Integration of renewable resources onto the grid. The growth of solar and wind power has increased variability in the power supply, necessitating flexible resources for reliable integration. Many types of DERs can effectively balance renewable resources.

n Changes to wholesale power market rules. The Federal Energy Regulatory Commission (FERC) and numerous balancing authorities have been modifying rules to accommodate new DER technologies and the companies that are bringing them to energy markets.

1 2015 Utility Solar Market Snapshot.

2 Photovoltaic System Price Quotes from Selected States; Solar Fundamentals Volume 2: Markets

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Introduction to Distributed Energy Resources

Defining DERs is, and will be, an ongoing process as current technologies evolve, new ones emerge, and advances in the fields of communications and computing allow for more integration of distributed technologies. Recognizing the difficulty of pinning a definition to any one group of technologies, the Smart Electric Power Alliance (SEPA) has adopted the following working definition of distributed energy resources.

Distributed energy resources are physical, as well as virtual, assets that are deployed across the distribution grid, typically close to load, which can be used individually or in aggregate to provide value to the grid, individual customers, or both.

The DER categories discussed in this guide are based on this definition. Please note that the term “demand response” is not specifically discussed here because it is too broad within this context. To more accurately describe the different technologies and capabilities involved in demand response (also known as demand management), three different categories are listed below: interruptible load, direct load control, and behavioral load shaping.

n Distributed solar: This category includes small-scale PV systems that are usually, but not exclusively, customer-sited and can be interconnected on either side of the meter. These resources are usually not utility-owned and, as a result, the grid operator’s visibility of historical and real-time performance is

typically limited. Residential rooftop systems are the most common example, but systems as large as a few megawatts could also qualify as distributed solar.

n Distributed solar with advanced inverter functionality: This category includes distributed

solar power systems with inverters capable of supporting and enhancing grid reliability, as opposed to passive inverters that only maximize real power output and shut off at the first sign of a grid disturbance. Advanced inverter functions can operate autonomously or when dispatched by a grid operator—even when the sun isn’t shining—if suitable communications infrastructure is in place.

n Battery storage: Battery energy storage systems chemically store electricity that can be released to a home, a business, or the electric grid when needed. For the purpose of this guide, the term “battery storage” is used to refer to batteries of all cell chemistries, even though all of them cannot provide the same services. Other energy storage technologies not explicitly covered in this paper include flywheels, gravitational storage, compressed air energy storage, and flow batteries.3

n Interruptible load: This category generally refers to high-demand industrial customers on an interruptible tariff. The tariff provides a discounted rate for electricity, but allows the utility to curtail, for a limited number of times during the year, some or all of the customer’s load in response to peak events. Some may

Distributed energy resources are physical, as well as virtual,

assets that are deployed across the distribution grid, typically close to load, which can be used individually or in

aggregate to provide value to the grid, individual customers, or both.

3 These types of storage are discussed in detail in a previous SEPA report, Electric Utilities, Energy Storage and Solar: Trends in Technologies, Applications and Costs. SEPA, 2014.

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categorize this resource as demand response, as is direct load control, below.

n Direct load control: This category consists ofcustomer loads that can be controlled by the utility in real time, either curtailing peak demand or increasing demand during surplus generation events. Examples include controllable water pumps, electric water heaters, electric vehicle chargers, and air conditioning units.

n Behavioral load shaping: This category refers to the use of electricity pricing, incentives, and consumer messaging to influence their use of electricity for the purpose of shaping load. Examples include time-of-use rates, electric vehicle charging rates, and voluntary demand response notifications. Sending critical peak price signals to customers would qualify in this category, but similar signals to dispatch loads would better align with direct load control.

n Energy efficiency: This category includes technologies designed to reduce the energy intensity of basic energy services, that is, light, heat and mechanical work. Savings can be achieved by both passive and active measures. Efficient lighting retrofits, new appliances or building materials, window replacements, or building designs that capture or minimize radiant heat may all be considered passive measures. Active measures include connected devices that monitor, control, and reduce energy consumption, for example, Wi-Fi-enabled thermostats.

Many other DER technologies that can also provide grid services are not directly examined in this guide. Combined heat and power plants, diesel generators, and wind turbines, for example, may qualify as DERs, but they are not covered here. Other emerging technologies are excluded because they are not yet widely deployed, such as fuel cells and new variations in energy storage.

Microgrids and electric vehicles, on the other hand, are directly relevant to this discussion of

DER capabilities, but the services they provide are better explored as specific applications of the above-mentioned DER categories. To prevent duplication, they are not listed as discrete categories in Figure 1.

Microgrids can encompass any of the DER categories listed above. Additionally, they may be able to “island”—that is, operate in parallel or independent of the power grid—to provide load reduction in the same manner, in the system operator’s view, as an interruptible load.

Consumers do not buy electric vehicles (EVs) primarily for their benefit to the grid; these vehicles are transportation first, but are capable of providing grid benefits only when not performing that function. However, these vehicles, and their constituent technologies—batteries and chargers—are potentially robust resources for many grid services, particularly when aggregated. If programmed to do so, EVs can regulate their power demand, and start or stop charging when it best suits grid conditions, which is similar to the direct load control category above. EVs may also discharge energy back to the grid, providing similar grid benefits as battery storage. EV charging rates and other methods to influence drivers to voluntarily charge during off-peak hours are examples of behavioral load shaping.



Capabilities of Distributed Energy Resources

When evaluating energy resources, utilities look at a range of attributes beyond energy production. From an operational standpoint, capacity and ancillary services are essential for reliable power delivery. Legacy grid assets commonly provide these services, but DERs are also doing so, though many remain untapped due to a variety of reasons including regulatory constraints, market factors, and communications connectivity.

Figure 1 illustrates the potential for DERs to provide energy, capacity, and ancillary services. Although it is possible for specific applications to provide more than one service at a given time, on the table, each is represented individually.

Please note that the ratings here represent basic technical capability, rather than actual current applications. Some of the technologies do not yet offer many of the DER services listed here due to

FIGURE 1: DER CAPABILITIES MATRIX

TECHNOLOGIES ENERGY

GEN

ERAT

ING

CA

PACI

TY

DIS

TRIB

UTI

ON

CA

PACI

TY

VOLT

AGE

REG

ULA

TIO

N

FREQ

UEN

CY

REG

ULA

TIO

N

LOAD

FO

LLO

WIN

G

BALA

NCI

NG

SPIN

NIN

G

RESE

RVES

NO

N-S

PIN

NIN

G

RESE

RVES

BLAC

K ST

ART

DISTRIBUTED SOLAR Energy Generator No No No

DISTRIBUTED SOLAR + ADVANCED INVERTER FUNCTIONALITY

Energy Generator No No No

BATTERY STORAGE Energy Storage Yes Yes Yes

INTERRUPTIBLE LOAD

Load Shaping Yes Yes No

DIRECT LOAD CONTROL Load Shaping Yes Yes No

BEHAVIORAL LOAD SHAPING

Load Shaping No No No

ENERGY EFFICIENCY Reduce Load No No No

Unsuitable for reliably performing the specified service.

May be able to perform a service, but is not well suited or can provide partial support.

Able to perform a service, but may be limited by factors such as availability or customer behavior.

Well suited to perform a service; may exceed legacy technologies for providing the service.

Source: Smart Electric Power Alliance, 2016.


regulatory or market reforms, communications infrastructure, or software control mechanisms that are in process or still lacking. In other cases, a technology may be capable of providing a service, but is better suited to a different use, such as using a robust direct load control program, such as non-spinning reserves, rather than for more valuable capacity savings. This guide does not address

these limitations, focusing instead on the individual technologies and their potential to provide each identified grid service.

Response time is a major determinant of whether or not a technology can perform a grid service. Figure 2 illustrates the approximate time requirements for each service, though they may vary by local requirements.

A. ENERGYEnergy is a measure of work. Electrical energy, for the purposes of this guide, measures the amount of energy services—light, heat, and motion—that are derived from grid power. Units of electrical energy are commonly expressed in megawatt-hours and kilowatt-hours. The technologies below are

evaluated based on their ability to serve customers’ present or future energy demand.

Distributed solar, with or without advanced inverter functionality, is an effective electricity generator. When the sun is shining, solar PV

Orange = Reserves, supplemental generation used to backup the system

Green = Regulation services, maintain balance between generation and load within a control area

Blue = Energy and capacity, continuous services

Gray = Black start, required to start grid assets before they can provide other services

Timescale is non-linear.

Source: Smart Electric Power Alliance, 2016.

FIGURE 2: RESPONSE TIME REQUIREMENTS FOR RESERVES AND REGULATIONS

1SECOND

1MINUTE

5MINUTES

30MINUTES

4HOURS

BLA

CK S

TART

RESERVES

REGULATION

SPINNING RESERVES

VOLTAGEFREQUENCY

LOAD FOLLOWINGLOAD BALANCING

ENERGY

GENERATING CAPACITY

DISTRIBUTION CAPACITY

NON-SPINNING RESERVES



systems convert sunlight into electrical energy to serve nearby loads or to power the grid.

Battery storage can provide energy services, but from the grid perspective, it can function as an energy source or a load depending on its state of charge. A battery stores energy when charging and distributes it back to the grid when discharging. These actions are net-zero energy minus conversion losses, which vary by chemistry but range in efficiency from 85–95 percent for lithium ion applications.

Battery storage can add dispatchability to intermittent renewable resources by temporarily storing their output to serve peak load at a later time. Storage dispatchability will be increasingly necessary for utilities in states with high renewable portfolio standards, such as California (50 percent by 2030), Hawaii (100 percent by 2045), Oregon (50 percent by 2040), the District of Columbia (50 percent by 2032) and Vermont (75 percent by 2032).

Energy prices vary by time and demand, which enables economic arbitrage—by utilities, customers, or third-party providers—between peak demand times when prices are highest, and off-peak times when energy is cheaper and more abundant. However, the potential economic benefits require a large price difference between peak and off-peak to account for hardware depreciation incurred in charging cycles.

Interruptible loads, direct load control and behavioral load shaping all shape load, but they do not necessarily reduce total energy demand. Utilities have reported that some of these tools save energy, but they are designed primarily to save capacity. For example, curtailing air conditioning loads during summer afternoon peaks often relies on the ability to precool an interior space and, thereby, shift load before a peak event. After the event, the load may resume, but if ambient air temperatures cool into the evening hours, the previously curtailed air conditioner may draw fewer kilowatt-hours to return the interior space to the preset temperature. Energy savings in this way, although real, can be unreliable and difficult to design into a demand management program.

Energy efficiency reliably serves load by durably reducing the intensity of energy consumption, whether by individual customers or energy systems as a whole. Customers actively invest in efficiency measures to reduce their own energy consumption and their electric bills. Utilities invest in increasing the efficiency of equipment, their own and their customers’, to decrease load growth overall.

The propensity for customers to increase their energy use after making efficiency upgrades—because their consumption patterns are now less energy-intensive—diminishes the impact of efficiency investments. One example of this phenomenon—called the rebound effect—is the individual who upgrades to a more efficient air conditioner then sets the temperature on the thermostat below the previous setting. Less energy is used overall, but the change in behavior reduces the ultimate savings.

Although energy efficiency practitioners understand the rebound effect, it remains challenging to control and varies among different efficiency investments. For example, a person who upgrades to a more efficient television may not watch more television. These examples describe the rebound effect’s impact on energy savings, but—since energy and capacity are inherently linked— also apply to energy efficiency’s effect on capacity savings.

TECHNOLOGIES ENERGY

DISTRIBUTED SOLAR Energy Generator

DISTRIBUTED SOLAR ADVANCED INVERTER FUNCTIONALITY

Energy Generator

BATTERY STORAGE Energy Storage

INTERRUPTIBLE LOAD Load Shaping

DIRECT LOAD CONTROL Load Shaping

BEHAVIORAL LOAD SHAPING Load Shaping

ENERGY EFFICIENCY Reduce Load


B. CAPACITY

TECHNOLOGIES GENERATING CAPACITY

DISTRIBUTION CAPACITY

DISTRIBUTED SOLAR


BATTERY STORAGE

INTERRUPTIBLE LOAD

DIRECT LOAD CONTROLBEHAVIORAL LOAD SHAPING

ENERGY EFFICIENCY





Capacity, represented in Watts (W), measures electric power. Power plants, electric loads, as well as power lines, transformers, and other utility infrastructure are all rated for their capacity to produce, transmit, or consume electric power. Units of capacity are typically measured in megawatts (MW) and kilowatts (kW). Generation and consumption capacity must balance at all times. Capacity is commonly metered and billed for large commercial and industrial customers; a small number of utilities also apply capacity charges to residential customers as well.

For the bulk power system, capacity refers to the generation and transmission required to meet total electricity load. At the distribution system level, it describes the maximum limit of the distribution equipment to connect this power to end users through transformers, power lines, and other hardware. The profiled technologies are well-positioned to address constraints at both levels, although aggregation would be required to meet bulk power system needs.

Battery storage is highly effective for serving capacity needs. Depending on its state of charge, the battery can provide capacity as power output or receive a charge, acting as a load of the same size. A partially charged battery can flatten the net load of a circuit by charging and discharging in proportion to the net load on a feeder circuit in much the same way a shock absorber dampens the bound and rebound of a car’s suspension.

Interruptible loads can provide capacity at the bulk power level. Because these loads are consistent and predictable, their capacity is known, and curtailing the load reliably returns that capacity to the utility. Dispatching these assets is limited to a certain number of times for a certain number of hours per year, according to the terms of the utility’s governing tariff, and this limitation reduces its total value. Interruptible load is less useful for deferring distribution capacity investments because these customers are typically interconnected at transmission or subtransmission voltages. Further, the limitation on the number and duration of dispatch events hinders a utility’s ability to avoid distribution system capacity upgrades.

Energy efficiency investments reduce demand capacity in the same way it reduces energy consumed. Efficiency can be targeted to constrained locations on the distribution network to alleviate congestion in power lines and substation equipment, or it can be deployed broadly to mitigate systemwide peaks, reducing the need for additional generating capacity. As noted above, the rebound effect also applies for energy efficiency’s capacity value.

Direct load control and behavioral load shaping curtail or shift load when capacity is needed due to generation shortages or high operational prices. To mitigate system peaks, noncritical load is shifted off-peak when power is cheaper. Inversely, surplus renewable generation is a growing occurrence, particularly in “shoulder” months—typically spring and autumn—when electricity demand is lowest. At such times, these



technologies can usefully increase load, avoiding a curtailment event for the renewable supply. Both applications are limited by the willingness of customers to participate and, between the two, direct load control can be more effectively dispatched by utilities although it may still be susceptible to customer overrides.

A distributed solar power system has a generating capacity rating, but is neither firm nor dispatchable, which severely limits its individual capacity value. From a customer’s perspective, solar cannot readily achieve capacity reductions for demand charges.

From the utility’s perspective, solar’s capacity value can vary as a function of the valuation

framework applied. As PV systems are more broadly distributed geographically, the more capacity value is possible at lower risk.4 For example, a portfolio of small rooftop PV systems concentrated in a small geographical area is more susceptible to intermittent production on a partly cloudy day than the same portfolio distributed across a much larger area.

Advanced inverter functionality with proper communications can add utility-dispatchable power curtailment, ramp rate control, voltage support, and other reliability enhancements. These features allow inverters to better emulate the grid-supporting role of traditional generators.

C. VOLTAGE REGULATION

TECHNOLOGIES VOLTAGE REGULATION

DISTRIBUTED SOLAR


BATTERY STORAGE

INTERRUPTIBLE LOAD

DIRECT LOAD CONTROL


ENERGY EFFICIENCY





Voltage is a measurement of the potential to move an electrical current between two points, comparable to the dynamics of pressure in a pipeline. Units are measured in volts. In the past, system operators had to closely monitor loads and use transformers, fixed capacitor banks, and line regulators to control voltage.

Both battery storage and distributed solar with advanced inverter functionality rank highly for voltage regulation due to one common component—the inverter. Inverters use power electronics not only to convert direct current from PV modules and batteries into grid-compatible alternating current; they can shape their output to support the grid at large. Sensors within inverters allow them to react autonomously, that is, without the need for dispatch from a grid operator. This autonomy allows inverters to respond to grid conditions almost instantaneously, which is crucial for voltage regulation. Grid-tied inverters can also modulate power quality using grid power only, which means that solar inverters can support the grid even at night.

The other technologies listed above are not well suited to regulate voltage.

4 Perez, Richard, et. al. “Achieving Very High PV Penetration: The need for an effective electricity remuneration framework and a central role for grid Operators.” Energy Policy. Vol. 96. September 2016.


D. FREQUENCY REGULATION

TECHNOLOGIES FREQUENCY REGULATION

DISTRIBUTED SOLAR


BATTERY STORAGE

INTERRUPTIBLE LOAD

DIRECT LOAD CONTROL


ENERGY EFFICIENCY





Frequency is a measure of the real-time balance between real power supply and demand on the grid. The equilibrium frequency on the U.S. power grid is 60 Hertz (Hz). It is a systemwide phenomenon, which means it does not usually vary based on local circuit conditions. However, generation and load are never constant; frequency is affected almost immediately when load changes, while generators take a moment to adjust. Sizable capacity is needed to measurably influence nominal frequency; therefore, relatively small distributed resources, like those listed in the table, may be combined for optimal effect.

Resources providing frequency regulation must, at a minimum, respond in less than one minute, although faster resources are preferred. When selling this service in formalized markets, the timeframes for active regulation may vary from several minutes to as long as 15 minutes.5 FERC Order 755 instituted performance-based compensation for resources better suited to regulation services, such as lithium-ion batteries; faster-acting technologies earn higher payments.

Fast-acting, inverter-based services from battery storage and advanced inverter functionality are well-suited to provide frequency regulation for the same reason they can effectively manage voltage. Some batteries, for example, can ramp from zero to full output nearly instantaneously, but combustion turbines and other traditional forms of power generation must physically accelerate to reach their maximum production, which can require several minutes or longer. One effect of Order 755 has been a shift in regulation services from peaker plants to battery storage units, particularly within the PJM Interconnection.

Direct load control has strong potential to regulate frequency as well. Responsive assets—such as electric vehicle chargers and electric water heaters—can receive frequency control signals and modulate their power demand to balance the grid. Although comparatively small, these loads can offer robust support when control is aggregated.Interruptible loads, behavioral load shaping, energy efficiency, and distributed solar with passive inverters cannot readily regulate frequency.

5 Kirby, Brendan. “Frequency Regulation Basic and Trends.” Oak Ridge National Laboratory. 2004.



E. LOAD FOLLOWING

TECHNOLOGIES LOAD FOLLOWING

DISTRIBUTED SOLAR


BATTERY STORAGE

INTERRUPTIBLE LOAD

DIRECT LOAD CONTROL


ENERGY EFFICIENCY





Load following is the act of matching generation to load over a time period ranging from a few minutes to half an hour.6 Although load following is similar to frequency regulation, fast reaction is less critical. Intermediate generators are traditionally strong providers of this service due to their flexibility to ramp in concert with the daily rise and fall of customer load.

The growing penetration of intermittent generation is redefining the role of load following generators. Load usually peaks around the same time solar output drops in the evening, which, in turn, raises the need for flexibility among firm resources as solar penetration rises. In California, for instance, an extreme, late-afternoon ramp event could require the system to add up to 10,000 MW over a five-hour period, according to the current version of the California Independent System Operator ’s “duck curve.” The magnitude and steep angle of the ramp is testing the limits of intermediate generators to

replace the sharp decline in solar power supply, making demand-side flexibility more critical.

Battery storage is very well suited to load following due to its high degree of flexibility. It can charge or discharge as needed, contributing to system-wide load or generation. Unlike the other technologies featured, storage can regulate either side of the load-generation balance.

Direct load control resources can shift, curtail, or otherwise reduce system load, or they can increase load to use surplus generation. A power surplus can occur when base load power plants with flat capacity utilization plus zero-variable-cost generators—such as wind and solar power—together supply more energy than the total system load. Such surpluses can result in negative wholesale prices to induce consumption. Direct load control—as well as behavioral load shaping to a lesser extent—is well suited to absorb surpluses. Whether increasing or decreasing load, these two demand-side resources can beneficially shape demand according to grid conditions.

Two advanced inverter functions—ramp rate control and real power curtailment—can support load following, although the technology is not well suited to providing this service when coupled with solar PV installations. Solar intermittency due to shading can cause output to ramp down suddenly and uncontrollably, regardless of the needs of the grid. Ramping up, on the other hand, can be controlled, potentially providing load following service.

Energy efficiency, distributed solar with passive inverters, and interruptible loads do not offer sufficient flexibility to balance generation and load; therefore, they cannot provide this service.

6 Yu, Xiaoyan, and Leon M. Tolbert. “Ancillary Services Provided from DER with Power Electronics Interface.” IEEE Power Engineering Society General Meeting, 2006.


F. BALANCING

TECHNOLOGIES BALANCING

DISTRIBUTED SOLAR


BATTERY STORAGE

INTERRUPTIBLE LOAD

DIRECT LOAD CONTROL


ENERGY EFFICIENCY





Balancing involves the matching of generation and load over longer time scales—hours and days—which requires even less flexibility than what is needed for load following. Utilities employ load forecasts, fuel price curves, transmission schedules, wholesale prices, and a range of other information to plan and schedule generator dispatch and power marketing to best serve load economically as well as reliably.

Demand management resources—specifically interruptible load and direct load control—match load to the available power supply and have become an emerging strategy for providing the balancing service. However, behavioral load shaping, which is limited to elective actions by customers, is less reliable for providing this service. Using critical peak pricing as a behavioral load shaping signal could be one of the more effective applications of this service.

Battery storage is well suited to balancing services as either a power source or dispatchable load. But, unlike its use in frequency regulation where storage can charge and discharge rapidly, the storage asset would act as either load or supply, not both. That is not to say that storage would be prevented from charging and discharging over a relatively short duration, but, if it were to do so, it would be performing frequency regulation or load following, not balancing.

Energy efficiency and distributed solar power are not available for balancing services. While the impact of energy efficiency may be evident in load forecasts that help to determine the amount of balancing resources that should be scheduled, it cannot, in and of itself, be scheduled or dispatched to provide balancing. Distributed solar power is forecastable but not dispatchable, which prevents it from being scheduled and dispatched for balancing.

G. SPINNING RESERVEIn the event of forced power plant outages or the loss of transmission, spinning reserves—also called synchronized reserves—ensure reliability by providing redundant generating capacity that is synchronized with the grid. Spinning reserves must be capable of responding within a range of a few seconds to 10 minutes.7 Once committed, spinning reserves can provide generation for time

frames ranging from several minutes to two hours, depending on control area requirements.

Often, the need for spinning reserves is met with unused capacity on generators already powering the grid. The difference between a generator’s net dependable capability8 and its current output is its potential capacity for providing spinning reserves.

7 North American Electric Reliability Corporation. NERC IVGTF Task 2.4 Report Operating Practices, Procedures, and Tools. 2011.

8 Net dependable capability is the maximum capacity a unit can sustain accounting for seasonal limitations and the power required to serve host process load. PJM. Rules and Procedures for Determination of Generating Capability.



TECHNOLOGIES SPINNING RESERVE

DISTRIBUTED SOLAR No

DISTRIBUTED SOLAR ADVANCED INVERTER FUNCTIONALITY No

BATTERY STORAGE Yes

INTERRUPTIBLE LOAD Yes

DIRECT LOAD CONTROL Yes

BEHAVIORAL LOAD SHAPING No

ENERGY EFFICIENCY No

If an outage or other contingency occurs, automatic generation controllers detect the occurrence as a frequency event and increase plant output to compensate.

Although battery storage lacks “prime mover inertia,”9 it is very fast-acting and can provide spinning reserves. Some interruptible loads and direct load control resources can also respond quickly enough to provide this service.10

Behavioral load shaping, distributed solar, and energy efficiency cannot offer this service because they lack both inertia and the firm dispatchability of spinning generators.

For solar with advanced inverter functionality, capacity could be intentionally curtailed and held for a contingency in order to act as a reserve. On today’s grid, limiting solar energy production for that purpose would misallocate the resource, but in a future characterized by high solar penetration, where curtailment is better tolerated, solar generators could be used in this manner.

H. NON-SPINNING RESERVES

TECHNOLOGIES NON-SPINNING RESERVE



BATTERY STORAGE Yes

INTERRUPTIBLE LOAD Yes

DIRECT LOAD CONTROL Yes



Generators capable of synchronizing with the grid to supply backup power in less than 10 minutes may provide non-spinning reserve service. Spinning and non-spinning reserves differ in three important

ways: synchronization, response time, and duration. Non-spinning reserves are not required to be synchronized prior to delivering service, do not have to respond as quickly, and may be required to provide service for a longer duration—up to four hours in some jurisdictions.

Battery storage, interruptible load, and direct load control resources may reliably provide non-spinning reserves in much the same manner as they do spinning reserve services. Behavioral load shaping, energy efficiency, and distributed solar power assets are not suited to the service. As mentioned above, solar with

advanced inverter functionality potentially could be curtailed to provide reserve capacity, although using it to for this service is not the most effective allocation of the resource.

9. “Prime mover inertia” is a property of spinning generators that provides a “stiffness” to the grid, allowing frequency, voltage, and other properties to resist abrupt changes. The prime mover refers to the rotor assemblies within generators powering the grid. Inertia is the tendency for objects in motion to remain in motion and objects at rest to remain at rest..

10 Hurley, Doug, Paul Peterson, and Melissa Whited. “Demand Response as a Power System Resource: Program Designs, Performance, and Lessons Learned in the United States.” Regulatory Assistance Project (RAP). May 2013


I. BLACK START

TECHNOLOGIES BLACK START (YES/NO)



BATTERY STORAGE Yes

INTERRUPTIBLE LOAD No

DIRECT LOAD CONTROL No



Generators that offer black start capability can start themselves without support from the grid and can also assist in starting other generators and transmission equipment.11

Battery storage could provide power in a black start situation, but only if the storage to be used is a higher-capacity installation that is interconnected at an appropriate location on the system. All other technologies listed are not capable of providing black start services. Using distributed assets for black start service would be challenging due to geographic limitations and the reactive power required for this service.

Looking Forward: Planning for the 21st Century Grid

The emergence of DERs, combined with the continuing, overall growth in renewable energy, has begun to alter utilities’ approach to ensuring reliability, and will continue to do so in the future. Generation portfolios are becoming less dispatchable and more distributed as wind and solar power grow, but energy storage and demand management strategies offer new tools and capabilities to firm these intermittent loads. DERs may provide an opportunity to operate a cleaner, more distributed grid, and, in some cases—such as advanced inverter functionality—superior solutions for ancillary services, such as voltage and frequency regulation.

Further, some services can be “stacked” to leverage multiple, simultaneous values from a single asset, and multiple technologies can provide similar services for a portfolio approach to reliability. Planning and operating the 21st-century grid will require a holistic approach to integrate all

grid assets on both sides of the meter. In order to successfully leverage these assets, managing data—from advanced metering infrastructure and distribution management platforms, for example—will be increasingly important.

Changes in wholesale power market rules and transmission and distribution planning indicate that DERs are already having a noticeable effect on many utilities today. The models derived from these programs and policies will continue to drive and shape the dialogue surrounding the future of utilities and the role of DER technologies.

As part of SEPA’s expanded mission, we will continue to explore the best practices, concepts, and projects that showcase the potential of DERs to reinvigorate utility business models. SEPA’s 51st State Initiative is just one of many efforts to facilitate these discussions.

11 North American Electric Reliability Corporation. NERC IVGTF Task 2.4 Report Operating Practices, Procedures, and Tools. 2011.

http://sepa51.org

http://sepa51.org

For further reading, check out other reports in SEPA’s Beyond the Meter series: “Beyond the Meter: The Potential for a New Customer-Grid Dynamic” and, in partnership with Nexant, “Beyond the Meter: Addressing the Locational

Valuation Challenge for Distributed Energy Resources”. These, and future reports in the series, will focus on three key themes:

1. Evaluating DERs as grid assets: Increasing the sophistication of grid planning and operational tools to account for potential system benefits from distributed energy resources (DERs) on a temporal and locational basis.

2. Integrating customer insights: Leveraging the increased segmentation of customer load profiles, propensity to adopt, and behavioral drivers to better evaluate the economic and achievable potentials of DERs.

3. Rewiring standard operating practices: Expanding planning processes across functional areas—system planning, resource planning, marketing, and regulatory affairs—to incorporate more robust and holistic deployment strategies.


REWIRING STANDARD

OPERATING PRACTICES

INTEGRATINGCUSTOMERINSIGHTS

EVALUATINGDERS AS

GRID ASSETS

"BEYOND THE METER:

THE POTENTIALFOR A NEW

CUSTOMER-GRID DYNAMIC."

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202-857-0898©2016 Smart Electric Power Alliance. All Rights Reserved.

beyond the meter · pdf filereport: derek kircher at dte energy; henry yoshimura at iso-new...

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