DSM in the Future: Residential Sector Consideration Kevin Bright • September 17, 2014

NC

SC

FL

OH

KY

IN

Headquarters

− Total assets: ~$114 billion

− Market capitalization: ~ $48 billion

− U.S. generation capacity: ~ 58 GW

− Electric customers: 7.2 million

Largest Utility in the United States (1)

(1) Total assets, US generation capacity, and electric customers as of Dec. 31, 2012; market cap as of February 2013

(2) 2005 represents pro-forma regulated generation combining Duke Energy and Progress Energy. Crystal River 3 excluded from 2015. Assumes CR1-2

retirement, but does not assume replacement generation

55% 38%

Duke Energy

2

6 regulated and

geographically

diverse

jurisdictions

Duke Energy, at a glance

− Corporate – Charlotte, NC

− Regional Headquarters:

− Carolina’s – Raleigh

− OH/KY – Cincinnati

− Indiana – Plainfield

− Florida – St Petersburg

So why are utilities so concerned about this issue?

Utilities can satisfy peak demand by:

Purchasing on open market

Building peaking power plants

DR is a much less expensive option than the above 2 options

Supply – Demand imbalance occur all times of year

© 2012 Electric Power Research Institute, Inc. All rights reserved.

How Demand Response Programs Work

As the graph illustrates, Demand Response programs remove, or shed, the peak of the load curve (as shown in green)

Demand Response programs traditionally relied on physical control switches to cycle air conditioners/heat pumps.

By contrast, Energy Efficiency programs permanently lower the entire load curve

Energy Efficiency programs traditionally rely on equipment replacement and building envelope improvements

But there is an increasing convergence of Energy Efficiency and Demand Response programs, which is blurring previously clear lines.

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Demand and Competition is Growing

Adoption of “connected” devices continues to rise.

Over 300 companies are in this space today, competing for customers.

Most are being built on proprietary platforms

Communicating thermostats have become an entry point for home management.

The “connected home” is growing:

Lighting, security, appliances, locks, etc.

The smart phone is the catalyst for the home management market.

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Retailers Vendors

Value Added Bundlers

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Many Scenarios Exist for End Use Connectivity

Wide Range of Devices

• High energy consumers (HVAC, hot water heater)

• Low energy consumers (refrigerator, clothes washer)

• Evolving energy consumers (plug-in electric vehicles)

Various Participation by Utilities and Customers

• Customer participation will vary (single appliance, suite of appliances)

• Utility programs will vary (single/multiple appliances, price or interrupt signal)

• Timing will vary (program availability may not occur until a “winning technology” emerges)

Demographics and Regional Differences

• Different levels of “smart grid” deployment

• Various communication platforms - zigbee, wifi, PLC, etc

• Different penetration levels of customer broadband

No single design or solution can accommodate all of these variations

Customer

Premise

Renewables

ETHERNET SERIAL

COMMUNICATIONS NODE

• Linux OS • Java and C+ supported • 256+ MB memory • Powerful processor • Network mgmt

capabilities • DNP3 • Integrated security

Made by: Multiple Vendors

A communications node is the physical control, logical, and telecommunications hub for the grid.

Comm Node 3G/4G, WiFi, GPS

Ethernet, Serial

PLC, 900Mhz ISM

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RF or

PLC

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HōM™ Energy Manager Current Offer

An Open Platform to Maximize Customer Options

Open software platform, capable of supporting industry communication standards, 3 party devices, and quick/low cost integrations with new devices.

Single software application, reusable across multiple jurisdictions to enable speed to market.

Flexible device control/management options.

“Agile” software solution, providing means to adapt to market conditions and delivery new enhancements/offers quickly.

Cross-selling engine to promote programs across the portfolio.

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Smart Device Management

Enhanced Demand

Response

Data Analytics

Normative Comparisons

Tips Engine

Customers Information

Devices

Open Platform

The Portal Application

Compatible with all smartphones, tablets, and computers:

An app for your phone

A web portal for your computer

Access to all features and information, anytime anywhere:

Thermostat settings

Schedule

Tips

Energy comparisons

One or two touches/clicks for all features.

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It’s smart. It’s easy. It’s secure.

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HōM™ Energy Manager Future

Next Up!

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Recent additions:

Post-installation survey functionality.

Tip management/sorting.

Tip acceptance % and cost/efficiency information.

Thermostat tip “try it” feature.

Coming in Q4:

Scoring feature – gamification of energy efficiency.

Expanded survey engine

Expanded thermostat preset options

“Nudge” Tip

Demand Response Upsell Tip

Available in 2015

2 new thermostat options

Water heater/pool pump control switches

CEA 2045 certified water heater

Close, but not quite yet

Thermostats today, but HōM™ Energy Manager is a growth platform.

Device agnostic

Water heaters, pool pumps, other appliances, lighting, security

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Thank you!

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