Batteries to Become Important Part of the Grid

The electric grid is a complex machine that has been developed since its inception to become more and more reliable. One way utilities have been able to uphold this standard is by getting energy from power plants that churn out a consistent and predictable level of electricity. However, emerging renewable energy technologies do not. Sometimes the wind blows, sometimes the sun shines.

Utility sized battery storage is becoming an increasingly sought after piece to America's energy puzzle. Large scale grid storage would allow utilities to "smooth" energy fluctuations. The poles and wires of the grid can neither have too much electricity or too little. The batteries would allow an opportunity for grid operator to store excess energy or use the stored power to cover any spikes in demand.

The question going forward is not if, but how it is going to look. Two options have begun to emerge with pilot projects testing their respective feasibility. One option is to build a large scale battery (generally made from a lot of smaller batteries) like A123's 8 MW battery. The other is a distributed network of batteries that could cover a single neighborhood which would create a much more nimble and faster acting more customized problem averting system.

Utilities in Illinois purchase their electricity on a real-time market similar to what you'll see for Power Smart Pricing customers. Just like our program, one way to lower your costs for electricity is to take advantage of lower priced hours. Putting batteries onto the grid would create a cost saving opportunity to recharge a battery at night when prices are the lowest, then that stored energy could underbid any of the electric generation that is occurring during a demand peak.

To learn more A123's massive battery, click here.
To learn more about the distributed battery model click here.

What if we all had RTP?

As a recipient of ARRA smart grid funds, Burbank Water and Power in California is set to automatically switch some of its largest residential customers to time-of-use rates. In all, BWP is installing 77,000 smart meters provided by Trilliant, a leading smart grid start up company. Households getting the new meters whose energy usage is greater than 250 kilowatts a month will be placed on time-of-use rates.

It will be essential for the program administrators to accurately educate their new crop of participants on how to take advantage of the potential benefits as well as limit any ideas that they are guaranteed. Initially, fear of the unknown will be a difficult hurdle to cross. However acceptance will come as soon as savings are understood and realized. This takes work from both engaged and educated participants to administrators who must be determined to figure out just how to engage and educate.

This initiative begs to ask the wider question, what if the rest of the country was automatically switched to real-time pricing?

Overall, it would be a great. One thing that Power Smart Pricing has shown is that participants with all types of housing size, hvac equipment, and usage have enjoyed savings. Some households would be better off than others, and surely there would be people who end up spending more, but in general America's bills would go down. The price curve would flatten and be less volatile as there would be more conservation during higher prices and more usage during lower priced hours.

Appliances would see a new era of innovation. Consumers would demand products that could react and shift to changing price demands. Products like the commercial-centric Ice Bear from Ice Energy that cools ice over night during cheaper evening prices to then use as an alternative to the expensive compressor during the peak afternoon periods would be more refined and aimed at homeowners.

This change would bring energy consumption closer to energy costs. The electricity market would be a vastly different stage. Again, we must commend our Power Smart Pricing participants as catalysts for more and more experimentation and confidence in the area of real-time pricing. Much of the consumer benefit of the expanded information with the smart grid depends on this pricing choice. The Burbank project will be closely watched.

Weighing in on Smart Grid Stimulus

CNT Energy's Director of Policy and Evaluation, Anthony Star, wrote up a great piece for GE's smart grid blog on how the new funds have made "getting dynamic pricing right... more important now than ever."

There are several reasons that I am nervous about this large increase in the availability of dynamic pricing. One of our key findings has been that it is essential to think about dynamic pricing from the consumer’s point of view.

The article goes on to describe how our organization feels an effective dynamic pricing program should be run. It took us a long time and a lot of effort to figure out the best methods. The smart grid funds mark a time when a lot of different utilities across the country will be introducing dynamic pricing to their customers. If it is done right, then a lot of people (just like our Power Smart Pricing customers) will benefit from finding a new way to think about their electricity use. If not, preconceptions and apprehension about something new and different can bring the opposite effect.

Read Anthony's GE post "Why Getting Dynamic Pricing Right is More Important Than Ever."

DOE Smart Grid Funding is Announced

This morning the Department of Energy announced the recipients of the $3.4 Billion allocated for 100 smart grid projects through the ARRA. Overall the funding will lead to the installation of 18 million smart meters, 1 million in-home energy management displays, 170,000 smart thermostats, as well as advanced transformers and load management devices.

While this is a major day for the smart grid on a national scale, it is unfortunate that neither of the major Illinois utilities were among those chosen to receive funds. The competition was incredibly fierce. Of the 400 applicants only 100 projects will see their projects funded through the grant.

Alongside the $3.4 billion set aside by the federal government, $4.7 billion in private funds will contribute to a total of $8.1 billion. This is quite an investment for an emerging field. Smart grid projects are still new and today is a day that will surely mark its true arrival.

Many of the projects include a dynamic pricing option where customers will pay for electricity on a rate that varies across each day and provides incentives to manage peak electric demand. Some projects even include a real-time pricing model like Power Smart Pricing where that rate will be based on the wholesale electricity market prices.

Here in Illinois we have seven years of experience of how to get the consumers, environmentalists, citizen watchdog groups, utilities, and governments all on board with dynamic pricing. This was not achieved by a chanced interaction between a group of like minded people. All parties had their input, and thus a mutually agreed upon consumer-centric approach has been successful. Nationwide roll outs of these programs need to be handled with care, and they need to focus on making it easy for the consumer.

Click on the map to open a pdf.

For more details, you can see lists of the smart grid projects by category (pdf), by state (pdf).

GE Continues Smart Grid Push

GE has launched a new website called itsyoursmartgrid.com.  Ever since their very inventive "If I only had a Brain" Super Bowl ad GE has led an engaging marketing campaign informing the public on the benefits of a smart grid. I could go on, but no one says it better than our own Anthony Star, "The easily understood, educational content on itsyoursmartgrid.com provides information in a simple, straight-forward manner that I've yet to find elsewhere on the Web."

Anthony is the Director of Policy and Evaluation here at CNT Energy and much of his recent work has been centered around shaping future smart grid policy in conjunction with many of the leading professionals in this emerging field. Over the past week, this influential conversation has taken place at the premier smart grid conference called Gridweek in Washington, DC. Keynote addresses were given by Secretary of the US Department of Energy Stuven Chu, and Secretary of the US Department of Commerce Gary Locke.

While experts of energy and policy can discuss the finest elements of the smart grid for an entire week using the latest industry terminology, it takes an entirely different effort to communicate its potential to the average person. GE has continued to refine and enhance its message using the web to engage potential users of this technology about its many benefits. Check out the GE's video accompanying the launch of the website.



Learn (much) more at itsyoursmartgrid.com.
GE's official press release.