1 International Experience in Demand Side Management Dr David Crossley Managing Director Energy Futures Australia Pty Ltd India Electricity Conference New Delhi, 20 September 2007
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
1
International Experience in Demand Side Management
Dr David CrossleyManaging Director
Energy Futures Australia Pty Ltd
India Electricity ConferenceNew Delhi, 20 September 2007
2
Presentation Topics
25 years of demand side managementEnvironmentally-driven DSMNetwork-driven DSMMarket-driven DSMConclusionsInformation resources
3
25 Years ofDemand Side Management
4
What is Demand Side Management?
In the electricity industry, ‘demand side management’ (DSM) is used to refer to actions which change the demand on the electricity system, including:
actions taken on the customer side of the electricity meter(the ‘demand side’), such as energy efficiency measuresarrangements for reducing loads on request, such as interruptibility contracts, direct load control and demand responsefuel switching, such as changing from electricity to gas for water heatingdistributed generation, such as stand by generators in office buildings or photovoltaic modules on rooftops; andpricing initiatives, including time of use and demand-based tariffs
5
Origins of DSM (1)
The term “demand side management” (DSM) was introduced to the electricity industry in 1981 by Clark Gellings, a senior executive at the Electric Power Research Institute (EPRI) in the United StatesGellings coined the term to describe measures taken by electricity utilities to influence the way end use customers purchase and use electricityDSM measures are designed to influence and, if necessary, change customer behaviour to achieve benefits for both the customer and the electricity industry
6
Origins of DSM (2)
Clark Gelling’s Conceptualisation of DSM (1981)
7
Types of DSM
There are three types of DSM based on the overall purpose of the DSM program:
Environmentally-driven – achieves environmental and/or social goals by reducing energy use, leading to increased energy efficiency and/or reduced greenhouse gas emissions Network-driven – deals with problems in the electricity network by reducing demand in ways which maintain system reliability in the immediate term and over the longer term defer the need for network augmentationMarket-driven – provides short-term responses to electricity market conditions (‘demand response’), eg by reducing load during periods of high market pricescaused by reduced generation or network capacity
8
Interactions between DSM Types
Environmentally DrivenEnvironmentally Driven
Network DrivenNetwork Driven
MarketMarketDrivenDriven
Energy Efficiency and/orDemand Side Abatement
Network-specific Demand Reduction
Demand Response
9
Characteristics of DSM
Timing – DSM programs may be designed to achieve specific outcomes at particular times of dayPre- or post-contingency – DSM programs may be designed to achieve specific outcomes either prior to a contingency or in response to a particular eventGeographical locations – DSM programs may be targeted to specific locations, eg
whole networknetwork regionsnetwork element
Market segments – DSM programs may be targeted to specific segments, eg residential, commercial orindustrial customer classes
10
Changing Nature of DSM
Early DSM programs were broadly-targeted and environmentally-drivenCurrently, this type of DSM program is used mainly for abatement of greenhouse gas emissionsThere is also a new generation of DSM programs which are more narrowly targeted with very specific objectives, comprising mainly network- and market-driven DSMNetwork-driven DSM is currently growing in importance in many countriesIndia (BEE) has recently joined an International Energy Agency multi-national research project on network-driven DSM
11
Environmentally-Driven DSM
12
North American Experience
From the mid-1980s to the mid-1990s, regulators in the United States and Canada imposed stringent requirements on electricity utilities to undertake DSM DSM was seen as being more cost-effective than supply-side resources and it also provided environmental and social benefitsCost-effectiveness of supply-side and demand-side options was analysed from the societal perspective and utilities were required to directly fund cost-effective DSM programsElectricity planning in the US became a highly legalistic process with armies of lawyers arguing about what should and should not be included in cost benefit analyses
13
Espanola Power Savers Project (1)
The Espanola Power Savers Project was a community-based energy efficiency project which aimed to extract the maximum possible reduction in electricity consumption from a geographically concentrated areaThe project was undertaken between 1991 and 1993 in Espanola, a small town in north eastern Ontario, Canada and was implemented by the local utility Ontario HydroThe Espanola Power Savers Project was carried out in both the residential and commercial sectors through:
implementing concentrated marketing campaigns;carrying out comprehensive energy audits; andproviding incentives for the installation of energyefficiency measures
14
Espanola Power Savers Project (2)
The project design included a market saturation approach to elicit attitudinal and behavioural change that optimisedenergy savings and then maintained the energy efficiency built into the community The aim was to achieve a long-term "culture shift" by:
saturating a specific geographic area with energy saving information and advice;attracting high levels of interest and participation;encouraging community leaders to champion the project;leaving the knowledge and skills within the community to promote sustained efficient energy use
Challenge was to motivate all Espanola residents to change attitudes and make energy-saving a habit
15
Espanola Power Savers Project (3)A detailed marketing/communication plan was developed and implemented, including:
the formation of a Community Advisory Committeeproject newsletters, radio/newspaper advertising and cable TV community service announcementselectricity bill inserts and direct mailopen house/information nights and presentations to community organisations and the municipal council an energy conservation week, picnics and displayshigh school presentations and a curriculum based energy conservation educational packagea spring writing contest and a logo/slogan contestEnergy Conservation Comer in the public libraryan energy saving tips contest
16
Espanola Power Savers Project (4)The Espanola Power Savers Project achieved an overall very high 86% participation rate, defined as the number of energy audits completed compared to the total eligible sitesOf the customers who underwent an energy audit, an overall 91% accepted at least one measure from the list of measures recommended by the auditorThe accepted measures represented 71% of the total estimated energy savings from all the recommended measuresThe average load reduction achieved per site was1.2 kilowatts
17
Decline of DSM in the US
Opponents of DSM in the United States argued that all electricity customers were paying for DSM programs whether or not they received benefits from the programsFrom the mid-1990s, electricity regulators in the US began to turn their attention away from DSM and towards electricity market reformWithout the regulatory imperative, US utilities very quickly dropped or substantially reduced their DSM programsHowever, policymakers in many US states that adopted electricity industry restructuring also created public benefits funding mechanisms to help ensure the continued implementation of broadly-targeted, environmentally-driven DSM programs
18
18
Total Utility Cost
0
500000
1000000
1500000
2000000
2500000
3000000
3500000
90 91 92 93 94 95 96 97 98 99 00 01 02 03
Year
Cos
t
Total Utility Cost
Total Utility Cost
Year
Cost
In
Dollars
Data from USDOE, EIA
19
States with Public Benefits Energy Efficiency Programs
No public benefit funding for energy efficiency
States with public benefit funding for energy efficiency
Not in ACEEE study
Source:
20
Experience in Other Countries
No other countries have developed as extensive environmentally-driven DSM programs as in the United States and CanadaSome countries, eg Australia, Denmark, Korea, Norway, Thailand, United Kingdom, Vietnam have developed smaller DSM programsIn those countries where competitive electricity markets have been introduced, interest in environmentally-driven DSM programs has been sharply reducedSome DSM programs have continued, supported by dedicated non-utility funding, eg some Australian states, Norway, United Kingdom, Thailand
21
DSM for GHG Emissions Abatement (1)
DSM MeasuresImplemented primarily to assist and improve the operation of electricity systems. Any impacts (positive or negative) of DSM measures on climate change are very much a minor consideration, if they are considered at all.
Climate Change MeasuresEmission mitigation measures focussed on increasing end-use efficiency usually do not consider any benefits to the electricity system (eg peak load reduction) that might be gained through implementing the measures.
22
DSM for GHG Emissions Mitigation (2)
The challenge is to reconcile these two different approaches so as to identify areas and
circumstances in which DSM can contribute to mitigating greenhouse gas emissions
The International Energy Agency DSM Programme is currently considering a multi-national research project to investigate this
23
Network-Driven DSM
24
Network-Driven DSM (1)
DSM targeted to relieving network constraints has been implemented in the United States since the mid-1980sHowever, until the late 1990s, only a few specifically network-driven DSM programs had been developedMore recently, as problems with ageing network infrastructure become more apparent, increasing numbers of network-driven DSM programs are being implemented in several countries
25
Network-Driven DSM (2)Sydney West Bulk Supply Point Load Profile
26
Network-Driven DSM (3)
The current International Energy Agency research project classified network-driven DSM projects by the major DSM measure implemented:
distributed generation, including standby generation and cogenerationenergy efficiencyfuel substitutionintegrated DSM projectsload management, including interruptible loads, direct load control and demand responsepower factor correctionpricing initiatives, including time of use and demand-based tariffs
27
LIPAedge Direct Load Control Program (1)
The LIPAedge program is the largest residential/small commercial direct load control program using two-way communication in the United StatesLong Island Power Authority (LIPA) uses central control of thermostats in air-conditioning to achieve peak load reductionsCarrier EMi thermostats are used in the LIPAedgeprogram; they are programmable both locally and remotely through the internet; two-way communication is byradio pagingTwo-way communication allows LIPA to monitor capability and response; it also enables customers to control their individual thermostats via the internet, a benefit that motivates customer to participate in the program
28
LIPAedge Direct Load Control Program (2)
Carrier EMi ThermostatWeb-based User Interface
29
LIPAedge Direct Load Control Program (3)
Customers receive a thermostat and installation free of charge, plus a one-time bonus payment of USD 25 (residential) or USD 50 (small commercial)Customers agree to have their central air conditioning systems adjusted between 2 pm and 6 pm for a maximum of seven days throughout the four month summer seasonCustomers have access to a dedicated web page for their thermostat and are able to remotely change the set point of their air conditioner at any timeAbout 20,400 residential and 3,000 commercial and small industrial customers are enrolled in the LIPAedge program, delivering about 25 MW of peak load reduction
30
LIPAedge Direct Load Control Program (4)
The LIPA system operator uses a web-based control system; two-way pagers are used to transmit curtailment commands to 20,000 thermostats and to receive acknowledgment and monitoring informationFor a summer load curtailment, the system operator might send a command at 9:00 am directing all thermostats to move their set points up 4 degrees, starting at 2:00 pm and ending at 6:00 pmAlternatively, the system operator could send a command directing all thermostats to completely curtail immediatelyCommands are received and acted upon by all loads, providing full response within about 90 seconds; in contrast a generator response requires a 10-minute ramp time
31
LIPAedge Direct Load Control Program (5)
32
Current Situation with Network-driven DSM
Implementation of network-driven DSM is increasing rapidly, particularly in countries with major peak load problems (often caused by increasing use of air conditioning)The IEA DSM Programme research project on network-driven DSM commenced with four countries participating: Australia, France, Spain and the United StatesRecently, three more countries have joined: India, New Zealand and South Africa
33
Market-Driven DSM
34
Market-Driven DSM (1)
The introduction of competitive electricity markets in some countries has led to a major increase in the implementation of market-driven DSM, particularly demand response programsMarket-driven DSM provides short-term responses to electricity market conditions (‘demand response’), eg by reducing load during periods of high market prices caused by reduced generation or network capacity
35
Market-Driven DSM (2)Demand response works in much the same way as interruptibility with the following differences:
in addition to reduced electricity prices, customers may receive payments for both the availability of demand response and for the load reductions actually achieveda third party aggregator often enrols customers in the demand response program and maintains communication with both the system operator and the customercommunication between the system operator, the third party aggregator and the customer is usually automatedremote meter reading and telemetry enable all parties to see the impact of demand response actions in nearreal time
36
System Operator initiatesrequest for Demand Response
Communications system alerts Third Party Aggregator to request
Facilities Manager receives message from Aggregator and instructs staff to implement load reduction procedures
Meter records load every 5 minutes and reportsdata to all parties
All parties see impactsfrom Demand Response in real time
Demand Response Process
37
New England DR Program (1)
This demand response program is implemented by the New England Independent System Operator (ISO)Commercial and industrial electricity users receive incentive payments if they reduce their electricity consumption or operate their own electricity generation facilities:
in response to high real-time prices in the wholesale electricity market; orwhen the reliability of the region’s electricity network is stressed
An interval meter is required to participate in most of the ISO-NE demand response programs
38
New England DR Program (2)
ISO-NE has about 200 commercial and small industrial customers enrolled in demand response programs and the programs achieve about 100 MW of peak load reductionISO New England customers who wish to participate in a demand response program can do so through an Enrolling ParticipantEnrolling Participants can be local utilities and energy suppliers or Demand Response Providers
39
New England DR Program (3)
Demand Response Providers are companies that provide technology and services to help customers participate in the demand response programsEnrolling Participants are responsible for helping customers identify the demand response program that is most suitable for their operation and enrolling them with ISO New EnglandISO New England makes incentive payments to Enrolling Participants who then share the incentives with their customersEnrolling Participants may also offer other incentives and services to customers
Actions Undertaken if Asked to Curtail
0%
10%
20%
30%
40%
50%
60%
Reducedlighting
AdjustedHVACtemps
Adjustedrefrig equip
Turned offoff ice equip
Turned offfans/pumps
Turned offelevators
Operatedgenerator
Shift mfgprocesses
Other actiontaken
Reliability Programs (N=28)Non-Participant (N=11)Price Response (N=49)
0
20
40
60
80
100
120
140
11:0
0
11:0
5
11:1
0
11:1
5
11:2
0
11:2
5
11:3
0
11:3
5
11:4
0
11:4
5
11:5
0
11:5
5
12:0
0
12:0
5
12:1
0
12:1
5
12:2
0
12:2
5
12:3
0
12:3
5
12:4
0
12:4
5
12:5
0
12:5
5
13:0
0
13:0
5
13:1
0
13:1
5
13:2
0
13:2
5
Time
MW
Reduction MW Enrolled MW
Notice sent at 10:45 a.m.Event Started at 11 a.m.Resources had 30 Minutes to RespondEvent ended at 1:30 p.m
August 20 2004 Test Performance – All Resources
0
20
40
60
80
100
120
11:0
0
11:0
5
11:1
0
11:1
5
11:2
0
11:2
5
11:3
0
11:3
5
11:4
0
11:4
5
11:5
0
11:5
5
12:0
0
12:0
5
12:1
0
12:1
5
12:2
0
12:2
5
12:3
0
12:3
5
12:4
0
12:4
5
12:5
0
12:5
5
13:0
0
13:0
5
13:1
0
13:1
5
13:2
0
13:2
5
Time
MW
Reduction MW Enrolled MW
August 20 2004 Test Performance – Emergency Generation Only
0
5
10
15
20
25
11:0
0
11:0
5
11:1
0
11:1
5
11:2
0
11:2
5
11:3
0
11:3
5
11:4
0
11:4
5
11:5
0
11:5
5
12:0
0
12:0
5
12:1
0
12:1
5
12:2
0
12:2
5
12:3
0
12:3
5
12:4
0
12:4
5
12:5
0
12:5
5
13:0
0
13:0
5
13:1
0
13:1
5
13:2
0
13:2
5
Time
MW
Reduction MW Enrolled MW
August 20 2004 Test Performance – Load Reduction Only
44
Current Situation with Market-driven DSM
Implementation of market-driven DSM is currently largely restricted to regions in North America where competitive electricity markets have been introducedHowever, as more competitive markets are established, implementation of market-driven DSM is expected to increase
45
Conclusion
46
Conclusion
Since 1981, DSM has changed markedly, adapting and adjusting as the electricity industry in many countries moved from the centrally planned provision of a public service to the supply of a tradeable commodity in competitive marketsIn particular, DSM programs have become more narrowly-targeted with very specific objectivesHowever, the main goal of DSM programs is still to influence the electricity-using behaviour of end-use customers to ensure that the objectives of the programs are achieved
47
Information Sources
David Crossley: [email protected] of documents on DSM and energy efficiency in Australia are available at my company’s website: www.efa.com.au/dsmdocs.htmlThe International Energy Agency DSM Programme carries out multi-national research projects on DSM. Website for information about the IEA DSM Programme: www.ieadsm.orgThe IEA DSM Programme is currently undertaking a research project on network-driven DSM. Website for information about this project: www.ieadsm.org/ ViewTask.aspx?ID=16&Task=15&Sort=0
Related Documents
