Transcript IEA Demand Response Economic Working Group Meeting, …

National Town Meeting on
Demand Response
Session A – Estimate It, Measure It, Verify It
Demand Response Coordinating Committee (DRCC)
Renaissance Washington Hotel
Washington, DC
June 2-3, 2008
By: Daniel Violette, Ph.D.
Summit Blue Consulting
Boulder, Colorado 80302
E-mail: [email protected]
1
Recent Trends in DR
•
•
Six trends should increase the dispatchability and reliability of DR programs –
four are discussed here:
1.
Increased automation of a customers’ load response.
2.
Increased focus on firm reductions in DR programs.
3.
More accurate estimation of delivered load impacts.
4.
Challenges in estimating DR Potential in markets.
5.
Diversification in program participation and management of large customer impacts.
6.
Target marketing of DR to provide higher benefits.
Situation Assessment:
– Currently facing increases in plant capital costs and fuel prices -- along with
needed expenditures on infrastructure (T&D as well as fuels transportation).
– May mean that the traditional approach to meeting future growth in electricity
will not work -- Unlike the past, the industry may not be able to just build its
way out of future supply issues.
–
An increased ability for the demand-side of the market to respond to price and
resource scarcity will help ensure overall market efficiency.
2
Trend 1: Increased Automation of DR
•
Residential loads are already largely automated through DLC
programs.
•
C&I field information:
– The fraction of load that is “automatically controlled” is increasing.
– Approximately 50% of loads have been automated in recent years with
70% of new loads being automated.
– C&I auto-DR rely on buildings that have EMCS that can be used to
control space conditioning, lighting, and other end-uses.
– Often the load sheds are designed to not impact building or facility
comfort or operations.
– Need to be able to appropriately value short-response DR, i.e. 10minute availability, versus longer notice DR.
•
Implication – Synergies between DR and EE programs that address
the EMSC system such as C&I new construction, retro-commissioning,
or major retrofit programs can produce load-shed capabilities.
3
Trend 2: Growing Focus on Firm Reductions
•
Increased emphasis on DR that provides firm capacity to
qualify DR for capacity deferrals and T&D deferrals.
– Can involve financial penalties (but in new ways).
– Not being paid for partial reductions that fall under the target.
– Contributions may be derated due to underperformance.
– Some customers may be dropped from programs if there is not a
good fit.
•
Operational protocols that call for testing of DR program
response to accredit MW in a DR program.
•
Aggregators seeking to provide highest value DR and are
using approaches that make DR a firm resource.
•
Managing the risk of under performance of DR is improving
with more aggregators signing firm contracts.
4
Trend 3: Accurately Estimating Impacts
•
Calculating overall program impacts and settlements for customers
participating in DR programs is becoming more sophisticated.
•
This includes the use of different baseline options:
– Different baselines for different customer segments within a program.
– Increasing recognition that a single method for estimating impacts will not
apply equally well to all customers.
– Programs are already taking this into account.
•
Better baseline methods are being used that are not limited to the
traditional “10-day before data.”
– Data from both before and after an event are being used, as well as data
from the entire season before an event.
•
Planners may want the best program-wide, locationally-based estimates
of impacts as possible.
– Regression analysis on full season of load data may provide better program
impact estimates – but, this method generally will not be appropriate for
customer settlements as part of a DR program design.
5
Note on Estimating DR Potential
•
Estimating the potential for energy efficiency (EE) is a mainstream
planning activity for EE program design.
•
EE and DR pose different challenges for potential estimation:
– The interpretation and calculation of certain benefit-cost tests in potential
studies have different meanings for EE and DR.
– The standard EE approach is to estimated Technical Potential, Economic
Potential and Market (or Achievable) Potential.
– This can work for DR, but economic potential can be more difficult to assess:
♦
A customer’s DR potential is often determined by their operational flexibility
and behavioral factors whose economics are hard to quantify.
♦
Unlike EE, DR cannot generally assume that service levels are constant.
♦
Estimating the value of lost loads to a customer can pose challenges.
– A number of DR potential studies have estimated technical potential by
“customer type” and then move directly to achievable potential based
on observed market data for each customer type.
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