The Federal Energy Regulatory Commission (FERC) has agreed to set a hearing on the reasonableness of American Electric Power Co.'s (AEP) nonfirm, offpeak hourly rate for electric transmission...
IT Roundtable: The Digitized Grid
of the aggregate residential refrigerator load is being created by defrost cycles. There's no reason to do that on peak, but the refrigerator is just too dumb to know that. It doesn't even have a clock.
You don't even need connectivity to reduce the peak refrigerator load by 7 percent. All you need is a battery-backup clock that tells refrigerators not to defrost during peak periods.
Fortnightly: This sounds like a good idea that will be difficult to implement. How are manufacturers and utilities responding to it?
Pratt: It's an idea that is foreign to both groups. Bringing them to the table has been a challenge, but we've been engaged for a couple of years and have made quite a bit of progress. We're working with one manufacturer quite closely, and we are starting a demonstration of the technology in the Pacific Northwest. An appliance manufacturer will build integral control capabilities into appliances and deploy them in places on the grid where we can measure the response of the appliances. Manufacturers are happy to put them in, but they need someone to pay them to do it. We don't want consumers making that decision, because they don't care about energy efficiency. You can appeal to patriotic goodwill, but it's far more effective to just get it built into every appliance sold in America. One way to accomplish that would be brute force; pass a law and make it part of efficiency standards. But that's not the way the world works anymore. So the real trick is getting grid operators to pay for having it installed in appliances.
The grid operators-the ISOs and utilities-are the ones who benefit. They gain by having a grid that is easier to control and not needing to have as many power plants on standby.
Utilities will go along if we can get regulators to cooperate. Utilities need to get credit for making these kinds of investments just as if it were a power plant. If it is equally prudent, they deserve to earn a return on it. If not, we take away the benefits of innovation.
Fortnightly: What else are you working on in the GridWise Alliance?
Pratt: The grid-friendly appliance is just one example of how an information technology can flip something completely on its head. There's a tipping point where transformative technologies and regulatory policies will change the paradigm of how we operate the power grid.
One example we are looking at is transactive control. Process control and energy management systems in large commercial or industrial facilities don't take the cost of energy into account. They have closed-loop control algorithms. In a commercial building where you are cooling certain spaces, the thermostat never bothers to explain to the energy management system how badly it needs cooling. It just whines until it gets it. If you can teach those processes to bid for services, you can change the way the control system behaves and price signals will go right through the premise boundary and into the control system. You just need new software, not a whole