Different customers have different wants and needs, and customer segmentation strategies can help utilities understand those differences. But what’s the best way to define customer classes? And...
Active Demand Management
A system approach to managing demand.
be realized as real-time feedback control increases reliability and speeds up recovery.
As demand management continues growing as a feasible solution to our energy needs, it will convince consumers and producers to develop highly informed interactions between the supply system and demand components, creating more resilience in an electric grid with increased strength and security against brownouts, blackouts, and even attacks by hostile actors.
A wide variety of factors will become drivers for change in the electric power industry in the coming years. Demand for energy is predicted to grow quickly in the near future. In the next 10 years, power consumption across the United States is predicted to increase 19 percent, with an increase of 7 percent expected for transmission capacity on the grid. Additional investments in transmission and distribution will be required to meet the expected growth. However, building more transmission capacity and more high-voltage power lines will become costlier and more difficult from a permitting perspective.
Demand management is a complex prospect with many coordinated and cooperative components. For demand management to function properly, individual components need to function collectively. These components include valuation and rate design; smart grid dispatch; customer outreach, registration and management; billing engine additions; premier user portal and keeping the customer engaged; dispatch controllers for premises; controlling load at the customer premise—residential, commercial and industrial; and modeling, simulation, and time-of-use (TOU) pricing (see Figure 1) .
Other, less powerful demand management components include at-the-plug devices that turn off appliances when grid instability is sensed, and grid-smart appliances, which sense grid instability and regulate their own power usage. One specific example is a clothes dryer: When the dryer senses a problem with the grid, it will turn off its heating process while continuing to spin the clothes, until the instability has passed, and will then restart the heating process. This technology allows the grid to recover from several problems without inconveniencing the customer.
In a variety of tests, demand management has proved successful. These successes have been possible thanks to a wide range of decisions made and actions taken. Some of these include installing new electric meters and connecting thermostats, water heaters and dryers to a computer network that allows homeowners to customize how appliances function in terms of desired comfort levels or cost savings and with the ability to respond to changing electricity prices in five-minute intervals. The network software and meters can lower the temperature of a thermostat or water heater during times of peak activity and cost. Thanks to the software, customers are able to preview the financial implications of their efforts to control usage. The visible savings to customers is a key to the plan’s success. In one test, grid-friendly appliance controllers embedded in dryers and water heaters are able to detect and respond to stress in the electric grid. When stress is detected, the controllers turn off certain functions in appliances. These short disruptions in electricity consumption are often enough to balance out the instability between supply and demand on the electric grid. This allows the grid to recover