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Load as a Resource

Integrating controllable demand into real-time, security constrained economic dispatch.

Fortnightly Magazine - August 2012

system availability. This approach makes sense if load is assumed to be relatively inelastic. Under the traditional dispatch mindset, load is considered the last resource that will be used to reduce system peaks, because load curtailment is considered onerous and thus should be used sparingly. As a result of this approach, the ability to use load shifting and curtailment is limited to peak shaving, and even then, in most instances it occurs only on the highest volume days or when the grid approaches critical conditions.

Including dynamic load in the forecast and operations ensures that SCED achieves its economic and reliability objectives. (See Figure 1.) Integrating controllable demand into the dispatch queue on a regular basis has the effect of making the utility more efficient; a less costly resource is used in lieu of a more costly resource to serve load. And the more costly resource is now available to serve other loads, such as wholesale customers. The effect can be lower prices for native load and increased earnings for the utility—the typical result of genuine efficiency improvements.

The process of integrating controllable demand into the dispatch queue in a traditional integrated utility regime requires assigning a cost to the controllable load—in effect the payment required to the curtailing customer. In a competitive market, the demand resource submits a bid, and if it clears, it receives the clearing price. In both cases, the controllable load then fits into the dispatch queue at the appropriate place, dispatched after lower-priced generating units but before more-expensive units. Figure 2 illustrates a scenario where the generating units are serving an uncontrollable load amount of 669 MW. In this situation, only two of the four available sources are actually serving the load, making the marginal price equivalent to the second-least expensive unit—the units attached at bus A. But a different picture is portrayed in Figure 3, when demand injections—at buses B, C and D—are broken up into controllable and uncontrollable loads. The controllable amount of load has been lowered by 23 MW in each case to achieve a new marginal price equivalent to the least expensive unit—in this case, the unit attached to bus E.

Regulation and Controllable Demand

Including dispatchable load provides benefits in both traditional regulated and market environments. As noted, in a regulated, cost-based dispatch environment, controllable load can displace generating units with higher variable costs, such as fuel costs. In competitive markets, controllable load is dispatched only when it clears a competitive auction. Thus, it displaces a generating unit that bid a higher price. In a regulated environment, the benefit appears as a lower fuel clause component of the end user’s bill. In a competitive market, the benefit appears as a lower clearing price.

Other benefits associated with increased integration of controllable load include reduced operating expenses, reduced reserve requirements, improved reliability, and better integration of renewables as quick-responding load can be used to firm up intermittent generation resources.

Demand dispatch can be deployed for multiple utility purposes and under alternative regulatory scenarios. The use of CD in this fashion can defer or