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The coming together of the Internet of Things and Smart Grids

I was asked to speak at the recent SAP TechEd && d-code (yes, two ampersands, that’s the branding, not a typo) on the topic of the Internet of Things and Energy.

This is a curious space, because, while the Internet of Things is all the rage now in the consumer space, the New Black, as it were; this is relatively old hat in the utilities sector. Because utilities have expensive, critical infrastructure in the field (think large wind turbines, for example), they need to be able to monitor them remotely. These devices use Internet of Things technologies to report back to base. this is quite common on the high voltage part of the electrical grid.

On the medium voltage section, Internet of Things technologies aren’t as commonly deployed currently (no pun), but mv equipment suppliers are more and more adding sensors to their equipment so that they too can report back. In a recent meeting at Schneider Electric’s North American headquarters, CTO Pascal Brosset announced that Schneider were able to produce a System on a Chip (SoC) for $2, and as a consequence, Schneider were going to add one to all their equipment.

And then on the low voltage network, there are lots of innovations happening behind the smart meter. Nest thermostats, Smappee energy meters, and SmartThings energy apps are just a few of the many new IoT things being released recently.

Now if only we could connect them all up, then we could have a really smart grid.

The slides for this talk are available on SlideShare.

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GE’s 2014 Digital Energy conference

MedPanTuesday-6

GE held their annual International Digital Energy Software Summit in Rotterdam this year. They asked me to speak on a panel titled “The Grid of Tomorrow… the challenge of integrating renewables and distributed generation on the grid“. One of the reasons they invited me to present is because of the many posts I have written, and talks I have given on what I have termed Electricity 2.0 over the years.

The Electricity 2.0 vision I have espoused is one where, to help balance the grid and enable greater penetration of renewables onto it, in-home appliances would listen to realtime energy price signals from the grid and adjust their behaviour accordingly. They would come on at times of low demand, and reduce their consumption at times of high demand.

Obviously not all loads in the home are movable. If you have your evening meal at 8pm every night, you are not going to change that just because there’s a higher load on the grid. However, many in-home loads are eminently movable. Washing/drying of clothes, or dishes, for example; heating water in an immersion too is generally movable, as can be aircon or cooling fridges/freezers.

When I first started talking about these possibilities in 2006, it seemed a fantastical, impossible notion. But now that we’re in 2014, the Internet of Things is well established, and I can control the lights in my home from anywhere in the world using my phone, that dream is now a lot closer to being realised.

One company, almost uniquely in a position to deliver on that vision is GE, given that they manufacture everything from wind turbines, to sub-stations, all the way down to the appliances in the home which need to respond to grid signals.

During the panel discussion we talked about many aspects of smart grids, the utilities rolling them out, and the regulations which they are bound by. We also went into some detail on the newer technologies that are emerging, particularly as they pertained to electric vehicles, vehicle to grid, and storage in general.

And finally the panel felt that utilities will need to be far more open to change than they traditionally have been. The markets are changing, customers are changing, and the technologies are changing. Utilities are extremely risk averse and therefore slow to change, however the risk for utilities now is if they don’t move with the times, they’ll be left behind.

This conclusion was confirmed by two data points this week:

  1. Wind energy is now cheaper than coal, according to European utility EDP, and
  2. this week when Barclays downgraded the entire electric sector of the U.S. high-grade corporate bond market.

From Barclays credit strategy team:

Electric utilities… are seen by many investors as a sturdy and defensive subset of the investment grade universe. Over the next few years, however, we believe that a confluence of declining cost trends in distributed solar photovoltaic (PV) power generation and residential-scale power storage is likely to disrupt the status quo. Based on our analysis, the cost of solar + storage for residential consumers of electricity is already competitive with the price of utility grid power in Hawaii. Of the other major markets, California could follow in 2017, New York and Arizona in 2018, and many other states soon after.

In the 100+ year history of the electric utility industry, there has never before been a truly cost-competitive substitute available for grid power. We believe that solar + storage could reconfigure the organization and regulation of the electric power business over the coming decade. We see near-term risks to credit from regulators and utilities falling behind the solar + storage adoption curve and long-term risks from a comprehensive re-imagining of the role utilities play in providing electric power.

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Here comes the sun… IBM and solar forecasting

Concentrating solar power array

For decades now electricity grids have been architected in the same way with large centralised generation facilities pumping out electricity to large numbers of distributed consumers. Generation has been controlled, and predictable. This model is breaking down fast.

In the last decade we have seen a massive upsurge in the amount of renewable generation making its way onto the grid. Most of this new renewable generation is coming from wind and solar. Just last year (2013), almost a third of all newly added electricity generation in the US came from solar. That’s an unprecedented number which points to a rapid move away from the old order.

This raises big challenges for the grid operators and utilities. Now they are moving to a situation where generation is variable and not very predictable. And demand is also variable and only somewhat predictable. In a situation where supply and demand are both variable, grid stability can be an issue.

To counter this, a number of strategies are being looked at including demand response (managing the demand so it more closely mirrors the supply), storage (where excess generation is stored as heat, or potential energy, and released once generation drops and/or demand increases), and better forecasting of the generation from variable suppliers.

Some of the more successful work being done on forecasting generation from renewables is being undertaken by Dr Hendrik Hamann at IBM’s TJ Watson Research Center, in New York. Specifically Dr Hamann is looking at improving the accuracy of forecasting solar power generation. Solar is extremely complex to forecast because factors such as cloud cover, cloud opacity and wind have to be taken into account.
IBM Solar Forecaster
Dr Hamann uses a deep machine learning approach to tackle the many petabytes of big data generated by satellite images, ground observations, and solar databases. The results have been enviable apparently. According to Dr. Hamann, solar forecast accuracy using this approach is 50% more accurate than the next best forecasting model. And the same approach can be used to predict rainfall, surface temperature, and wind. In the case of wind, the forecast accuracy is 35% better than the next best model.

This is still very much a research project so there is no timeline yet on when (or even if) this will become a product, but if it does, I can see it being an extremely valuable tool for solar farm operators (to avoid fines for over-production, for example), for utilities to plan power purchases, and for grid management companies for grid stability purposes.

The fact that it is a cloud delivered (pun intended, sorry) solution would mean that if IBM brings it to market it will have a reduced cost and time to delivery, bringing it potentially within reach of smaller operators. And with the increase in the number of solar operators (140,000 individual solar installations in the U.S. in 2013) on the grid, highly accurate forecasting is becoming more important by the day.

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The Internet of Things is bringing Electricity 2.0 that much closer

One of the reasons I started working with GreenMonk back in 2008 was that James heard my Electricity 2.0 vision, and totally bought into it.

The idea, if you’re not familiar with it, was that as smart grids are deployed, homes will become more connected, devices more intelligent, and home area networks would emerge. This would allow the smart devices in the home (think water heaters, clothes dryers, dish washers, fridges, electric car chargers, etc.) to listen to realtime electricity prices, understand them, and adjust their behaviour accordingly. Why would they want to do this? To match electricity demand to its supply, thereby minimising the cost to their owner, while facilitating the safe incorporation of more variable suppliers onto the grid (think renewables like solar and wind).

That was 2008/2009. Fast forward to the end of 2013 and we see that smart meters are being deployed in anger, devices are becoming more intelligent and home area networks are becoming a reality. The Internet of Things, is now a thing (witness the success of devices like Nest’s Thermostat and Protect, the Philips Hue, and Belkin’s WeMo devices). Also, companies like Gridpoint, Comverge and EnerNoc are making demand response (the automatic reduction of electricity use) more widespread.

We’re still nowhere near having realised the vision of utility companies broadcasting pricing in realtime, home appliances listening in and adjusting behaviour accordingly, but we are quite a bit further down that road.

One company who have a large part to play in filling in some of the gaps is GE. GE supplies much of the software and hardware used by utilities in their generation, transmission and distribution of electricity. This will need to be updated to allow the realtime transmission of electricity prices. But also, GE is a major manufacturer of white goods – the dish washers, fridges, clothes dryers, etc. which will need to be smart enough to listen out for pricing signals from utilities. These machines will need to be simple to operate but smart enough to adjust their operation without too much user intervention – like the Nest Thermostat. And sure enough, to that end, GE have created their Connected Appliances division, so they too are thinking along these lines.

More indications that we are headed the right direction are signalled by energy management company Schneider Electric‘s recently announced licensing agreement with ioBridge, and Internet of Things connectivity company.

Other big players such as Intel, IBM and Cisco have announced big plans in the Internet of Things space.

The example in the video above of me connecting my Christmas tree lights was a trivial one, obviously. But it was deliberately so. Back in 2008 when I was first mooting the Electricity 2.0 vision, connecting Christmas tree lights to the Internet and control them from a phone wouldn’t have been possible. Now it is a thing of nothing. With all the above companies working on the Internet of Things in earnest, we are rapidly approaching Electricity 2.0 finally.

Full disclosure – Belkin sent me a WeMo Switch + Motion to try out.

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Comverge’s automated demand response is a win for utilities and their customers

Controls

Electric utility companies have to supply electricity to a user base whose demand is variable but reasonably predictable. On particularly hot or cold days, demand will increase as people turn on air conditioning or central heating units. This causes a peak in demand which may only occur for a few hours per year but still has to be met by these utilities.

How do utilities deal with these peaks in demand? There are two ways generally. The first is to build peaking plants. These are generation facilities built specifically to handle peaks in power demand. This is the traditional way of handling surges in electricity consumption but it is expensive to build a power plant, especially one that will only potentially be used a couple of days a year.

The other way is to try to manage the demand for electricity so it doesn’t reach as high a peak – known as peak shaving, or more typically, demand response.

One company which supplies demand response solutions to utilities is Comverge. I spoke to Comverge’s VP of Marketing, Jason Cigarran recently, about their newest demand response product, SmartPrice.

Comverge have been working on demand response solutions with utilities for a number of years now and they have just published case studies with two of their customers Tampa Electric [PDF] and Gulf Power [PDF].

What is interesting about these case studies is that the utilities customers report increased satisfaction with their utilities, as well as lower power bills. And the utilities get more predictable demand response, as well as happier customers. Classic win-win.

How does it work so well? Well the Comverge demand response offering is an automated system. Utility customers access it through a web portal and set how their devices should respond to demand response events. Typically they might set their pool pump to turn off, or their aircon to increase its temperature a degree or two.

The utility companies in turn see how much demand their customers have signed up to shed and because it is an automated load shedding, they know how much demand will reduce. This is unlike more manual demand response systems where the utilities are hoping their customers will turn down their appliances.

Demand response is a solution I have mentioned many times on this blog, and it was always my contention that an automated system, where devices listen to pricing signals from utilities, and respond accordingly, was the only way demand response would work well. It is great to see Comverge making that a reality.

Image credit Adam Rubock

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Japan achieves its 15% energy reduction goal

Candle

I wrote a post a number of weeks back where I talked about how TEPCO were using realtime data to help manage energy demand in Japan. Towards the end of the piece I speculated on whether or not Japan would be able to maintain the effort through August – their hottest month.

You will remember that after the March earthquake, Japan had to shut down all but 15 of its 54 nuclear power plants. This forced the Japanese government to issue an order on July 1st obliging large scale users of electricity (>500kW) to cut their consumption by 15%. They also asked households and small businesses to do likewise but the cut was not legally binding on them

Well, according to the New York Times, Japan made it through the month of August and so successful were they, that this month, ahead of schedule, the government lifted all restrictions on power use. This despite the nuclear power stations not being turned back on.

This is an amazing success story and goes to show how, when a people are properly motivated (in this case with a sense of national pride and unity), they can achieve the seemingly impossible.

The downside of this story is that in the absence of nuclear power Japan is now burning far more fossil fuels to meets its energy requirements. Hopefully, they’ll transition away from fossil fuels and onto renewables to make up for the shortfall in their generation needs.

Photo credit Tom Raftery

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The zero-emissions Nissan Leaf test drive

The Nissan Leaf

I love the idea of electric cars and have done for a long time.

Recently, one of my best friends Ray Flynn, proprietor of Flynns Garage (a Nissan Dealership in Carlow, Ireland), contacted me to let me know he is one of only 15 Nissan dealerships in Ireland who have been approved to sell the new all-electric Nissan Leaf. As such he had a limited number of slots available for a test drive and he wanted to know if I’d like one of them. I jumped at the chance!

The Leaf is a totally electric car relying completely on its 24 kW?h/90 kW lithium ion battery pack for power. The battery pack is rated to deliver 100 miles on a full charge but this can vary from about 62 miles (100 km) to almost 138 miles (222 km) depending on driving style, load, traffic conditions, weather (i.e. wind, atmospheric density) and accessory use.

Nissan Leaf under the hood

Nissan Leaf under the hood

The car is a five seater with a spacious interior. It is very responsive to drive. My own car is a 2008 Toyota Prius and this is a much nippier car than the Prius. It handles well on the road and because there are 300kg of batteries under the floor, the car sticks to the road on corners!

Charge time varies on the type of charging (normal or fast) and whether the battery is fully depleted or only partially. Using a standard 220/240 volt 30 amp supply the battery can be fully charged in 8 hours. Fast charging using a 440V level 3 charger charges to 80% in around 20 minutes – these are typically the kinds of chargers you will see deployed in places like McDonalds, Tesco’s and motorway caf?’s I assume.

Nissan Leaf interior

Nissan Leaf interior

There is a lot of technology built in to the car. It is connected to a global data center which provides support, information and entertainment at all times. The GPS navigation system delivers a constantly updating display of your range as well as showing all the charging stations on your route and it allows you to book a charging station to ensure that it is available when you arrive.

Mobile phone apps will allow remote turning on of aircon and heating as well as setting charging times to coincide with time of use rates from utilities. The advantage of turning on aircon/heating before getting to the car is to have it pre-heated/cooled while still connected to the mains to save on battery life.

Nissan Leaf rear spoiler with solar panels

Nissan Leaf rear spoiler with solar panels

It has a spacious boot and there is an option to get a rear spoiler with solar panels to trickle charge the auxiliary 12 volt battery, though, tbh this feels like a bit of a gimmick!

In terms of the main battery, Nissan has announced that it will warranty the battery pack in the Leaf for 8 years or 100,000 miles after which time Leaf batteries will still hold around 70-80% of their rated capacity. I suspect that there will be a significant market for slightly depleted car batteries at that point for home energy storage to better enable load shifting and smart grid applications.

The car I was driving is a pre-production model. Because the production lines are only now being set-up, this one was hand-made and is insured for a replacement value of ?1.2 million! Consequently I drove it very carefully.

Conclusion: The Nissan Leaf is the future of motoring, no doubt. It is fast, affordable and very cheap to run. And that’s not taking into account at all, the environmental advantages of running a zero emissions car! Sure, there are limitations to having a car with a 100 mile range – most of these will be overcome by the roll-out of networks of fast-charging stations. After this test drive, I have no doubt that when it comes time to replace my Prius, my next car will be all-electric.

The Leaf goes on sale in Ireland in February 2011 at a price of ?29,995 (after a ?5,000 govt subsidy), in the UK in March 2011 for ?28,990 and in the US in December for US$32,780.

And finally, if you are interested in going entirely zero-emissions with your motoring, my buddy Ray (mentioned above) has partnered with a solar panel company and they are able to offer a Nissan Leaf and the solar panels to charge it from. Now that’s serious awesomeness!

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GreenMonk talks Smart Grids with Wattpic Energia

While at the Smart Grids Europe conference last week, I had a talk with Dr Hugo Niesling of Wattpic Energia.

Wattpic are based in Barcelona and while their main product is photovoltaic trackers, they do a lot of research into demand response technologies and have a microgrid near Girona which has been operating successfully off-grid for 15 years making extensive use of demand response and was the only place with power when recent snow storms left 250,000 people in the region without power!

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Smart Grid Heavy Hitters series – Landis+Gyr President and COO Andreas Umbach

This is the fourth of my Smart Grid Heavy Hitters’ interviews, and in it I talked to the President and COO of Landis+Gyr, Andreas Umbach. Landis+Gyr have been in the meter business for decades now so I was very interested to hear what Andreas had to say.

It was a great chat, we talked about:

  • Andreas’ and Landis+Gyr’s definition and the benefits of a Smart Grid
  • The differences in smart grid rollouts around the world and
  • Demand response programs which are consumer friendly
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Klaus Heimann espouses SAP’s smart utility of 2020 at International SAP for Utilities conference

I attended the 7th International SAP for Utilities event in Munich last week.

Having attended the SAP for Utilities event in San Antonio last year, I had reasonably high expectations from this conference and I wasn’t disappointed. At the San Antonio event SAP talked very much about the ‘State of the Now’ talking up their, then recently launched, Energy Capital Management software. At this event however, Head of SAP Service Industries, Klaus Heimann keynoted introducing SAP’s vision for the utility company of 2020!

In what was a very forward-looking address, Klaus confidently predicted that:

In two years time this will no longer be a Utilities conference, it will be en Energy conference

This must have had a lot of the people in the room squirming in their seats because, as Klaus himself said, “Utilities are not known as being good at change!”

But change they must.

Just a few of the upcoming major changes utility companies are going to have to cope with include the growing imperative to move to a greater penetration of renewables in the generation mix, the impending explosion in the numbers of electric vehicles to be charged, and the need to roll-out smart grids and take in distributed generation.

Klaus’ vision for the utility company of 2020 is summarised in the video interview I conducted with him above, but briefly he talked of an energy market vastly more complex than today’s. An energy market:

  • where customers can be consumers and producers (via micro-generation)
  • where customers may have shares in a wind-farm which sells electricity to the local utility
  • where customers receive rebates on kWh’s saved during times of peak demand (compared to avg previous day’s use at same time, for example)
  • where utilities will have special renewable-only power offerings (I wish they had that now)
  • where utilities will need to be able to bill customers for energy used to charge electric vehicles, away from home (at the office) or even in different countries and
  • where utilities will need to be able to offer real-time consumption information, generation data and a control interface to the customer’s appliances

Nothing too earth-shattering in that list to be honest. But, when put against the types of changes utilities have gone through in the last 100 years, this is an enormous upheaval. This is probably a good time to be a change management consultant in the utilities sector ;-)

For this vision to become real (and any utilities who don’t start to move in this direction can start writing their own obituaries now), there needs to be massive changes in utilities communications infrastructures and their data handling capabilities.

With big change, comes big opportunities so it is not surprising to see SAP are all over this and helping the utilities visualise where they need to go.