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Grid of the Future
The Rise of Distributed Energy: What is its True Value?
Nalini Rao Technical Leader
Electric Power
Research Institute
Doug Staker VP, Global Business Development EnerNOC@StakeDE
Alex Portilla Manager, Grid of Things PG&E
Linh Tran Western Region Manager LG Chem Power Inc.@LTatLGC
Barry Cinnamon CEOCinnamon Energy Systems @spicysolarguy
Moderator
The Rise of Distributed Energy
What is its True Value?• Doug Staker, EnerNOC• Alex Portilla, PG&E
• Linh Tran, LG Chem• Nalini Rao, EPRI
• Moderated by Barry Cinnamon, Cinnamon Energy Systems
Cinnamon Energy Systems
Silicon Valley Solar and Storage Installations since 2001
Meeting Multiple Sustainability Goals
Technology
StakeholdersEconomics
Current Reality
• Technology works• Solar
• Batteries
• Software
• Economics are favorable• Net savings and high ROIs
• State and Federal incentives
• All stakeholders are engaged• Customers
• Manufacturers
• Utilities
Marcus Garvey Apartments
Micro Grid
Doug Staker
VP of Utility Business Development
EnerNOC/Enel X
Brooklyns Queens Demand Management Program
▪Substation upgrade deferral = $ 1.2B
▪PSC approved $200M Non-Wire Solutions (NWS)
▪Program cost allowed in rate base
▪Reverse auction drove market-based
response > $1,992/kW; 2-year program
▪Drives better distribution system utilization
▪Framework for future market-based Non-Wire Solutions
Marcus Garvey Apartments Micro GridESNA Distributed Storage Project of 2017
Low Income Development in the most under served network in NYC
•Highest rate of brownouts/blackouts network in Con Ed territory
Multiple development partners:
•Demand Energy – Storage + Microgrid + Advanced controls to manage all DER’s on site with zero net export constraint
•Bloom Energy – Fuel Cells
•Bright Power - Solar
Shared Savings Economics
•DEN is storage asset owner gets incentive payments (BQDM) covering 40% of Capex, plus 80% of savings/DR revenues
•L+M Development (customer) gets ~20% of total savings
300 kW/1.2MWH
Storage (ESA)
400kW
Distributed
PV System
400 kW Energy
Fuel Cell (PPA)
Marcus Garvey Apartments is a 625-unit L+Mproperty, spread across nine city blocks inBrooklyn.
MARCUS GARVEYBROOKLYN, NY
Community Resiliency
Backup Power
▪Provides backup power for the management and security office
▪Community room power for extended outages
Shared Savings Revenue Stream
Demand Charge Management BQDM Load Relief Compliance Market Participation
Wholesale/Retail Value Stacking
▪ Optimized load management from the combined Solar + Fuel Cell + Building Load + Battery Operations.
▪ Called when the day-ahead forecast is projected to 93% of the summer forecasted peak
▪ Day-ahead hourly pricing▪ NYISO winter DR ▪ Con Edison DLRP program
Economic Optimal Control
LOAD PREDICTIONPRESENT
TIME
PV PREDICTION
PROBLEM STATEMENT: What control sequence will deliver the minimum operating cost?
● Optimizes economics considering ALL possible value streams simultaneously
● Automatically manages the battery degradation self-consistently as a cost (negative value stream)
● Only requires one optimization engine (OE) (not multiple apps)
• Tariffs• Contracted Incentives• Battery Model• System Size and Limits• Minimum Import
Value Streams:• Rate changes• Demand capping• Battery lifetime• Self consumption• Energy arbitrage• Utility incentives...Demand Reduction
CONFIGURE OE TO BE KNOWLEDGEABLE:
12
Max. PV Utilization
DMP
Supply Arbitrage
Zero Net Export Constraint
Tailoring SoC for Minimal Battery Aging
Conclusions
▪Development of Non-Wire Solutions and the ability to recover cost under a performance based rate design gives utilities like Con Edison a new tool in grid management
▪“Energy as a Service” provides end users and utilities new paths to managing a grid in need of flexibility
▪Managing power costs in mixed-income housing is the right thing to do for all
▪Resilience will be an ongoing need as we continue to experience extreme weather events
2013 2017
Doing the Right Thing is Always
The Right Thing to Do
READ AND DELETE
For best results with this template, use PowerPoint 2003
Alex Portilla, Manager, Grid InnovationPacific Gas and Electric Company (PG&E)May 24, 2018
Opportunities in the Changing Energy System
Silicon Valley Energy & Sustainability Summit 2018
Environmental leadership policies
Drivers of Change
The California Energy Landscape is Changing Rapidly
Environmental leadership policies
California is Targeting:
50%renewables by 2030
1.5Melectric vehicles by 2025
1.3GWBattery Storage by 2024
California Greenhouse Gas Reduction Goals
and Historic Emissions*Million metric
tons CO2e
2020 20302015 2025
AB 32 requires
California to return to
1990 levels by 2020
SB 32 requires at
least 40% below 1990
levels by 2030
Historic Emissions
Ag. & Forestry
Res. & Comm.
Transportation
Electricity
Generation
Industrial
Drivers of Change
The California Energy Landscape is Changing Rapidly
-73% in 6 Yrs.
Environmental leadership policies
Rapidly advancing technology
15₵ / kWh
$30,000
Rooftop Solar
Lithium-ion Prices
The California Energy Landscape is Changing Rapidly
Drivers of Change
Electric Vehicles
Increasing customer choice and engagement
Rapidly advancing technology
350k (3,000 MW)
Customer Solar
150KElectric Vehicles
Drivers of Change
Environmental leadership policies
The California Energy Landscape is Changing Rapidly
Power Plants
Smart Grid functionality restores the
balance Hydro Power Plants
Nuclear Power Plants
Natural Gas GeneratorsTransmission Lines
Distribution Substations
Plug-in Electric Vehicles
Rooftop Solar
Solar Farms / Power Plants
Wind Farms
Electric Grid Customers
Utility-scale Storage
Distributed Storage
Traditionally, the grid has operated by transporting electricity in one direction, from generation through transmission and distribution lines to customers, but changes are coming
Electric Grid Evolution
Key Capabilities for the Distribution System Operator
Situational awareness of DER contributions, flexibility and “hidden load”
3Proactively controlling DER to help manage the electric network and maintain reliability
1
Advanced forecasting and integration w/3rd
party DERs for operational impacts due to DER2
A Utility Integrated Grid Platform will be needed to enhance the safety and reliability of a high DER penetration grid and enable value creation for all customers from DER
PG&E’s DERMS Project Overview
Key Project Objectives
• Demonstrate coordination of energy storage and PV-connected smart inverters to provide distribution grid services
• Create, test, and iterate on future DERMS requirements
• Define boundaries and integrations with other PG&E and external systems
• Evaluate the performance of aggregated DERs providing distribution services
Project funded by PG&E’s customers via the Electric Program Investment Charge (EPIC) Program
Swift
PG&E’s Distributed Energy Resource Management System (DERMS) demonstration is designed to enable PG&E and industry learning about people, process, and technology.
“DER Sandbox” in San Jose
Collaborating with 3rd party aggregators to deploy a “fleet” Behind the Meter (BTM) storage and PV with Smart Inverters on 3 feeders in San Jose controlled by a utility DERMS
DERMS – Control System
CommercialStorage with
Smart Inverter Control
• 360 kW, 2 hour
storage
• 3 customers
Utility ScaleYerba Buena Battery
• 4MW, 7 hour
battery
• PG&E-owned,
customer-sited
• Wholesale resource
Residential PV Solar + Storage with
Smart Inverter Control
• 124 kW PV solar
• 66 kW, 4 hour storage
• 27 customers
Key Project Learnings
• DERs can successfully provide distribution services (voltage and capacity) orchestrated by an integrated utility system (DERMS)
• PG&E will need to invest in a system wide integrating platform in order to enable value creation form DERs for all customers
• While at the same time continuing to develop targeted DERMS solutions for localized projects
• Targeted DER Customer Acquisition and Deployment is more difficult and time consuming than expected.
• Managing and Integrating 3rd party DER aggregations has proven to be very complex technically for all parties
• Standards are immature and uniform operational business rules are not established
• New interactions with 3rd party DERs will require rethinking security and communications requirements
Lessons learned from DERMS Project will inform future programs and investment strategy for DER integration into grid operations
THE VALUE OF DERS FOR
RESIDENTIAL & SMALL C&I MARKETS
Linh Tran
Director of Sales – Residential ESS
BEFORE WE START...
Who are we?
• $20B profitable
• Global presence, all mkt segments
• Chemical company
R&Rs
• Battery manufacturer
• Continue to deliver safe and reliable products to the market
HITS CLOSE TO HOME
• What’s it to me?• Grid services
• Protection against outages
• Foster more solar installations
• EVs
• Follow the money, you’re involved
• Smart Grid technology to reduce outages
• “green energy or otherwise known as renewables
SMALL C&I
• 20~200kW peak demand
• demand charge or PDP/CPP
• Value-Adds of Small C&I DERS
• Demand charge reduction
• Leasing/shared-savings/finance
• Utility incentives (?)
• Grid services
• Demand Response
• Regional dispatch
• VPP
HOW DOES LG CHEM FIT IN?
Installers
Developers
DistributorsTECH.
PARTNER
CommercialSite
<System Integrator>
RESIDENTIAL
• Back up and TOU• demand charge (?)
• Get an ESS for your PV
• Leasing/shared-savings/finance• Capitalize on overproduction
• Secure your home
• Utility incentives
• Tax benefits
• Grid services
• Demand Response
• Regional dispatch
• VPP
HOW DOES LG CHEM FIT IN?
Installer
TPO
Distribution
OthersTech.Partner
Home
THE VALUE OF DERS
• Summary
• The value of DERs is expansive
• The value of DERs is still being developed
• Batteries fit in everywhere
The Rise of Distributed Energy: What Is Its True Value?Nalini S. Rao, Ph.D.
Technical Leader
Water Availability and Ecological Risk Research Program
Electric Power Research Institute (EPRI)
Water: Context and Issues
▪Integrated Energy Network
▪Changing Generation Mix
▪Energy-Water Nexus
▪Water and Energy
DER
▪DERs are “distribution-connected distributed generation resources such as energy efficiency, demand response, customer generation (e.g. rooftop solar), energy storage, alternative fuel vehicles (e.g., electric vehicles), and water-energy conservation” (CPUC)
▪DERs hold the potential to meet electric power grid needs at lower costs compared to conventional alternatives
▪EPRI has large research areas in energy storage, demand response, energy utilization, and integration
▪What is the link between environmental/water issues and DER?
Demand Response and DER
▪Water and electricity systems integration
▪Water and power utilities
▪Critical infrastructure and resiliency
Examples of DER and water-energy issues
▪Off-peak water treatment
▪Water conveyance
▪Effects on water use and watersheds
▪Storage
▪Waste water treatment facilities and other
energy intensive uses
▪Reduce imbedded water demand
▪Example from EPRI
Flexible Water Pumping Pilot
Objective
Achieve 20% demand adjustment in support of California policy goals for Demand Response and Renewable Integration through demonstration at water pumping site
Means
• Identify Control Strategies and best practices appropriate for fast and flexible Demand Response
• Design and develop for proof-of-concept a Flexible Energy Management System (FEMS)
▪ Operator support for flexible water pumping while respecting constraints (water quality, water infrastructure, customer water demands)
• Market signaling interface using Open Automated Demand Response (OpenADR) 2.0
• Pilot test developed strategies with a pumping station
Climate Smart Cities and Water
▪Location
▪Cooling, water treatment, and infrastructure
▪Platforms and water-specific controls
▪Developing sensing devices
▪Role of technology and planning
▪Emerging trends
EPRI Energy Water Tournaments
▪Simulation gaming exercise with scenarios (ex. Water supply declines)
▪Multi-disciplinary teams discuss and develop an integrated water and electric utility plan
▪5-6 Regional Sites for Tournaments
▪Host electric and water utilities
▪Funding and technical support to
support tool development and planning
▪Next steps – set project structure,
advisory panels, set location for
first tournament (early 2019)
Electrification 2018
Summary
▪Research questions center on the unanswered questions on the environmental impacts of DER
▪What may be some of the non-grid benefits and impacts?
▪What can we learn from some of the research on flexible operations?
▪Will some of the advances in climate smart cities have implications?
▪Will some of the energy-water tournament exercises give insights?
▪Many more questions to be examined!
Thank you!
Thank you!
Nalini S. Rao, Ph.D.
Electric Power Research Institute (EPRI)
Email: [email protected]
Phone: 650-855-2044
Thanks to my EPRI colleagues Ammi Amarnath, Sara Beaini, Angela Chuang, Jim Davis,
Haresh Kamath, Ben Kaun, Karen Larsen, Amardeep Mehat, Sudeshna Pabi, and Kent Zammit
The Future’s So Bright: Financing the Sun
Tamara Prendergast CEO & Co-Founder Climatic Energy LLC
Tim McRaeVP of EnergySilicon Valley Leadership Group@SvlgTimMcRae
Parin Shah Senior Strategist Asian Pacific Environmental
Network @parinorama
Danny Kennedy Managing Director, California Clean Energy Fund @dannyksfun
Elizabeth Willmont Carbon Program Lead Microsoft
@microsoft_green
Moderator
May 2018
Microsoft’s Commitment to Clean Energy
May 2018
The challenges of our time
Deep Commitment to Efficient, Low-Carbon Energy
2017
Set carbon reduction goal
2009
Set carbon target
2012
Carbon fee & carbon neutrality
2030
75% decline in carbon emissions
2020
60% renewable energy
2016
Set energy goals
2018
50% renewable energy
Long-termgoal
100% renewable energy
Buying renewable
energy on the
open market
Using our operations as a living lab of innovation
Help green the grid and accelerate the transition to a zero-carbon energy future
Parin Shah – Senior Strategist
Energy & Sustainability Summit
May 2018
Climate Wars
“Begun, the climate and energy war has.”
-Yoda (if he were in this galaxy)
“When nature is viewed solely as a source of profit and gain, this has serious consequences for society.”
- Pope Francis I
Market Failure
Barriers
Opportunities
THANK YOU
CA ENERGY EFFICIENCY CHALLENGE
IMPLEMENT STATE POLICY WITH PRIVATE FUNDING
The State of California EE Funding Needs-
• $10-50 billion of private investment
• 50% ENERGY EFFICIENCY by 2030
• 30% GHG reduction targets by 2030
• Mandatory energy & GHG reporting
Energy Efficiency CLASS B BUILDINGS
Save the Planet, Main Street & Jobs
WHY EE COMMERCIAL REAL ESTATE?
• 50% building inventory
building between 1970-1999 in CA
• Buildings consume 70% of electricity in California
• #2 Source of GHG emissions
• Good utility bill payers,
but bad loan credit
PRIVATE PUBLIC Innovation Solution
Innovation
• Project Green Bonds
• Savings Agreements
• Public Credit Enhancement
Proposal: Credit Enhancement induce 10-20x private investment into the State’s Class B Commercial Buildings for Energy Efficiency Retrofits
BOND GUARANTEE-Leverage
Energy Savings Agreement
ESA
USE CASE:
$1 Utility “As Is”
Spend
Water
Controls
HVAC
Yesterday’s Equipment = Emissions, Waste & Consumption Driver
Energy Savings Agreement
$1 Use Case
Energy Savings Bill:
• “As Is” Utility spend $1
Energy Savings Agreement
$1 Use Case
Energy Savings Bill:
• “As Is” Utility spend $1
• Actual Retrofit savings $0.50
50% Total Savings
Energy Savings Agreement
$1 Use Case
Energy Savings Bill:
• “As Is” Utility spend $1
• Actual Retrofit savings $0.50
• Customer pays $0.80 for
20% savings with ZERO capex
• $0.30 savings revenue – repay bond, equipment & investors
• $1-.20= 0.80 - 0.50 = $0.30
50% Total Savings
20% Customer
Savings
Energy Savings Agreement
$1 Use Case
Energy Savings Bill:
• “As Is” Utility spend $1
• Actual Retrofit savings $0.50
• Customer pays $0.80 for
20% savings with ZERO capex
• $0.30 savings revenue – repay bond, equipment & investors
• $1-.20= 0.80 - 0.50 = $0.30
50% Total Savings
20% Customer
Savings
CA Market Value$0.30 x $10bn Needs➔$3.0bn revenue
CA Jobs Value25 green jobs per project
CA GDP Value1% growth
Macro Impact:
Building Owner Value
Corporate Green Bottom Line
$1 energy opex savings
translates to increase of $5-7 in property value
• A private equity multiple increase of 2.5x to 3.0x
• Green equities index
• Sustainable risk management
Climatic = Energy +Technology + Financial Products
Tomorrow's Innovation = Energy, Technology, Finance
THANK YOU
Please join us in the lobby for a networking reception
