Demand response
Demand response is a change in the power consumption of an electric utility customer to better match the demand for power with the supply.[1] Until the 21st century decrease in the cost of pumped storage and batteries, electric energy could not be easily stored, so utilities have traditionally matched demand and supply by throttling the production rate of their power plants, taking generating units on or off line, or importing power from other utilities. There are limits to what can be achieved on the supply side, because some generating units can take a long time to come up to full power, some units may be very expensive to operate, and demand can at times be greater than the capacity of all the available power plants put together. Demand response, a type of energy demand management, seeks to adjust in real-time the demand for power instead of adjusting the supply.
This article is about the electrical concept. For the transport concept, see Demand responsive transport.
Utilities may signal demand requests to their customers in a variety of ways, including simple off-peak metering, in which power is cheaper at certain times of the day, and smart metering, in which explicit requests or changes in price can be communicated to customers.
The customer may adjust power demand by postponing some tasks that require large amounts of electric power, or may decide to pay a higher price for their electricity. Some customers may switch part of their consumption to alternate sources, such as on-site solar panels and batteries.
In many respects, demand response can be put simply as a technology-enabled economic rationing system for electric power supply. In demand response, voluntary rationing is accomplished by price incentives—offering lower net unit pricing in exchange for reduced power consumption in peak periods. The direct implication is that users of electric power capacity not reducing usage (load) during peak periods will pay "surge" unit prices, whether directly, or factored into general rates.
Involuntary rationing, if employed, would be accomplished via rolling blackouts during peak load periods. Practically speaking, summer heat waves and winter deep freezes might be characterized by planned power outages for consumers and businesses if voluntary rationing via incentives fails to reduce load adequately to match total power supply.
Background[edit]
As of 2011, according to the US Federal Energy Regulatory Commission, demand response (DR) was defined as:
"Changes in electric usage by end-use customers from their normal consumption patterns in response to changes in the price of electricity over time, or to incentive payments designed to induce lower electricity use at times of high wholesale market prices or when system reliability is jeopardized."[2] DR includes all intentional modifications to consumption patterns of electricity to induce customers that are intended to alter the timing, level of instantaneous demand, or the total electricity consumption.[3] In 2013, it was expected that demand response programs will be designed to decrease electricity consumption or shift it from on-peak to off-peak periods depending on consumers' preferences and lifestyles.[4] In 2016 demand response was defined as "a wide range of actions which can be taken at the customer side of the electricity meter in response to particular conditions within the electricity system such as peak period network congestion or high prices".[5]
In 2010, demand response was defined as a reduction in demand designed to reduce peak demand or avoid system emergencies. It can be a more cost-effective alternative than adding generation capabilities to meet the peak and occasional demand spikes. The underlying objective of DR is to actively engage customers in modifying their consumption in response to pricing signals. The goal is to reflect supply expectations through consumer price signals or controls and enable dynamic changes in consumption relative to price.[6]
In electricity grids, DR is similar to dynamic demand mechanisms to manage customer consumption of electricity in response to supply conditions, for example, having electricity customers reduce their consumption at critical times or in response to market prices.[7] The difference is that demand response mechanisms respond to explicit requests to shut off, whereas dynamic demand devices passively shut off when stress in the grid is sensed. Demand response can involve actually curtailing power used or by starting on-site generation which may or may not be connected in parallel with the grid.[8] This is a quite different concept from energy efficiency, which means using less power to perform the same tasks, on a continuous basis or whenever that task is performed. At the same time, demand response is a component of smart energy demand, which also includes energy efficiency, home and building energy management, distributed renewable resources, and electric vehicle charging.[9][10]
Current demand response schemes are implemented with large and small commercial as well as residential customers, often through the use of dedicated control systems to shed loads in response to a request by a utility or market price conditions. Services (lights, machines, air conditioning) are reduced according to a preplanned load prioritization scheme during the critical time frames. An alternative to load shedding is on-site generation of electricity to supplement the power grid. Under conditions of tight electricity supply, demand response can significantly decrease the peak price and, in general, electricity price volatility.
Demand response is generally used to refer to mechanisms used to encourage consumers to reduce demand, thereby reducing the peak demand for electricity. Since electrical generation and transmission systems are generally sized to correspond to peak demand (plus margin for forecasting error and unforeseen events), lowering peak demand reduces overall plant and capital cost requirements. Depending on the configuration of generation capacity, however, demand response may also be used to increase demand (load) at times of high production and low demand. Some systems may thereby encourage energy storage to arbitrage between periods of low and high demand (or low and high prices). Bitcoin mining is an electricity intensive process to convert computer hardware infrastructure, software skills and electricity into electronic currency.[11] Bitcoin mining is used to increase the demand during surplus hours by consuming cheaper power.[12]
There are three types of demand response - emergency demand response, economic demand response and ancillary services demand response.[13] Emergency demand response is employed to avoid involuntary service interruptions during times of supply scarcity. Economic demand response is employed to allow electricity customers to curtail their consumption when the productivity or convenience of consuming that electricity is worth less to them than paying for the electricity. Ancillary services demand response consists of a number of specialty services that are needed to ensure the secure operation of the transmission grid and which have traditionally been provided by generators.
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$_$_$DEEZ_NUTS#0__call_to_action.textDEEZ_NUTS$_$_$Application for intermittent renewable distributed energy resources[edit]
The modern power grid is making a transition from the traditional vertically integrated utility structures to distributed systems as it begins to integrate higher penetrations of renewable energy generation. These sources of energy are often diffusely distributed and intermittent by nature. These features introduce problems in grid stability and efficiency which lead to limitations on the amount of these resources which can be effectively added to the grid. In a traditional vertically integrated grid, energy is provided by utility generators which are able to respond to changes in demand. Generation output by renewable resources is governed by environmental conditions and is generally not able to respond to changes in demand. Responsive control over noncritical loads that are connected to the grid has been shown to be an effective strategy able to mitigate undesirable fluctuations introduced by these renewable resources.[31] In this way instead of the generation responding to changes in demand, the demand responds to changes in generation. This is the basis of demand response. In order to implement demand response systems, coordination of large numbers of distributed resources through sensors, actuators, and communications protocols becomes necessary. To be effective, the devices need to be economical, robust, and yet still effective at managing their tasks of control. In addition, effective control requires a strong capability to coordinate large networks of devices, managing and optimizing these distributed systems from both an economic and a security standpoint.
In addition, the increased presence of variable renewable generation drives a greater need for authorities to procure more ancillary services for grid balance. One of these services is contingency reserve, which is used to regulate the grid frequency in contingencies. Many independent system operators are structuring the rules of ancillary service markets such that demand response can participate alongside traditional supply-side resources - the available capacity of the generators can be used more efficiently when operated as designed, resulting in lower costs and less pollution. As the ratio of inverter-based generation compared to conventional generation increases, the mechanical inertia used to stabilize frequency decreases. When coupled with the sensitivity of inverter-based generation to transient frequencies, the provision of ancillary services from other sources than generators becomes increasingly important.[32][33]
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Technologies for demand reduction[edit]
Technologies are available, and more are under development, to automate the process of demand response. Such technologies detect the need for load shedding, communicate the demand to participating users, automate load shedding, and verify compliance with demand-response programs. GridWise and EnergyWeb are two major federal initiatives in the United States to develop these technologies. Universities and private industry are also doing research and development in this arena. Scalable and comprehensive software solutions for DR enable business and industry growth.
Some utilities are considering and testing automated systems connected to industrial, commercial and residential users that can reduce consumption at times of peak demand, essentially delaying draw marginally. Although the amount of demand delayed may be small, the implications for the grid (including financial) may be substantial, since system stability planning often involves building capacity for extreme peak demand events, plus a margin of safety in reserve. Such events may only occur a few times per year.
The process may involve turning down or off certain appliances or sinks (and, when demand is unexpectedly low, potentially increasing usage). For example, heating may be turned down or air conditioning or refrigeration may be turned up (turning up to a higher temperature uses less electricity), delaying slightly the draw until a peak in usage has passed.[34] In the city of Toronto, certain residential users can participate in a program (Peaksaver AC[35]) whereby the system operator can automatically control hot water heaters or air conditioning during peak demand; the grid benefits by delaying peak demand (allowing peaking plants time to cycle up or avoiding peak events), and the participant benefits by delaying consumption until after peak demand periods, when pricing should be lower. Although this is an experimental program, at scale these solutions have the potential to reduce peak demand considerably. The success of such programs depends on the development of appropriate technology, a suitable pricing system for electricity, and the cost of the underlying technology. Bonneville Power experimented with direct-control technologies in Washington and Oregon residences, and found that the avoided transmission investment would justify the cost of the technology.[36]
Other methods to implementing demand response approach the issue of subtly reducing duty cycles rather than implementing thermostat setbacks.[37] These can be implemented using customized building automation systems programming, or through swarm-logic methods coordinating multiple loads in a facility (e.g. Encycle's EnviroGrid controllers).[38][39]
Similar approach can be implemented for managing air conditioning peak demand in summer peak regions. Pre-cooling or maintaining slightly higher thermostat setting can help with the peak demand reduction.[40]
In 2008 it was announced that electric refrigerators will be sold in the UK sensing dynamic demand which will delay or advance the cooling cycle based on monitoring grid frequency[41] but they are not readily available as of 2018.
Industrial customers[edit]
Industrial customers are also providing demand response. Compared with commercial and residential loads, industrial loads have the following advantages:[42] the magnitude of power consumption by an industrial manufacturing plant and the change in power it can provide are generally very large; besides, the industrial plants usually already have the infrastructures for control, communication and market participation, which enables the provision of demand response; moreover, some industrial plants such as the aluminum smelter[43] are able to offer fast and accurate adjustments in their power consumption. For example, Alcoa's Warrick Operation is participating in MISO as a qualified demand response resource,[44] and the Trimet Aluminium uses its smelter as a short-term nega-battery.[45] The selection of suitable industries for demand response provision is typically based on an assessment of the so-called value of lost load.[46] Some data centers are located far apart for redundancy and can migrate loads between them, while also performing demand response.[47]
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