tag:theconversation.com,2011:/africa/topics/demand-response-17806/articlesDemand response – The Conversation2023-10-17T12:20:30Ztag:theconversation.com,2011:article/2139992023-10-17T12:20:30Z2023-10-17T12:20:30ZWhat is a virtual power plant? An energy expert explains<figure><img src="https://images.theconversation.com/files/553720/original/file-20231013-23-zo06aw.jpg?ixlib=rb-1.1.0&rect=26%2C8%2C5964%2C3979&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">A large-scale battery storage system in Long Beach, Calif., provides renewable electricity during peak demand periods.</span> <span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/weikko-wirta-aes-southland-director-of-operations-and-vice-news-photo/1243414725">Patrick T. Fallon/AFP via Getty Images</a></span></figcaption></figure><p>After nearly two decades of stagnation, U.S. electricity demand <a href="https://www.eia.gov/electricity/monthly/">is surging</a>, driven by growing numbers of electric cars, data centers and air conditioners in a warming climate. But traditional power plants that generate electricity from <a href="https://www.eia.gov/todayinenergy/detail.php?id=54559">coal</a>, <a href="https://www.eia.gov/todayinenergy/detail.php?id=55439">natural gas</a> or <a href="https://www.nei.org/resources/statistics/decommissioning-status-for-shutdown-us-plants">nuclear energy</a> are retiring faster than new ones are being built in this country. Most <a href="https://www.eia.gov/todayinenergy/detail.php?id=57340">new supply</a> is coming from wind and solar farms, whose output varies with the weather.</p>
<p>That’s left power companies seeking new ways to balance supply and demand. One option they’re turning to is virtual power plants. </p>
<p>These aren’t massive facilities generating electricity at a single site. Rather, they are aggregations of electricity producers, consumers and storers – collectively known as distributed energy resources – that grid managers can call on as needed. </p>
<p>Some of these sources, such as batteries, may deliver <a href="https://theconversation.com/these-3-energy-storage-technologies-can-help-solve-the-challenge-of-moving-to-100-renewable-electricity-161564">stored electric power</a>. Others may be big electricity consumers, such as factories, whose owners have agreed to cut back their power use when demand is high, freeing up energy for other customers. Virtual power sources typically are quicker to site and build, and can be cleaner and cheaper to operate, than new power plants. </p>
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<iframe width="440" height="260" src="https://www.youtube.com/embed/-KQEt5QqPXU?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Virtual power plants are more resilient against service outages than large, centralized generating stations because they distribute energy resources across large areas.</span></figcaption>
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<h2>A growing resource</h2>
<p>Virtual power plants aren’t new. The U.S. Department of Energy <a href="https://liftoff.energy.gov/wp-content/uploads/2023/09/20230911-Pathways-to-Commercial-Liftoff-Virtual-Power-Plants_update.pdf">estimates</a> that there are already 30 to 60 gigawatts of them in operation today. A gigawatt is 1 billion watts – roughly the output of <a href="https://www.energy.gov/eere/articles/how-much-power-1-gigawatt">2.5 million solar photovoltaic panels</a> or one large nuclear reactor.</p>
<p>Most of these virtual power plants are industrial customers that have agreed to reduce demand when conditions are tight. But as growing numbers of homes and small businesses add rooftop solar panels, batteries and electric cars, these energy customers can become not only consumers but also suppliers of power to the grid. </p>
<p>For example, homeowners can charge up their batteries with rooftop solar when it’s sunny, and discharge power back to the grid in the evening when demand is high and prices sometimes spike. </p>
<p>As smart thermostats and water heaters, rooftop solar panels and batteries enable more customers to participate in them, DOE estimates that virtual power plants could <a href="https://liftoff.energy.gov/wp-content/uploads/2023/09/20230911-Pathways-to-Commercial-Liftoff-Virtual-Power-Plants_update.pdf">triple in scale by 2030</a>. That could cover roughly half of the new capacity that the U.S. will need to cover growing demand and replace retiring older power plants. This growth would help to limit the cost of building new wind and solar farms and gas plants. </p>
<p>And because virtual power plants are located where electricity is consumed, they’ll ease the burden on aging transmission systems that have <a href="https://www.cnbc.com/2023/02/21/why-its-so-hard-to-build-new-electrical-transmission-lines-in-the-us.html">struggled to add new lines</a>.</p>
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<a href="https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="A hand points to a lighted electronic panel." src="https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/553740/original/file-20231013-26-wjqdxl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">A battery display panel inside a model home in Menifee, Calif., where 200 houses in a development are all-electric, equipped with solar panels and batteries and linked by a microgrid that can power the community during outages.</span>
<span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/scott-hensen-vice-president-of-floor-planning-for-kb-home-news-photo/1244677704">Watchara Phomicinda/MediaNews Group/The Press-Enterprise via Getty Images</a></span>
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<h2>New roles for power customers</h2>
<p>Virtual power plants scramble the roles of electricity producers and consumers. Traditional power plants generate electricity at central locations and transmit it along power lines to consumers. For the grid to function, supply and demand must be <a href="https://theconversation.com/what-is-curtailment-an-electricity-market-expert-explains-185279">precisely balanced at all times</a>.</p>
<p>Customer demand is typically assumed to be a given that fluctuates with the weather but follows a fairly predictable pattern over the course of a day. To satisfy it, grid operators dispatch a mix of <a href="https://www.eia.gov/tools/glossary/?id=B">baseload sources</a> that operate continuously, such as coal and nuclear plants, and more flexible sources such as gas and hydropower that can modulate their output quickly as needed.</p>
<p>Output from wind and solar farms rises and falls during the day, so other sources must operate more flexibly to keep supply and demand balanced. Still, the basic idea is that massive facilities produce power for millions of passive consumers. </p>
<p>Virtual power plants upend this model by embracing the fact that consumers can control their electricity demand. Industrial consumers have long <a href="https://emp.lbl.gov/publications/past-present-and-future-us-utility">found ways to flex their operations</a>, limiting demand when power supplies are tight in return for incentives or discounted rates.</p>
<p>Now, thermostats and water heaters that communicate with the grid can let households modulate their demand too. For example, <a href="https://neep.org/blog/smart-energy-home-blog-series-smart-water-heaters">smart electric water heaters</a> can heat water mostly when power is abundant and cheap, and limit demand when power is scarce. </p>
<p>In Vermont, Green Mountain Power is <a href="https://greenmountainpower.com/news/gmps-request-to-expand-customer-access-to-cost-effective-home-energy-storage-is-approved/">offering its customers incentives</a> to install batteries that will provide power back to the grid when it’s needed most. In Texas, where I live, deadly <a href="https://doi.org/10.1016/j.erss.2021.102106">blackouts in 2021</a> highlighted the importance of bolstering our isolated power grid. Now, utilities here are using <a href="https://www.utilitydive.com/news/tesla-virtual-power-plants-vpp-ercot-puc-texas-grid/691713/">Tesla Powerwalls</a> to help turn homes into virtual power sources. South Australia aims to connect 50,000 homes with solar and batteries to build that country’s <a href="https://www.energymining.sa.gov.au/consumers/solar-and-batteries/south-australias-virtual-power-plant">largest virtual power plant</a>.</p>
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<a href="https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="People wait at a propane gas station, bundled in heavy clothes." src="https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/553749/original/file-20231013-15-n4pyp1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">People line up to refill propane tanks in Houston after a severe winter storm caused electricity blackouts and a catastrophic failure of Texas’ power grid in February 2021.</span>
<span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/people-line-up-at-a-propane-gas-station-to-refill-their-news-photo/1231242378">Go Nakamura/Getty Images</a></span>
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<h2>Virtual power, real challenges</h2>
<p>Virtual power plants aren’t a panacea. Many customers are reluctant to give up even temporary control of their thermostats, or have a delay when charging their electric car. Some consumers are also concerned about the <a href="https://smartgrid.ieee.org/bulletins/july-2018/security-and-privacy-concerns-in-smart-metering-the-cyber-physical-aspect">security and privacy of smart meters</a>. It remains to be seen how many customers will sign up for these emerging programs and how effectively their operators will modulate supply and demand.</p>
<p>There also are challenges at the business end. It’s a lot harder to manage millions of consumers than dozens of power plants. Virtual power plant operators can overcome that challenge by rewarding customers for allowing them to flex their supply and demand in a coordinated fashion. </p>
<p>As electricity demand rises to meet the needs of growing economies and replace fossil fuel-burning cars and furnaces, and reliance on renewable resources increases, grid managers will need all the flexibility they can get to balance the variable output of wind and solar generation. Virtual power plants could help reshape electric power into an industry that’s more nimble, efficient and responsive to changing conditions and customers’ needs.</p><img src="https://counter.theconversation.com/content/213999/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Daniel Cohan does not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Some power plants don’t have massive smokestacks or cooling towers – or even a central site.Daniel Cohan, Associate Professor of Civil and Environmental Engineering, Rice UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/2143232023-09-29T16:43:11Z2023-09-29T16:43:11ZSelf-driving buses that go wherever you want? How the UK is trying to revolutionise public transport<figure><img src="https://images.theconversation.com/files/551206/original/file-20230929-23-z1vo5d.jpg?ixlib=rb-1.1.0&rect=14%2C164%2C3015%2C1730&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Scotland’s CAVForth self-driving bus service began in May 2023, serving a 14-mile route that crosses the Forth Road Bridge on the outskirts of Edinburgh.</span> <span class="attribution"><span class="source">Stagecoachbus.com</span></span></figcaption></figure><p>Futurology is littered with predictions that failed to materialise, not least in the field of transport technology. In Edwardian times, when public transport was largely powered by horse or steam, a number of new concepts emerged which were hailed as the “future of public transport”.</p>
<p>In 1910, the <a href="https://collection.sciencemuseumgroup.org.uk/objects/co27065/brennans-gyroscopic-mono-rail-car-model-gyroscopic-mono-railcar">Brennan Monorail</a> was a gyroscopically stabilised, diesel-powered monorail train that ran on a circular test track at the White City in London. One of the early passengers on this <a href="https://www.midnight-trains.com/post/on-board-louis-brennans-gyroscopic-monorail">50-person prototype</a> was then-home secretary Winston Churchill, who insisted on driving the train himself. The new technology <a href="https://www.newscientist.com/article/mg19225780-125-histories-the-spinning-top-railway/">reportedly</a> “proved as interesting to the statesman as a new toy would to a child” – and Churchill is said to have told its Irish-Australian creator <a href="https://www.irishtimes.com/life-and-style/people/louis-brennan-the-inventive-life-of-the-monorail-man-from-mayo-1.1757782">Louis Brennan</a>: “Sir, your invention promises to revolutionise the railway systems of the world.”</p>
<p>Buoyed by such designs, engineering writers of the time looked forward to a future of us all whizzing around the country on new forms of hi-tech transport. But there were concerns too: in one popular <a href="https://en.wikipedia.org/wiki/Harmsworth_Popular_Science">1912 encyclopaedia</a>, an artist’s impression of a monorail train crossing a gorge via an unfeasibly skimpy bridge was accompanied by the warning:</p>
<blockquote>
<p>When [note, not ‘if’] the monorail comes into general use, the feeling of insecurity – quite unnecessary but nevertheless inevitable – will be felt the strongest where there are single-rail bridges.</p>
</blockquote>
<p>In fact, despite Churchill’s support, the Brennan Monorail never got further than the test track. In both its target markets – cheaply built branch lines and the military – a far simpler technology easily outdid it on grounds of practicality, flexibility and cost: the motorised bus and truck.</p>
<p>More than a century on, we are in a new era of transport technology disruption. In recent years, across the world, we have seen the emergence of the <a href="https://www.thetimes.co.uk/article/flying-electric-taxis-are-hailed-as-the-future-2v6jllgfc">flying taxi</a> and <a href="https://www.forbes.com/sites/jamesmorris/2022/11/29/is-it-finally-time-for-high-speed-hyperloop-transportation/">hyperloop train</a> prototypes, <a href="https://www.latimes.com/politics/story/2021-08-10/hydrogen-highway-or-highway-to-nowhere">hydrogen highways</a> and <a href="https://www.weforum.org/agenda/2022/09/trackless-trams-help-revitalize-suburbs/">trackless trams</a>, as well as countless driverless <a href="https://www.theverge.com/2012/12/23/3797260/self-driving-cars-automated-vehicles">car</a>, <a href="https://theconversation.com/driverless-cars-what-weve-learned-from-experiments-in-san-francisco-and-phoenix-199319">taxi</a> and <a href="https://fortune.com/2017/01/14/vegas-self-driving-bus/">bus</a> pilots. At the same time, our most popular forms of public transport – the train and bus – are creaking under the strain of <a href="https://www.local.gov.uk/about/news/thousands-bus-routes-risk-amid-funding-uncertainty">government funding cuts</a>, <a href="https://news.sky.com/story/resolving-rail-disputes-would-have-cost-less-than-strikes-admits-minister-12789405">union disputes</a> and <a href="https://www.railpro.co.uk/railpro-magazine/april-22/staffing-strategies-must-be-fixed-to-secure-future-for-uk-rail">technological upheaval</a>.</p>
<p>Is this the dawning of a much-needed revolution in mass transit, led by a new breed of clean-powered, demand-responsive, driverless vehicles? Or for all the people young and old, rural and urban-based, who rely on public transport for their everyday needs, will these grand designs turn out to be little more than modern versions of the Brennan Monorail flop?</p>
<h2>Slow death of the bus</h2>
<p>A key factor influencing today’s public transport strategies is the commitment to limit planetary warming to 1.5°C by reaching net zero emissions – a strategy the UK prime minister, Rishi Sunak, <a href="https://www.bbc.co.uk/news/uk-politics-66857551">recently appeared to row back on</a>. One global projection by the C40 network suggests public transport use in cities needs to <a href="https://www.c40.org/news/public-transport-cities-decade-1-5c-target/">double by 2030</a> to meet these targets.</p>
<p>But there are, of course, many other benefits of good public transport: from <a href="https://www.unep.org/explore-topics/resource-efficiency/what-we-do/cities/sustainable-transport-and-air-pollution">improving air quality</a> and <a href="https://www.urbantransportgroup.org/resources/social-inclusion#:%7E:text=Transport%20has%20a%20vital%20role,to%20fully%20participate%20in%20society.">social inclusion</a> to encouraging <a href="https://www.newstatesman.com/spotlight/economic-growth/regional-development/2022/07/transport-is-the-core-of-levelling-up">regional economic development</a> (aka levelling up) and <a href="https://oecd-opsi.org/innovations/pink-passes/">widening workforce participation</a>.</p>
<p>In the UK, trains continue to hog the headlines, amid the rumoured <a href="https://www.bbc.co.uk/news/business-66909732">cancellation of the northern section of the HS2 route</a>, the general <a href="https://www.theguardian.com/commentisfree/2022/oct/22/north-rail-system-franchises-london">lack of rail investment in the north</a>, ongoing <a href="https://www.theguardian.com/uk-news/rail-strikes">industrial action</a> over pay and staffing levels – and even the agonising <a href="https://www.theguardian.com/uk-news/2023/sep/26/no-one-knew-anything-rail-passengers-11-hour-london-to-edinburgh-odyssey">11-hour ordeal</a> endured by rail passengers when their London to Edinburgh service was cancelled mid-route. Meanwhile, the long, slow <a href="https://www.theguardian.com/commentisfree/2023/aug/06/bus-neglect-national-failure-public-policy-motorists">collapse of the UK’s local bus services</a> has gone largely unnoticed – other than by the people who have lost this critical mode of travel.</p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="BBC graphic of bus cuts" src="https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=935&fit=crop&dpr=1 600w, https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=935&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=935&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1176&fit=crop&dpr=1 754w, https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1176&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/550306/original/file-20230926-15-nvzbgk.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1176&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Changes in bus use in English counties.</span>
<span class="attribution"><a class="source" href="https://www.bbc.co.uk/news/uk-64651414">Department for Transport/BBC</a></span>
</figcaption>
</figure>
<p>In March 2023, the House of Commons Transport Committee <a href="https://committees.parliament.uk/publications/34612/documents/190548/default/">reported</a> that England’s long-term decline in bus use outside London – a 15% drop between 2010-11 and 2018-19 – had deteriorated by a further 15% despite the government’s temporary <a href="https://www.gov.uk/guidance/2-bus-fare-cap">£2 cap on fares</a> (rising to £2.50 in November 2023). The situation is <a href="https://www.transport.gov.scot/publication/scottish-transport-statistics-no-38-2019-edition/chapter-2-bus-and-coach-travel/#:%7E:text=380%20million%20journeys%20were%20made,cards%20in%20Scotland%20in%202019.">similar in Scotland</a>, where bus use has declined 22% since 2007-08.</p>
<p>In parallel with this decline, <a href="https://www.bbc.co.uk/news/business-64557250">services and routes have been cut</a>. Government bus grants have become increasingly selective, resulting in entire bus networks vanishing in a number of areas, and being left “<a href="https://www.msn.com/en-gb/money/other/local-bus-services-hanging-by-a-thread-mps-warn/ar-AA19fI5V?ocid=msedgntp&cvid=e1abcf8487c34436b238e8eb141cacb9&ei=34">hanging by a thread</a>” in others.</p>
<p>This isn’t just in smaller towns and rural areas. Many larger settlements have also been affected, such as Stoke-on-Trent, where bus services have reduced by half since 2012-14. In June 2023, when <a href="https://www.bbc.co.uk/news/articles/c3gz35wgpdyo">further cuts were announced</a>, <a href="https://www.stokesentinel.co.uk/news/stoke-on-trent-news/first-potteries-axes-journeys-cuts-8536993">local media</a> reported the impact on users such as this unhappy traveller:</p>
<blockquote>
<p>I use the bus to get to work and back, and losing the service would mean reducing my hours. It’s getting us down. My husband’s an Avon rep, so he’s on and off the buses all the time. And the 8am bus I get is packed.</p>
</blockquote>
<p>There are exceptions to this downward spiral. Manchester’s mayor, Andy Burnham, recently heralded the launch of the new, <a href="https://www.greatermanchester-ca.gov.uk/news/local-accountability-at-centre-of-new-bus-network-as-operators-appointed-to-run-first-franchised-services-outside-of-london-for-almost-40-years/">“re-regulated” Bee network of buses</a> across Greater Manchester as “symbolic of a need to get more public control and ownership of critical services”. Praising this initiative, the Guardian wrote in its <a href="https://www.theguardian.com/commentisfree/2023/sep/18/the-guardian-view-on-greater-manchesters-bus-revolution-the-public-at-the-wheel?CMP=share_btn_tw">leader column</a>:</p>
<blockquote>
<p>The cutting of bus services on purely commercial grounds has led to greater social and economic isolation, restricting opportunities for the elderly and those without other means of getting around. Publicly regulated buses will at last allow greater accountability in relation to a service that, for many passengers, is fundamental to their daily quality of life.</p>
</blockquote>
<p>But this is not the direction of travel in most parts of the country, where privatised, disconnected bus services remain dominant. A key structural reason for the decline in local bus use is that people’s patterns of travel have become <a href="https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1165693/our-changing-travel-how-people_s-travel-choices-are-changing.pdf">much more dispersed and complex</a> – behaviour that is hard to accommodate with a conventional, fixed-route public transport system such as the bus.</p>
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<p><strong><em>This article is part of Conversation Insights</em></strong>
<br><em>The Insights team generates <a href="https://theconversation.com/uk/topics/insights-series-71218">long-form journalism</a> derived from interdisciplinary research. The team is working with academics from different backgrounds who have been engaged in projects aimed at tackling societal and scientific challenges.</em></p>
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<p>In fact, the strongest recent growth in local travel – seemingly exacerbated by the pandemic – has not been along major corridors to city centres, but in <a href="https://citeseerx.ist.psu.edu/document?repid=rep1&type=pdf&doi=5f45c81567467d0a5f56899774153461b85b1e4e">suburban and rural areas</a>. Not only are people <a href="https://www.ons.gov.uk/employmentandlabourmarket/peopleinwork/employmentandemployeetypes/articles/characteristicsofhomeworkersgreatbritain/september2022tojanuary2023">working in different ways</a> but our economy is increasingly <a href="https://commonslibrary.parliament.uk/research-briefings/sn02786/#:%7E:text=The%20service%20industries%20include%20the,employment%20in%20January%E2%80%93March%202023.">service</a> and <a href="https://www.capitaleconomics.com/newsroom/uk-economy-returns-growth-driven-consumer-spending">consumer-focused</a>, and travel patterns have altered significantly as a result. The major areas of travel growth are now for <a href="http://www.demand.ac.uk/wp-content/uploads/2018/04/FutureTravel_report_final.pdf">social and leisure-related purposes</a> – and again, traditional fixed-route bus services struggle to accommodate these types of trip, while it is so much easier to simply use a car.</p>
<p>The advent of certain digital technologies – in particular, <a href="https://www.route-one.net/features/cashless-is-king-the-shifting-landscape-of-ticketing/">cashless ticketing</a> and <a href="https://www.theguardian.com/public-leaders-network/2016/sep/15/top-10-transport-apps-smarter-travel">journey planning apps</a> – may make using public transport more desirable for those comfortable with such technology. But they don’t change the core service. A smart app is just a high-tech insult if buses don’t run when and where you want to go.</p>
<h2>The emergence of trackless trams</h2>
<p>In 2011, a small but radical new service was established to connect passengers using Heathrow Airport’s Terminal 5 with their parked cars. These <a href="https://www.heathrow.com/transport-and-directions/heathrow-parking/heathrow-pod-parking-terminal-5">Heathrow Pods</a> consisted of driverless, four-seater vehicles available on demand, taking passengers straight to their destination along special elevated, segregated roadways. Users were promised they would “never have to wait more than 30 seconds for one to become available”.</p>
<p>While admittedly covering a very limited area, this radical alternative to the traditional fixed-route, scheduled model of public transport <a href="https://www.dailystar.co.uk/travel/travel-news/mans-video-futuristic-heathrow-airport-28010349">continues to garner praise</a> since reopening after a hiatus during the pandemic. In the wake of the Heathrow Pods’ introduction, it had been expected that similar tracked, autonomous transport systems would develop elsewhere – but that hasn’t come about.</p>
<p>Rather, they could be seen as a small-vehicle precursor to the <a href="https://citymonitor.ai/transport/trackless-trams-may-be-the-best-alternative-to-light-rail">trackless tram systems</a> that have subsequently emerged around the world. A combination of <a href="https://en.wikipedia.org/wiki/Global_Positioning_System">GPS</a> and <a href="https://www.mrlcg.com/latest-media/lidar-in-cars-how-lidar-technology-is-making-self-driving-cars-a-reality-299493/">Lidar (light detection and ranging</a>) guidance technologies are enabling battery-powered electric vehicles to fulfil the function of trams without the need for disruptive and costly track and overhead line infrastructure – making high-quality tram-style services viable beyond a handful of “global elite” cities.</p>
<p>The Chinese <a href="https://www.researchgate.net/figure/The-Trackless-Tram-System-developed-by-CRRC-and-demonstrated-in-Zhuzhou-China-Source_fig1_330069521">pioneered this form of public transport</a> with the automated rapid transit (ART) vehicles, which <a href="https://theconversation.com/why-trackless-trams-are-ready-to-replace-light-rail-103690">first entered service in the eastern city of Zhuzhou</a> in 2018, then rapidly spread to other Chinese cities. Initially manually driven, these trackless trams are now moving to autonomous operation. In Zhuzhou, a four-carriage model was introduced in 2021 which can carry 320 passengers at a maximum speed of just over 40mph, running on batteries charged at each station stop.</p>
<p>And the concept is spreading beyond China: in 2022, a trial was announced for a five-mile route <a href="https://www.stirling.wa.gov.au/your-city/news/2022/march/exciting-new-phase-in-trackless-tram-feasibility">in the city of Stirling</a>, Western Australia. In the UK, however, there is less inclination to <a href="https://eandt.theiet.org/content/articles/2022/10/uk-and-us-seek-to-undermine-chinas-growing-technological-influence/">depend on Chinese-controlled technology</a>. And of course, trams – trackless or otherwise – don’t solve the issue of people wanting services that take them beyond a fixed route.</p>
<p>Meeting the modern, disparate mobility needs of an entire population doesn’t just require new types of vehicle or clever booking apps. We need a new vision of what public transport could be – and in different corners of the UK, there are places starting to offer this.</p>
<h2>The UK’s self-driving public transport prototypes</h2>
<p>Scotland’s <a href="https://www.cavforth.com/">CAVForth self-driving bus service</a>, which came into public service in May 2023, is described on its website as “the world’s most ambitious and complex autonomous bus system”. Serving a <a href="https://www.cnet.com/tech/i-rode-the-worlds-first-autonomous-public-bus-service/">14-mile route</a> that crosses the Forth Road Bridge on the outskirts of Edinburgh, the buses drive themselves along ordinary roads, obey traffic lights, and mix with pedestrians and cyclists. The main reaction of passengers seems to be that they are unaware the buses are not manually driven, as one early user <a href="https://www.cnet.com/tech/i-rode-the-worlds-first-autonomous-public-bus-service/">wrote in CNet</a>:</p>
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<p>Though the bus is fully autonomous, you’d be forgiven for not really recognising it as such. You’ll find a regular steering wheel upfront, and behind it, a driver who’ll no doubt look as though they’re operating the vehicle as usual. UK law dictates that even fully autonomous vehicles must still have an ‘operator’ present who can take manual control, should the need arise.</p>
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<figcaption><span class="caption">Stagecoach video showing passengers on board the CAVForth self-driving bus service.</span></figcaption>
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<p>Using a combination of three sets of Lidar technology and a “suite of cameras and radar”, the autonomous system can currently manage 90% of the route, <a href="https://www.itpro.com/technology/meet-the-cavforth-project-the-worlds-first-autonomous-bus#:%7E:text=The%20five%2Dbus%20fleet%20began,will%20expand%20northwards%20to%20Dunfermline.">according to ITPro</a>, with the human driver “handling the exit from the depot and a few other locations”. The route is projected to expand further north, to the city of Dunfermline, in 2024.</p>
<p>Because the driver is a <a href="https://theconversation.com/free-public-transport-doesnt-add-up-unless-you-get-rid-of-the-drivers-97129">big part of bus running costs</a>, if buses can eventually be autonomous then the challenging costs of providing late-night services or thinly used routes will be reduced – meaning that services could be improved. But the IT-led potential extends much further than a driverless bus.</p>
<p>In south-east England, <a href="https://www.mi-link.uk/">Mi-Link</a> – billed as “the UK’s first fully electric autonomous bus service” – is a move towards something more radical. As well as being electric-powered, this self-driving bus service – which launched in January 2023 and now <a href="https://www.bbc.co.uk/news/uk-england-oxfordshire-65888336">runs on public roads to Didcot Parkway railway station</a> in south Oxfordshire – is linked to a real-time journey planning app which helps travellers plan their journey whether they are walking, cycling or taking the bus to the Milton Park trading estate. It keeps users updated according to their individual travel preferences through the likes of WhatsApp and Messenger.</p>
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<figcaption><span class="caption">First Bus video launching the Mi-Link self-driving electric bus service in Oxfordshire.</span></figcaption>
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<p>The integration of autonomous technology with a smart journey planning system feels critical if public transport is to prosper by attracting traditional car users. App-linked self-driving taxi fleets may well prove another key part of this future, and there are already entirely driverless public taxi fleets such as Waymo and Cruise in <a href="https://www.bing.com/videos/search?q=driverless+cars+san+francisco&docid=603485803253406102&mid=FACAC36B1FADD54CBAAFFACAC36B1FADD54CBAAF&view=detail&FORM=VIRE">San Francisco</a>, and the <a href="https://uk.pcmag.com/news/145977/visiting-chinas-capital-city-dont-be-surprised-if-your-taxi-has-no-driver">Robotaxi</a> in China. On the whole, these appear to be <a href="https://theconversation.com/driverless-cars-what-weve-learned-from-experiments-in-san-francisco-and-phoenix-199319">technically successful</a>, if highly subsidised and dependent on powerful 5G networks to operate. However, their emergence has been <a href="https://www.bbc.co.uk/news/technology-66611513">met with resistance</a> both about perceived lack of safety and <a href="https://www.ft.com/content/f312c9ff-633d-480e-8887-4b5ad3f0ae5e">luddite-esque fears</a> of potential job losses.</p>
<p>But for one of the best clues to what local public transport could look like in the future, we should again look closer to home, to a UK city that has long been renowned – and sometimes mocked – for its futuristic visions.</p>
<h2>The future according to Milton Keynes</h2>
<p>After its foundation in 1967, the ambitious <a href="https://www.tcpa.org.uk/areas-of-work/garden-cities-and-new-towns/new-towns/">new town</a> of Milton Keynes in Buckinghamshire soon began attracting an international reputation for anticipating future social, economic and cultural trends. Along the way, it was also derided as a <a href="https://inews.co.uk/news/uk/milton-keynes-turns-50-embracing-roundabouts-city-wants-lead-culture-tech-42699">city of roundabouts</a> and <a href="https://en.wikipedia.org/wiki/Concrete_Cows">concrete cows</a>, with one architecture critic <a href="https://www.theguardian.com/books/2010/oct/23/ruins-britain-owen-hatherley-review">calling it</a> “the doomed apotheosis of the fossil-fuel society”.</p>
<p>Today, its designers’ desire to accommodate extremely high levels of car use can be viewed as an environmentally irresponsible planning stance. But despite its detractors, Milton Keynes has proved extremely successful both economically and socially, and today has a growing reputation for being at the forefront of a <a href="https://www.milton-keynes.gov.uk/news/2023/major-boost-advanced-rapid-transport-mk">more climate-friendly era of transport innovation</a>.</p>
<p>Recently, its planners have grappled with the need for a new type of public transport – something that is “demand responsive” in the way of a taxi, but without taxi-level fares.</p>
<p>Demand-responsive transport (DRT) services have been attempted by public authorities over the years – but <a href="https://oro.open.ac.uk/19345/1/">largely without success</a>. A <a href="https://www.sciencedirect.com/referencework/9780081026724/international-encyclopedia-of-transportation">global assessment</a> in 2021 concluded that when a new DRT service is set up, revenue from the low number of passengers could not cover the running costs, particularly those of the driver and back-office systems.</p>
<p>One early example was the <a href="http://news.bbc.co.uk/1/hi/england/2399505.stm">Corlink DRT service</a> in north Cornwall, which launched in 2002 to link rural communities with towns. The subsidy cost of over £28 per passenger trip was financially unsustainable and when special government support for the project ended, the service was withdrawn.</p>
<p>The Taxibus service to Bicester rail station, which launched around the same time, ran flexible routes off-peak and, by late 2003, was carrying 50,000 passengers a year. But even then, the service was eventually withdrawn as commercially unviable.</p>
<p>Twenty years on, however, Milton Keynes has addressed <a href="https://oro.open.ac.uk/85542/1/Corrected%20proofs%20TCP%20DRT%20article.pdf">the cost problem</a>, at least, with its DRT service, <a href="https://getaroundmk.org.uk/on-board/mk-connect">MK Connect</a>. Facing the familiar situation of decreased funding to support the rising cost of uneconomic bus services, the city council opted not to implement cuts. Instead, it replaced its subsidised routes with a new demand-responsive service in partnership with the international tech company <a href="https://ridewithvia.com/about?lang=en-gb">Via Transportation</a>. Introduced in 2021, MK Connect still requires a subsidy, but <a href="https://oro.open.ac.uk/85542/">half that of the conventional bus services</a> it replaced.</p>
<p>The service is booked by users like an Uber taxi, logging their pick-up and drop-off addresses through a smartphone app, web portal or by phoning the contact centre. The app directs users to a nearby pick-up point, and they are dropped near their destination. Other passengers may be picked up and dropped off along the way.</p>
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<p>The vehicles are small: as well as the fleet of eight-seater vans (many of which are electric), some cars are used. They generally arrive within 30 minutes of a booking being made, though the wait can be longer at busy times and in more rural areas. Fares are similar to that of traditional buses (payment is cashless), and the service covers the whole Milton Keynes city area – with far better coverage and operating times than the limited bus routes the service replaced.</p>
<p>An important feature is that the app will not allow someone to book on MK Connect if they could use a commercial bus route for their trip instead. In these cases, travellers are informed where to catch the conventional bus and when it will arrive. This ensures that MK Connect does not adversely affect existing viable bus routes, while improving the city’s public transport as a whole. Equally, if people cannot use existing buses due to a disability or other reason, they can register this and will always be accommodated on MK Connect.</p>
<p>The service is widely used, with some 40,000 trips being made each month (almost half a million each year) – a level of use that means its finances stack up. MK Connect has enabled trips to be made that previously were difficult or impossible using conventional buses, including for a man with sight loss who is the <a href="https://www.youtube.com/watch?v=oQYnJ41CmTY">subject of a widely shared video</a>.</p>
<p>One of us – Stephen – has used MK Connect on a number of occasions, and offers this mixed review of his experiences of the service:</p>
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<p>I booked a trip to get to the barbers for a haircut. You can only book an hour or so beforehand, but I found a service that would get me there on time, which picked me up from the end of our road (the app guided me to the exact pick-up point). One other person joined us on the way and another was dropped off en route, but I got to my drop-off point in time for a three-minute walk across to the barbers. Coming back was less smooth, though. Initially, I was refused a booking – no vehicles were available. I waited a few minutes and tried again. This time I got a vehicle, after a 50-minute wait …</p>
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<p>This mixed experience reflects the feedback that has been given in various <a href="https://oro.open.ac.uk/85542/1/Corrected%20proofs%20TCP%20DRT%20article.pdf">passenger surveys</a>. MK Connect is designed to serve modern, dispersed patterns of travel demands but is by no means perfect – some people find it harder to use than the buses it replaced, and there are problems with the vehicles being full at busy times, meaning prospective passengers are refused a booking or not accommodated for a long time. The booking system is also not yet reliable enough when a person has to get to an appointment or college lecture on time, say, or to connect with a specific train.</p>
<p>However, generally speaking, regular users appear to be getting used to the new system and its quirks. The real benefit to them, of course, is that this DRT service allows them to make trips that would be much more difficult, or impossible, using traditional route buses.</p>
<p>Another recently launched DRT, <a href="https://www.intelligenttransport.com/transport-articles/132018/transport-accessibility-hertslynx-drt-hertfordshire/">HertsLynx</a>, aims to serve the rural fringes of Hertfordshire using four electric-powered, 16-seater minibuses in an operating zone centred around the market town of Buntingford and surrounding villages. Passengers are able to travel between 250 virtual bus stops, as well as nearby towns including Stevenage, Hitchin, Letchworth and Baldock – although travel to these towns is limited to fixed points (hospitals, train and bus stations, and high streets).</p>
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<p>HertsLynx now makes 2,600 passenger trips a month and, like MK Connect, booking is by app, online or phone. With only four buses, it has hit a similar issue to MK Connect of being unable to take some trip requests when vehicles are fully in use, as noted in this <a href="https://busandtrainuser.com/2023/07/30/the-drt-renowned-for-its-success/">recent review</a>.</p>
<p>These two prototype services suggest a good model is emerging for local public transport, but that it needs refining. DRT services can best serve more dispersed trips, while conventional buses work well when a regular, predictable arrival time is needed and in situations of high demand. A good mix of the two is what is needed and Milton Keynes and HertsLynx, while heading that way, haven’t yet achieved it. Adding a in a <a href="https://www.manchestereveningnews.co.uk/news/greater-manchester-news/its-a-new-dawn-for-27759901">Manchester-style regulation structure</a> might well do that. </p>
<h2>The future of local public transport?</h2>
<p>As the Brennan Monorail flop illustrated more than a century ago, predicting the future is a dangerous thing. But there is clearly potential to <a href="https://theconversation.com/four-visions-for-the-future-of-public-transport-125443">rethink public transport systems</a> all over the world, in a way that makes a real difference to the planet and quality of daily life – by improving mobility while reducing costs, air pollution and congestion levels.</p>
<p>This revolution is being driven by a range of organisations, spanning powerful technology companies and IT startups as well as the existing public transport industry and both national and local policymakers. Central to a more diversified public transport future is easily accessed information and payment systems that allow users to customise different services for their own travel needs. Personalised apps on mobile devices to book and pay for public transport services will become increasingly important.</p>
<p>If you combine digital planning and payment systems, autonomous driving and a DRT service redesign, then a radically better form of public transport starts to emerge. Without the need for a driver, fixed-route buses could be smaller but run more frequently. Combined with DRT services to cover more dispersed trips, the potentially transformative, “small vehicle-small infrastructure” vision of public transport systems comes into place.</p>
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Read more:
<a href="https://theconversation.com/driverless-public-transport-will-change-our-approach-to-city-planning-and-living-35520">Driverless public transport will change our approach to city planning – and living</a>
</strong>
</em>
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<p>The result could be that, rather than people needing to adjust their behaviour to the schedules and routes of a bus or metro, they can travel directly, whenever they want, on services operating 24/7 – overcoming the poor quality of infrequent evening, night and Sunday public transport services experienced today.</p>
<p>All that said, the future may still not end up quite as automated as <a href="https://blogs.worldbank.org/digital-development/automated-transport-could-propel-development-forward-can-we-turn-vision-reality">some technologists predict</a>. Driverless vehicles overseen by control centres cost an awful lot to set up and run, and this may limit the use of driverless bus and taxi systems to where use is high enough to make the sums add up – in other words, major cities. For a good while yet, public transport vehicles in most medium-sized UK towns, as well as rural areas, are likely to remain manually driven.</p>
<p>Rather than trying to jump straight to an IT-driverless ideal, a phased introduction of upgradable, adaptable system designs makes more sense. In this way, the spectre of the Brennan Monorail should remain a useful reminder that not all technological advances will change our world for the better, and there is a real danger that second-best fixes could impede potentially transformative change. This is a journey that has only just started – and it’s going to be a bumpy ride.</p>
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</ul>
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<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Amid bus route cuts and rail strikes, can the answer to our future public transport needs be found in the hi-tech prototypes being trialled around the UK?Stephen Potter, Professor of Transport Strategy, The Open UniversityMatthew Cook, Professor of Innovation, The Open UniversityMiguel Valdez, Lecturer in Technology and Innovation Management, The Open UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1984942023-02-10T13:52:39Z2023-02-10T13:52:39ZTwo years after its historic deep freeze, Texas is increasingly vulnerable to cold snaps – and there are more solutions than just building power plants<figure><img src="https://images.theconversation.com/files/508675/original/file-20230207-31-lk5791.jpg?ixlib=rb-1.1.0&rect=18%2C9%2C5988%2C3989&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Snow on cattle drive sculptures in Dallas after a winter storm, Feb. 3, 2022.</span> <span class="attribution"><a class="source" href="https://www.gettyimages.com/detail/news-photo/snow-lies-on-the-ground-and-on-the-backs-of-sculptures-at-news-photo/1238170684"> Emil Lippe/Getty Images</a></span></figcaption></figure><p>Texans like to think of their state as <a href="https://www.youtube.com/watch?v=wxSEIK2Ire4">the energy capital of the world</a>. But in mid-February 2021, the energy state ran short of energy. </p>
<p>An <a href="https://www.weather.gov/fwd/Feb-2021-WinterEvent">intense winter weather outbreak</a>, informally dubbed Winter Storm Uri by the Weather Channel, swept across the U.S., bringing snow, sleet, freezing rain and frigid temperatures. Texas was hit especially hard, with all 254 counties under a winter storm warning at the same time. </p>
<p>Across the state, sustained arctic temperatures <a href="https://www.ferc.gov/media/february-2021-cold-weather-outages-texas-and-south-central-united-states-ferc-nerc-and">froze power plants and fuel supplies</a>, while energy demand for home heating climbed to <a href="https://www.puc.texas.gov/agency/resources/reports/utaustin_(2021)_eventsfebruary2021texasblackout_(002)final_07_12_21.pdf">all-time highs</a>. Cascading failures in the electric power and <a href="https://doi.org/10.1016/j.erss.2021.102106">natural gas sectors</a> left millions of people in the dark for days. At least 246 people died, <a href="https://www.kvue.com/article/weather/winter-storm/here-is-why-death-totals-from-winter-storm-uri-may-vary/269-f2bf277f-74d9-443b-ab2e-ff89f336f3ec">possibly many more</a>, and economic damage estimates damages reached <a href="https://www.dallasfed.org/research/economics/2021/0415">US$130 billion</a>.</p>
<p>Water systems, which require energy for pumping and treatment, <a href="https://doi.org/10.1142/S2345737621500226">also were severely damaged</a>. At least <a href="https://www.wfaa.com/article/weather/10-million-texans-still-under-boil-water-notice-and-many-are-without-water/287-c50e9f51-aed4-4398-b40d-dc830de82f83">10 million people</a> were under boil-water notices during and after the storm, sometimes for weeks. Low-income and minority residents, who had fewer resources to find alternative housing and make repairs, <a href="http://dx.doi.org/10.1088/2516-1083/aca9b4">suffered the worst impacts</a>. </p>
<p>As <a href="http://www.webberenergygroup.com/">energy researchers based in Texas</a>, we have spent much of the past two years analyzing why the state was so unprepared for this event and how it can do better. A common knee-jerk reaction to disasters that cause widespread power outages is to call for building more “firm” power plants – those that use fuels like coal or natural gas and are designed to deliver power at any time of day or night. But coal and gas plants, and their fuel supplies, can fail spectacularly. </p>
<p>We think it is important to think beyond just building more power plants. Our findings spotlight other solutions that can be cleaner, cheaper and faster to put in place.</p>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/vh-yuvBq3bg?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
<figcaption><span class="caption">Texans describe their experiences during Winter Storm Uri and its lasting impacts.</span></figcaption>
</figure>
<h2>Planning for winter</h2>
<p>Analyses after Uri revealed that a <a href="https://www.asme.org/topics-resources/content/the-texas-power-crisis-didn-t-have-to-happen">lack of winterization</a> in the electric and gas sectors was a critical cause of systemwide failure. The Texas legislature enacted <a href="https://www.texasmonthly.com/news-politics/texas-electric-grid-failure-warm-up/">new winterization requirements for electricity generators</a>. But it did not do the same for natural gas producers, which provide fuel to about <a href="https://www.ercot.com/files/docs/2022/02/08/ERCOT_Fact_Sheet.pdf">40% of Texas power plants</a> and <a href="https://www.ercot.com/files/docs/2021/04/28/ERCOT_Winter_Storm_Generator_Outages_By_Cause_Updated_Report_4.27.21.pdf">weren’t able to deliver</a> during the storm. </p>
<p>Since then, Texas saw significant drops in natural gas production during winter cold snaps in January and February 2022. As happened during Uri, production at many gas wells was halted because water and other liquids that come to the surface with the natural gas froze when they hit a frozen wellhead, creating an ice dam and stopping the flow of gas into pipelines. </p>
<p>In December 2022, Winter Storm Elliott caused more <a href="https://www.texasmonthly.com/news-politics/texas-power-plants-outages-freeze/">drops in gas production</a>, as well as <a href="https://www.utilitydive.com/news/duke-energy-apologizes-for-winter-storm-outages-as-ferc-nerc-open-investig/639583/">power outages</a> across the Southeast U.S. These events show that winter reliability risks are not specific to Texas.</p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"1621659665263124480"}"></div></p>
<h2>Cold weather challenges</h2>
<p>Our research shows that winter peak electricity demand in Texas – driven by electric space heating – has become <a href="https://doi.org/10.1016/j.isci.2022.104173">more sensitive to cold temperatures</a> over the past 20 years. Winter peaks are also growing faster and are more erratic than summer peaks. We know that every summer is going to be hot, but we don’t know for certain that winter will be cold, which makes it harder to plan. </p>
<p><iframe id="xAnvl" class="tc-infographic-datawrapper" src="https://datawrapper.dwcdn.net/xAnvl/3/" height="400px" width="100%" style="border: none" frameborder="0"></iframe></p>
<p>Texas is at the forefront of a national shift to heating homes with electricity instead of oil or gas. About 60% of homes in Texas use either <a href="https://www.eia.gov/todayinenergy/detail.php?id=47116">heat pumps or electric resistance heating</a>.</p>
<p>Heat pumps shift home winter energy demand from carbon-emitting sources like natural gas to electricity. They can also cool buildings more efficiently than older air conditioning units. However, heat pumps that aren’t rated for low temperatures can <a href="https://theconversation.com/electric-heat-pumps-use-much-less-energy-than-furnaces-and-can-cool-houses-too-heres-how-they-work-154779">use more energy</a> to heat in the winter than to cool in the summer. Better minimum efficiency standards can help <a href="https://www.consumerreports.org/heat-pumps/can-heat-pumps-actually-work-in-cold-climates-a4929629430/">mitigate this challenge</a>. </p>
<p>The shift to electricity for heating indicates that within the next few decades, electricity demand in Texas is likely to regularly peak in winter rather than summer. Meanwhile, lower-demand shoulder seasons in spring and fall – the times when fossil fuel and nuclear power plants normally go offline for maintenance – are getting shorter, as heat waves start earlier and winter storms push <a href="https://doi.org/10.48550/arXiv.2302.00185">later into the spring</a>. </p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"1620949318223147008"}"></div></p>
<h2>What do we do now?</h2>
<p>These trends are making it harder for grid planners and operators to ensure sufficient power capacity is always available, especially in winter. In addition to making sure Texas has enough generating capacity online, here are three areas where we believe the state should do more: </p>
<p>– Promote energy efficiency.</p>
<p>Currently the nonprofit American Council for an Energy-Efficient Economy ranks Texas <a href="https://www.aceee.org/sites/default/files/pdfs/u2206.pdf">29th among the states</a> for its policies and programs to save energy and promote energy efficiency. Adopting policies such as stricter building codes and minimum appliance efficiency standards would reduce consumers’ energy bills. It also would lower <a href="https://www.aceee.org/press-release/2021/10/energy-upgrades-texas-homes-could-avert-blackouts-lower-cost-proposed-gas">peak demand</a> during extreme events. And if outages still occur, well-insulated houses will stay warm or cool for longer, reducing risks to occupants.</p>
<p>– Increase investment in <a href="https://www.energy.gov/oe/demand-response">demand response</a>.</p>
<p>Demand response programs offer electricity customers incentives to turn off noncritical appliances, like pool pumps or water heaters, for short periods to reduce overall load on the grid during periods of high demand. For real-time balancing of supply and demand on the grid, turning off 500 megawatts of noncritical demand is functionally equivalent to turning on a 500-megawatt power plant. While Texas has made some progress in this area, <a href="https://www.ferc.gov/sites/default/files/2021-12/2021%20Assessment%20of%20Demand%20Response%20and%20Advanced%20Metering%20DEC%202021_0.pdf">it is below average</a> relative to its peers.</p>
<p>Our research shows that Texas could free up <a href="https://www.me.utexas.edu/news/1683-energy-efficiency-resilience-in-extreme-weather-events">7 gigawatts or more of electric generating capacity</a> through demand response, which would double what it has available today. </p>
<p>Increasing demand response can be cheaper than building new power plants. While a new wind or solar farm might cost $1,000 or more per kilowatt of generating capacity, demand response programs cost about <a href="https://www.osti.gov/servlets/purl/1373278">$200 per kilowatt</a> of demand that can be turned off. </p>
<p>It’s also faster. Technicians can install thousands of remote-controllable thermostats or appliance switches in months, compared with the years of lead time required to site, license and build new power plants.</p>
<p>– Connect Texas’ isolated power grid to the Western and Eastern interconnections.</p>
<p>Most electricity in the U.S. is generated and sold over two large grids that cover nearly all of the lower 48 states. Texas has kept its <a href="https://www.ercot.com/about/profile">own grid</a> inside state lines as a way to <a href="https://www.kut.org/energy-environment/2021-07-22/texas-electric-grid-february-blackouts-the-disconnect">minimize federal regulation of its power sector</a>. While there are some very weak direct-current ties to those grids, Texas utilities can’t import meaningful amounts of power when supplies are scarce, or export it when they have a surplus and neighboring states need support. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="US map showing Western and Eastern Interconnect and ERCOT grids." src="https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/508671/original/file-20230207-14-fw7y1i.jpeg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Most of Texas gets power from the state grid, managed by the Electric Reliability Council of Texas (ERCOT), which has limited interconnections with grids that deliver power over the rest of the continental U.S.</span>
<span class="attribution"><a class="source" href="https://www.ercot.com/files/assets/2022/12/13/ERCOT-Maps_Interconnection-Map.jpg?">ERCOT</a>, <a class="license" href="http://creativecommons.org/licenses/by-nd/4.0/">CC BY-ND</a></span>
</figcaption>
</figure>
<p>Expanded grid connectivity would make electricity supply in Texas more reliable and enable generators to export low-carbon power from the state’s abundant wind and solar farms. Rapid growth in wind and solar generation in Texas has saved the state’s consumers <a href="https://www.ideasmiths.net/wp-content/uploads/2022/10/IdeaSmiths_CFT_ERCOT_RE_FINAL.pdf">billions of dollars</a> while making a lot of money for <a href="https://www.ideasmiths.net/wp-content/uploads/2023/01/Economic-Impact-of-Renewable-Energy_JAN2023.pdf">rural landowners and local governments</a>. </p>
<p>Those economically beneficial renewable power plants will eventually saturate the limited Texas market. Opening access to consumers in other states by connecting Texas to other grids would continue to spur economic growth and job creation in rural areas and would give the state grid a lifeline during extreme events. Our ongoing research shows that this would be a cheaper and cleaner way to assure reliability than just adding more natural gas power plants. </p>
<p>Texas officials often tout the state’s “<a href="https://www.washingtontimes.com/news/2022/apr/27/texas-leading-the-charge-in-all-of-the-above-energ/">all of the above” energy strategy</a>, but that vision focuses heavily on production. In our view, an approach that employs every tool in the toolbox – including efficiency, demand response and increased grid connectivity – would better serve the state.</p><img src="https://counter.theconversation.com/content/198494/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Michael E. Webber receives funding from variety of government agencies, foundations, and industry, including financial institutions and energy companies. A full list of supporters is available at <a href="http://www.webberenergygroup.com">http://www.webberenergygroup.com</a>. He is on the board of GTI Energy, CTO at Energy Impact Partners, and co-founder and Chairman of IdeaSmiths LLC, an engineering consulting firm. Any opinions, findings, conclusions or recommendations expressed in this material are
those of the authors and do not necessarily reflect the views of the sponsors, Energy Impact Partners, GTI Energy, or
IdeaSmiths LLC. The terms of this arrangement have been reviewed and approved by the University of Texas
at Austin in accordance with its policy on objectivity in research.</span></em></p><p class="fine-print"><em><span>Drew Kassel receives funding from META Technologies, Artesion, Grid United (GU), and the State Energy Conservation Office (SECO). Any opinions, findings, and conclusions or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the views of the sponsors or the University of Texas at Austin.</span></em></p><p class="fine-print"><em><span>Joshua D. Rhodes receives funding from variety of government agencies, foundations, and industry, including financial institutions and energy companies. A full list of academic supporters is available at <a href="http://www.webberenergygroup.com">http://www.webberenergygroup.com</a> and list of public consulting reports, including those that funded them, is available at <a href="https://www.ideasmiths.net/reports-publications/">https://www.ideasmiths.net/reports-publications/</a>. He is on the board of Catalyst Cooperative, and co-founder and CTO of IdeaSmiths LLC, an engineering consulting firm. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of the sponsors, clients, the University of Texas, Columbia University, or IdeaSmiths LLC. The terms of this arrangement have been reviewed and approved by the University of Texas at Austin in accordance with its policy on objectivity in research.</span></em></p><p class="fine-print"><em><span>Matthew Skiles receives funding from the University of Texas at Austin and from the National Science Foundation Graduate Research Fellowship Program under Grant No. DGE-1610403. Any opinions, findings, and conclusions or recommendations expressed in this material are those of the author(s) and do not necessarily reflect the views of the University of Texas at Austin or the National Science Foundation.</span></em></p>Texas wasn’t prepared to keep the lights on during Winter Storm Uri, and it won’t be ready for future cold weather unless it starts thinking about energy demand as well as supply.Michael E. Webber, Josey Centennial Professor of Energy Resources, The University of Texas at AustinDrew Kassel, PhD Student in Mechanical Engineering, The University of Texas at AustinJoshua D. Rhodes, Research Scientist, The University of Texas at AustinMatthew Skiles, PhD Student in Mechanical Engineering, The University of Texas at AustinLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1406402020-06-17T04:24:02Z2020-06-17T04:24:02ZEnergy giants want to thwart reforms that would help renewables and lower power bills<figure><img src="https://images.theconversation.com/files/342044/original/file-20200616-23266-3qzulm.jpg?ixlib=rb-1.1.0&rect=25%2C0%2C5534%2C3709&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Darren England/AAP</span></span></figcaption></figure><p>Australia’s energy market is outdated. It doesn’t encourage competition and that’s holding back the <a href="http://www.unswlawjournal.unsw.edu.au/wp-content/uploads/2017/09/39-4-6.pdf">transition</a> to renewable energy. Important reforms to modernise the market are on the way, but big energy companies are seeking to use the cover of COVID-19 to prevent the change.</p>
<p>This is bad for consumers, and for climate action. Reform would help create a modern grid <a href="https://relp.lexxion.eu/article/RELP/2011/2/44">designed</a> around clean energy, pushing coal-fired generators to retire earlier. Over time, it would also bring down power costs for households and business.</p>
<p>Renewable energy is the cheapest form of new electricity. It’s far better for the environment than coal and gas, and can deliver reliable supplies when backed by batteries and other energy storage. </p>
<p>Instead of delaying reform, Australia should be advancing it.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/342051/original/file-20200616-23235-82b1p1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/342051/original/file-20200616-23235-82b1p1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=395&fit=crop&dpr=1 600w, https://images.theconversation.com/files/342051/original/file-20200616-23235-82b1p1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=395&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/342051/original/file-20200616-23235-82b1p1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=395&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/342051/original/file-20200616-23235-82b1p1.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=496&fit=crop&dpr=1 754w, https://images.theconversation.com/files/342051/original/file-20200616-23235-82b1p1.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=496&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/342051/original/file-20200616-23235-82b1p1.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=496&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Wind and solar energy is better for the environment, and consumers.</span>
<span class="attribution"><span class="source">Tim Wimborne/Reuters</span></span>
</figcaption>
</figure>
<h2>What’s this all about?</h2>
<p>Regulators and governments recognise the need to modernise the rules governing the National Electricity Market. That market, established in 1998, supplies all Australian jurisdictions except Western Australia and the Northern Territory.</p>
<p>Reliable electricity requires that supply and demand be kept in balance. This balance is primarily provided by a system known as the <a href="https://www.aemc.gov.au/sites/default/files/content//Five-Minute-Settlement-directions-paper-fact-sheet-FINAL.PDF">wholesale spot market</a>. Every five minutes, electricity generators bid into the spot market, specifying how much energy they will provide at a certain price. </p>
<p>An entire <a href="http://www.coagenergycouncil.gov.au/publications/post-2025-market-design-national-electricity-market-nem">redesign</a> of the market rules is scheduled for 2025. This should make the market work efficiently and reliably as coal retires and is replaced by renewable energy.</p>
<p>In the meantime, one important rule change is due to start in July next year, known as “<a href="https://www.aemc.gov.au/rule-changes/five-minute-settlement">5-minute settlement</a>”.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/matt-canavan-says-australia-doesnt-subsidise-the-fossil-fuel-industry-an-expert-says-it-does-131200">Matt Canavan says Australia doesn't subsidise the fossil fuel industry, an expert says it does</a>
</strong>
</em>
</p>
<hr>
<p>Currently, electricity is sold and sent out from generators in 5-minute blocks. But the actual price paid for this electricity in the wholesale market is averaged every 30 minutes. This means there are six dispatch periods, each with their own price, which are then averaged out when the market is settled. </p>
<p>This strange design has enabled big electricity generators to <a href="https://www-sciencedirect-com.ezp.lib.unimelb.edu.au/science/article/pii/S0140988316301839">game the market</a>. One method involves placing high bids in the first interval, then placing low or even negative bids in the remaining five intervals. This ensures that electricity from the big generators is purchased, but that they and all other generators receive an artificially high average price for the whole 30-minute period.</p>
<p>In 2017, the Australian Energy Market Commission (AEMC) <a href="https://www.aemc.gov.au/sites/default/files/content/97d09813-a07c-49c3-9c55-288baf8936af/ERC0201-Five-Minute-Settlement-Final-Determination.PDF">decided</a> to replace 30-minute settlement with 5-minute settlement.</p>
<p><a href="https://www.aemc.gov.au/sites/default/files/content//Five-Minute-Settlement-directions-paper-fact-sheet-FINAL.PDF">The commission says</a> the current system was adopted more than 20 years ago due to technological barriers which have since been overcome. It argues moving to 5-minute settlement would better reflect the value to consumers of fast-response technologies, such as batteries storing renewable energy and so-called “demand response” (a concept we’ll explain later).</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/342058/original/file-20200616-23247-kd09nn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/342058/original/file-20200616-23247-kd09nn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/342058/original/file-20200616-23247-kd09nn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/342058/original/file-20200616-23247-kd09nn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/342058/original/file-20200616-23247-kd09nn.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/342058/original/file-20200616-23247-kd09nn.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/342058/original/file-20200616-23247-kd09nn.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The rule change would reduce power costs for consumers.</span>
<span class="attribution"><span class="source">Brendan Esposito/AAP</span></span>
</figcaption>
</figure>
<p><a href="https://www.aemc.gov.au/rule-changes/five-minute-settlement">According to</a> the AEMC, the rule change would lead to lower wholesale costs, cutting electricity prices for consumers.</p>
<p>But on March 19 this year, the Australian Energy Council, which represents most coal-fired power stations and the big three electricity retailers, sought to delay the reform. It wrote to federal energy minister Angus Taylor and his state counterparts, arguing the pandemic means energy companies must focus on “<a href="https://www.energycouncil.com.au/analysis/covid-19-brings-reform-challenges/">critical supply and reliabilty</a>” issues, rather than implementing the rule change. </p>
<p>But energy consumption has <a href="https://www.tai.org.au/content/national-energy-emissions-audit-april-2020">barely changed</a> during the pandemic, the Australia Institute’s national energy emissions audit shows. So delaying the reform to deal with supply and reliability issues appears unjustified.</p>
<p>Despite this, the Australian Energy Market Operator has proposed delaying the change for a year. Our <a href="https://www.tai.org.au/content/delaying-energy-market-reform-increase-costs-slow-transition-renewables-think-tank-industry">submission</a>, endorsed by energy and technology leaders, opposes the delay. </p>
<p>Moves by regulators to delay another <a href="https://reneweconomy.com.au/regulators-flag-delays-to-16-energy-reform-projects-as-fossil-fuel-interests-dig-in-15284/">16 market reforms</a> due to COVID-19 also seem to be afoot.</p>
<h2>Change is possible</h2>
<p>Last week, one big rule change to the National Electricity Market <em>did</em> proceed as planned. <a href="https://www.abc.net.au/news/2020-06-11/customers-paid-for-reducing-electricity-demand-radical-change/12343790">It allows</a> “demand response” energy trading from 2021.</p>
<p><a href="http://www.tai.org.au/content/finkel%E2%80%99s-forgotten-finding-%E2%80%93-%E2%80%98negawatts%E2%80%99">Demand response</a> involves reducing energy consumption during peaks in demand, such as during heatwaves. Basically, the rule means big energy users, such as smelters and manufacturing plants, could power down in these periods, and be paid for doing so.</p>
<p>Technology pioneers such as battery entrepreneur <a href="https://www.afr.com/companies/energy/covid-19-may-delay-national-electricity-market-reform-20200419-p54l3s">Simon Hackett</a> and Atlassian chief <a href="https://www.smh.com.au/politics/federal/ambitious-energy-reforms-set-to-cut-household-power-bills-20200611-p551rs.html">Mike Cannon-Brookes</a> have backed this change. </p>
<p><div data-react-class="Tweet" data-react-props="{"tweetId":"1267305793033867265"}"></div></p>
<p>Australia has successfully used demand response to provide <a href="https://arena.gov.au/assets/2019/03/demand-response-rert-trial-year-1-report.pdf">emergency</a> electricity capacity and <a href="https://www.afr.com/news/demand-response-worth-half-a-liddell-to-energy-queensland-20180404-h0ybij">other</a> <a href="https://www.aemc.gov.au/rule-changes/demand-response-mechanism">benefits</a>. But it’s never been unleashed in the wholesale energy market.</p>
<p>The rule change doesn’t involve smaller users such as households. But it’s a promising start that creates new competition for fossil fuel generators and allows energy users to help make the grid more reliable.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/new-demand-response-energy-rules-sound-good-but-the-devil-is-in-the-hugely-complicated-details-120676">New demand-response energy rules sound good, but the devil is in the (hugely complicated) details</a>
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<p>Political warfare over climate policy has held back Australia, <a href="https://onlinelibrary.wiley.com/doi/abs/10.1111/1467-8500.12328">and the electricity market</a>, for more than a decade. But energy reform that encourages greater market competition can readily be supported by political conservatives.</p>
<p>The demand-response rule change is a clear example: it has been <a href="https://www.minister.industry.gov.au/ministers/taylor/media-releases/wholesale-demand-response-help-lower-costs-and-strengthen-energy">championed by Taylor</a> and his predecessors <a href="https://www.abc.net.au/news/2017-07-13/negawatts-touted-as-solution-to-growing-energy/8707232">Josh Frydenberg</a> and <a href="https://www.theaustralian.com.au/national-affairs/climate/coalition-seeks-deal-to-cut-power-demand/news-story/5b7a3dd86ddf11c91d5f817405bb43a9">Greg Hunt</a>.</p>
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<img alt="" src="https://images.theconversation.com/files/338473/original/file-20200529-51456-mfb7ry.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/338473/original/file-20200529-51456-mfb7ry.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/338473/original/file-20200529-51456-mfb7ry.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/338473/original/file-20200529-51456-mfb7ry.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/338473/original/file-20200529-51456-mfb7ry.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/338473/original/file-20200529-51456-mfb7ry.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/338473/original/file-20200529-51456-mfb7ry.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Newly built renewable electricity is cheaper than new coal-fired power.</span>
<span class="attribution"><span class="source">Petr Josek/Reuters</span></span>
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<h2>Getting future-ready</h2>
<p>Once the health crisis is over and economic recovery has begun, Australia will need the economic and social benefits of electricity market reform even more than before.</p>
<p>Such reform “<a href="https://www.tai.org.au/content/energy-reform-after-covid-19">stimulus</a>” would help ready the grid for the inevitable retirement of coal-fired power stations, such as Liddell in 2023. </p>
<p>It would also align with state government investments in renewable energy, and boost private investment in new generation (which has <a href="https://reneweconomy.com.au/cec-calls-for-action-on-grid-issues-as-renewables-investment-cut-in-half-28289/">recently slumped</a>) and <a href="https://thenewdaily.com.au/finance/finance-news/2020/05/26/coronavirus-manufacturing-industry/">large-scale batteries</a>.</p>
<p>Electricity remains Australia’s <a href="https://theconversation.com/australia-to-attend-climate-summit-empty-handed-despite-un-pleas-to-come-with-a-plan-123187">highest-polluting sector</a>. Around the world, electricity markets are planning the <a href="https://www.ren21.net/renewables-report-launch/">transition</a> from high to low emissions. </p>
<p>Delaying reform in Australia would be a major setback on the path to our essential energy transition.</p>
<p><em>Richie Merzian, Climate & Energy Program Director at The Australia Institute, contributed to this piece.</em></p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/putting-stimulus-spending-to-the-test-4-ways-a-smart-government-can-create-jobs-and-cut-emissions-140339">Putting stimulus spending to the test: 4 ways a smart government can create jobs and cut emissions</a>
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<img src="https://counter.theconversation.com/content/140640/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Daniel J Cass is Energy Policy & Regulatory Lead at the Australia Institute and is on the board of Solar Head of State.</span></em></p>The rules governing Australia’s electricity market are more than 20 years old and no longer serve consumers, or climate action. But big energy companies are using COVID-19 to delay reform.Daniel J Cass, Research Affiliate, Sydney Business School, University of SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1206762019-07-24T00:07:42Z2019-07-24T00:07:42ZNew demand-response energy rules sound good, but the devil is in the (hugely complicated) details<figure><img src="https://images.theconversation.com/files/285036/original/file-20190722-116552-wb64el.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Demand response sounds good, but is punishingly difficult to execute.</span> <span class="attribution"><span class="source">Matthew Henry/Unsplash</span>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span></figcaption></figure><p>Last week the body that governs Australia’s energy market released a draft proposal to introduce a <a href="https://www.aemc.gov.au/news-centre/media-releases/using-demand-management-take-pressure-power-system">demand response mechanism</a> to the wholesale electricity market.</p>
<p>It argues the proposal will unearth some electricity users’ “latent flexibility” to prices in the extremely volatile wholesale market, and that this will potentially promote more efficient use of electricity, more secure power systems, and lower prices.</p>
<p>The move comes after nearly two decades of sustained campaigning, which prompts the question: why doesn’t such a useful-sounding mechanism already exist?</p>
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Read more:
<a href="https://theconversation.com/managing-demand-can-save-two-power-stations-worth-of-energy-at-peak-times-78173">Managing demand can save two power stations' worth of energy at peak times</a>
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<p>It’s a good question. If this demand-response mechanism does what it is claimed to do, it could be a significant development for the electricity markets in southern and eastern Australia. But the actual proposal is eye-wateringly complex and there is reason to be circumspect. </p>
<h2>What is proposed and how does it work?</h2>
<p>The Australian Energy Market Commission’s determination is that new market participants, to be known as “Demand Response Service Providers” (DRSPs), will be allowed to offer hypothetical demand reductions into the wholesale market at prices they determine. If the price they offer for such reductions is less than the price at which the market clears, the DRSPs will be paid the market price, as if they were a generator, for these hypothetical reductions.</p>
<p>One obvious difficulty here is the fact that the reductions are hypothetical. They are the difference between the customers’ demand if they did not respond to an enticement to reduce demand – the “baseline” – and their actual demand. Customers (and DRSPs) have an incentive to overstate the baseline, as this increases the volume of the reductions they offer and, if accepted, get paid for.</p>
<p>DRSPs profit from the demand reductions they sell, and so they have an incentive to seek out customers who are willing to reduce demand relative to the baseline. </p>
<p>Retailers that sell electricity to DRSPs’ customers will buy (from the wholesale market) the actual volume of electricity consumed and also the hypothetical demand reduction, and pay the wholesale price for both. The retailer charges the customer for the actual demand and charges the DRSP for the demand reduction at a regulated price equal to the 12-month load-weighted average wholesale price. </p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/baffled-by-baseload-dumbfounded-by-dispatchables-heres-a-glossary-of-the-energy-debate-84212">Baffled by baseload? Dumbfounded by dispatchables?
Here's a glossary of the energy debate</a>
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<p>This will typically leave the retailer out of pocket by an amount equal to the difference between the actual wholesale price at which they have “bought” the demand reductions, and the 12 monthly weighted average wholesale price (which will almost certainly be lower, because demand reductions will occur when wholesale prices are higher than average)</p>
<p>Retailers will seek to recover the shortfall from the DRSPs’ customers or, more likely, from all their customers. To the extent that they are unable to recover the shortfall, retailers are likely to try to offload those of their customers that are paid to reduce demand.</p>
<p>This is a simplified description of the arrangement. The complexity of the actual data and money flows between customers, DRSPs, retailers, the energy market operator, network service providers and regulators is enough to provoke a nose-bleed from the most seasoned corporate lawyers.</p>
<p>By now, I am sure you are wondering why all the bother with baselines and hypothetical reductions. Why not simply pay customers for actual load reductions? The answer, in short, is that the pool of possible directly contracted customers is small. </p>
<p>If demand response is to be extended to thousands of customers - as this proposal seeks to do - setting baselines and hence hypothetical demand reductions, with all their unwelcome consequences, is unavoidable.</p>
<h2>Will it work?</h2>
<p>I am not sure. It is certainly punishingly complex. The energy market operator and regulator will have their hands full ensuring that baselines are not set at a level that prints money for DRSPs and their customers, at the expense of retailers and other electricity users. If the market operator and regulator achieve this without imposing undue cost and administrative burden, this demand-response proposal has promise.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/south-australias-experience-contradicts-coalition-emissions-scare-campaign-117079">South Australia's experience contradicts Coalition emissions scare campaign</a>
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<p>It will be fascinating to see whether DRSPs can indeed flush out the “latent flexibility” in a manner that is advantageous to themselves, the latently flexible, and the rest of us. Like many others, I will be watching with interest.</p>
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<p><em>Update: Following publication, the AEMC clarified they intended to refer to the 12 month <strong>load-weighted</strong> average wholesale price of energy, rather than the simple average price. The article has been updated to reflect this.</em></p><img src="https://counter.theconversation.com/content/120676/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Bruce Mountain does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Proposed rules for managing energy demand could potentially lower prices and reduce blackout risk, but there are reasons to be skeptical.Bruce Mountain, Director, Victoria Energy Policy Centre, Victoria UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/842122017-09-25T20:07:41Z2017-09-25T20:07:41ZBaffled by baseload? Dumbfounded by dispatchables?
Here’s a glossary of the energy debate<figure><img src="https://images.theconversation.com/files/187153/original/file-20170922-20964-udaq0x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">High-voltage power lines stand near an electricity substation on the outskirts of Sydney.</span> <span class="attribution"><a class="source" href="http://pictures.reuters.com/C.aspx?VP3=SearchResult&VBID=2C0BXZNRMVU8V&SMLS=1&RW=2065&RH=1196#/SearchResult&VBID=2C0BXZNRMVU8V&SMLS=1&RW=2065&RH=1196&PN=2&POPUPPN=115&POPUPIID=2C04082IN5PL0">Reuters</a></span></figcaption></figure><p>Australia’s energy market is a prominent fixture in our daily news cycle. Amid the endless ideology and politics swirling around the sector, technical terms such as “baseload power” and “dispatchable generation” are thrown around so often that there is a danger the meaning of these terms can get lost in the public debate. </p>
<p>The term “energy crisis” is <a href="http://www.theaustralian.com.au/business/mining-energy/energy-crisis-too-late-to-stop-power-outages-now-brickworks/news-story/49f1d823546c00609147f8bbc8a138c1">bandied</a> around quite loosely with some confusion around whether the crisis is about prices or security of supply. The politics of this are infernal and largely avoidable if all sides of politics had paid consistent and principled attention to energy policy over the 20 years since the formation of the <a href="https://www.aemo.com.au/Electricity/National-Electricity-Market-NEM">National Energy Market</a>. </p>
<p>It’s worth setting the record straight on the meaning of some of these terms and how they relate to climate policies, new technologies and the progression of market reform and regulation in Australia. </p>
<p>This glossary, which is by no means exhaustive, is a first step.</p>
<h2>Baseload power</h2>
<p>Baseload power refers to generation resources that generally run continuously throughout the year and operate at stable output levels. The continuous operation of baseload resources makes economic sense because they have low running costs relative to other sources of power. The value of baseload plants is mostly economic, and not related to their ability to follow the constantly varying system demand.</p>
<p>Baseload plants include coal-fired and gas-fired combined-cycle power plants. However, Australia’s international <a href="http://www.environment.gov.au/climate-change/publications/factsheet-australias-2030-climate-change-target">commitment</a> to reduce carbon emissions is curtailing the economic viability of traditional baseload sources.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/187156/original/file-20170922-9750-1b1gmot.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/187156/original/file-20170922-9750-1b1gmot.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=426&fit=crop&dpr=1 600w, https://images.theconversation.com/files/187156/original/file-20170922-9750-1b1gmot.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=426&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/187156/original/file-20170922-9750-1b1gmot.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=426&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/187156/original/file-20170922-9750-1b1gmot.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=535&fit=crop&dpr=1 754w, https://images.theconversation.com/files/187156/original/file-20170922-9750-1b1gmot.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=535&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/187156/original/file-20170922-9750-1b1gmot.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=535&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Coal-fired power stations like this one at Loy Yang are being gradually retired.</span>
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<h2>Wholesale market (the “National Energy Market”)</h2>
<p>The term National Energy Market is confusing because it refers to a competitive market for wholesale energy mostly on the east cost of Australia. It doesn’t include Western Australia or the Northern Territory and also includes the gas system. The National Energy Market allows all kinds of utility-scale power resources to connect to transmission system to meet large-scale power requirements. </p>
<p>However, industry talk about the “energy market” or even the “NEM” can also refer to the entire supply chain that includes the networks for voltage transmission, and medium- and low-voltage distribution as well as the retailing to the end consumer. The prices consumers see include all these aspects of the supply chain. This can add significantly to confusion.</p>
<p>The wholesale market is referred to as a “market” because there is competition between generators. Each generator places daily price “bids” to sell power and adjusts quantities in up to 10 price bands every five minutes. In this way, the sale of power is matched to the available energy and performance of the generating unit. </p>
<p>The market works to efficiently dispatch all variable and “dispatchable” resources to minimise the cost of electricity. The <a href="https://www.aemo.com.au/">Australian Energy Market Operator</a> (AEMO) co-ordinates the National Energy Market.</p>
<h2>Wholesale price</h2>
<p>The wholesale “spot” price at which power is traded in the NEM is based on the highest accepted generator offers to balance supply and demand in each region. This is intended to encourage efficient behaviour by generators, as well as to co-ordinate efficient directing of resources. </p>
<h2>Storage</h2>
<p>Storage refers to energy captured for later use, typically in a battery. Electricity has been expensive to store in the past, but the cost of storage is expected to continue to fall with the improvement of battery technologies. For example, <a href="https://link.springer.com/book/10.1007/978-0-387-34445-4">lithium-ion batteries</a> were developed for mobile communications and laptops but now are being upscaled for electric vehicles and utility-scale energy storage. </p>
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<img alt="" src="https://images.theconversation.com/files/187154/original/file-20170922-20964-8rl8u0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/187154/original/file-20170922-20964-8rl8u0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/187154/original/file-20170922-20964-8rl8u0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/187154/original/file-20170922-20964-8rl8u0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/187154/original/file-20170922-20964-8rl8u0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/187154/original/file-20170922-20964-8rl8u0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/187154/original/file-20170922-20964-8rl8u0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Lithium-ion batteries were developed for mobile phones, but are now being used as part of electric vehicles such as Tesla Inc’s Model S and Model X.</span>
<span class="attribution"><a class="source" href="http://pictures.reuters.com/C.aspx?VP3=SearchResult&VBID=2C0BXZNRMP4L3&SMLS=1&RW=2065&RH=1196#/SearchResult&VBID=2C0BXZNRMP4L3&SMLS=1&RW=2065&RH=1196&POPUPPN=6&POPUPIID=2C0BF1FOKFSKR">Reuters</a></span>
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<p>Due to traditionally low storage levels in the system, electricity has to be mostly generated within seconds of when it is needed, otherwise the stability of the system can be put at risk. Storage technology will become more valuable as the market penetration of wind and solar power increases. With declining costs of various battery technologies, this will become easier to deliver.</p>
<h2>Demand (and peak demand)</h2>
<p>Demand refers to the amount of electricity required to meet consumption levels at any given moment. Power refers to the rate of energy consumption in megawatts (millions of Watts, or MW), whereas energy in megawatt-hours (MWh) refers to the total consumption over a period, such as a day, month or year. </p>
<p>Peak demand is the highest rate of energy consumption required in a particular season, such as heating in winter or cooling in summer. It is a vital measure because it determines how much generation equipment is needed to cover for unexpected outages and maintain reliable supply.</p>
<h2>Dispatchable generation</h2>
<p>Dispatchable generation refers to a type of generation based on fossil fuels or hydro power that can be controlled to balance electricity supply and demand. More flexible power plants based on natural gas firing (such as open-cycle gas turbines or hydro power plants) can operate at partial loading and respond to short-term changes in supply and demand. </p>
<p>Flexibility is the key here. Storage can provide flexibility as well, either from batteries or pumped-hydro storage. The need for such resources is becoming more urgent due to <a href="http://www.abc.net.au/news/2017-03-30/hazelwood-power-plant-shutdown-explained/8379756">retirement</a> of the older baseload plants and the growing amount of less emissions-intensive energy sources.</p>
<h2>Frequency control</h2>
<p>Synchronous generators in power stations spin at around 50 cycles per second. This speed is referred to as “frequency” (denoted Hertz, symbol Hz). Controlling this constant frequency is essential for maintaining reliability. </p>
<p>If there is loss of generation somewhere, extra power is drawn through the electricity network from other plants. This causes these generators’ rotors to slow down and the system frequency to fall. A key parameter is the so-called “maximum rate of change of frequency”. The faster the frequency changes, the less time is available to take corrective action.</p>
<h2>Inertia</h2>
<p>Inertia refers to the ability of a system to maintain a steady frequency after a significant imbalance between generation and load. The higher the inertia, the slower the rate of change of frequency after a disturbance. </p>
<p>One critical concern is that inertia must almost always be sufficient to enable stable power. Given many coal-fired power plants are being retired, the amount of inertia is falling markedly. </p>
<p>Eventually power systems will need to provide inertia explicitly by adding synchronous rotors (operating independently of power generation) or by providing other power system controls that are able to respond very quickly to deviations in power system frequency. These can be based on a combination
of storage and advanced power electronics already available today.</p>
<h2>Regional markets within the National Energy Market</h2>
<p>The National Energy Market operates as five interconnected regional markets in the eastern states: Queensland, New South Wales, Victoria, South Australia and Tasmania. This reflects the way the power systems were originally set up under state authorities. </p>
<p>The National Energy Market cannot operate as a single market with a single price due to two important factors. It is not cost-effective to completely remove power transmission constraints between the state regions, and electrical losses in power transmission mean that each location requires a different price to efficiently reflect the impact of these losses. </p>
<p>When there are large power flows between regions, the prices can vary by up to 30% between regions due to losses. High prices occur when there is a power shortage relative to demand. Negative prices occur when load is less than the minimum stable generation committed. During periods of high prices (usually due to high demand or, less frequently, due to lower capacity) greater price differences can occur when the interconnectors reach their limits, causing very high-priced generation in the importing region to be dispatched.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/187146/original/file-20170922-21005-1rvyowi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/187146/original/file-20170922-21005-1rvyowi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=539&fit=crop&dpr=1 600w, https://images.theconversation.com/files/187146/original/file-20170922-21005-1rvyowi.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=539&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/187146/original/file-20170922-21005-1rvyowi.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=539&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/187146/original/file-20170922-21005-1rvyowi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=677&fit=crop&dpr=1 754w, https://images.theconversation.com/files/187146/original/file-20170922-21005-1rvyowi.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=677&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/187146/original/file-20170922-21005-1rvyowi.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=677&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">The National Energy Market operates across Australia’s east coast.</span>
</figcaption>
</figure>
<h2>Interconnectors</h2>
<p>In view of the long distances in the National Energy Market (4000km from end to end, the longest synchronous power system in the world), there are significant constraints in transmission capacity between the state-based regions. These constraints are given special treatment called “interconnectors”. </p>
<p>The marginal power losses across these interconnectors are calculated every five minutes to support efficient dispatch of resources and to ensure that the spot prices in each region are efficient and consistent with prevailing supply and demand. These interconnectors have limited capacity (due to overheating and other factors), however, and AEMO carefully manages their use to ensure balancing and inertia can be provided across regions.</p>
<h2>Ancillary services and spinning reserve</h2>
<p>Ancillary services refer to a variety of methods the market requires for consistent frequency and voltage control. They maintain the quality of supply and support the stability of the power system against disturbances. This frequency control is required during normal operation to maintain the continuous balance of energy supply and demand. For this purpose some generation capacity is held in reserve in order to vary its output up and down to adjust the total system generation level. </p>
<p>This difference between the maximum power output and the lower operating level is called “spinning reserve”. Spinning reserve is also required for output reduction to cover sudden disconnection of load or sudden increase in solar or wind power. </p>
<h2>Transmission upgrades</h2>
<p>The upgrading of the transmission system, including the interconnectors, is a complex regulatory process. Transmission has a significant value across the whole electricity supply chain from producers to consumers. </p>
<p>This value is easy to measure given electricity market conditions at any given moment. But it’s difficult to predict when these interconnectors need to be built or replaced because some transmission assets can operate for up to 80 years. Significant co-ordination is required in planning new investments as the location and deployment timing of new renewable generation capacity is uncertain and variable.</p>
<h2>30-minute price settlement windows (and five-minute ones)</h2>
<p>Generators are paid the spot price for all their output, and consumers (via retailers) are charged at the spot price for their consumption by AEMO. This “trading” price is calculated every 30 minutes for the purpose of transacting the cash flows (as an average of the five-minute dispatch price). This process is called “settlement”. </p>
<p>There is a plan in place to move to five-minute settlement over the next three years. This would help reward more flexible resources (including batteries) as they respond more efficiently to the impact of sudden changes in output.</p>
<img src="https://counter.theconversation.com/content/84212/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Ariel Liebman receives funding from the Australian Federal Departments of Education and Foreign Affairs and Trade through the Australia Indonesia Centre</span></em></p><p class="fine-print"><em><span><a href="mailto:ross.gawler@monash.edu">ross.gawler@monash.edu</a> is affiliated with Monash Univeristy, Jacobs Consulting and McDonald Gawler Pty Ltd
I occasionally consult to participants in the National Electricity Market in affiliation with Monash University or Jacobs Consulting or through McDonald Gawler Pty Ltd, a small private company.
I contribute a small monthly donation to Get-up!</span></em></p>The energy debate in Australia is making daily headlines. This glossary of the energy debate is our attempt to decipher the language behind the debate in simple terms.Ariel Liebman, Deputy Director, Monash Energy Materials and Systems Instutute, and Senior Lecturer, Faculty of Information Technology, Monash UniversityRoss Gawler, Senior Research Fellow, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/717752017-01-27T13:54:50Z2017-01-27T13:54:50ZWhy artificial intelligence could be key to future-proofing the grid<figure><img src="https://images.theconversation.com/files/154352/original/image-20170126-23840-1mo1ycx.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Watt a good idea. </span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-illustration/wired-brain-illustration-next-step-artificial-561931702?src=UobSFSwc534xvzH3GJYHkA-1-7">Laurent T</a></span></figcaption></figure><p>A <a href="https://theconversation.com/the-year-coal-collapsed-2016-was-a-turning-point-for-britains-electricity-70877">recent Conversation piece</a> pointed out that the British electricity mix in 2016 was the cleanest in 60 years, with record capacity from renewable energy, mainly from wind and solar power. But one problem with this great expansion in renewables is they are intermittent, meaning they depend on weather conditions such as the wind blowing or sun shining. Unlike conventional power, this means they can’t necessarily meet surges in demand. Hence many <a href="http://www.telegraph.co.uk/news/2016/12/11/britain-facing-energy-crisis-could-could-see-families-pay-extra/">press headlines</a> in recent years about the “lights going out”. </p>
<p>National Grid, the UK grid operator, has several ways of ensuring supply can always meet demand. For shorter gaps in generation, it asks electricity suppliers <a href="http://energystorage.org/energy-storage/technology-applications/spinning-reserve">to run</a> their conventional power stations at below maximum potential output and ramp up as needed. </p>
<p>For longer gaps, it ensures power stations, particularly gas-based ones, are kept on standby. Some stations may only be asked to generate power for between several dozen and a few hundred hours a year. Besides contributing to carbon emissions, operating power plants for such short interventions is expensive. </p>
<p>The question is what to do about this problem. We could build less renewable power and make conventional power “greener” instead by removing the CO₂ and burying it underground. Opinion <a href="https://www.theguardian.com/environment/2017/jan/03/indian-firm-carbon-capture-breakthrough-carbonclean">divides</a> on <a href="https://theconversation.com/the-latest-bad-news-on-carbon-capture-from-coal-power-plants-higher-costs-51440">when</a> these carbon capture technologies <a href="https://theconversation.com/carbon-capture-and-storage-is-unlikely-to-save-coal-in-the-long-run-54182">can</a> be made commercially viable on a large scale. In the UK, unfortunately two government kickstarter projects <a href="https://www.theguardian.com/environment/2017/jan/20/carbon-capture-scheme-collapsed-over-government-department-disagreements">have floundered</a> due to concerns about costs and departmental disagreements.</p>
<p>An alternative is to install very big (“grid scale”) batteries capable of storing renewable power to be released when required. This has <a href="http://www.telegraph.co.uk/business/2016/08/10/holy-grail-of-energy-policy-in-sight-as-battery-technology-smash/">generated</a> a lot of interest lately. But given the costs of current battery technology, grid-scale storage requires expensive upfront investments. </p>
<h2>Solutions on demand</h2>
<p>While researchers study these problems, the UK is developing an alternative known as <a href="http://www2.nationalgrid.com/UK/Services/Balancing-services/Demand-Side-Response/">demand-side response</a>. One aspect involves rewarding certain electricity consumers for reducing their usage at short notice. This can range from large industrial customers to smaller consumers using power for heating rooms, cooling, lighting or even refrigeration. </p>
<p>The other aspect of demand response involves asking customers who own equipment that can store power to help balance surges in demand. For example, the owners of a house equipped with solar panels and corresponding battery storage might reduce repayment costs on the equipment by making the battery units available to the grid. Other equipment in this category includes electric vehicles and hospital/university uninterruptible power supply (UPS) units. </p>
<p>Both types of demand response are happening already. Some industrial power customers and certain other companies such as hotel operators have contracts for reducing power, while National Grid has been <a href="http://analysis.energystorageupdate.com/uks-200-mw-grid-storage-tender-flooded-battery-bid-interest">attracting much bidder interest</a> for power storage schemes and has some underway in parts of the country. This storage is an alternative to deploying large-scale batteries, and promises to be much more economical if we can make it work on a large enough scale. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=672&fit=crop&dpr=1 600w, https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=672&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=672&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=845&fit=crop&dpr=1 754w, https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=845&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/154353/original/image-20170126-23854-1gkz8jh.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=845&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Lightbulb moment?</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-vector/electricity-supply-vector-icon-computer-website-562320595?src=yOaoo_Uyfji2S34-8847bA-1-0">MyVector</a></span>
</figcaption>
</figure>
<p>The problem is that these schemes get more complicated once the pool of customers gets beyond a certain size. Knowing which customers to sign up and what tariffs to offer requires understanding to what extent devices will be available and at what cost, for example. </p>
<p>Once a pool of customers is set up, some devices might not always be available for storage or reducing demand when needed. This needs to be factored into the calculations both to minimise grid disruption and incentivise customers to participate at these times. </p>
<p>There can also be undesired effects, such as large simultaneous rebounds in consumption. For example many refrigerators will draw extra power to get their internal temperature below the required level when a demand response period ends. </p>
<p>Finally there’s a <a href="https://theconversation.com/the-cyberattack-on-ukraines-power-grid-is-a-warning-of-whats-to-come-52832">potential major security issue</a>: a central system that collects data about energy usage from many devices may be prone <a href="https://theconversation.com/traffic-light-hacking-shows-the-internet-of-things-must-come-with-better-security-30803">to malicious attacks</a> and information tampering. This could undermine both grid balancing and keeping track of what customers are owed. </p>
<h2>How AI can help</h2>
<p>Emerging artificial intelligence technologies look like providing answers to these challenges. To select the best participants, for example, grid operators will be able to use sophisticated <a href="http://digitalsubstation.com/en/2017/01/17/ai-machine-learning-service-to-be-launched-for-energy-storage-managment/">machine-learning techniques</a> to model the behaviour of individual devices and battery storage units by reviewing data from smart meters and sensors. </p>
<p>Once signed up for grid storage, it should be possible to estimate the useful lifetime of a battery pack or unit by applying <a href="https://pdfs.semanticscholar.org/7f8a/48cabeee8b61d0c7bc27b818e923bf6dfcc1.pdf">prognostic algorithms</a> to its charging/discharging data. Owners will then receive appropriate compensation, plus the added incentive of knowing how long their battery will last. </p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=600&fit=crop&dpr=1 600w, https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=600&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=600&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=754&fit=crop&dpr=1 754w, https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=754&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/154355/original/image-20170126-23845-1tb7vrr.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=754&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">What’s in store.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-illustration/3d-illustration-rendering-house-solar-panels-556227403?src=vl9MAZpwGqjiQpqnFX2UZA-2-65">3D_Creation</a></span>
</figcaption>
</figure>
<p>When it comes to managing devices in the pool, people used to think we could use individual smart meters or control devices to feed a central server in the cloud. But meters are expensive and the short response times require the cloud server to analyse data in milliseconds, which looks unfeasible once many thousands of units are in a pool. </p>
<p>An alternative is to have metering devices which detect demand levels on the grid themselves and reduce power accordingly. These take pressure off the central server and it only requires metering at site level, rather than for every electrical device. But it still leaves you with a complex control problem in coordinating all these individual decisions. We at Heriot-Watt are working on a solution to this using AI-based algorithms. </p>
<p>Another line of AI research draws on insights from algorithmic game theory <a href="https://pureapps2.hw.ac.uk/portal/files/10576055/Ma_ijcai16.pdf">to develop</a> reward/penalty mechanisms which ensure enough customers in the pool are willing to participate, and actually respond when necessary. Researchers are also optimistic that <a href="https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/492972/gs-16-1-distributed-ledger-technology.pdf">blockchain protocols</a>, using the same technology as Bitcoin, could underpin a decentralised ledger system that would get round the security risk of having a single storage point for user data. </p>
<p>Numerous AI research groups, both in the UK and elsewhere, have been addressing these challenges, while a number of start-ups have started developing such systems in practice – relatively simple versions of machine learning are now beginning to be used, for instance. The UK has a good chance to be at the forefront of international efforts to make smarter demand response a reality over the next few years.</p><img src="https://counter.theconversation.com/content/71775/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Valentin Robu is an Assistant Professor in the Smart Systems Group at Heriot-Watt University. He receives funding from Innovate UK for a joint research project on energy demand response, in partnernship with Upside Energy. Heriot-Watt receives no funding from Upside Energy. </span></em></p>Many believe we can stabilise the power supply by asking customers to help - but there’s a problem.Valentin Robu, Lecturer in Smart Grids, Heriot-Watt UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/538452016-01-29T10:45:40Z2016-01-29T10:45:40ZThe Supreme Court saves the smart grid, but more battles loom<figure><img src="https://images.theconversation.com/files/109527/original/image-20160128-27133-d0f7ry.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Supreme Court ruling allows consumers and businesses to make money by reducing power and other grid services. </span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/wilks_photography/1342803683/in/photolist-33EdKD-p3JqVp-5KFNnq-dvmSjb-5gvc83-oEu8Fx-oVRrDQ-d1onrY-nmQdm8-CnRaJ9-fLBf2A-mSzqZZ-mSzsiv-amjYmJ-e1EVke-cPfdvh-ppGqgq-pXz1W6-gWrv6L-fhHeG3-d8Er5u-b8Uunx-qz6zjo-3cvVm-CvbovS-eS5bDt-5AhWkA-83VYzZ-wATkhb-7hb6VG-pZGG96-5W3Z1B-btVar5-oYfb92-v4Lgm1-z1gUEo-aAQnUA-FwGag-pFK75V-uDkGPV-8KRn1t-u2LC3e-wsVKNS-cu7rZo-b3RTw-ncXnA2-vXC6Hi-fhHe6S-cioUqJ-4s9qHo">wilks_photography/flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc/4.0/">CC BY-NC</a></span></figcaption></figure><p>In a surprising 6-2 decision, the <a href="http://www.bloomberg.com/politics/articles/2016-01-25/ferc-s-demand-response-rule-upheld-by-u-s-supreme-court">Supreme Court upheld</a> a controversial energy conservation rule from the Federal Energy Regulatory Commission (FERC), the agency that regulates interstate electricity sales.</p>
<p>The rule was one of those arcane pieces of federal policy so complex that even attorneys arguing for and against had difficulty explaining it. Yet this particular decision by the court is <a href="https://theconversation.com/will-the-supreme-court-kill-the-smart-grid-48725">one of the most important in the energy world for many years</a> – not because it upheld a particular FERC rule but because the decision seems to tip the balance of power on electricity policy toward the federal government and away from the states. </p>
<p>The breadth of this decision paves the way for a host of new technologies and business models that seem poised to disrupt the usually staid business of electric utilities and usher in a more technologically advanced power grid. At the same time, the ruling sidestepped a number of thorny questions at the heart of state versus federal control over the power grid.</p>
<h2>Getting paid to save energy</h2>
<p>The FERC rule allows homes and businesses to get paid for energy conservation when demand on the power grid is very high, a practice known as demand response in the electricity business. Demand response has been around for years even before the case was heard by the Supreme Court, and has been credited with keeping power costs down and even with <a href="http://www.greenbiz.com/blog/2014/01/10/demand-response-helps-texas-avoid-rolling-blackouts">avoiding blackouts</a>. </p>
<p>For example, on hot summer afternoons when the air conditioner load soars, consumers and businesses can sign up for utility programs to turn up thermostats for short periods and, in return, receive a rebate. By arranging to consume less power during those critical times, grid operators can avoid purchasing costly power from very polluting generators. </p>
<p>Critics of the practice have <a href="http://www.hks.harvard.edu/fs/whogan/Amicus_Brief_14-840,%2014-841%20bsac%20Borlick%20et%20al_090815.pdf">complained</a> that payments in the demand response market have been so lucrative as to amount to a major subsidy for electricity users, one that has eroded the profits of power plants to the point where (ironically) the <a href="http://www.rtoinsider.com/demand-response-04/">reliability of the grid may eventually be threatened</a>. The decision issued on Monday, and the margin by which FERC’s demand response rules were upheld, came therefore as something of a surprise. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=268&fit=crop&dpr=1 600w, https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=268&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=268&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=337&fit=crop&dpr=1 754w, https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=337&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/109529/original/image-20160128-27136-1daid7.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=337&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The Supreme Court ruling paves the way for innovative businesses, such as earning money for excess power from solar panels and electric vehicle batteries.</span>
<span class="attribution"><a class="source" href="https://en.wikipedia.org/wiki/Plug-in_electric_vehicle#/media/File:Baka-charging-station_cropped.jpg">Sass Peress, Renewz Sustainable Solutions Inc</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<p>During oral arguments in October last year, the attorneys <a href="http://www.supremecourt.gov/oral_arguments/argument_transcripts/14-840_5ok6.pdf">arguing on behalf of the FERC</a> sometimes struggled to explain the workings of the power grid and the markets that have been created in the wake of electricity deregulation in the 1990s. </p>
<p>A host of awkward analogies, from sports cars to hamburger stands, were used on all sides. At the end of arguments, it seemed that the FERC had won some points and opponents of demand response some others, but ultimately, that confusion had prevailed.</p>
<p>Some months ago, <a href="https://theconversation.com/will-the-supreme-court-kill-the-smart-grid-48725">I argued</a> that this case has hugely broad implications for the electricity business, particularly for innovation, that go far beyond demand response. Indeed, the <a href="http://www.supremecourt.gov/opinions/15pdf/14-840_k537.pdf">majority opinion</a>, authored by Justice Kagan, seemed at times very sweeping. </p>
<p>During arguments, power generators complained that FERC simply did not have the jurisdiction to set up a market for demand response. The Federal Power Act suggests that the portion of the grid that distributes power to homes and businesses, rather than high-voltage transmission lines that transport power long distances, is the jurisdiction of the states. On this point, the message from the court was pretty clear: FERC has the authority to make the rules for deregulated electricity markets, and it can be as permissive or restrictive as it sees fit in determining who gets to participate in those markets.</p>
<p>As a result, the ruling seems to put the federal government in the driver’s seat over modernizing the power grid, at least in the 70 percent of the U.S. where deregulated regional electricity markets are now the norm and have been for nearly two decades. </p>
<p>Get paid to reduce electricity demand? Use on-site generators to supplement the grid during hot summer days? Allow community solar and energy storage to earn the same market price as natural gas or nuclear power generators? The Supreme Court has now opened the door to all of this. A smarter grid, here we come!</p>
<h2>Microgrids and community solar</h2>
<p>While demand response has been controversial, it has (alongside the rest of the smart grid) undoubtedly paved the way for a burst of innovative technologies, practices and business models, the likes of which the electricity sector has not seen in many decades. </p>
<p>Electric vehicles, the Wi-Fi connected thermostat, <a href="https://theconversation.com/tesla-batteries-just-the-beginning-of-how-technology-will-transform-the-electric-grid-40142">Tesla’s distributed battery system</a> and the <a href="https://theconversation.com/could-one-million-smart-pool-pumps-store-renewable-energy-better-than-giant-batteries-41937%22%22">automated response of household appliances</a> in reaction to conditions on the grid are among the potentially game-changing solutions to the grid’s many challenges – and all have the potential to do the job better and more cheaply than large power plants or batteries.</p>
<p>My home state of Pennsylvania is but one example. A number of companies that coordinate demand response have sprung up in southeastern Pennsylvania and neighboring New Jersey. </p>
<p>For instance, the Philadelphia subway system is now <a href="http://www.septa.org/sustain/blog/2011/07-06.html">capturing energy from braking and storing it in batteries</a> for reuse or resale on the wholesale energy markets. The city’s electric utility, PECO, is looking into developing micro-grids for local power supply and distribution. (Full disclosure: I have been involved in a number of projects related to demand response, smart grids and micro-grids through my university employer, Penn State, and the <a href="http://www.microgridsystemslab.com%22%22">Microgrid Systems Laboratory</a>.)</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=401&fit=crop&dpr=1 600w, https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=401&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=401&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=504&fit=crop&dpr=1 754w, https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=504&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/109528/original/image-20160128-27167-1hhr98u.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=504&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The Philadelphia subway authority has installed a large battery to store energy generated by braking trains. Getting paid to provide power into energy markets allowed it purchase the system.</span>
<span class="attribution"><a class="source" href="http://www.septa.org/sustain/blog/2011/07-06.html">SEPTA</a></span>
</figcaption>
</figure>
<p>So it would now seem to be all systems go for demand response, electric vehicles, rooftop solar and Tesla’s home battery system. But the irony of Monday’s ruling is that it may actually have muddied the waters, even when the sweeping language in the ruling suggests the opposite. </p>
<p>The Supreme Court ruling enables the creation of new services, such as selling home battery power back to the grid. But the <a href="https://theconversation.com/has-tesla-cracked-the-grid-energy-storage-problem-41131%22%22">business models for many innovative smart grid technologies are still being worked out</a>, and it still isn’t clear what a sustainable business model looks like. Prices in electricity markets, for example, have been in a slump for years thanks to cheap natural gas, which makes it more difficult to earn money selling electricity services.</p>
<p>The ruling also does not mean the end of all tensions between state and federal regulations. States may still be able to prohibit or limit participation in demand response markets. </p>
<p>Community solar, for example, may be able to sell into power markets in theory, but in practice much still depends on the rules governing how solar power is metered when connected to the grid. Those rules, still firmly in the hands of the states, <a href="https://theconversation.com/why-rooftop-solar-is-disruptive-to-utilities-and-the-grid-39032%22%22">have become more restrictive</a> in some places in recent years. </p>
<p>So by ruling for FERC, the Supreme Court did not kill the smart grid, as some people had feared. But it will take more than a single sweeping ruling to completely save it.</p><img src="https://counter.theconversation.com/content/53845/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Seth Blumsack receives funding from the U.S. National Science Foundation, the U.S. Department of Energy, the U.S. Environmental Protection Agency, the Commonwealth of Pennsylvania, Alfred P. Sloan Foundation, and electric utilities and natural gas pipeline companies.</span></em></p>An obscure Supreme Court ruling paves the way for people and businesses to earn money with distributed energy technologies.Seth Blumsack, Associate Professor, Penn StateLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/487252015-10-14T08:52:20Z2015-10-14T08:52:20ZWill the Supreme Court kill the smart grid?<figure><img src="https://images.theconversation.com/files/97659/original/image-20151007-7335-13lkmc4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The Supreme Court will decide a case that will have a big effect on distributed energy technology, including batteries. </span> <span class="attribution"><a class="source" href="http://www.teslamotors.com/sites/default/files/images/presskit/teslaenergy_utility2.jpg?617">Tesla</a></span></figcaption></figure><p>On April 30, Tesla’s Elon Musk took the stage in California to introduce the company’s Powerwall <a href="https://theconversation.com/has-tesla-cracked-the-grid-energy-storage-problem-41131">battery energy storage system</a>, which he hopes will revolutionize the dormant market for household and utility-scale batteries. </p>
<p>A few days later, the Supreme Court <a href="http://www.supremecourt.gov/orders/courtorders/050415zor_7648.pdf">announced</a> that it would hear a case during its fall term that could very well determine whether Tesla’s technology gamble succeeds or fails. Justices will hear arguments on October 14 to address <a href="http://www.utilitydive.com/news/supreme-court-to-hear-ferc-order-745-case-over-demand-response-rules/393722/">questions</a> having to do with federal jurisdiction over the fast-changing electricity business.</p>
<p>At issue is an obscure federal policy known in the dry language of the electricity business as “Order 745,” which a lower court <a href="http://www.greentechmedia.com/articles/read/what-us-appeals-court-decision-on-ferc-order-745-means-for-demand-response">vacated last year</a>. </p>
<p>Order 745 allowed electricity customers to be paid for reducing electricity usage from the grid – a practice known as “demand response.” It also stipulated that demand response customers would be paid the market price for not using the grid – like the power industry’s version of paying farmers not to grow corn. </p>
<p>Paying people not to use electricity may sound preposterous – one <a href="https://www.epsa.org/forms/uploadFiles/33552000003CA.filename.SCOTUS_Amicus_Utility_Law_Project_of_NY_09082015.pdf">critique</a> of Order 745 was that it permitted overly generous prices and lax performance standards, basically making demand response a license for electricity consumers to print money. </p>
<p>But research, including <a href="http://www.sciencedirect.com/science/article/pii/S0301421508003364">some of my own</a>, has shown that demand response can make markets operate more efficiently, temper the market power held by power generating companies and reduce the risk of blackouts. </p>
<p>In other words, as long as the prices and rules are right, paying people to use less electricity isn’t such a crazy idea. Indeed, it’s just one way that <a href="https://theconversation.com/tesla-batteries-just-the-beginning-of-how-technology-will-transform-the-electric-grid-40142">new technologies</a>, including rooftop solar and batteries, could make the grid cleaner and lower prices.</p>
<h2>Smart grid on trial</h2>
<p>The Order 745 case has already proven to be a major disruption in the US electricity market. It has thrown uncertainty into business models, market prices, and in some cases even the <a href="http://www.powermag.com/ferc-order-745-and-the-epic-battle-between-electricity-supply-and-demand/?pagenum=2">planning of the power grid</a> to ensure reliability in the coming years. </p>
<p>The case, however, ultimately goes far beyond demand response. </p>
<p>The issue at hand is all about the ability of the federal government to set market rules for local power systems – that is, the portion of the grid that reaches individual homes and businesses – versus the regional grid that transports power over long distances across the US. It therefore has implications for the value of rooftop solar systems, backup generators, and even Tesla’s Powerwall battery – basically anything that would allow individual customers to supply energy to the power grid or reduce demands on an already strained infrastructure. </p>
<p>In fact, Order 745 could very well be the biggest energy-related Supreme Court case in decades.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=398&fit=crop&dpr=1 600w, https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=398&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=398&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=501&fit=crop&dpr=1 754w, https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=501&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/97666/original/image-20151007-7352-wzplos.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=501&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Historically, federal authorities, notably the Federal Energy Regulatory Commission (FERC), had jurisdiction only over long-distance transmission lines.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/dukeenergy/4587281064/in/photolist-7Zn1QQ-oDJ5bb-oUbeDG-bJ4FQ4-7kNZb7-dxpuKP-dxpvfH-9HHHED-aXfW9R-8tA43A-dVNJWj-qKHFM5-qHvdEu-qKHFrq-qKN2o4-qKCvzv-dxpuVB-er3jAo-eq75JT-dCfstr-dCkTmG-dCftkg-dCfuf4-dCkV7Q-dCkUhJ-dCkUwL-fvRZZ5-9Fb6pT-74ptHF-eeqPaJ-e2B2ny-doQojt-bR4VJM-pG8gby-ykK4yM-yBiahu-ra1HTr-r7SCtG-raaqWM-qSArS9-fvBJ8P-xFepaU-qBzwSV-rbRmVK-eFGCvA-eFAwJH-eFAwNZ-eFGCss-bR4VHp-epUVo6">Duke Energy</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc-nd/4.0/">CC BY-NC-ND</a></span>
</figcaption>
</figure>
<p>The significance of this particular case is rooted in the two different and opposing directions in which technology, policy and good old consumer behavior are pushing and pulling the business of electricity. </p>
<p>On the one hand is a federal policy of playing a greater role in the business of managing the regional power grid, supplanting the traditional electric utility. Regional organizations now manage portions of the national grid for more than 70% of all electricity consumed in the US. </p>
<p>The other trend is the increasing democratization of electric power production through rooftop solar photovoltaics, small-scale energy storage devices (like Tesla’s Powerwall) and increased interest in “micro-grids” to produce, distribute and manage electricity on a localized scale. Local energy is rapidly becoming the new local food. (There has even been a buzzword – “loca-volt” – coined to capture this movement.)</p>
<p>The simultaneous trends of regional grid management and democratized electricity supply are now in tension with one another, not for any technological reason, but primarily for reasons of policy and economics. </p>
<p>The Federal Power Act, which was passed in 1935, attempts to draw a “bright line” between those elements of the electricity system that are under federal versus state jurisdiction. </p>
<p>The federal role is to regulate the regional transmission grid – including the power lines that transport electricity long distances and across state lines – and wholesale markets for buying and selling power. The role of the states is limited to the local grid that delivers electricity to homes and businesses and to retail sales.</p>
<p>Market rules like Order 745 provided a pathway for these two trends to be complementary, rather than in opposition, without a patchwork of individual state regulations. </p>
<p>Want solar panels on your house? Sure thing – and those solar panels could also provide power to the grid at a price, perhaps avoiding the need to build some new power plants. Or you could provide demand response by using less electricity from the grid during certain days, and more from your solar panels. Order 745 created rules to compensate people and businesses on the wholesale energy markets to lower power use, whether it was from a bank of giant batteries or highrise buildings in New York City. </p>
<h2>Distributed energy technologies</h2>
<p>Demand response and Order 745 are so significant because they have blurred the bright line between federal and state control over the electricity sector. This bright line is increasingly becoming an artifact of our federalist legal structure. </p>
<p>A regional grid operator’s primary function is to ensure the lights stay on by having enough power to match the demand. But there is no technological reason that demand response, backup generators or energy storage banks, electric vehicles, and other emerging technologies that are all part of the “smart grid” could not serve the same function for regional power grids that large power plants do today. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=371&fit=crop&dpr=1 600w, https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=371&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=371&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=466&fit=crop&dpr=1 754w, https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=466&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/97662/original/image-20151007-7371-15wjuen.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=466&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Supply power to the grid through solar panels and other distributed energy products and services, including demand response, can be more cost-effective and cleaner than building new power plants.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/cocreatr/5417867928/in/photolist-9fKZo1-9fKYkJ-eMzno9-gts9JW-gts9u7-9dxZcs-6gjgXt-9duTLn-9duUrx-9dy1cf-dp55iH-dp55eP-9d5vQ3-8T8fEQ-9d2qwD-c3bZ9d-9dxXX7-6aLfiu-ceWmTs-aXSp6v-g9Yao2-2dRUst-9d5vVG-9dxZzJ-9dxXHG-9dxYkj-9duUcv-9dxZ4U-9dxYZY-9duVAZ-79uvHv-9duWjg-9dxXPQ-9dxZ97-9duVwt-4tmVnd-uKkP6h-c2REkS-9duUM2-9dxZJG-gtsqPt-6Jb6DT-eZg3Ps-abmSEb-6GWtzJ-amp4zo-6sji9e-abmTDj-9dxXvy-9duTWv">cocreatr/flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-sa/4.0/">CC BY-SA</a></span>
</figcaption>
</figure>
<p>And there are good reasons to believe that harnessing <a href="http://www.greentechmedia.com/articles/read/dueling-charts-of-the-day-peaker-plants-vs.-green-power">loca-volt energy and energy efficiency</a> will actually be cheaper than building new power plants for times when large-scale wind and solar plants aren’t available (France and some places in the US already do this, through controllable hot water heaters).</p>
<p>Striking down Order 745 would make the bright line ever so brighter, but it would also complicate the economic environment for one of the most innovative segments of the electricity sector. </p>
<p>This case, ultimately, is far more significant than getting paid for not using electricity. It’s about who gets to set the rules of the road for emerging technology in the electricity sector – the states or the federal government – and whether the US will be able to modernize its energy policy the same way that it would like to modernize its power grid. (Full disclosure: My university employer, Penn State, has been involved in a <a href="https://smartenergyacademy.psu.edu/gridstar/about-gridstar">demonstration project</a> that uses battery energy storage to balance fluctuations on the power grid in Pennsylvania and I am an advisor to the <a href="http://microgridsystemslab.com/">Microgrid Systems Laboratory</a> in New Mexico.) </p>
<p>Before launching Tesla’s wall-mounted batteries, perhaps Mr Musk should have sat on his hands for a bit longer.</p>
<p><em>This article has been updated with more detail on the author’s involvement in microgrid projects.</em></p><img src="https://counter.theconversation.com/content/48725/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Seth Blumsack receives funding from the US National Science Foundation, US Department of Energy and the Pennsylvania Department of Environmental Protection.</span></em></p>The Supreme Court hears a case that will decide whether homes and businesses can earn money from distributed energy technologies, including demand response and home battery systems.Seth Blumsack, Associate Professor, Penn StateLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/419372015-06-12T10:18:06Z2015-06-12T10:18:06ZCould one million smart pool pumps ‘store’ renewable energy better than giant batteries?<figure><img src="https://images.theconversation.com/files/84611/original/image-20150610-6823-1sxzzu4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Lots of wind blowing – often at night when there's little demand for power.</span> <span class="attribution"><a class="source" href="https://www.flickr.com/photos/ncbob/3781036383/">ncbob/flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by-nc/4.0/">CC BY-NC</a></span></figcaption></figure><p>As more wind and solar energy comes online, the people who run the power grid have a problem: how do they compensate for the variable nature of the sun and wind?</p>
<p>California plans to spend <a href="http://www.npr.org/2013/12/23/250031679/could-big-batteries-be-big-business-in-california">billions of dollars</a> for batteries to even out the flow of power from solar and wind, much the way shock absorbers smooth out bumps on the road. But do they need to? Not at all!</p>
<p>In my <a href="http://www.slideshare.net/spmeyn/demandside-flexibility-for-reliable-ancillary-services?related=2">research</a>, I’ve found that we can accommodate a grid powered 50% by renewable energy without the use of batteries. </p>
<p>Systems flexible enough to accommodate the ups and downs of solar and wind production can be made by adjusting the power at millions of homes and businesses on a minute-by-minute or even second-by-second basis. This approach requires no new hardware, some control software and a bit of consumer engagement.</p>
<h2>Massive balancing act</h2>
<p>Already, electric power procured from the wind or sun is leading to large and small “bumps” in the energy fed to the grid. </p>
<p>For example, on a typical week in the Pacific Northwest, power can increase or decrease by more than one gigawatt in an hour. That’s the equivalent of the output from one huge nuclear power plant able to supply a million homes.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=442&fit=crop&dpr=1 600w, https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=442&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=442&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=556&fit=crop&dpr=1 754w, https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=556&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/84607/original/image-20150610-6804-ibc5b4.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=556&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Look at the green line. Wind power generation is volatile and not always in sync with the actual demand for power (red line, below the blue).</span>
<span class="attribution"><a class="source" href="http://transmission.bpa.gov/business/operations/Wind/baltwg.aspx">Bonneville Power Administration</a></span>
</figcaption>
</figure>
<p>This is an enormous challenge to grid operators in this region. Massive fluctuations in power require equally massive storage devices that can charge when the wind is blowing, and discharge during periods of calm. </p>
<p>Now, the balance of supply and demand for power is primarily done by generating more power rather than storage.</p>
<p>Grid operators draw on what is called the balancing reserves obtained from fossil fuel generators or hydro plants, when available. These power plants ramp up and down their output in response to a signal from a grid balancing authority. This is just one of many ancillary services required to maintain a reliable grid.</p>
<p>Many states are now scrambling to find new sources of ancillary services, and the federal government is also searching for incentives: Federal Energy Regulatory Commission (FERC) orders 745, 755 and 784 are recent responses by a government agency to create financial incentives for <a href="http://www.di.ens.fr/%7Ebusic/papers/HICSS48_Sept1.pdf">responsive resources to balance the grid</a>.</p>
<h2>Are batteries the solution?</h2>
<p>Storage is everywhere, but we have to think beyond electricity.</p>
<p>Consider a <a href="http://www.meyn.ece.ufl.edu/assets/uploads/2014/12/HVACtoGRID2014.pdf">large office building</a>. Will anyone notice if the fan power is reduced or increased by 10% for 10 or 15 minutes? This makes no demands on the comfort of occupants of the building, but the resulting deviations in power can provide a substantial portion of the needs of the grid. A building can be regarded as a virtual battery because of thermal inertia – a form of thermal storage.</p>
<p>What about for longer time periods? Residential pool pumps (as well as pumps used in irrigation) are a significant load in Florida and California – well over one gigawatt in each state – that can be run at different times of the day.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/84610/original/image-20150610-6798-qrg3up.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Turning down, or turning on, many of these = enough power smooth out solar and wind, while still cleaning the pool.</span>
<span class="attribution"><a class="source" href="http://pixabay.com/en/pump-pool-filter-water-pump-pool-318331/">Pixabay</a></span>
</figcaption>
</figure>
<p>Through local intelligence – in the form of a chip on each device or a home computer for many devices – the collection of one million pools in Florida can be harnessed as massive batteries. Through one-way communication, each pool will receive a regulation signal from the grid operator. The pool will change state from on to off based on its own requirements, such as recent cleaning hours, along with the needs of the grid. Just as in the office building, each consumer will be assured of desired service.</p>
<p>Pools are, of course, just one example of a hungry but flexible load.</p>
<p>On-off loads such as water pumps, refrigerators or water heaters require a special kind of intelligence so that they can accurately erase the variability created from renewable generation. Randomization is key to success: To avoid synchronization (we don’t want every pool to switch off at once), the local intelligence includes a specially designed “coin-flip”; each load turns on or off with some probability that depends on its own environment as well as the state of the grid.</p>
<p>It is possible to obtain highly reliable ancillary service to the grid, while maintaining strict bounds on the quality of service delivered by each load. With a smart thermostat, for example, indoor temperature will not deviate by more than one degree if this constraint is desired. Refrigerators will remain cool and reliable, and pools will be free of algae.</p>
<h2>Where do we go from here?</h2>
<p>We first must respect the amazing robustness of the grid today. </p>
<p>This is the result of ingenious control engineering, much like the automatic control theory that brought the first human to the moon and makes our airplanes so reliable today. We cannot pretend that we can transform the grid without partnering with the control and power engineers who understand the mysterious dynamics of the grid. Instabilities and blackouts occur when we are too aggressive in attempting to balance supply and demand, just as they occur when we are too slow to respond.</p>
<p>We are certain that the engineering challenges will be largely solved in the upcoming years – it is an exciting time for power!</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=166&fit=crop&dpr=1 600w, https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=166&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=166&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=208&fit=crop&dpr=1 754w, https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=208&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/84618/original/image-20150610-6796-ib511x.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=208&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">“Intelligent” loads, or devices with controllers, can balance supply and demand of power along with generators and batteries.</span>
<span class="attribution"><span class="source">Author</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>The next challenge is participation. </p>
<p>Today, about 750,000 homeowners in Florida have signed contracts with utility Florida Power & Light, allowing them to shut down pool pumps and water heaters in case of emergencies. How can we expand on these contracts to engage millions of homeowners and <a href="http://ieeexplore.ieee.org/xpls/abs_all.jsp?arnumber=6483455&tag=1">commercial building operators</a> to supply the virtual storage needed? Recent FERC rules that offer payments for ancillary services for balancing the grid are a valuable first step in providing incentives.</p>
<p>It is possible that little incentive is required since we are not subjecting consumers to any loss of comfort: it is the pool or fridge that provides flexibility, and not the homeowner.</p>
<p>A sustainable energy future is possible and inexpensive with a bit of intelligence and flexibility from our appliances.</p><img src="https://counter.theconversation.com/content/41937/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Sean Meyn receives funding from NSF, DOE, and Google.</span></em></p>Smoothing out variable wind and solar is a growing problem. Instead of storing energy with batteries, utilities can adjust the power of millions of devices in buildings and homes.Sean Meyn, Professor of Electrical and Computer Engineering, University of FloridaLicensed as Creative Commons – attribution, no derivatives.