Demand Response Prof. S. A. Khaparde EE 772 Department of - - PowerPoint PPT Presentation

Demand Response

• Prof. S. A. Khaparde

EE 772

Department of Electrical Engineering IIT Bombay

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Motivation

Demand supply balance : a critical aspect of electricity grid Challenges increase further with increase in competition at retail level

market based problems : generators or retailers faces financial risk due to spot price volatility network based problems : TSO or DSO faces problem to maintain reliability during peak hours

Traditionally, generating utilities has to compensate for load-generation mismatch by increasing/reducing generation. Utilities has to ensure security margin of generation for reliable operation of the system.

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Motivation contd...

These problems can be categorized as

short-term problems : network based problems long-term problems : environmental effects due to usage of fossil fuel

Demand side management (DSM) was introduced in 1980s by Electric Power Research Institute (EPRI) to address these problems. DSM includes variety of activities: load management, energy saving, energy efficiency etc. Short term problems can be tackled by efficient load management programs which are collectively referred to as Demand Response (DR).

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Definition of DR

According to Federal Regulatory Commission DR is defined as : ”Change in electric usage by end-use customers from their normal consumption patterns in response to changes in the price of electricity over time, or to incentive payments designed to induce lower electricity usage at times of high wholesale market price or when grid reliability is jeopardized.” DR can be considered as a virtual resource which can be exchanged between two groups of participants:

Group I: retailers, DSO, TSO, Market Operator (MO) Group II: aggregator, Consumer

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Types of DR

There are three main types of demand response Emergency Demand Response : used to mitigate the potential for blackouts or brownouts during shortage of supply. This typically occurs on days of extreme hot or cold temperatures when heating and cooling systems are causing greater demand

• n the grid.

Economic Demand Response : employed by utilities to avoid the significantly higher costs of producing energy during peak demand times, typically associated with ramping up ”peaking” power plants to meet higher than expected demand. Ancillary Service Demand Response : used to support the transmission of electricity to loads in a manner consistent with reliability requirements that are imposed on utility companies by industry regulators.

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DR Strategies

There are two common ways in which demand response events are executed by utility companies Direct Load Control demand response events involve the remote interruption of customers’ energy usage, in which power distributors cycle loads like heating, cooling, elevators, washing etc. ON and OFF at varying time intervals during peak hours of the day. Dynamic Pricing uses variable electricity rates to encourage customers’ voluntary curtailment during DR events. Utilities use a variety of pricing schemes including peak time rebates, critical peak pricing, and time of use (TOU) rates to curtail usage.

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DR Programs

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Classification of DR

Demand Response Dispatchable Non­Dispatchable Time Sensitive Pricing TOU, CPP, RTP, PTR, System Peak, Response Transmission Tariff Economic Energy Price Demad Bidding/ Buy Back Reliability Capacity Energy­ Voluntary Emergency Ancillary Spinning, non­ spinning reserves regulation DLC, I&C

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Classification of DR contd...

There has been different ways to classify DR. And different programs differs on following parameters. customer’s freedom to respond penalty for not fulfilling the contract no of participants price structure defining base line factor of trust between customer and service provider

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DR Benifits

There can be following four major points of view to count the benefits of DR. system wide benefits :

saving on capital investments reduction in system peak load increasing balancing resources rapid deployment of balancing resources TSO can benefit by being able to improve reliability of network DSO can use DR for managing network constraints by relieving voltage constrained power transfer, congestion, and thus can improve quality of supply.

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DR Benifits contd...

market benefits :

reduced market power and improved efficiency reduce financial risk involved with the spot price volatility faced by retailers

customer benefits :

reduction in net price paid for electricity earning financial rewards for reducing consumption

social benefits :

Encouraging deployment of new technologies like distributed generation, storage promoting the habit of adjusting needs whenever required.

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DR Benifits contd...

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Impacts of DR

• Fig. describes the potential impact of efficiency and DR measures
• n customer service levels

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Literature Pertaining to DR

The literature related to DR can be broadly classified in three categories1: DR concepts and models DR literature directly applicable to wholesale markets DR literature directly applicable to retail markets

1Balijepalli VSK Murthy, Vedanta Pradhan, S. A. Khaparde, and R. M.

• Shereef. ”Review of demand response under smart grid paradigm.” In

Innovative Smart Grid Technologies-India (ISGT India), 2011 IEEE PES, pp. 236-243. IEEE, 2011.

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Literature Pertaining to DR contd...

The literature in the category of DR concepts and models mainly present concepts which guide incorporation of DR into system at various time-scales. Various conclusions are derived in the literature of this category which are, To ensure reliability of market-based DR models, effective DR mechanisms are needed: consumer must be charged on an hourly basis and vary consumption with certain level of responsiveness 2 If prices are not sifficiently different, it wil be difficult to justify investments on DSM 3

2Fraser Hamish. ”The importance of an active demand side in the

electricity industry.” The Electricity Journal 14, no. 9 (2001): 52-73.

3Strbac Goran. ”Demand side management: Benefits and challenges.”

Energy policy 36, no. 12 (2008): 4419-4426.

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Literature Pertaining to DR contd...

The incentives to the participants comprises of an energy reward, a reserve reward and a capacity reward which must be set so as to fully compensate cost of load reduction 4 Neither reliability based nor price based DR can individually maximize the benefits out of DR 5 The effects on distribution loads on transmission operation for an event of DR is also addressed 6

4Yoo, Tae Hyun, et al. ”Development of reliability based demand response

program in Korea.” Innovative Smart Grid Technologies (ISGT), 2011 IEEE

• PES. IEEE, 2011.

5Nguyen, Duy Thanh. ”Demand response for domestic and small business

consumers: A new challenge.” Transmission and Distribution Conference and Exposition, 2010 IEEE PES. IEEE, 2010.

6Lu, Shuai, et al. ”Centralized and decentralized control for demand

response.” Innovative Smart Grid Technologies (ISGT), 2011 IEEE PES. IEEE

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Literature Pertaining to DR contd...

Various conclusions derived in the category of DR framework directly applicable to wholesale market are as follow, The summary of DR implementation in wholesale markets are presented 7 The usefulness of DR in balancing the high penetration of renewable is discussed 8 A short term security constrained unit commitment(SCUC) model for scheduling generating unit with spinning reserve along with reserve provided by DR provider is also discussed. 9

7Albadi, Mohamed H., and Ehab F. El-Saadany. ”A summary of demand

response in electricity markets.” Electric power systems research 78.11 (2008)

8Stadler, Ingo. ”Power grid balancing of energy systems with high renewable

energy penetration by demand response.” Utilities Policy 16.2 (2008): 90-98.

9Parvania, Masood, et al. ”Demand response scheduling by stochastic

SCUC.” IEEE Transactions on smart grid 1.1 (2010): 89-98.

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Literature Pertaining to DR contd...

Most of the DR papers reported point to the retail market implementations. Scheduling of interruptible loads to achieve a system requirement of hourly curtailments is considered 10 A scheduling of household appliances equipped with renewable generator and stand alone battery is presented 11 The idea of integrating DR as a source of primary frequency control alonside that from dedicated generators is presented 12

10MAA Pedrasa, et al. ”Scheduling of demand side resources using binary

particle swarm optimization.” IEEE Transactions on Power Systems 24.3 (2009): 1173-1181.

11Hubert, Tanguy, and Santiago Grijalva. ”Realizing smart grid benefits

requires energy optimization algorithms at residential level.” Innovative Smart Grid Technologies (ISGT),IEEE, 2011.

12Molina-Garcia, Angel, Franois Bouffard, and Daniel S. Kirschen.

”Decentralized demand-side contribution to primary frequency control.” IEEE Transactions on Power Systems 26.1 (2011): 411-419.

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Clustering in DR

A primary step in DR implementation is the detailed knowledge of customer potential through customer aggregation and characterization of demand clusters. Customers whose demand follow the day-ahead or real-time prices are the ones who are more suitable for DR programs selection from the view point of both customer and supplier Clustering provides typical load pattern of each customer class which can be used for choosing DSM program, tariff structure etc. Moreover demand characterization provides an effective tool to estimate the potential demand reduction, loss of service cost and impact of DR programs on demand.

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DR in Smart Grid

Technology advancements in smart grid facilitates deployment of DR Early detection : Smart grid enables utilities to detect and respond to load increases early by calling a DR event. Improved Communication : Smart grid promises to increase the efficacy of DR by streamlining the notification process and providing real-time information to customers Accurate and Easy Verification : Smart grid enables utilities to measure and verify customers’ curtailment during a DR event Automation Systems : An automated DR would automatically detect the need to shed load, send signals to participants, and control all devices that use electricity Demand Response Markets : Smart grid creates a market for energy efficiency by enabling large energy users to reduce consumption when pricing rates are higher.

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DR in Smart Grids contd...

Demand side management DR Porgrames Energy Conservation Strategic load growth Flexible load shaping Incentive based Load management Market based Direct load control Interruptible load control Demand side bidding Capacity market Ancillary services Price based Time of use Real time pricing Critical peak pricing

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Enabling Technologies

It can be broadly captured under following heads- Advanced metering - Advanced Meter Reading (AMR) and Advanced Metering Infrastructure (AMI). Most essential feature of AMI is availability of continuous and automatic bidirectional communication link. Communication - Local Area Network(LAN) for communication within consumer’s premise and between the premise and nearest data aggregators, while Wide Area Network (WAN) for collection of data from aggregators spread over wide area. Meter data management - collecting, organizing and processing data for various applications e.g. billing customer load profiling etc. Control - Control of consumption. Home automation systems, home area network (HAN), In-home Displays (IHDs)

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Popular DR programs

Some programs from US and Europe. New York ISO : Reliability based and Economic based DR programs. ISO England, USA : Incentive based DR. Pennsylvania Jersey Maryland (PJM, USA): Economic and Emergency DR programs. Electric Reliability Council of Texas (ERCOT, USA) : Emergency Response service. Nordic Market - apart from similar economic and reliability based DR programs it also has grid tariffs for effective price based also included.

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DR Standards

Energy inter-operation version 1.0 -information and communication model developed by OASIS for the coordination purpose between any two parties in power system OpenADR 2.0 - extension of OpenADR 1.0. It had two

• profiles. First one is OpenAdr2.0a, to support basic DR

services in low-end embedded devices while second one is OpenADR2.0b, to support DR for high-end embedded devices. It’s communication is based on the principle of VTN (virtual top node) and VEN (virtual end node). Smart Energy profile 2.0 - specification for different energy transaction in smart grid domain e.g. communication smart meters, energy management systems, electric vehicles.

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Practical Challenges

Following are the major challenges faced in the implementation of a DR program.

• perational time-scale at which it should be incorporated into

the system proper tariff and regulation policies cost recovery and profit for economic sustainability automation of different systems reliability of supply and privacy of usage for sensitive customers base line problem mainly in incentive based DR programs security and privacy for both customers and utility

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DR in Indian Context

Demand response is in its nascent stages in India. Its benefits will mirror those seen in Western countries, such as reduced electricity blackouts, reduced electricity costs,

• ffsetting the need to build supply resource and the ability to

integrate electric vehicles and renewable energy sources. Regulatory framework also needs to be in place for implementation of DR strategies. It is necessary to identify the appropriate consumers to be roped in for DR to ensure the success of the program due to large diversity. Consumer awareness and maintaining transparency with them must be a priority to win their confidence and ensure acceptance of the DR program. The electrical distribution network must be strengthened to ensure reliability in operations. To cater to the diverse needs of the consumers, a variety of DR modules need to be prepared.

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