Change is coming: standards and regulations in the age of DERs

Change is coming: standards and regulations in the age of DERs

New opportunities and new challenges. Thanks to the rapid growth of distributed energy resources (DER), electric cars, and the IoT, electricity providers are encountering plenty of both. All around the world, utilities are investigating or transitioning to a distributed grid to meet government and market demands for renewable energy. For the most part, they’re doing it without up-to-date regulations and technology standards – and that’s one of the challenges.

As the grid evolves from centralized to decentralized distribution, the electricity power sector will see a number of changes. Specifically:

  • Utilities will update their business models to incorporate new energy sources and services
  • Regulations and legislations will be set to enable fair competition
  • New standards will be implemented for:
    • Cybersecurity, protection and control
    • Device connectivity
    • Communication
    • Interoperability

Updating regulations for decentralized distribution

Reliability is everything in power distribution. Historically, regulated utilities have used a rate-based mechanism as well as continual investments in people, equipment, and technology to ensure a reliable power supply. As adoption of grid-edge power sources and loads increase, it will become exponentially more complex to monitor, control, track and restore outages, and analyze/optimize the distribution network for optimal reliability.

All the same, it’s a challenge utilities are willing to take on. This is perhaps best illustrated by their response to the New York State power outage that saw 590,000 customers lose power for up to 10 days in March 2018. While government representatives and regulators have called for accountability and launched an investigation into the affected utilities’ preparation and response, utilities in general have focused on preventing future occurrences. Specifically, utilities are focused on enhancing resiliency and improving outage responses by reinforcing the distribution grid through automation and DERs.

Many jurisdictions are already in the process of modernizing their grid. Regions with ambitious renewable energy mandates are furthest along, having established regulations and incentives to encourage utilities to invest appropriately to meet regulated requirements and deliver shareholder value. The majority of utilities around the world, however, lack clarity on how regulations will affect decentralized grid operations. It seems likely that they’ll have to wait for regulators to watch frontrunning markets and apply the lessons learned.

Can performance-based regulation assist with the transition?

Take performance-based regulation (PBR), for example. With a PBR model, utilities would earn a rate of return based on specific performance objectives such as quality of service, system reliability, and innovation. The Michigan Public Service Commission recently assessed the feasibility of integrating PBR into the current cost-of-service regulatory model. It examined six jurisdictions with transmission and distribution utilities to evaluate methods for:

  • Estimating the revenue required by utilities to operate
  • Increasing the time between rate cases
  • Setting performance incentives and penalties
  • Enabling profit sharing for consumers and utility stakeholders while managing the risk for adopting innovative technologies

The Commission concluded that the PBR model used in other jurisdictions could be adapted on a jurisdiction-by-jurisdiction basis to augment existing regulatory models. From a regulatory standpoint, this is a promising option to encourage utilities to evolve their business model and embrace a decentralized grid.

Modernizing industry standards to address current and upcoming changes

Regulations are only one part of the equation. Standards are the other. With the rise of DERs, the industry needs to update and harmonize standards for technology, interoperability, security, and data privacy. Some work has already been done or is in progress:

  • The new IEEE 1547-2018 standard for interconnection and interoperability of DERs and interfaces with electric power systems was released in February 2018. At five times the length of the last revision, this much-needed standard document is far more comprehensive in terms of specifications.
  • The US Department of Energy is sponsoring multi-million dollar programs to facilitate collaborative R&D between national labs, utilities, industry, and academia on technologies, performance, and interoperability requirements.
  • The IESO in Ontario, Canada is engaged with the 70 local distribution companies to enhance coordination and interoperability standards for the province’s long-term energy plan. The council is focused on:
    • Ensuring reliable data exchange for maximum visibility and access to DERs
    • Developing a better understanding of how DER operating conditions will impact the grid’s energy balance
    • Identifying additional values that could improve operational reliability and resiliency
  • Across North America, utilities are engaged in varying degrees on the NERC-CIP cybersecurity standard. Technology considerations span from endpoint encryption to full operational situational awareness of the grid infrastructure. There are still grey areas in terms of data ownership and privacy requirements, particularly around the access and usage of consumer meter and third-party DER data.

There’s no doubt that DERs offer great potential for peak demand management, resiliency, power quality management, and advanced grid support such as imbalance and reserves management. To extract multi-tier values, however, utilities will need an effective regulatory framework, as well as the operational readiness to manage a decentralized grid.

What are your thoughts on the state of regulations and standards in the context of a decentralized grid? Let’s keep the discussion going – share your thoughts below.

Young Ngo

 

Califican con ‘nota alta’ en energía a la compañía Energética de Occidente

La Compañía Energética de Occidente, CEO, que brinda el servicio en el vecino departamento del Cauca fue destacada por la Superintendencia de Servicios Públicos Domiciliarios como una de las empresas que mejor calidad ofreció el año pasado entre las principales…

Click the link below to read the complete news story on elpais.com.co:

https://www.elpais.com.co/contenido-premium/califican-con-nota-alta-en-energia-a-la-compania-energetica-de-occidente.html

 

The road to renewable: how and why the power industry is changing

The road to renewable: how and why the power industry is changing

Renewable energy is an undeniable force of change in the power industry. It’s altering the way governments, utilities, and consumers think about energy and it’s forcing power companies to transform their operating and business models.

But what, specifically, is driving the change? And why now?

Essentially, it boils down to three main factors:

  • Government mandates that support renewable energy and storage
  • Investments in technology aimed at reducing reliance on fossil fuels
  • The increasing affordability of renewable energy and storage technology

Government mandates

All around the world, governing bodies are increasingly promoting the use of renewable energy over fossil fuels. Europe has been particularly progressive in integrating renewable energy sources into its electricity supply over the last 10 years. While Europe may be leading the charge, it’s not alone. In the U.S., many states are in the process of establishing target dates for greater reliance on renewable energy, if not 100% dependency. Hawaii, for example, plans to transition completely to renewable energy by 2045. While this is the most aggressive mandate in the U.S., states such as California, Nevada, New York, and Arizona are not far behind in their goals for their renewable portfolio.

It’s worth noting that the influence of governments is not restricted to renewable energy transition. For example, on February 15, 2018, the U.S. Federal Energy Regulatory Commission voted to remove barriers to electric storage resources participating in the capacity, energy, and ancillary services markets operated by Regional Transmission Organizations and Independent System Operators. This is expected to result in energy storage becoming a viable technology for improving operating efficiency and resiliency of the electric power system.

Investments in Technology

Not surprisingly, the focus is on advancing technology to meet these new demands. Since 2013, over $1 trillion has been invested globally in renewable energy, creating nearly 10 million jobs. And it’s paying off: disruptive technologies in the renewable energy and storage markets have grown exponentially in recent years and they continue to evolve.

This is particularly evident in the storage market, where the automotive sector is driving the rapid commercialization of the lithium-ion battery. Fueled by the innovations of Tesla and a number of countries setting non-fossil transportation targets, virtually every major automotive manufacturer around the world has announced electric vehicles in its lineup over the next several years. Naturally, this has resulted in an intense focus on battery technology advancements and cost reduction to enable mass market availability.

The lithium-ion battery has already proven its value in the power distribution arena by successfully resolving the intermittency challenges of renewable distributed energy resources (DERs) such as solar and wind. This has established a very strong business case for utilities to leverage lithium-ion batteries for operational objectives such as demand response, peak management, resiliency, capacity dispatch, and power quality metric improvement.

The U.S. government’s ruling underscores the market’s confidence in energy storage performance and the ability for lithium-ion battery technology to contribute effectively to an integrated grid. The ability to plan, schedule, and dispatch the battery storage capacity, either at grid or residential scale, provides additional value to the collective distributed energy resources asset. It also demonstrates how storage can be a valuable component in a decentralized distribution grid.

Affordability

Altogether, government mandates for reduced fossil-fuel consumption and continuous advances in power generation and storage technology have led to one of the biggest disruptors in the power industry: affordability for the general market.

Renewable energy sources such as solar and wind can now compete with conventional generation technologies on a cost per kilowatt hour generation basis. According to the International Renewable Energy Agency, onshore wind projects are achieving an average cost of $0.06 per KwH and solar PV is coming in at $0.10 per KwH, versus fossil-fuel electric generation ranging from $0.05 to $0.17 per KwH (IRENA, Renewable Power Generation Costs in 2017, www.irena.org.)

Once again, this can be attributed to three factors:

  • The competitive procurement process required for new power plants
  • A larger pool of experienced developers and suppliers
  • Cost efficiencies arising from technology advancements and economies of scale

At the same time, storage technology is becoming increasingly affordable. Lithium-ion batteries are dominating the market due to their greater scale and lower commercialization cost. Thanks to ongoing research and development – not to mention demand – renewable energy power storage options are close to reaching viability for the residential market.

What are your feelings about the forces driving change in the power industry? Are the plans to transition to renewable energy realistic? Is storage technology going to help the industry address demand? Let’s keep the discussion going – share your thoughts below.

Young Ngo

Survalent Signs Leadership Accord on Gender Diversity

Participation reinforces Survalent’s commitment to ensuring a fair, equitable, and inclusive workplace for all employees

BRAMPTON, ON — July 5, 2018 —  Survalent, a leading provider of advanced distribution management system (ADMS) software, is proud to announce its participation in the Leadership Accord on Gender Diversity in the Canadian Electricity Industry (“the Accord”). In signing the Accord, Survalent joins a growing list of industry leaders committed to ensuring fair hiring practices, training, and mentorship opportunities for women seeking to pursue careers in the electrical industry.

The Accord, which was developed by Electricity Human Resources Canada and the Connected Women steering committee, is a public commitment by employers, educators, unions, and governments to promote the values of diversity and inclusion within their organizations. Signatories agree to support the development of women in the industry through fair hiring practices, comprehensive training, and mentorship opportunities that help all individuals reach their full potential.

“The electrical industry is traditionally a male-dominated one, with women comprising only a quarter of the workforce. Yet, studies show that diversity drives innovation, engagement, and profitability,” notes Steve Mueller, President and Chief Executive Officer of Survalent. “With the power sector undergoing disruption due to new technologies and a move toward clean energy, there’s never been a better time to encourage the fresh and innovative viewpoints of a diverse workforce.”

“The Accord lays out a clear path for achieving equality, respect, and inclusion at all levels and for all participants, and offers greater potential for women to thrive within the electrical industry,” commented Kathy Lerette, Vice President of Business Transformation at Alectra Utilities. Lerette, who serves as the Vice Chair of the Board of Directors for Electricity Human Resources Canada, presented the Accord to Mueller who signed it during the Women in Renewable Energy (WiRE) event hosted by Survalent on July 4, 2018.

A 2017 study by Grant Thornton surveyed over 5,000 mid-market businesses in 36 countries to determine the percentage of senior executive roles filled by women. In Canada, women represent 23% of senior leaders, slightly below the 25% worldwide figure. At Survalent, 44% of executive roles are held by women – nearly double the national average.

“Survalent has always valued the unique insights that arise from a diverse workforce. By signing on to the Accord, we’re formalizing our commitment to gender diversity and will continue to foster an inclusive culture in which all of our employees have equal opportunity to learn, grow, and excel,” concluded Mueller.

About the Leadership Accord on Gender Diversity
The Accord was developed by EHRC and the Connected Women steering committee, a group of industry stakeholders who collaboratively developed a national mentorship program for women in the sector (Connected Women Mentorship Program) which was launched May 31, 2017.
To learn more, visit http://electricityhr.ca/workplace-support/diversity-inclusion/ehrc-leadership-accord/

About Electricity Human Resources Canada
Electricity Human Resources Canada (EHRC) is Canada’s most trusted source of objective human resources information and tools to help the Canadian electricity industry match workforce supply and demand. EHRC helps to build a better workforce by strengthening the ability of the Canadian electricity industry to meet current and future needs for a highly skilled, safety-focused, diverse and productive workforce. For more information, visit http://www.ElectricityHR.ca.

About Survalent
Survalent (survalent.com) is the most trusted provider of advanced distribution management systems (ADMS) for electric, gas, transit and water/wastewater utilities across the globe. Over 600 customers in 30 countries have implemented the SurvalentONE platform to improve operational efficiencies, customer satisfaction and network reliability. The company’s comprehensive substation automation solution, StationCentral, delivers advanced control and monitoring for enhanced network performance and protection. To learn more, visit us at www.survalent.com. Follow us on Twitter @Survalent and LinkedIn.

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