Nega-watts are better than megawatts
Last week, I touched upon a number of issues and ideas brought up at the TechAdvantage conference, and promised to delve deeper into Tariq Samad’s presentation, which discussed customer interface beyond the meter.
Samad, who is a corporate fellow with Honeywell Automation and Control Solutions, and a member of the governing board for the Smart Grid Interoperability Panel, shared his thoughts about the homes-and-buildings side of automation control.
About three-quarters of the nation’s electricity consumption is in homes and buildings, he told us. So, it would logically follow that one of the benefits of the smart grid is to enable more widespread use of demand response (to reduce peak electricity demand) and energy efficiency measures (to reduce overall demand).
The realization of this and other smart grid benefits, not the least of which is to increase consumers’ awareness of their own energy consumption, will need variable pricing, deployment of controls beyond the meter, and standard architecture and communications controls, Samad said. But automated meter reading (AMR) deployments can be leveraged to achieve these goals under variable pricing plans.
There are architecture and security considerations, especially with regard to Home Area Network (HAN) architecture. In Samad’s scenario, the energy management system (EMS) connects to the meter, and controls the HAN devices in the home. As anything connected to the utility has to be authenticated, the EMS allows for privacy and security benefits by creating an effective firewall. When necessary, the utility can also communicate directly through the EMS (such as in demand response situations, for example). This, he feels, is the most optimal architecture “beyond the meter.”
This particular HAN approach also minimizes risk and maximizes the benefit from real-time consumption information, Samad said. As well, the aggregate data provided by AMR and AMI bring into play a lot of potential services of interest both to utilities and consumers, such as usage comparison over time and among neighbors, best practices, usage comparison patterns, and more.
What struck me most about Samad’s presentation, however, were his thoughts on the economics of energy efficiency and demand response.
“Energy efficiency can be viewed as a ‘source’ of electricity: nega-watts instead of megawatts,” he explained. The cost to the end-user of electricity “generated” from energy efficiency products is typically 4 cents to 8.5 cents per kilowatt-hour, Samad noted, and it can be as low as 1 cent per kilowatt-hour in certain cases. “It compares favorably with today’s retail prices for electricity [about 11 cents per kilowatt-hour],” he said.
Demand response, too, compares favorably with all types of generation: “it is two to three times cheaper than peak generation from natural gas under conservative assumptions,” Samad told us.
I have been writing in this space about energy efficiency and its smart grid connections for many months. At times, it feels like a shout into the dark, because energy efficiency hasn’t, for many, been a part of the grid intelligence equation. It is, however, informed by grid intelligence, and therefore difficult to separate when looking at the ultimate goal. It was encouraging to hear Tariq Samad’s “beyond the meter” thoughts at TechAdvantage, not only because they echoed my own (validation by an expert in the field is always good), but because of the clarity with which he presented his argument.
In summary, because his points deserve driving home:
- The smart grid doesn’t stop at the meter.
- Nega-watts are better than megawatts.
- Architecture definition must be informed by end-use considerations.
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