Load Shifting in Chicago's Commercial Buildings

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They think big in Chicago.

Last year, BOMA/Chicago [3]—the Building Owners and Managers Association (BOMA) chapter in the Windy City—sought a $93 million smart grid investment grant from the U.S. Department of Energy.

The grant could have paid half the cost of enabling BOMA/Chicago members' buildings to do load-shifting for fun and profit.

The grant didn't materialize. But last week the group announced that—with assistance from the Illinois Science & Technology Coalition (ISTC [4])— it had signed a memorandum of understanding with the Korean Smart Grid Association to pilot load-shifting by nearly a dozen commercial buildings.

The Korean association has enlisted KT Corporation and LG Electronics—two of that country's largest energy and technology companies—among others, to deploy technology and services valued at $20 million to $30 million to conduct the pilot. Illinois' Citizens Utility Board (CUB) will oversee a related residential smart grid pilot as well. 

In BOMA/Chicago's vision, a successful pilot over the next few years could lead to full involvement by its membership, which could be replicated by the nation's 90 other BOMA chapters.

Let's flesh that out.

BOMA/Chicago's membership operates 260 commercial buildings in downtown Chicago totaling 125 million square feet, or 80 percent of the city's commercial space. Peak demand reaches 1,000 megawatts. If the pilot is successful and a program is fully implemented across BOMA/Chicago's membership, which achieves 20 percent energy savings, that would represent 200 megawatts of capacity, the output of a mid-sized, coal-fired power plant. Do the math on 90 other cities and you begin to glimpse one of the practical outcomes of a smarter grid.

Commercial buildings, said to be one of the prime candidates for energy savings [5], would cut operating costs and share in revenue from selling unused capacity on the wholesale market. Some say hurdles remain; see our column on doubters [6].

 The pilot plan calls for "intensive technology assessments" within 90 days, which means energy audits and analyses of how heating, cooling, ventilating and lighting are accomplished. Retrofits and system programming are to begin shortly thereafter. The goal is to conduct initial transactions—swapping a shift in peak load for dollars—by year's end. Participants want a fully functioning pilot by next summer, which would presumably include a network operating center, or NOC, that would act as go-between BOMA/Chicago's participating members and the whole sale electricity market.

The Korean angle certainly is an intriguing one. It was described to me by Matt Summy, president and CEO of the ISTC—a membership-driven nonprofit focused on attracting research-and-development investment to Illinois through public-private partnerships.

"We thought it was an innovative proposal," Summy said of BOMA/Chicago's initial grant request, one that aligned Chicago's and Illinois' interests that aligned with Korean interests in proving technology in an investment-friendly setting that would "unlock market opportunities."

Illinois entities in total have secured some $175 million in smart grid-related grants and, coupled with major energy efficiency funding, the state represents attractive, "aggregated market power," in Summy's words.

According to Mike Munson, CEO of Metropolitan Energy, the technology consulting arm of BOMA/Chicago, "[The Koreans] seemed to be on their toes."

So were BOMA/Chicago members, who've already over-subscribed the pilot program. 

"Commercial buildings are not well-suited for the capacity market," Munson said. "Tenants won't stand to have their electricity shut off for eight hours at a time. This has to be much more refined and sophisticated load-shifting.

"Our theory is that commercial buildings are well-suited for the balancing services—the PJM demand response ancillary services, as opposed to being used as a last resort to avoid blackouts." 

The pilot will employ smart meters, variable speed drives and digital controls for more granular systems operations—dimmers versus on/off switches, if you will.

"That provides flexibility to maintain comfort," Munson said. "I want to emphasize that any changes absolutely must maintain comfort in the building."

Or, as Michael Cornicelli, executive vice president of BOMA/Chicago [7], put it a few weeks ago in a conversation with me:

"These office buildings are filled with huffy lawyers who will call the management office if the temperature varies two degrees. We need to enable these response mechanisms to allow us to make adjustments when and where they're needed in ways that don't inconvenience or aggravate the tenants."

Phil Carson
Editor-in-chief
Intelligent Utility Daily
pcarson@energycentral.com [8]
303-228-4757