Flexible DR integration

This research investigated the current electric tariffs, enabling technologies, communication platforms, and the innovative priorities that will be needed in the near future for widespread implementation of dynamic pricing to effectively reduce grid congestion via automated demand response (ADR), particularly for Southern California Edison (SCE). Topics covered are an examination of the components of the SCE tariffs, overview of ADR technology (including data models, communication architectures, and standards), and potential barriers to adoption of new technical enhancements (including cost trends, persistence, reliability, storage, Internet of Things trends, and Information Technology opportunities). Key results include: recommendation for an overall communication architecture; Price-Based Grid Coordination (PBGC) that enables diverse communication paths and multiple locations translating prices to functional controls; the new concept of a “local price” of electricity to facilitate maximum use of prices as the central mechanism for managing power distribution; and a standard data model for representing price information. KEY FINDINGS An overall communication architecture, Price-Based Grid Coordination (PBGC), is defined in Section 3 of the report. It enables diverse communication paths and multiple locations translating prices to functional controls, and it offers significant opportunities for flexibility while maximizing interoperability. There are numerous ways for devices to receive price signals and respond, including intelligence and control algorithms in the cloud, in the flexible loads themselves, and in central customer-site control devices. The new concept of a “local price” of electricity facilitates maximum use of prices as the central mechanism for managing power distribution. Streaming prices to loads via Automation Service Providers (ASPs) on a continuous basis to facilitate nimble demand flexibility for grid operators is highly practical. A standard data model for representing price information underpins the communication. There are several technology standards well-suited for price communication, but they can be improved and supplemented to make using them simpler and easier. WHY THIS MATTERS To achieve California’s ambitious goals for operating an wholesale market and electric grid with significant levels of renewable energy, there is a growing need to enable substantial customer retail demand flexibility. An objective of this report is to explore how to develop more flexibility via dynamic pricing from existing and future customer electrical loads. Loads in buildings, such as appliances, processes, and operating systems increasingly contain sophisticated algorithms to manage their internal operation for optimum service delivery. Dynamic electricity prices can be readily integrated into such algorithms, to reduce electricity bills for facility owners