Generac Grid Services Blog

Demand side management (DSM) is the umbrella term for the various methods that power providers employ to get customers to curb consumption. It’s been around since the 1970s, notes Joseph Eto, a Lawrence Berkeley National Lab researcher who wrote a detailed history of it in 1996. He counts conservation education, energy audits, efficiency freebies, financial assistance and time-based tariffs among the forms of DSM utilities use.

Eto also covers the technological approaches designed to achieve objectives like load shifting, peak reduction and off-peak consumption increases.

Every demand response program, every virtual power plant, every distributed energy resource (DER) management system needs one thing to be successful: customers who are willing to hand over their DER controls. Given that participant recruitment is such an important factor in a DER management program’s success, it can’t hurt to bone up on the art of persuasion.

That’s easy to do with The Small Big, a business book that looks at several different studies on how to coax others to do the things you want them to do. Its authors include Robert Cialdini, who wrote Influence, a business psychology text that has been on Fortune’s list of the 75 Smartest Business Books for years. Influence boils down the art of persuasion into six key motivators.

For too many people, demand-side management (DSM) of energy resources means one thing: shedding load. That’s a limiting and outdated view of DSM.

Given the right control platform, Distributed Energy Resources (DERs) can move their power consumption up or down to support the needs of the power system. To get the benefit of that flexibility, you need to think of all DERs – even loads – as resources that can be charged up the same way you charge a battery energy storage system. 

INTRODUCTION:

Raise your hand if you’re a utility professional or grid operator planning to make some significant infrastructure investments in the next few years. You won’t be alone.

After all, energy infrastructure in the U.S. earns a D+ from the American Society of Civil Engineers (ASCE). If you went to the ASCE report card, you’d see some mighty big numbers associated with the transmission and distribution spending that will likely be needed by 2020 to fill the investment gap, which is the difference between what’s needed and what’s planned.

This past Earth Day, plenty of power system participants celebrated our lovely planet. PECO used the date to launch it’s new Solar Stakeholder Collaborative. Louisville Gas & Electric sponsored a do at the Louisville Zoo. First Energy held EarthFest, Ohio's largest environmental education event, for some of its six million customers. Even California’s Independent System Operator (CAISO) used the date to push eco-friendly living. It issued its summer power supply forecast via a press release that sported the headline, “Energy Conservation: What’s Good for the Planet is Good for the Power Grid.”

Ultimately, that’s true. Ironically, a recent survey by the consultancy West Monroe Partners found that most utilities treat DERs -- like customer-sited solar -- as a threat. The same survey shows that only 3 percent of executives who responded view the growth of DER as an opportunity.

Here’s something that’s not so smart about smart inverters: Many people assume we can’t take advantage of the voltage and frequency benefits they could offer grid operators because regulations get in the way. But, even in jurisdictions where regulations hamper autonomous operation of smart inverters, there’s still a way you could gain benefit from them. Just hook them up to a DER-management platform like Symphony by Enbala.

What could be could be

For those who don’t know much about smart inverters, here’s a quick look at what they are and what they can do.

A NEW BUSINESS MODEL? THE UTILITY AS THE NETWORK ORCHESTRATOR:

You’ve probably noticed that a lot of articles and blogs these days begin with the now-obvious observation that the grid is moving from a centralized model to a decentralized one. Often, these pronouncements are offered in a tone that seems like the speaker is wrinkling his brow with worry, wringing his hands … and probably sweating a little, too. Such anxiety is likely over doing it.

In reality, the opportunities presented by distributed energy resources (DERs) far outweigh the challenges that ubiquitous adoption of them may bring. DERs are going to help us green up our grid with more renewables, clean up our atmosphere, improve reliability and form new alliances between power providers and customers.

To bring these benefits about, power providers will need to expand their business models a little. Instead of being asset builders who make their money off the generation they construct and energy they send whizzing down the power line, it’s time to look at making money from the role of orchestrators who direct the energy, storage and flexibility DERs can deliver.

Given the proliferation of renewables — plus the dramatic growth rates predicted for solar and wind power over the next year or two — plenty of people are looking to storage as the way to save us from renewable intermittency. But, storage is pricey. And, given the potential for long stretches of inclement weather that knocks solar PV output down or fails to turn the wind turbines, the storage we have available today is unlikely to be sufficient for the power grid’s needs.

INTRODUCTION:

Do you remember that outage that left some 50 million people in the dark on August 14, 2003? It took down 61,900 megawatts of load in eight eastern U.S. states and the Canadian Province of Ontario. The financial impact was as high as $10 billion in the U.S. and $2.3 billion up north. When government researchers from the U.S. and Canada examined the event, they reported that insufficient reactive power was one of the factors leading to it.

So, here’s the big question: When rooftop solar installations start causing localized voltage headaches for utilities, will there be enough local reactive power to bump that voltage up? There will if we get smart inverters along with new solar deployments.

For anyone who worries about global warming and wants to see more renewables integrated into our grids because of it, demand-side management may be about the greenest choice there is. After all, carbon dioxide accounts for 82 percent of greenhouse gases, according to the U.S. Environmental Protection Agency. And utilities are the biggest carbon polluters, responsible for some 40 percent of carbon emission, says the same source.