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Legaland EconomicInstrumentsfor
EnvironmentalPolicy
Dr.MartinWickel L.LM,Dr.Cathrin Zengerling L.LM,Ph.D. Irene Peters
- RenewableEnergies-
ElectricityGrids
by Benedict Adcock, Dave Huntington, Gabriel Niessen andHeather Troutman
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
electric line
New York
1890
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
electric line
Chidambaram, India
2014
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
globallight pollution /grid structure
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
India
national grid
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
USA
national grid
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Germany
national grid
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
AC –alternating current
_ the flow ofelectric charge periodically reverses direction
_ commonly used
_ forshorter distances
HVDC –high-voltage direct current
moreeconomical for longer distances _
less losses _
well suitable for underwater-installation _
AC / HVDC ACsimplifiedgrid
generation
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
national
transmission
distribution
regional
local
potential plants
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Germany
future situation
high demand
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
planneddevelopmentof theGerman grid
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
power exchanges
in Europe
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
electrical interconnection in Europe
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Project
Desertec
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Future grid?
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
DistributedGeneration
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
DistributedGeneration (DG)
• DG systems are made of one or many ‘Distributed Energy Resources’ (DER)
• DER are small-scaleand modular devices, and consist of both fossil and renewable
energy technologies
• DG systems are located close to the load (end-use customer) and usuallyhave a
capacity of 10 MWor less
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
History of DG
• DG is not a new phenomenon, but its inherent threat to centralized electricity grids and
utility pricing models is
• Today, centralizedgrids have become the main driver of customers’ energy costs and
electricity reliability or quality problems
• Efficiency gainsno longer come from connecting new centralizedpower plants to the
grid, but rather bylocating smaller DG systems nearer to the demand
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
• The IEA notes 5 major factors contributed to the evolution and growth of DG
– New technology developments
– Constraints on the construction of new transmission lines
– Increased customer (primarily commercial, but also residential) demand for reliable
electricity
– Liberalization of electricity markets
– Concerns about climate change
DistributedGeneration (DG)
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
Why DG?
• DG offer solutions to blackouts, energy security concerns, power quality issues, tighter
emissions standards, transmission bottlenecks, and the desire for greater control over
energy costs
• DG reduces the amount of energy lost in transmitting electricity long distances
• DG is promising in countries with remote regions not presently connected to a
centralized grid
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
IEEE 1547 Standard
• Industry standards for interconnecting DG systems to the existing grid and utility
systems
– Covers safety, performance, installation,operation, and synchronism.
• In 2005, the EnergyPolicyActestablished IEEE1547 asthe nationalstandard in the U.S.
• In Europe, many nationalregulations set standards
– In Germany, VDE-AR-N4105 for lowvoltage and BDEW-2008 for medium/high
voltage
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
PolicyInstruments
• City of Vancouver (Canada) requires developers of any large tract of land tocomplete
feasibilitystudy of “district energy”
• State of Colorado (U.S.A.) enacted a law requiring by 2020 that 3% of power generation
utilizes DG
• States of Louisiana,Idaho, and California have rejected callsto impose taxes on solar
users
• Germany introduced anincentive program aimed at on-site self-reliantDG systems
Benedict Adcock
Heather
Troutman
DaveHuntingtonGabriel Niessen
DistributedGeneration (DG) Questions
• Does it make sense to accelerate the development of new high-voltage transmission
lines that reinforce a centralized model of electricity delivery?
– Should we pursue distributed solar on homes insteadof centralized, utility-scale
solar plants?
• Solar users drain revenue while continuing to use utility transmission lines for backup
or to sell their power back to the grid. How canutilities pay for necessary maintenance
and upgrades of the grid if this “free ride” continues?
Amicrogridis controlled by asupervisory controller
thatdecides whichmicrogridenergy resources touse at
whattimesin order tobalanceload andgeneration. This
microgridcontroller maytakeinto accountpredicted
load profile, predicted powerprice profile, predicted
windor solarpower profile, predicted heating or cooling
needs (if themicrogrid containscogeneration),
emissions andother parameters. The microgridcontroller
mayalso changetheoperating modesof power
resources, provide power setpoints toresources, or
regulate droop characteristics.
InternationalRenewableEnergy Agency(IRENE) (2013) Kempener,et al. Smart GridsandRenewables:A Guidefor Effective Deployment(p. 35)
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Microgrids
small-scaleelectricity networks capableof
isolationfrom thecentralized electricity system Islandmode
• Micro-gridscovering 30–50kmradius
• Smallpowerstationsof5–10MW
• Generatepowerlocallytoreducedependenceandelectrical energylosses
Sources:http://galvinpower.org/microgrids,http://en.wikipedia.org/wiki/Distributed_
generation#Microgrid,http://www.rmi.org/nations_largest_microgrid_online_esj_article
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Reasons for Microgrids
• Moreefficient use of renewable energies suchas photovoltaics, wind turbines, and fuel cells, biomass
powered generators, and combined heat and power plants (CHP)
• microgrids can ensure continuity of power to critical infrastructure such as military bases, hospitals,
schools and emergency services.
• Customer need for morereliable, resilient, and sustainable service
• Electrification in remote locations and developing countries
http://www.microgridinstitute.org/about-microgrids.htmlhttp://www.rmi.org/nations_largest_microgrid_online_esj_article
The International Energy Agency (IEA)estimatesthat
to achieve its goal of universalaccessto electricity,
“70% of the rural areasthatcurrently lack access will
need to be connected usingmini-grid or off-grid
solutions.”
World EnergyOutlook 2011
EnergyforAll:FinancingAccess forthePoor
http://www.iea.org/papers/2011/weo2011_energy_for_all.pdf
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
1.Transmissionnetworksallowenergyfromoffshorewind farmsto
travelgreatdistances.
2.Fossilpowerplants operatewithgreaterefficientlythanksto
enhancedmanagementbetweenpeakandoff-peakperiods.
3.Solarfarmslocatedinsunnierregionscontributeenergyto thegrid.
4.Decentralizedcombinedheatandpower(CHP)plants supplies both
industrialcompaniesaswellasresidentialandcommercialbuildings
withenergy,whileexcessenergyisfed back intothegrid.
5.Industrialandprocessautomationfunctionsefficientlyand
productively.Energymanagementandsmartdevicesmakeit a “smart
factory”.
6.Substationsanddistributionnetworksfacilitatelow-losspower
transmission,evenoverlongdistances.
7.Computersprocessdata fromelectronicmetersandcontrolenergy
generatorsandconsumers.Thecontrollogicensuresthepossible site for
thebalanceof electricitysupplyandremoval:ina street,inthelocal
networkoronthedistributionnetwork.
8.Smartmetersandcomprehensivebuildingmanagementsystems
increaseefficiencyinresidentialhomes.
9.Smartgrids andbuildingcontrolsalso improvetheenergyefficiencyof
commercialbuildings.
ABBin Germany:Smart Grid (PressRelease)14.04.2010[Online
http://www.abb.de/cawp/seitp202/77a7e74be1ea8904c12577050030ab14.aspx[Accessed:13.11.2014]
Overview of the „Modern“ElectricityGrid
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
ABB(2010)Review(1)10 [Online]Smart Grids.[Accessed:13.11.2014]http://www.poweranswercenter.com/83
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
ABB(2010)Review(1)10 [Online]Smart Grids.[Accessed:13.11.2014]http://www.poweranswercenter.com/83
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
ABB(2010)Review(1)10 [Online]Smart Grids.[Accessed: 13.11.201http://www.poweranswercenter.com/83
Controls
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
http://www.terrapass.com/science-technology/demand-response/
ManagingAppliances
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
http://www.mpoweruk.com/electricity_demand.htmBenedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Grid response to solarPV
California
FraunhoferUSA CenterforSustainableEnergySystems(2014 ) CleantechNotes[Online]Tracking the Duck Curve [Accessed12.11.2014]
http://www.cleantechnotes.org/2014/05/07/tracking-the-duck/Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
TheU.S.electricity system is onthecuspof fundamentalchange,driven by rapidly
improving costeffectiveness oftechnologies thatincrease customers’ ability to efficiently
manage,store, andgenerate electricity inhomesandbuildings.
Bychangingelectricity pricingto morefullyreflect the benefits andcostsof electricity
services exchangedbetween customersandthegrid, utilities andregulators canunleash
new waves ofinnovationin distributed energy resource investment thatwill help to reduce
costswhile maintainingor increasing systemresilience andreliability.
~AmoryLovins
Rocky Mount Institute
RateDesignfortheDistributionEdge
August 2014
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Time-of-usepricing (TOU): A tariff structure inwhich electricity prices are set for a specific time period on anadvance or forward basis, typically
not changingmore often than twice a year. Prices paid for energyconsumed duringthese periods arepre-established and knownto consumers in
advance, allowing them to vary their usage in response to such prices and manage their energycosts by shifting usage to a lower cost period or
reducingtheir consumption overall.
International Energy Agency (2011) Technology Roadmap: Smart Grids. France
RockyMountainInstitution.(2014) ElectricityInnovationLab [Online]RateDesignedfortheDistributionEdge:
ElectricityPricingfora DistributedResourceFuture.USA [Accessed:12.11.2014] http://www.rmi.org/elab_rate_designBenedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
PoliticalAspects
Sources:http://www.microgridinstitute.org/about-microgrids.html,http://www.smartgridnews.com/artman/publish/Delivery_Microgrids/)
• Regulationofcontractsandtariffs
– Lawsandregulationsmustevolve toenable utilitiesandthirdpartiesto competeon alevel playing field toprovide
behind-the-meterproductsandservices tocustomers
– TimeofUsePricing allows utilities tosend pricesignals forwhereandwhen electricity generationis neededfrom
DER
– PowerPurchasingAgreements providefinancialsecurityfortherecoupmentofDERtechnologyinvestments
• StandardizedTechnology
– maximizecompatibility,interoperability,safety,repeatabilityandquality
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Innovative Policies
Sources:http://galvinpower.org/microgrids
• Microgrid long-term property assessed financing
• Energy districts
• Allow local government to build, own and operate new smart microgrids
• Allow local governments to invest in and direct utilitiesto make smart grid
improvements
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
PolicyReform Ideas
Source:http://galvinpower.org/microgrids
• Reliability and performance metric standards
• Low-interest loans for local governments to direct smart microgrids
• expand consumer choice and ISO markets that value consumer participation
• Ensure new legislation likecap and trade values consumer participation
German Case Study
Wildpoldsried + AÜW + Siemens
Began: 1997InnovativeLeadershipPlan
Goal:100%renewableenergy by2020
Progress:500% renewableSURPLUSin 2014=USD$7million annual
~5 MWsolarPV :200residences, 12public buildings
5 biogasplants:8.2MMBtu/year:wastewoodfromlocalforest
biogasheatdistrictnetwork:120 residences,all public buildings, 4companies
11wind turbines:12MWcapacity:9 financedbylocaldairyfarmers
10yearpayback 80%annualincome ofdairyfarmers
2,100sqmsolar-thermalsystems
3 smallhydro-powerplants
All figures have beenobtained from:Rocky Mountain Institute
“A Small Town in Germany Becomes aTestGround fora SmartGrid” RMIOutlet [blog] [Accessed: 13.11.2014]
http://blog.rmi.org/blog_2014_11_06_small_german_town_becomes_testing_ground_for_smart_grid
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Allelectricity generated from
solar
wind
biomass
sold toAÜW undera
fixed-price 20-year
power-purchase agreement (PPA)
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Integration of Regenerative Energy and ElectricMobility IRENE
200 measuring devices: (I, V, f) production consumption
138 kWh battery storage :absorbs electricity discharges, stabilizing the grid
32 electric vehicles: leased to residence for additional storage
SOEASY: self-organizing automation system :balances supply and demand
(1) Personal energy agent:howmuch, whattime,whatprice:15minute
(2) balancemaster:installed atAÜW :decideswhich offersto accepttomeet demand
(3) area administrator :communicateswithpersonalenergy agentssending excess tostorage
(4) networktransport agent :collects datafromenergy producers,consumers,thegrid, andsupplies it toareaadministratorand
balancemaster
(5) energy police:ensurethatall energy producerreachsupplycommittal
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Results
140 : new jobs
Ecological training center
Increased eco-tourism
Over 100 : delegations visiting the town each year
500 % : surplus renewable electricity generation
USD $7 million : annualrevenue
medical center, recreation center, fire station, et cetera
2,600 : population (consistent)
Benedict Adcock
Heather
Troutman
Dave HuntingtonGabriel Niessen
Thank You

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Legal and Economic Instruments for Environmental Policy and Electricity Grids

  • 1. Legaland EconomicInstrumentsfor EnvironmentalPolicy Dr.MartinWickel L.LM,Dr.Cathrin Zengerling L.LM,Ph.D. Irene Peters - RenewableEnergies-
  • 2. ElectricityGrids by Benedict Adcock, Dave Huntington, Gabriel Niessen andHeather Troutman
  • 3. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen electric line New York 1890
  • 4. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen electric line Chidambaram, India 2014
  • 5. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen globallight pollution /grid structure
  • 9. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen AC –alternating current _ the flow ofelectric charge periodically reverses direction _ commonly used _ forshorter distances HVDC –high-voltage direct current moreeconomical for longer distances _ less losses _ well suitable for underwater-installation _ AC / HVDC ACsimplifiedgrid
  • 10. generation Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen national transmission distribution regional local
  • 11. potential plants Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen Germany future situation high demand
  • 12. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen planneddevelopmentof theGerman grid
  • 13. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen power exchanges in Europe
  • 14. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen electrical interconnection in Europe
  • 18. Benedict Adcock Heather Troutman DaveHuntingtonGabriel Niessen DistributedGeneration (DG) • DG systems are made of one or many ‘Distributed Energy Resources’ (DER) • DER are small-scaleand modular devices, and consist of both fossil and renewable energy technologies • DG systems are located close to the load (end-use customer) and usuallyhave a capacity of 10 MWor less
  • 19. Benedict Adcock Heather Troutman DaveHuntingtonGabriel Niessen History of DG • DG is not a new phenomenon, but its inherent threat to centralized electricity grids and utility pricing models is • Today, centralizedgrids have become the main driver of customers’ energy costs and electricity reliability or quality problems • Efficiency gainsno longer come from connecting new centralizedpower plants to the grid, but rather bylocating smaller DG systems nearer to the demand
  • 20. Benedict Adcock Heather Troutman DaveHuntingtonGabriel Niessen • The IEA notes 5 major factors contributed to the evolution and growth of DG – New technology developments – Constraints on the construction of new transmission lines – Increased customer (primarily commercial, but also residential) demand for reliable electricity – Liberalization of electricity markets – Concerns about climate change DistributedGeneration (DG)
  • 21. Benedict Adcock Heather Troutman DaveHuntingtonGabriel Niessen Why DG? • DG offer solutions to blackouts, energy security concerns, power quality issues, tighter emissions standards, transmission bottlenecks, and the desire for greater control over energy costs • DG reduces the amount of energy lost in transmitting electricity long distances • DG is promising in countries with remote regions not presently connected to a centralized grid
  • 23. Benedict Adcock Heather Troutman DaveHuntingtonGabriel Niessen IEEE 1547 Standard • Industry standards for interconnecting DG systems to the existing grid and utility systems – Covers safety, performance, installation,operation, and synchronism. • In 2005, the EnergyPolicyActestablished IEEE1547 asthe nationalstandard in the U.S. • In Europe, many nationalregulations set standards – In Germany, VDE-AR-N4105 for lowvoltage and BDEW-2008 for medium/high voltage
  • 24. Benedict Adcock Heather Troutman DaveHuntingtonGabriel Niessen PolicyInstruments • City of Vancouver (Canada) requires developers of any large tract of land tocomplete feasibilitystudy of “district energy” • State of Colorado (U.S.A.) enacted a law requiring by 2020 that 3% of power generation utilizes DG • States of Louisiana,Idaho, and California have rejected callsto impose taxes on solar users • Germany introduced anincentive program aimed at on-site self-reliantDG systems
  • 25. Benedict Adcock Heather Troutman DaveHuntingtonGabriel Niessen DistributedGeneration (DG) Questions • Does it make sense to accelerate the development of new high-voltage transmission lines that reinforce a centralized model of electricity delivery? – Should we pursue distributed solar on homes insteadof centralized, utility-scale solar plants? • Solar users drain revenue while continuing to use utility transmission lines for backup or to sell their power back to the grid. How canutilities pay for necessary maintenance and upgrades of the grid if this “free ride” continues?
  • 26. Amicrogridis controlled by asupervisory controller thatdecides whichmicrogridenergy resources touse at whattimesin order tobalanceload andgeneration. This microgridcontroller maytakeinto accountpredicted load profile, predicted powerprice profile, predicted windor solarpower profile, predicted heating or cooling needs (if themicrogrid containscogeneration), emissions andother parameters. The microgridcontroller mayalso changetheoperating modesof power resources, provide power setpoints toresources, or regulate droop characteristics. InternationalRenewableEnergy Agency(IRENE) (2013) Kempener,et al. Smart GridsandRenewables:A Guidefor Effective Deployment(p. 35) Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 27. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen Microgrids small-scaleelectricity networks capableof isolationfrom thecentralized electricity system Islandmode • Micro-gridscovering 30–50kmradius • Smallpowerstationsof5–10MW • Generatepowerlocallytoreducedependenceandelectrical energylosses Sources:http://galvinpower.org/microgrids,http://en.wikipedia.org/wiki/Distributed_ generation#Microgrid,http://www.rmi.org/nations_largest_microgrid_online_esj_article
  • 28. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen Reasons for Microgrids • Moreefficient use of renewable energies suchas photovoltaics, wind turbines, and fuel cells, biomass powered generators, and combined heat and power plants (CHP) • microgrids can ensure continuity of power to critical infrastructure such as military bases, hospitals, schools and emergency services. • Customer need for morereliable, resilient, and sustainable service • Electrification in remote locations and developing countries http://www.microgridinstitute.org/about-microgrids.htmlhttp://www.rmi.org/nations_largest_microgrid_online_esj_article
  • 29. The International Energy Agency (IEA)estimatesthat to achieve its goal of universalaccessto electricity, “70% of the rural areasthatcurrently lack access will need to be connected usingmini-grid or off-grid solutions.” World EnergyOutlook 2011 EnergyforAll:FinancingAccess forthePoor http://www.iea.org/papers/2011/weo2011_energy_for_all.pdf Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 30. 1.Transmissionnetworksallowenergyfromoffshorewind farmsto travelgreatdistances. 2.Fossilpowerplants operatewithgreaterefficientlythanksto enhancedmanagementbetweenpeakandoff-peakperiods. 3.Solarfarmslocatedinsunnierregionscontributeenergyto thegrid. 4.Decentralizedcombinedheatandpower(CHP)plants supplies both industrialcompaniesaswellasresidentialandcommercialbuildings withenergy,whileexcessenergyisfed back intothegrid. 5.Industrialandprocessautomationfunctionsefficientlyand productively.Energymanagementandsmartdevicesmakeit a “smart factory”. 6.Substationsanddistributionnetworksfacilitatelow-losspower transmission,evenoverlongdistances. 7.Computersprocessdata fromelectronicmetersandcontrolenergy generatorsandconsumers.Thecontrollogicensuresthepossible site for thebalanceof electricitysupplyandremoval:ina street,inthelocal networkoronthedistributionnetwork. 8.Smartmetersandcomprehensivebuildingmanagementsystems increaseefficiencyinresidentialhomes. 9.Smartgrids andbuildingcontrolsalso improvetheenergyefficiencyof commercialbuildings. ABBin Germany:Smart Grid (PressRelease)14.04.2010[Online http://www.abb.de/cawp/seitp202/77a7e74be1ea8904c12577050030ab14.aspx[Accessed:13.11.2014] Overview of the „Modern“ElectricityGrid Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 33. ABB(2010)Review(1)10 [Online]Smart Grids.[Accessed: 13.11.201http://www.poweranswercenter.com/83 Controls Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 36. Grid response to solarPV California FraunhoferUSA CenterforSustainableEnergySystems(2014 ) CleantechNotes[Online]Tracking the Duck Curve [Accessed12.11.2014] http://www.cleantechnotes.org/2014/05/07/tracking-the-duck/Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 38. TheU.S.electricity system is onthecuspof fundamentalchange,driven by rapidly improving costeffectiveness oftechnologies thatincrease customers’ ability to efficiently manage,store, andgenerate electricity inhomesandbuildings. Bychangingelectricity pricingto morefullyreflect the benefits andcostsof electricity services exchangedbetween customersandthegrid, utilities andregulators canunleash new waves ofinnovationin distributed energy resource investment thatwill help to reduce costswhile maintainingor increasing systemresilience andreliability. ~AmoryLovins Rocky Mount Institute RateDesignfortheDistributionEdge August 2014 Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 39. Time-of-usepricing (TOU): A tariff structure inwhich electricity prices are set for a specific time period on anadvance or forward basis, typically not changingmore often than twice a year. Prices paid for energyconsumed duringthese periods arepre-established and knownto consumers in advance, allowing them to vary their usage in response to such prices and manage their energycosts by shifting usage to a lower cost period or reducingtheir consumption overall. International Energy Agency (2011) Technology Roadmap: Smart Grids. France RockyMountainInstitution.(2014) ElectricityInnovationLab [Online]RateDesignedfortheDistributionEdge: ElectricityPricingfora DistributedResourceFuture.USA [Accessed:12.11.2014] http://www.rmi.org/elab_rate_designBenedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 40. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen PoliticalAspects Sources:http://www.microgridinstitute.org/about-microgrids.html,http://www.smartgridnews.com/artman/publish/Delivery_Microgrids/) • Regulationofcontractsandtariffs – Lawsandregulationsmustevolve toenable utilitiesandthirdpartiesto competeon alevel playing field toprovide behind-the-meterproductsandservices tocustomers – TimeofUsePricing allows utilities tosend pricesignals forwhereandwhen electricity generationis neededfrom DER – PowerPurchasingAgreements providefinancialsecurityfortherecoupmentofDERtechnologyinvestments • StandardizedTechnology – maximizecompatibility,interoperability,safety,repeatabilityandquality
  • 41. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen Innovative Policies Sources:http://galvinpower.org/microgrids • Microgrid long-term property assessed financing • Energy districts • Allow local government to build, own and operate new smart microgrids • Allow local governments to invest in and direct utilitiesto make smart grid improvements
  • 42. Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen PolicyReform Ideas Source:http://galvinpower.org/microgrids • Reliability and performance metric standards • Low-interest loans for local governments to direct smart microgrids • expand consumer choice and ISO markets that value consumer participation • Ensure new legislation likecap and trade values consumer participation
  • 43. German Case Study Wildpoldsried + AÜW + Siemens Began: 1997InnovativeLeadershipPlan Goal:100%renewableenergy by2020 Progress:500% renewableSURPLUSin 2014=USD$7million annual ~5 MWsolarPV :200residences, 12public buildings 5 biogasplants:8.2MMBtu/year:wastewoodfromlocalforest biogasheatdistrictnetwork:120 residences,all public buildings, 4companies 11wind turbines:12MWcapacity:9 financedbylocaldairyfarmers 10yearpayback 80%annualincome ofdairyfarmers 2,100sqmsolar-thermalsystems 3 smallhydro-powerplants All figures have beenobtained from:Rocky Mountain Institute “A Small Town in Germany Becomes aTestGround fora SmartGrid” RMIOutlet [blog] [Accessed: 13.11.2014] http://blog.rmi.org/blog_2014_11_06_small_german_town_becomes_testing_ground_for_smart_grid Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 44. Allelectricity generated from solar wind biomass sold toAÜW undera fixed-price 20-year power-purchase agreement (PPA) Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 45. Integration of Regenerative Energy and ElectricMobility IRENE 200 measuring devices: (I, V, f) production consumption 138 kWh battery storage :absorbs electricity discharges, stabilizing the grid 32 electric vehicles: leased to residence for additional storage SOEASY: self-organizing automation system :balances supply and demand (1) Personal energy agent:howmuch, whattime,whatprice:15minute (2) balancemaster:installed atAÜW :decideswhich offersto accepttomeet demand (3) area administrator :communicateswithpersonalenergy agentssending excess tostorage (4) networktransport agent :collects datafromenergy producers,consumers,thegrid, andsupplies it toareaadministratorand balancemaster (5) energy police:ensurethatall energy producerreachsupplycommittal Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen
  • 46. Results 140 : new jobs Ecological training center Increased eco-tourism Over 100 : delegations visiting the town each year 500 % : surplus renewable electricity generation USD $7 million : annualrevenue medical center, recreation center, fire station, et cetera 2,600 : population (consistent) Benedict Adcock Heather Troutman Dave HuntingtonGabriel Niessen