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Accessing cost savings and revenue sources from new,
innovative Utility programmes

Scott Petersen
Business Development Director, Smart Grid Solutions, Europe &
North Africa
Agenda

    • Key challenges

    • Market Drivers

    • The role of buildings as a solution

    • The Honeywell solution

    • Future developments

    • Value for building owners

    • Summary


2
Electricity Sector key challenges

    1.    Renewal of aging network infrastructure &
          reduction of future constraints

    2.    Building & funding new capacity to meet
          growing demand

    3.    The rapid and significant installation of new
          low-carbon and renewable generation

    4.    Coping with intermittency inherent in high
          wind % in supply mix

    5.    Coping with cross-border restrictions

    6.    Reducing financial exposure to increasing
          trading market volatility                       Keep the lights on!

    7.    Retaining & growing the profitability of
          business customers

3
No. of household appliances trebled since 1970




4
The future –EVs, GSHPs, Renewables, IT




5
These Challenges are real and local!
    Kulfyrede Ensted & Stigsnæs kraftværker lukker 2013
    
                                                       RTE
                                                                 ask
                                            Sydsverige energy s France’s
                             r Sjæl land og                        cons
                                                                          umpt
                                                                                 Mayo
                        amme                                                   ion a rs to cont
                  lse l                                                             t pea       rol
    St rømafbryde                                                                         k
                                     DMI ramt
                                               af et totalt
                                                            udfald i el
                                                                        forsyninge
                                                                                    n

                                                                    lsen omfatter kunder
                               Elforsynin gen blive afbrudt. Afbryde
                                                                      klager den gene.
                                   omkring  Grødbyvejen. Østkraft be
    Power Cut d
                estr   oys Christm
                                   as business


                                                                              a to
                                                      Romania’s Hidroelectric
      Three wo                                                                    drought
               men are                                             pplies due to
      pavemen
              t ‘explod
                         burned a
                                  s Edgwa             Cut Power Su
                        es’              re Road




                          €100s billions of new investment required
6
Issues are growing - driving need for solutions




                                                                                       EasthampstePrimary~Winter Peak Day (05-01-2010)
                                                                                                       Load Profile
                                                                                                                                   Physical limit
                                                                                                                              of Primary Sub -station
                                                                              25


                                                                              20
    Danish spot hits negative value
    Electricity spot prices on the Danish market plummeted into negative      15
                                                                              A
                                                                              V
    territory for the first time on Sunday, Nordic power exchange Nord Pool   M
                                                                              10
    figures revealed. The negative price was seen in Nord Pool's West
    Denmark price area, known as DK1, at 6:00-7:00 Central European            5
    Time, when prices slid to -€7.40/MWh on the Elspot Day-ahead market.
    Danish TSO Energinet.dk put the event down to “a combination of low        0
    demand due to the time of day and the day of the week, coupled with        00:00      04:00    08:00    12:00     16:00      20:00        00:00

    strong wind generation”.
                                                                                                                     Need to manage out peak
7                                                                                                                     between 16:30 & 20:30
Buildings are one source of the problem




                     Education


     Commercial




                   Manufacturing




    Cold Storage

                       Pumping Stations




8
A new resource – Flexible Load

    •  Commercial and Industrial buildings all use
       electricity for different things in different
       ways
    •  Don’t need it at full demand all the time
    •  Buildings are able to reduce or turn off
       electricity for certain lengths of time without
       negatively affecting the way people operate
       within them
    •  Aggregate flexible load from many buildings
       at the same time, quickly and efficiently
    •  Virtual Power Plant of negative watts
    •  Turning off 10MW of demand has the same
       impact as turning on 10MW of additional
       generation
    •  No fossil fuel is used, so there are no fuel
       costs and no carbon is emitted.


9
Buildings are also a solution

                                                     Transmission System
                                                           Operator



                      Education
                                                        Distribution System
                                                              Operator
      Commercial




                                                         Energy Trader
                    Manufacturing



                                                          Energy Supplier

     Cold Storage

                        Pumping Stations
                                                          Energy Generator


           Access to the same resource provides range of solutions
10
The Honeywell Solution
               Connect Utility or Aggregator
               with end users on the network
                     & enable interaction




11
A 3 Step Approach

                                                              Peak Load
                                                             Management
                  Base Load Reduction




       Energy                     Energy                       Demand
     Optimisation      +         Efficiency              +     Response


                               Building Owner Benefits


     Save Money                Save Money                    Save Money

     Save Carbon              Save Carbon                    Save Carbon

                                                             Make Money
12          Address base load then peak load
End-to-End Energy Solution

                                                      Sub-Metering
                        Attune
                                                                      ACT Earth energy efficiency
                        Advisory Services                             education & awareness behavioural
                        Understand & optimise                         programmes for staff                         Energy Retrofits
                        your energy performance                                                                    •  Facility & consumption
                        •  Detailed sub-metering,                                                                  appraisal
                        •  Energy monitoring & reporting                                                           •  Energy equipment & controls
                        •  Diagnostics in 4 levels                                                                 upgrade & replacement
                                                                                                                   •  Guarantees
                                                                                                                   •  Financing




                                                            Renewable Energy
            Energy Dashboard                                Solutions
                                                            •  Best economic case tool for Solar PV,
                                                            Solar Therm, Wind, Biomass therm &
                                                            CHP, Geotherm
                                                            •  Financing


                                                                                                       Demand Response
                                                                                                       •  Enable access to flexible
     Keeping staff & visitors informed with live                                                       electricity load shedding in
     energy performance information screens                                                            buildings
     in public places                                                                                  •  Revenue earning for building
                                                                                                       owner
13                                                                                                     •  VPP build
A total facility approach

                                  Lighting replacement,
                                    control systems &
               Ventilation fans           LEDs                 Building
                                                          Management Systems                    Damper control
 Solar gain
minimization




            Zone
         temperature
            control
                                                                                                        Voltage
                                                                                                        reduction
            Chiller upgrade/
             replacement &
           absorption cooling
                                   Plug load                                      VSD motor control
                                  management    On-Site Technical Resource
                                                       Management
                                                                     High efficiency motors    Boiler upgrades, controls
                                                                                               Combined Heat & Power



                   Agnostic approach to technology – over 250 ECMs
14
Typical load shedding areas in Buildings

     •  Reducing the output of Air Handling Units, Fan Cooling Unit’s etc;
     •  Adjustment of non-critical internal environmental conditions;
     •  Localised temperature set-point adjustments;
     •  Reduced motor & pump loads, via Variable Speed Drives settings;
     •  Space pre-cooling or heating, prior to initiation of the event;
     •  Turning off non essential pumps eg ornamental lake fountains;
     •  Reducing non-essential lighting, within compliance settings;
     •  Isolation of lighting zones (e.g. near windows);
     •  Pre-cooling refrigerated units prior to initiation of the event;

     •  Turning off external sign lighting.




15
How will they use your flexible load in the future?

     Transmission System Operator:
     •  Accommodate wind volatility in the supply mix
     •  Accommodate unforeseen demand peaks
     •  Compensate for late generation & generation trips

     Distribution System Operator:
     •  Avoid/defer network upgrade investment
     •  Accommodate daily peak demand
     •  Dynamically observe major electricity users on network
     •  Re-engage with end-users
     •  Managing network constraints in operational timescales
     •  Minimise customer outages

     Energy Trader:
     •  Reduce exposure to market by optimising contracting position
     •  Rebalance positions quickly due to sudden supply constraints

     Energy Supplier
     •  Enhance margins & lengthen contracts with business customers
     •  Create new service markets with new revenue streams

     Energy Generator:
     •  Provide peaking power generation at half conventional cost, requiring no transmission infrastructure, at
        half operating cost, built in half the time & with no carbon emissions
16
Peak Electricity Demand in Denmark




                                                  EasthampstePrimary~Winter Peak Day (05-01-2010)

     Nationally                                                   Load Profile
                                                                                              Physical limit
                                                                                         of Primary Sub -station
                                         25


                                         20


                                         15
                                         A
                                         V
                                         M
                                         10


                                          5


                                          0

                        By Sub-station    00:00      04:00    08:00    12:00     16:00      20:00        00:00



                                                                                Need to manage out peak
                                                                                 between 16:30 & 20:30
17
Value for the Building Owner

                      Commercial Offices
                      •  Energy Efficiency Improvement – 20%
                          -  Heating, Chillers, Controls, Lighting
                      •  Demand Response Programme
                      •  265 kW load on 18 Sep 2012
                      •  97 kW of which was shed for 2 hours:
                         4pm – 6pm
                      •  €24k per MW pa typical payment
                         (depending on availability)




18
Summary

     • Increasing change = new challenges for Utilities and
       opportunities for large Facility Owners
     • New business models developing to earn money
       from the smart grid
     • Mutual benefits for Utilities and Facility Owners
     • Provide access to huge, clean resource – flexible
       load
     • Energy Efficiency + Demand response
     • For Utilities looking for tomorrows solutions, today


                    Fast, Clean and Green
19

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Accessing cost savings and revenue sources from new, innovative Utility programmes af Scott Petersen

  • 1. Accessing cost savings and revenue sources from new, innovative Utility programmes Scott Petersen Business Development Director, Smart Grid Solutions, Europe & North Africa
  • 2. Agenda • Key challenges • Market Drivers • The role of buildings as a solution • The Honeywell solution • Future developments • Value for building owners • Summary 2
  • 3. Electricity Sector key challenges 1.  Renewal of aging network infrastructure & reduction of future constraints 2.  Building & funding new capacity to meet growing demand 3.  The rapid and significant installation of new low-carbon and renewable generation 4.  Coping with intermittency inherent in high wind % in supply mix 5.  Coping with cross-border restrictions 6.  Reducing financial exposure to increasing trading market volatility Keep the lights on! 7.  Retaining & growing the profitability of business customers 3
  • 4. No. of household appliances trebled since 1970 4
  • 5. The future –EVs, GSHPs, Renewables, IT 5
  • 6. These Challenges are real and local! Kulfyrede Ensted & Stigsnæs kraftværker lukker 2013 RTE ask Sydsverige energy s France’s r Sjæl land og cons umpt Mayo amme ion a rs to cont lse l t pea rol St rømafbryde k DMI ramt af et totalt udfald i el forsyninge n lsen omfatter kunder Elforsynin gen blive afbrudt. Afbryde klager den gene. omkring Grødbyvejen. Østkraft be Power Cut d estr oys Christm as business a to Romania’s Hidroelectric Three wo drought men are pplies due to pavemen t ‘explod burned a s Edgwa Cut Power Su es’ re Road €100s billions of new investment required 6
  • 7. Issues are growing - driving need for solutions EasthampstePrimary~Winter Peak Day (05-01-2010) Load Profile Physical limit of Primary Sub -station 25 20 Danish spot hits negative value Electricity spot prices on the Danish market plummeted into negative 15 A V territory for the first time on Sunday, Nordic power exchange Nord Pool M 10 figures revealed. The negative price was seen in Nord Pool's West Denmark price area, known as DK1, at 6:00-7:00 Central European 5 Time, when prices slid to -€7.40/MWh on the Elspot Day-ahead market. Danish TSO Energinet.dk put the event down to “a combination of low 0 demand due to the time of day and the day of the week, coupled with 00:00 04:00 08:00 12:00 16:00 20:00 00:00 strong wind generation”. Need to manage out peak 7 between 16:30 & 20:30
  • 8. Buildings are one source of the problem Education Commercial Manufacturing Cold Storage Pumping Stations 8
  • 9. A new resource – Flexible Load •  Commercial and Industrial buildings all use electricity for different things in different ways •  Don’t need it at full demand all the time •  Buildings are able to reduce or turn off electricity for certain lengths of time without negatively affecting the way people operate within them •  Aggregate flexible load from many buildings at the same time, quickly and efficiently •  Virtual Power Plant of negative watts •  Turning off 10MW of demand has the same impact as turning on 10MW of additional generation •  No fossil fuel is used, so there are no fuel costs and no carbon is emitted. 9
  • 10. Buildings are also a solution Transmission System Operator Education Distribution System Operator Commercial Energy Trader Manufacturing Energy Supplier Cold Storage Pumping Stations Energy Generator Access to the same resource provides range of solutions 10
  • 11. The Honeywell Solution Connect Utility or Aggregator with end users on the network & enable interaction 11
  • 12. A 3 Step Approach Peak Load Management Base Load Reduction Energy Energy Demand Optimisation + Efficiency + Response Building Owner Benefits Save Money Save Money Save Money Save Carbon Save Carbon Save Carbon Make Money 12 Address base load then peak load
  • 13. End-to-End Energy Solution Sub-Metering Attune ACT Earth energy efficiency Advisory Services education & awareness behavioural Understand & optimise programmes for staff Energy Retrofits your energy performance •  Facility & consumption •  Detailed sub-metering, appraisal •  Energy monitoring & reporting •  Energy equipment & controls •  Diagnostics in 4 levels upgrade & replacement •  Guarantees •  Financing Renewable Energy Energy Dashboard Solutions •  Best economic case tool for Solar PV, Solar Therm, Wind, Biomass therm & CHP, Geotherm •  Financing Demand Response •  Enable access to flexible Keeping staff & visitors informed with live electricity load shedding in energy performance information screens buildings in public places •  Revenue earning for building owner 13 •  VPP build
  • 14. A total facility approach Lighting replacement, control systems & Ventilation fans LEDs Building Management Systems Damper control Solar gain minimization Zone temperature control Voltage reduction Chiller upgrade/ replacement & absorption cooling Plug load VSD motor control management On-Site Technical Resource Management High efficiency motors Boiler upgrades, controls Combined Heat & Power Agnostic approach to technology – over 250 ECMs 14
  • 15. Typical load shedding areas in Buildings •  Reducing the output of Air Handling Units, Fan Cooling Unit’s etc; •  Adjustment of non-critical internal environmental conditions; •  Localised temperature set-point adjustments; •  Reduced motor & pump loads, via Variable Speed Drives settings; •  Space pre-cooling or heating, prior to initiation of the event; •  Turning off non essential pumps eg ornamental lake fountains; •  Reducing non-essential lighting, within compliance settings; •  Isolation of lighting zones (e.g. near windows); •  Pre-cooling refrigerated units prior to initiation of the event; •  Turning off external sign lighting. 15
  • 16. How will they use your flexible load in the future? Transmission System Operator: •  Accommodate wind volatility in the supply mix •  Accommodate unforeseen demand peaks •  Compensate for late generation & generation trips Distribution System Operator: •  Avoid/defer network upgrade investment •  Accommodate daily peak demand •  Dynamically observe major electricity users on network •  Re-engage with end-users •  Managing network constraints in operational timescales •  Minimise customer outages Energy Trader: •  Reduce exposure to market by optimising contracting position •  Rebalance positions quickly due to sudden supply constraints Energy Supplier •  Enhance margins & lengthen contracts with business customers •  Create new service markets with new revenue streams Energy Generator: •  Provide peaking power generation at half conventional cost, requiring no transmission infrastructure, at half operating cost, built in half the time & with no carbon emissions 16
  • 17. Peak Electricity Demand in Denmark EasthampstePrimary~Winter Peak Day (05-01-2010) Nationally Load Profile Physical limit of Primary Sub -station 25 20 15 A V M 10 5 0 By Sub-station 00:00 04:00 08:00 12:00 16:00 20:00 00:00 Need to manage out peak between 16:30 & 20:30 17
  • 18. Value for the Building Owner Commercial Offices •  Energy Efficiency Improvement – 20% -  Heating, Chillers, Controls, Lighting •  Demand Response Programme •  265 kW load on 18 Sep 2012 •  97 kW of which was shed for 2 hours: 4pm – 6pm •  €24k per MW pa typical payment (depending on availability) 18
  • 19. Summary • Increasing change = new challenges for Utilities and opportunities for large Facility Owners • New business models developing to earn money from the smart grid • Mutual benefits for Utilities and Facility Owners • Provide access to huge, clean resource – flexible load • Energy Efficiency + Demand response • For Utilities looking for tomorrows solutions, today Fast, Clean and Green 19