Answers on energy storage?
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I'll share a few more vignettes from earlier this week at DistribuTech, a kaleidoscopic event whose implicit, dual theme is arguably cleaner energy and consumer involvement in achieving it.
As long as you need to modernize your grid, you're going to take advantage of digital technologies that offer visibility down to the meter, new efficiencies that decrease emissions and data that allows you to optimize. And you're going to begin bringing your customers along on a journey that takes them beyond flicking a switch to knowledgeable participation in an interconnected energy world.
This stuff is completely mainstream now, even if people still quibble over why a weakened superpower would want to develop sustainable practices and energy independence, learn the wise use of limited resources and forge technical leadership in a resource-constrained world. That's why it's probably a reasonably good bet for President Obama to argue for pursuing a cleaner energy agenda, as he did yesterday a few miles from my office.
But let's return to DistribuTech. You can catch up on my other coverage from this past week in "Microsoft's Jon Arnold: Think Strategy," "Postcards From DistributTech" and "Engaging Customers: After All, They Foot the Bill."
I had the opportunity to chat with Bill Ernzen, an Accenture partner who specializes in workforce management. He managed to persuade me that, beginning with something as simple as keeping a field supervisor out in the field at least 50 percent of his time, the pursuit of efficiencies can have ripple effects across operations, the business, customer satisfaction and, thus, regulatory approval of new smart grid initiatives.
I won't connect all the dots here, but Ernzen said he'd concluded that a one point improvement in, say, the annual J.D. Power customer satisfaction index (CSI) could be worth $20 million to $30 million in increased revenue and create a favorable atmosphere for cost recovery and rate increase discussions with regulators.
"Regulators love good CSI numbers," Ernzen told me.
Doug Houseman, vice president of technology and innovations for EnerNex, refreshingly uses the English language as a cudgel, as in when he intoned during a paper session:
"It's not the 'stupid transformer' anymore, it's the transformer, stupid," he said.
Houseman said that as he spelled out a wish list for next-gen transformers, to make the point that if the industry doesn't demand more innovation from vendors to meet utility challenges, all the industry will get is "stupid transformers."
"It may be unrealistic," Houseman told an audience, "but I'm just trying to make people think. It's time to take a step back and look at the problem holistically. If we're looking at the next-gen smart grid, it makes sense to step back and think holistically."
Three presentations followed Houseman in the same session, dubbed "Technologies That Are Transforming the Distribution Grid," all focused on microgrids. Vic Romero, director of asset management and smart grid projects for San Diego Gas & Electric (SDG&E), which is constructing a microgrid at Borrego Springs, Calif., captured the theme of nearly every session I attended when he said, "We want to learn how this stuff works and how to manage it."
That sentiment certainly applied to the well-attended session, "Energy Storage: Essential for Large-scale Renewable Energy Integration?" The answer, as it turned out, was the honest if unsatisfying "too soon to tell." From four presentations, one conclusion was that significant findings about the costs and benefits of various storage applications would come in the late 2012 to 2014 timeframe.
Presenters also noted that storage's value will increase as one is able to "stack benefits," in the words of Mark Rawson, research and development manager for the Sacramento Municipal Utility District (SMUD) on distributed generation, demand response and storage. In other words, the more roles that storage plays, the more likely that cost-benefit ratio will justify implementation.
Presentations revealed that nearly every storage technology is being scrutinized by utilities, from batteries inside the customer's home to community energy storage in neighborhoods to tractor-trailer-sized installations of batteries for large wind farms to compressed air energy storage and pumped hydro. Significant work is underway at SMUD, SDG&E, American Electric Power Ohio, Southern California Edison and Detroit Edison—just to name the projects described at the session.
Two comments captured much of the storage deliberations.
"The bottom line is 'Who pays for storage?'," said moderator Johan Enslin, director of the Energy Production and Infrastructure Center (EPIC) at the University of North Carolina, Charlotte, campus. "The developer? He's not happy if it doesn't earn a return. The utility? If utilities don't like intermittency, why would they pay to enable it? The consumer? Who picks up the tab at the end of the day?"
But is storage essential to enable states seeking to meet high renewable portfolio standards?
"I don't think we know," said Tom Weaver, manager of distribution system planning for AEP. "That's important for where we are today. Thus our strategy to find out all we can, so that when we learn the answer, we can apply it cost-effectively."
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