Brad Williams, Vice President, Industry Strategy
Billions of connected devices, from smart vehicles and smart meters to smart thermostats, smartphones, wearables and more, make up what has come to be known more broadly as the Internet of Things (IoT). More simply, this is a moniker that had been coined to better define the proliferation of things or devices with intelligent sensors, the networked connectivity of those things, and the ability to leverage the data being gathered by them.
This explosion of smart devices has created opportunities for new business solutions based on IoT technology. Businesses are increasingly finding new ways to harness the data coming from these devices, and using it to drive smarter decision-making, enable new services, and reduce costs.
The utility industry is already solidly invested in the IoT. The smart grid, after all, is essentially the application of IoT technology (smart sensors, two-way communications, and analytics) to our electric grid infrastructure to enable better efficiency, improved reliability, the integration of more renewables and distributed energy resources, reduced emissions, and more engaged and empowered customers.
In fact, in coming years the utility industry is expected to drive exponential growth of new IoT applications to communicate machine-to-machine (M2M) to new field devices and to consumer energy technology devices at the edge of the grid. But even more important than this increased ability for M2M communication is how the sensor data being gathered can be operationalized for more efficient and proactive efforts by the utility.
Using IoT Technologies for Distributed Energy Resources
In recent years, residential and business customers alike have begun to take advantage of decreasing technology costs and favorable government policy to adopt distributed energy resources (DER), including solar photovoltaic (rooftop solar), wind turbines, diesel generators, energy management systems, electric vehicles, and energy storage. These rapidly proliferating resources have the ability to extend and change the electric distribution grid in a number of positive ways, but they also have the ability to affect grid reliability and performance unless adeptly managed by utilities.
For the purpose of this article, then, we will focus on three specific areas in which IoT and associated technologies can be successfully leveraged to best utilize the distributed energy resources (DER) being incorporated into the grid, both by customers and by the utility itself.
- Minimizing asset risk by identifying and managing negative performance patterns via cloud-based analysis and network modeling of distributed energy resources (DER) sensor data.
- Increasing customer choice to participate in demand response, load shifting, and the sale of excess and stored DER generation into other markets.
- Alleviating utility constraint via demand response by leveraging both utility and consumer assets to dynamically shift output among generation resources.
As DER are integrated into the distribution grid, utilities will need communication channels that permit many different systems and devices to send commands based on customer choices. In certain instances, the utility will need to communicate beyond the meter and directly into DER to ensure these choices are effectively executed. Additionally, data and commands must also flow among DER, operational systems, equipment like grid sensors, and load control devices to maintain reliability and meet peak demand.
To effectively deal with the resources and issues at the grids edge, technology solutions need to be able to provide the communication and data structure to serve as a single point of connection among DER, systems, and devices, and to:
- Ensure efficient and timely flow of data to appropriate applications
- Provide data accuracy across utility and customer processes and minimize duplication
- Assist in outage detection and verification as well as restoration confirmation
Hand-in-hand with IoT technologies, automation and cloud-based analytics play important roles in delivering these services.
Minimizing Asset Risk
The influx of distributed renewable generation, which is intermittent in nature, creates variability in energy supply. As consumers connect more and more DER into the grid, the intermittency of the DER creates real risks to reliability and grid health, and can place additional strain upon traditional distribution assets. Therefore, modern distribution management necessitates a data-centric approach to monitoring, control and optimization of both traditional distribution and edge-of-grid needs, managing operational asset risk and asset performance.
This type of approach requires an understanding of every distribution assets condition as well as its importance to the organization. In adding DER to the distribution mix, it is therefore important to be able to model the generation output profile of every distributed energy resource, accounting for location, condition of use, and other attributes unique to each asset, and then to incorporate that information into the broader utility distribution model. By aggregating all of the asset data, including work history and condition rating, into a single system, updating condition changes as they occur, and balancing the importance of differing factors, utilities are armed with a more reliable view of asset health, and can make more meaningful investment and work decisions about how best to balance compliance, reliability, safety and risk.
Cloud-based analysis and network modeling of DER sensor data make the process of identifying and managing negative performance patterns smoother: the cloud allows for multi-sourced and cross-sourced analytics to take place quickly, as well as historical, trending and comparative analytics, and is scalable to meet the ever-growing needs of a more distributed grid. As well, using the cloud to perform these functions eliminates the need for a comparably larger IT department, and reduces IT maintenance costs.
Increasing Customer Choice
There is increasing discussion around the concept of a plug-and-play distribution grid for the future, one that would involve a transactive energy market that consumers could participate in right along with traditional generators. Specifically, as defined by the GridWise Architectural Council in its initial framework document, the term transactive energy (or TE) refer[s] to techniques for managing the generation, consumption or flow of electric power within an electric power system through the use of economic or market-based constructs while considering grid reliability constraints. The term transactive comes from considering that decisions are made based on a value. These decisions may be analogous to or literally economic transactions.
As consumer-driven/consumer-owned DER is added to the distribution grid in increasing volume, it is not unrealistic to expect that a consumer-driven, transactive energy market will take shape in the future, once the processes, infrastructure and regulatory framework is in place to handle it.
Already, there is an increasing addition of customer participation in demand response and load shifting programs, as well as the sale of excess and stored DER generation into other markets. IoT is used as a mechanism for the utility to manage the actual control of the DER device based upon its contract with the customer, or the program obligations to which the customer commits. With IoT, utilities can make the shift in real time as needed per the contractual agreement, rather than relying upon data after the fact to confirm that the customer has met the stipulations of the particular demand response or load shifting program to which he has subscribed. The use of IoT technologies allows the utility to model, manage and control the individual DERs response in real time, unlocking the greater valueincluding improved investment performance and lower operational coststo the utility along the way.
In the future, a transactive energy market will include both utility customers DER as well as that of other third parties in a new market exchange equation, dynamically balancing energy supply and demand in a real-time market.
Alleviating Utility Constraint
To build even further on the concept of dynamically balancing consumer supply and demand of distributed energy resources, the IoT can also alleviate utility constraint on peak load days without having to shift to peaker generation plants, which are extremely costly to maintain year-round for the ability to operate them only when there is extremely high demand for electricity.
By using demand response (as described earlier in this article) to leverage consumer DER assets together with centralized distribution assets to dynamically shift output among generation resources in real-time, and managing peak load in this manner, the use of costly peaker plants may no longer be necessary.
Here, too, the cloud can assist. If this type of extreme dynamic load management is cyclical, rather than necessary throughout the year, a cloud environment is, by its very nature, uniquely suited to the flexibility to scale to peak demand and then return to a more regular operational level.
The addition of distributed energy resources to the utility distribution grid is a new frontier for the industry. Sensor data will continue to be key to ensuring end-to-end visibility, as well as the means to model, manage, analyze, control and optimize DER. The Internet of Things provides the glue connecting all the pieces of the new distribution platform, and the cloud provides the environment for doing it quickly, with reduced risk and lower costs.
For more information visit www.oracle.com/industries/utilities/
The GridWise Architectural Council, GridWise Transactive Energy Framework Version 1.0, January 2015.http://www.gridwiseac.org/pdfs/te_framework_report_pnnl-22946.pdf