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Despite the still-depressed economy and high (and increasingly unpredictable) costs of fuel and electricity, consumers are using more energy today than at any other time in history. They are heating and cooling larger homes, making longer commutes to work, and feeding more electricity into their ever-growing collection of devices. These range from larger refrigerators to triple-digit-wattage home theater systems and the large-screen LCD and plasma displays that go with them. One can argue gluttony, but on the flip side, we all know it's much cheaper to eat at home and create one's own home theater than to continually go out to restaurants and out to the cinema.

Regardless, with all of the additional burdens on the electric grid, electric utility companies, or their independent system operator equivalents, are forced to build new production plants, fire up emergency diesel generators, buy additional electricity from neighboring utilities or from factories, or are posed with the need to encourage curtailment -- to have consumers be the catalysts for reducing energy use during periods of peak use. It is this latter option of curtailment that can be managed automatically from the consumer side; what used to be known in the early 1990s as demand-side energy management (DSEM or, simply, DSM).

The comeback of demand-side management

Bolstered by high fuel costs, the increase in electricity consumption, and the federal government's goals of healing the nation's aging electric grid, we've seen a sudden rebirth of DSM for preventing energy shortfalls. Though under a new name -- Demand Response (DR) -- the song is the same. When sung, it entices consumers to shed usage (load) during peak and instable periods of electricity supply. The goal is to prevent having to build new plants, run expensive generators, and buy from others while being able to increase grid reliability (up time) to reduce and ultimately prevent blackouts.

There are many initiatives today in the DR field; some under government funding and others under the trend to "green" the environment. What they all have in common is the willingness of companies and homeowners to participate in programs that benefit both the Earth and the bottom line. Many of the programs provide rebates or discounts to the consumer for easing some of the demand on the grid for a few hours a week, or a few days a year, by the request of the electricity provider.

The business case for the electric utility is simple: no new plants, no expensive-to-operate diesel generators, and no buying electricity from neighboring utilities to meet the demand. But what does such a program entail? It's relatively straightforward: rather than the antiquated double-meter systems where the utility can cut the power to the air-conditioning meter "at will" in return for an overall reduced electric rate on that meter, these new programs allow buildings and homes (consumers) to receive curtailment or pricing messages from their electric provider or from a middleman company that handles the logistics.

The message tells the consumer that there is a high-rate "event" approaching, minutes to days in advance, based on weather, holidays, and regulations imposed on the timing of such "events". The building or home then responds automatically to the new rate by, for example, reducing air conditioning and dimming lights based on rules established by the owners/occupants of the buildings/homes, sometimes by a contract to shed an agreed-upon amount, and other times at the random choice of the owner/occupant. This is an example of DSM; leaving the consumer in control.

Homeowners and future DR-savvy devices

Imagine being a homeowner involved in such a program. If the normal rate of electricity is 10 cents per kWh, perhaps you might be offered a new rate of 5 cents if you are willing to accept rate tiers of 5 cents, 25 cents, and 50 cents on notice from the electricity provider. Your thermostat or similar module could then act in your personal interest (your programmed "threshold of discomfort") to curtail load whether you're home or away. With proper integration, you could have the thermostat communicate with your electronic calendar, and it would automatically know and keep track of your schedule to minimize your discomfort.

To accomplish this, we need to have devices that are "DR-savvy": that is, thermostats, lights, TVs, and appliances that can accept messages from the provider and intelligently act upon them. It's a tall order, especially from a simple desk lamp, unless we realize that the full range of DR knowledge doesn't necessarily need to propagate down into the individual devices, where a simple load-curtailable interface would suffice. Instead, we can begin to build hierarchies of curtailment interfaces, where a lighting controller would direct the load-shed of individual ballasts, for example. Such a lighting controller might receive its curtailment message from a home-wide controller -- perhaps the home controller also consults or even contains the family calendar.

It may seem far-fetched, but these technologies are being implemented today worldwide in buildings and homes. Our utility task group is working with several organizations around the world to interface to their curtailment messages and deliver a unified occupant-side structure for disseminating their messages to the various devices. The task group also defines the type of feedback from those devices to be shared with the electricity provider, third-party data aggregators, and the owner/occupant.

Who controls the demand?

There are several problems the task group is looking to solve. All parties involved agree that there is tremendous value in having a two-way communication structure between the internal building devices and the external enterprise. In the case of utilities, having access to load usage -- and potentially the ability to send information to specific loads to offer usage criteria -- is critical. Demand response is about managing the demand; however, there are differing opinions as to who controls the demand and how this should be done.

First there is the issue of intelligence: Where should the decisions within a facility or a home take place? The two competing options are "centrally" or "distributed". Should there be a "box" that makes the decisions for a building (sometimes referred to as the Energy Management System), or should the devices themselves be "smart" and have their own ability to make decisions? We have taken the approach that the smarter the devices and the more ability they have to react to changes externally, the more manageable and efficient the system. However, there will always be a need for some supervisory control and data acquisition (SCADA). SCADA refers to a system that collects data from various sensors at a building or factory, or in other remote locations, and then sends these data to a central computer that then manages and coordinates responses to those data.

The key to a successful DR program is having a solid two-way communication structure that not only defines how information is passed between devices, but also what that information should look like so that there are no discrepancies. Our utility task group members have been building and enhancing the structure and data-sharing library for the past 15 years and have developed a set of interoperability guidelines that enable this robust communication. This membership has further defined the "standard network-variable types" (SNVTs) for conveying everything from kilowatt values to currency. On top of those, a higher-level abstraction was defined that allows for a standard grouping of data points to profile the functions of thermostats, washing machines, sun blinds, lamps, air-conditioning units, and many others. Appropriately, these are titled "functional profiles".

The thermostat's role

It is often easiest to learn a concept by example. Here is a look at a simple, in-building device example. A thermostat is a device that has three main functions: to read the present temperature of a space; to allow the adjustment of a desired temperature; and to offer a user interface or display. Sensing and maintaining the temperature in the space is a thermostat's primary function. However, it is the ability to adjust temperatures that results in the sales of complex thermostats with everything from 30-day scheduling to vacation modes, and a host of other ways to increase and decrease temperatures at different times and on different days.

Imagine a thermostat in a facility: Occupants could change the set-point but the facility manager could define a maximum and minimum set-point in order to limit the energy load. Where the ability to change set-points truly becomes valuable is when the facility's enterprise management system remotely changes the set-point, the maximum range, and the minimum range, based on external criteria such as the present electricity market price or present/anticipated weather conditions.

Now imagine every energy-consuming aspect of a building or facility is intelligent, and able to communicate. That concept is real and it has already been implemented in hundreds of thousands of buildings and facilities around the world. But there is still the need to tie the supply side into the picture: There needs to be a standard way of receiving curtailment or pricing information from a utility or service provider and then reliably responding within that facility/home by, of course, shedding load; but further, by communicating back to the supplier that the load was shed, or that it will be shed in 30 minutes. Instead, perhaps, the response is that 20 percent will be shed right now but 40 percent within the hour; or even, that no load will be shed today, perhaps because out-of-town guests have arrived. This is where the concept of true demand-side management shines.

The key is having access to the control point through a seamless communications structure. Additionally having the ability to access data from many sources in an open, interoperable, non-proprietary way enables more options, lower costs, and greater manageability. The objective of the task group is to help users make better decisions and be more energy efficient through intelligent control.

Intelligent control and standardization a must

Looking further down the road, people will have a greater set of options with what today is simply a commodity: Price may not be the only factor for electricity in the world of tomorrow, where there are multiple suppliers of energy, each with different ratings of "up time" reliability, percentage of "green-ness," and differing records of social responsibility/stewardship. An increasing number of consumers will have choices between nuclear power and solar power; local generation and "not in my backyard" generation; 99.9 percent reliability or cheaper rates but greater risk of outages; and the list will go on -- further customizing this commodity of today's electricity. The goal is to help users make informed decisions and be more energy-efficient through intelligent control.

Even more intriguing is the possibility of consumers selling power back to the utility -- generated from their own home's solar roof while they were away at work -- electric power with quality ratings just like those coming from the utility. There is a great deal of standardization that needs to take place to get all of the players ready for these innovative and emerging market changes. The ability to give each device the smarts they need is here today in an open, interoperable, non-proprietary way. The next step is to establish the needed communications between suppliers and consumers.

The end results to consumers and businesses everywhere is the potential to save a significant amount of money, prevent blackouts, and even reduce their energy-consumption footprint in the process. Consumers may not be willing to watch fewer movies on their new home theater systems to reduce their energy consumption during those critical peak hours of the day, but they wouldn't necessarily need to if curtailment of electricity could come from delaying the dishwasher, reducing the dryer heat, or charging the new plug-in electric car later in the day. Intelligent devices - coupled with a user-controllable schedule, based on cost sensitivity -- will allow us to have our popcorn and eat it too.