Future Energy

Smart Grid Comes to B.C.

Source: cleantechnica.com

Last week BC Hydro announced that it had selected Itron as the supplier of smart meters for the province, in a contract worth $270 million. This followed on an earlier announcement, in January, that Corix, a Vancouver company, had been selected to install 1.8 million smart meters and that Capgemini had been selected to provide project implementation and technology integration services. Installation of smart meters is a key step towards the development of a smart grid - simply put, the incorporation of digital monitoring and communications technologies into the existing electrical grid.  As BC Hydro rightly points out on their website, implementation of a smart grid potentially offers enormous benefits, including:

• Two-way communications providing real-time information allows consumers to manage their own energy use and utilities to better balance generation and demand;
• Real time information from all points of the grid also allows better customer service in the event of power failures - if utilities can pinpoint the failure earlier, they can fix it quicker;
• Allows time-of-day electricity pricing, i.e. higher prices when demand is greatest, lower prices when demand is reduced, which can lead to reduced demand in peak periods and, ultimately, less need to build (expensive) generation facilities that sit idle for all but short periods of time;
• Permits a distributed and more adaptive network that increases the stability, security and reliability of the grid;
• Allows more distributed generation such as intermittent and small-scale renewables to be attached to the grid.

Overall, making the grid smarter should support more efficient use of electricity, reduce the generating capacity that has to be built, support development of renewables and reduce emissions associated with electricity generation.

What's not to like and why are smart meters so unpopular?

U.S. utilities installing smart meters in California, Colorado, Maine, Texas and elsewhere have faced a barrage of consumer complaints (not to mention Ontario - here and here).  The biggest source of concern appears to be the perception that power bills have increased with installation of smart meters, although, social concerns relating to "big brother" monitoring or even controlling in-home electrical use have also emerged as have the usual  concerns for increased exposure to electro-magnetic fields (EMF).

Part of the problem might be ignorance.  GE published results of a 2010 survey in which it found 79% of Americans were unaware of the term smart grid and had no idea what it meant (GE did find that 80% of those who did understand the term - i.e. 16% of the total, not an overwhelming number - did believe that there would be benefits from introducing smart meters.  Judging from the public reactions in the states where smart meters have been introduced I wonder if GE isn't kidding itself about even that low level of understanding.) 

Another might be utility approaches to customer service, or lack thereof.  Back in 2009, when the California revolt against smart meters first erupted, Katie Fehrenbacher, writing at Gigacom.com, had this to say:

"Smart grid technology and smart meters don’t represent new or risky or bleeding-edge technology. They use the same type of information technology — wireless networks, silicon, software — that controls our cell phones, computers and Internet, and that plays a massive role in the U.S. economy. It’s just being used in a new industry: electricity. Of course software can occasionally be glitchy, but so can a person manually driving by and reading home meters. As Grid Net CEO Ray Bell told audience members of the GreenBeat conference today “digital meters are rigorously tested, and highly accurate.”

 The big issue is that utilities need to learn to communicate a lot better, and develop a much stronger relationship, with their customers, whether that’s through marketing, PR or customer outreach. As Seth Frader-Thompson, CEO of energy management startup EnergyHub said at the Dow Jones Energy Conference this week, utilities, with their regulatory markets, have a long history of looking at their customers as “rate payers,” or even “load”.  There needs to be a sea change in the relationship between utilities and power consumers .... ultimately it’s the responsibility of the organization that’s leading the switch to the digital two-way system to keep the line of communication open."

With all of the information that is out there about managing change you would think the utilities would have perfected the art of introducing new technologies and growing electrical rates. Apparently not.  So what does it take to successfully introduce smart meters (or any significant change for that matter)?

Arguably, John Kotter's Eight-Step Process of Creating Major Change is the best known framework for bringing about change in a corporate setting:

Modified from John P. Kotter, "Why Transformation Efforts Fail", Harvard Business Review (March-April, 1995):61.

It may be a bit too Corporate so I have been using a simpler diagram to explain what I think is need to bring about a change:

Whether you like a simple approach or a more complex one, the basics appear to be the same - communication and lots of it.  And it wouldn't hurt to clearly describe the the benefits to the people that are going to be affected, in terms that are relevant for them, e.g. lower long term costs, greater reliability, faster repairs, etc.  Making consumers aware of the change and what it will mean before it arrives on their doorstep wouldn't hurt either.

The Crown corporation, which enjoys an almost complete monopoly in B.C., is obviously aware of the consumers concerns that have arisen in other jurisdictions, as a BC Hydro customer I am not aware of any significant communications efforts beyond the project website.  And this is in a province in which a previously popular Premier was forced into retirement over his failure to adequately engage voters before abruptly introducing a significant change in the province's sales tax regime - perhaps the first Canadian tax revolt in (recent) history.

Hopefully, BC Hydro will learn from that experience.  It was awfully close to home.

 

 

 

 

Integrating Renewables into the Grid - Its All About Flexibility

Source: techvert.com

Back in mid-January, Stanford's TomKat Centre for Sustainable Energy hosted the Grid Integration of Renewables Workshop, bringing together a group to examine the issues relating to grid expansion and the integration of renewables into that grid.  I came across a report on the workshop at the CleanTech blog that interested me but was unable to get much detail about the discussions. 

Sometime in the past few weeks, the TomKat Centre posted most of the presentations given at the workshop.  Collectively they provide an interesting picture of the issues at least these experts foresee as the proportion of intermittent renewables such as wind and solar that are connected to the grid becomes significant.

Keynote Speakers included U.S. Senator Jeff Bingaman (New Mexico) and Commissioner Jeffrey Byron of the California Energy Commission (CleanTech blog's report focuses on what the keynote speakers had to say in lots of detail so I won't try to add anything here).

Speakers included:

• Gregor Czisch, Transnational Renewables, Germany - The Supergrid: 100% Renewable Electricity Supply for Europe and Its Neighborhood » (ppt)
• Mark Jacobson, Stanford - Grid Integration Challenges for 100% Conversion to Wind and Solar Power » (pdf)
• Hans Henrik Lindboe, Ea Energy Analyses, Denmark - Enabling Renewable Energy Integration in Denmark » (pdf)
• V. John White, Center for Energy Efficiency and Renewable Technologies - Pulling the Pieces Together: Thinking Regionally and Cooperatively » (pdf)
• Antonio Alvarez, PG & E - Efforts and Challenges to Manage California's Expected Intermittent Renewable Additions » (pdf)
• Debbie Lew, National Renewable Energy Laboratory - Finding Flexibility in the Existing System » (pdf)
• Nick Jenkins, Cardiff University, UK - Optimizing AC and DC Transmission Networks for High Penetration of Renewables » (pdf)
• Michael Wara, Stanford - Key Regulatory Challenges for Deep Penetration of Renewables (no links provided)
• Willett Kempton, University of Delaware - Low Cost Grid Integration via Met-Smart Interconnection and Storage Inherent in End-Use Devices » (pdf)

The clearest point of agreement running through the speakers' presentations was that increased reliance on non-hydro renewables would lead to greater uncertainty of supply, which would in turn demand greater flexibility within the management of the grid if supply and demand were to be successfully balanced.  Suggested mechanisms for achieving the necessary flexibility generally fell into one of three categories, including:

Increase the Size of the Catchment

Speakers identified a range of approaches that relate to increasing the size of the area from which power can be drawn from to lessen the chance that power is available due to weather issues.  Suggested mechanisms included imports, Balancing Area cooperation and development of "asynchronous" resources (i.e. resources that are expected to be couter-cyclical in the availability).  The underlying assumption of efforts to increase the size of the catchment being that its always windy somewhere.  Needless to say, just about any approaches relying on increased catchment size demand big investments in transmission infrastructure - perhaps one of the most significant challenges facing future grid development.

Better Manage  Supply

While some of the suggestions appear to focus primarily on the need for standby conventional power sources, more creative approaches included development of asynchronous sources, as noted above, and the need for grid storage.

Better Manage Demand

Clearly an approach with a lot of future potential as Smart Grid technologies are developed, speakers focused on automatic demand response technologies, "dynamic pricing" (i.e. higher pricing during times of the day that electricity is in greater demand or less available) and curtailment or the ability to automatically cut off some customers or applications as demand increases/supply decreases.

When you say them fast, these all sound pretty simple.  But they represent significant shifts in approach, huge infrastructure investments and potentially years of regulatory and public process to put in place. 

Still an interesting collection of views on what seems the most likely future direction for electricity.

Chevy Volt: The Future of Driving? - There Seems to be Some Dispute

  Source: GM/You Tube

To mark the occaision of GM's first commercial for the Volt (on tonight's World Series opener), it seems appropriate to pull together some of the recent commentary on hybid and electric vehicles.

Lets start with the pictures:  CNET's Green Tech blog provides a photo gallery of the leading hybrid and battery-electric vehicles we can look forward to buying in the months to come.

Jeremy Cato, writing in todays Globe & Mail, reported on a J.D. Power study that concludes that "it will be difficult to convince large numbers of consumers to switch from conventionally powered passenger vehicles to hybrid electric vehicles (HEVs) and battery electric vehicles (BEVs) ...." (see Buyers Like Green Cars - Until They See the Price Tag).

Qouting a J.D. Power spokesman ...

“While considerable interest exists among governments, media and environmentalists in promoting HEVs and BEVs, consumers will ultimately decide whether these vehicles are commercially successful or not,” said John Humphrey, senior vice president of automotive operations at J.D. Power. “Based on our research of consumer attitudes toward these technologies - and barring significant changes to public policy, including tax incentives and higher fuel economy standards - we don’t anticipate a mass migration to green vehicles in the coming decade.”

[J.D. Power's report is Drive Green 2020: More Hope than Reality.  You can find directions to it on the home page of the Company's website.  I didn't pursue it because I found the amount of information required to be intrusive.]

The LA Times Greenspace blog also provides a review of the report (see Hybrid, Battery-Electric Cars: Will the Hype Lead to Sales, October 27^th) but seems to strike a bit more balanced note, talking about the reasoning behind the conclusions in a bit more detail.

According to the Drive Green 2020 Report, the main reasons U.S. car buyers do not consider buying hybrids are cost, displeasing designs, performance deficiencies and maintenance concerns. Those who consider purchasing hybrids but ultimately buy internal-combustion vehicles do so because the cost of the hybrids is too high and the performance, i.e. acceleration or towing capacity, is inadequate, the report said.

Quoting J.D. Power again, .....

"There are a lot of unknowns in the market," Dunne said. "At the end of the day, consumers want to do the right thing, but they're going to consider how it impacts them financially first. The price to the consumer is paramount if you really want success. ..... While many people are interested in reducing fuel consumption and improving emissions, ..... there's no coordinated global policy in terms of how to achieve that."

Writing in the NYTimes, Christopher Jensen takes a more optimistic look at two electric vehicles in particular, reporting on test drives of the Chevy Volt and Nissan's Leaf (see Back-to-Back Drives in the Chevy Volt and Nissan Leaf, October 26^th).

The Nissan Leaf and Chevrolet Volt take different approaches to environmentally friendly motoring, and they look about as dissimilar as Laurel and Hardy. But how do they compare on the road? While Nissan and Chevrolet have recently allowed some journalists to drive their vehicles at separate events, I had the opportunity last week for a rare back-to-back turn at the wheel.

And the result was ......

But what the electric tour of Hell showed is that when it comes to ride and handling, these are real cars with different dynamic natures. The Volt is a pleasant cruiser and commuter, while the Leaf is more lively and may appeal more to a driving enthusiast, albeit a driving enthusiast on a leash.

Also in CNET's Green Tech blog, is the announcement that Tesla today opened the doors of its California manufacturing plant for the production of what are absolutely the hottest green cars out there, the company's Model S sports cars.

Writing at Yale's Environment 360 blog, David Levitan looks at the promise for using electric cars to support a grid that relies on wind and other intermittent renewables (see Rising Hope That Electric Cars Can Play a Role on the Grid, October 14^th).

The electricity generation and transportation sectors may seem like two disparate pieces of a puzzle, but in fact they may end up being intimately related. The connection comes in the form of the vehicle-to-grid concept, in which a large electric vehicle (EV) fleet — essentially a group of rechargeable batteries that spend most of their time sitting in driveways and garages — might be used to store excess power when demand is low and feed it back to the grid when demand is high. Utilities and electricity wholesalers would pay the EV owners for providing that power.

Vehicle-to-grid, or V2G, is not a new idea. In fact, it’s been floating around environmental and green tech circles for a decade at least. But it has always had the tough-to-shed image of a utopian technology. Now, though, V2G — as well as simpler schemes based on smart-timed charging of the vehicles — is slowly becoming reality, evolving in quiet synergy with the worldwide push for renewable energy.

And last but not least, to accompany the article by Mr. Cato, the Globe & Mail provided the following diagram that illustrates the type of electric cars expected to be sold in the coming decade and where.

 

The diagram is a bit fuzzy when copied so here's the link to the real thing.

 

New, Clean Life for Old Coal Plants?

                                     

                                      Source: www.webbaviation.co.uk

Drax Power Station (UK) Combines Renewable Biomass With Coal

Britain's Guardian newspaper announced yesterday that Drax power station, the UK's largest, had begun a project to replace up to 10% of the coal the plant uses with biomass (see Drax's £50M renewables project throws biomass into coal mix, Guardian, May 19th).  After testing cofiring up to 2-3% biomass for several months, the company signed an agreement with Alstrom (EPA: ALO) to construct a US$98 million biomass processing facility that would allow up to 1.5 million tonnes of biomass to be used per year, replacing 1 million tonnes of coal and saving up to 2 million tonnes of CO2 emissions.

Drax is operated by the Drax Group plc. (LON: DRX).  The 4,000 MW power station in north Yorkshire supplies 7% of the UK's power.   

While this is not a first, I was unable to find other examples of co-firing with biomass on this scale.  Not unlike Drax testing 2-3% co-firing for several months, other utilities have run trials.  For example, in 2006, Alliant Energy completed a test burn of switchgrass co-fired with coal at its Ottumwa Generating Station in Iowa (see Switchgrass Burn Test Proves Hopeful, Renewable Energy World, June 19th, 2006).   

The Guardian article qoutes Drax's CEO who describes co-firing biomass and coal as the "forgotten" renewable.  No doubt in the rush to embrace Carbon Capture & Storage (CCS) technology even the coal industry has not paid a lot of attention to what appears to be a relatively low-tech, incremental approach.

CCS offers a high cost, long term solution to managing the carbon risk associated with coal fired power.  If it ever works for widespread implementation, it is some ways into the future.  Co-firing biomass appears to offer an interim step that could be implemented at relatively low cost.  As noted above, Drax indicates that it will be spending only US$98 million for this initiative.

With all of the coal-fired generating plants in the world today, a simple, low-cost solution such as co-firing could be great first step towards managing carbon emissions.

U.S. Electric Power Emissions

Who is the Cleanest U.S.  Power Producer?

Two weeks ago CERES, a Washington based NGO released its sixth report benchmarking the air emissions of the 100 largest electric power producers in the U.S. (see Benchmarking Air Emissions, May 2008).  Using 2006 emission data, CERES together with its partners, Natural Resources Defense Council, PSEG and PG&E Corporation, examined power producers' emissions of SOx, NOx, CO2 and Mercury.  The report ranks electric power producers by their power output and by their emissions rates for each of the four target pollutants.

If you are interested in the sustainability of the energy companies you invest in, the CERES report provides a huge body of data to be mined.  With that in mind, I looked for some simple ways to slice and dice their information in ways that would help me understand the relative regulatory/environmental risk associated with each power producer.

My interest is in investing so the so my first step was to extract the cooperatives and government owned generators, which reduced the list by more than a third.

Step two was to look at CO2 emissions.  What I was interested in here was the emissions rates achieved by each generator, i.e. the kilograms of CO2 produced per megawatt of  electricity generated.  Arguably, the risk each company faces is related to the additional costs per MW it will face in future rather than its absolute level of emissions.

So, if you are as concerened about the future impacts of greenhouse gas regulation as I am, who would you want to invest in?  The table below provides the ten least carbon-intensive U.S. electricity producers in 2006.

  Least Carbon-Intensive U.S. Electricity Producers (2006)

Rank	Company	Symbol	2006 Emissions (Tonnes)	2006 Emissions Rate (kg/MWh)
1	PG & E	NYSE: PCG	216,031	13.0
2	Exelon	NYSE: EXE	5,204,720	68.2
3	El Paso Electric	NYSE: EE	768,884	240.0
4	Entergy	NYSE: ETR	15,263,130	265.4
5	Avista	NYSE AVA	1,193,025	305.9
6	Constellation	NYSE: CEG	8,493,229	347.0
7	FPL	NYSE: FPL	25,009,936	354.0
8	Sempra	NYSE: SRE	2,825,349	355.3
9	PSEG	NYSE: PEG	11,317,355	360.9
10	Calpine	NYSE: CPN	16,065,600	404.0

But CO2 is only one of four pollutants examined by CERES.  To try and develop an overall sense of the different power companies relative regulatory/environmental risks, I constructed a simple index.  I just added up the rankings each company had for each pollutant.  The result shows a lot of overlap with the list of the ten least carbon-intensive generators.

                        Least Emissions-Intensive U.S. Electricity Producers (2006)

Rank	Company	Symbol
1	PG & E	NYSE: PCG
2	El Paso Electric	NYSE: EE
3	Calpine	NYSE: CPN
4	Sempra	NYSE: SRE
5	Avista	NYSE: AVA
6	Exelon	NYSE: EXC
7	International Power	Lon: IPR
8	FPL	NYSE: FPL
9	Entergy	NYSE: ETR
10	IDACorp	NYSE: IDA

My index is pretty simple and doesn't take into account the different levels of risk that may be associated with particular pollutants, e.g. who really thinks CO2 is as undesirable as Mercury?  But it does cut thorugh all of the data to give me a starting piont for looking more closely at U.S. power generators.

By the way, who is the dirtiest power producer using my index?  Allegheney Energy (NYSE: AYE).