Thursday, October 30, 2008

A Smart Grid Relies On Demand Response

SmartGrid offers an Industry News summary
Their take: That new transmission has to be smart and self-healing to better accommodate the stresses of intermittent wind.

NERC cites improving Demand Response and lagging grid

Highlights I found in the 2008 Long-Term Reliability Assessment from the North American Electric Reliability Corp

To consistently validate and measure the results of the demand response programs, NERC is inaugurating a demand response event analysis system (Demand Response Data Task Force), expected to be launched in 2010.

Significant increases in demand response programs over the next ten years are projected to reduce growth in demand and provide ancillary services across North America.

Demand response will become a critical resource for maintaining system reliability over the next ten years.

Though demand continues to grow, new development of supply-side options are becoming increasingly limited – many coal plants have been deferred or cancelled, nuclear plants are becoming more and more expensive, and transmission lines increasingly difficult to site.

Further, demand response also has an important role to play as more variable resources (such as wind) are added to the system. Variable resources, for example wind generation, often need a “dance partner” which can provide operational flexibility to maintain reliability during resource down-ramps that can be ssociated with them.

Demand response can provide all or a portion of the flexibility required for this integration.

Brattle Group consultant Ahmad Faruqui revealed that his firm has updated its 2007 assessment of DR’s present value. The previous assessment, called The Power of Five Percent, concluded that if DR could reduce peak demand by five percent it would produce a benefit stream over twenty years with a present value of $35B.

Since then, says Faruqui, the cost of providing peak energy has doubled. Meanwhile, DR technology costs have come down and regulators have started promoting faster adoption. Even at a five percent reduction, the present value jumps to $66B.

If DR can reduce peak demand by 25%, says Faruqui, the present value is $332B.

2008 Long-Term Reliability Assessment from the North American Electric Reliability Corp

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