Demand Response and Energy Efficiency

WHAT IS DEMAND RESPONSE?

Demand response refers to the policy and business area whereby electricity customers

reduce or shift their electricity use during peak demand periods in response to “price

signals” or other types of incentives. At present, the vast majority of electricity customers

are on flat, average rates that do not vary by time of day or season, no matter how much

the cost to generate or deliver electricity fluctuates as demands on the system rise and fall.

Flat rates combined with the growth in the use of air conditioning—one of the highest

demands during peak periods—has led to peak power demand growing faster than overall

growth in electricity consumption. Rising peak demand is straining the electricity system

and threatening the reliability of the power grid. It is also adding costs that all customers

pay one way or the other, while leading to increased emissions.

HOW IS DEMAND RESPONSE DIFFERENT FROM ENERGY EFFICIENCY?

Energy efficiency usually refers to devices or practices that provide the same level of output

or benefit by using less energy. Energy efficiency usually focuses on reducing overall energy

use, not just at certain times. Demand response improves the overall efficiency of the

electricity system (including transmission and distribution) but differs from traditional

energy efficiency in that it is more dynamic and controllable, meaning that it can be

“dispatched” to meet rising demand in lieu of turning on a power plant. Demand response

focuses primarily on reducing use during the peak period, and involves providing customers

with price signals or time‐based incentives to encourage them to reduce their peak use.

Demand response can react to conditions in the market or to threats to system reliability

(e.g., blackouts).

Smart Grid introduction

Smart Grid introduction

Introduction to Electric Grid

The electric grid generally refers to all or the smart grid, in a nutshell, is a way to transmit and distribute electricity by electronic means. The electric grid delivers electricity from points of generation to consumers. The electricity delivery network functions via two primary networks: the transmission system and the distribution system. The transmission systems deliver electricity from power plants to distribution substations, while distribution systems deliver electricity from distribution substations to consumers.

The grid also encompasses myriads of local area networks that use distributed energy resources to several loads and/or to meet specific application requirements for remote power, municipal or district power, premium power, and critical loads protection.

Introduction to Smart Grid

Smart grid lacks a standard definition, but enters on the use of advanced of technology to increase the reliability and efficiency of the grid, from transmission to distribution. The Smart Grid is a vision of a better electricity delivery infrastructure.

Smart Grid implementation dramatically increases the quantity, quality, connectivity, automation and Coordination between the suppliers, consumers and networks, and use of data available from advanced sensing, computing, and communications hardware and software.

In addition to being outdated, power plants and transmission lines are aging, meaning they have difficulty handling current electricity needs, while demand may not be reduced any time, but it can still be increasing continuously. One solution could be to add more power lines, but the aging system would still be overwhelmed.

So instead of a quick fix, a more reliable, permanent solution is needed. Perhaps the most fundamental aspect of transitioning to a smarter electricity system is the smart meter.

Renewable and Smart Grid

The smart grid can be seen as an alternative energy source, certainly a change from the current way of doing things. In addition to rerouting electricity, the smart grid would be able to fill in the gaps of these alternative energy power sources. One way this could be accomplished, surprisingly enough, is with another alternative energy technology – the electric car, specifically, the plug-in electric hybrid (PHEV).

This would work through the concept of energy storage, in the case of the PHEV, specifically referred to as V2G or vehicle to grid. This use of alternative energy sources, like wind and solar reduces the nation’s dependence on foreign oil and helps keep pollution from car exhaust and power plants to a minimum.