Electric Power Management
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8.3 Demand Management
The adoption of smart meters and a smart grid opens up a range of possibilities for demand management. The development of demand management
strategies will become increasingly important for the overall functioning
of the electrical system. Smart meters and a smart grid can implement
automated demand management that, for example, reduces power use in
subtle ways when it is necessary to manage supply and demand. Some of
this is currently being used in various locations, often based on the price
of electricity where there is time- of- use pricing. People or organizations
interested in saving money can use demand management to reduce their
usage at peak power times (when demand is greater and time- of- use prices
are high), sometimes by delaying activities until a time of lower prices when
there is a need to increase demand. In particular, for locations where there is
significant solar generation, there may be low prices for electricity in the late
morning and in the middle of the day to encourage immediate and direct
use of the solar- generated electricity. One good way to increase consumption
during these time periods would be to plug in and charge electric vehicle
batteries, which may be sitting in workplace parking lots.
Real- time prices may be used to manage supply and demand where
customers have smart meters and there is good communication. Wholesale
prices of electricity vary with supply and demand; these are the prices at
which utilities buy and sell electricity from one another. Real- time prices for
customers may be adjusted based on wholesale prices and/ or the supply
and demand of the utility (Taylor and Taylor, 2015).
Customers who allow their demand to be reduced by the utility are usually compensated for their participation in a direct load control program,
where the utility reduces power flow to the customer during peak power
times as needed. The air conditioner may run less or the electric water heater
may receive less power, for example. One example of this approach is the
program of Baltimore Gas and Electric. The Baltimore customers who allow
their air conditioning to be reduced at peak demand times receive $1.25/
kWh for each kWh that is not supplied (Taylor and Taylor, 2015).
Larger electricity consumers may participate in an interruptible load
program, in which the utility may call and request that the load be reduced
by an amount that has been agreed upon. There may be a time period
of some minutes for the customer to reduce the load. In some cases, it
may be possible for the utility to make the change remotely (Taylor and
Taylor, 2015).
For programs such as those described above, the installation of smart
meters (along with a smart grid; see Chapter 7) is a critical infrastructure that
must be in place first. Smart meters have been very beneficial for advancing
demand response programs because of the improved communication and
better ability to educate customers with respect to the programs.
81
81
8.3 Demand Management
The adoption of smart meters and a smart grid opens up a range of possibilities for demand management. The development of demand management
strategies will become increasingly important for the overall functioning
of the electrical system. Smart meters and a smart grid can implement
automated demand management that, for example, reduces power use in
subtle ways when it is necessary to manage supply and demand. Some of
this is currently being used in various locations, often based on the price
of electricity where there is time- of- use pricing. People or organizations
interested in saving money can use demand management to reduce their
usage at peak power times (when demand is greater and time- of- use prices
are high), sometimes by delaying activities until a time of lower prices when
there is a need to increase demand. In particular, for locations where there is
significant solar generation, there may be low prices for electricity in the late
morning and in the middle of the day to encourage immediate and direct
use of the solar- generated electricity. One good way to increase consumption
during these time periods would be to plug in and charge electric vehicle
batteries, which may be sitting in workplace parking lots.
Real- time prices may be used to manage supply and demand where
customers have smart meters and there is good communication. Wholesale
prices of electricity vary with supply and demand; these are the prices at
which utilities buy and sell electricity from one another. Real- time prices for
customers may be adjusted based on wholesale prices and/ or the supply
and demand of the utility (Taylor and Taylor, 2015).
Customers who allow their demand to be reduced by the utility are usually compensated for their participation in a direct load control program,
where the utility reduces power flow to the customer during peak power
times as needed. The air conditioner may run less or the electric water heater
may receive less power, for example. One example of this approach is the
program of Baltimore Gas and Electric. The Baltimore customers who allow
their air conditioning to be reduced at peak demand times receive $1.25/
kWh for each kWh that is not supplied (Taylor and Taylor, 2015).
Larger electricity consumers may participate in an interruptible load
program, in which the utility may call and request that the load be reduced
by an amount that has been agreed upon. There may be a time period
of some minutes for the customer to reduce the load. In some cases, it
may be possible for the utility to make the change remotely (Taylor and
Taylor, 2015).
For programs such as those described above, the installation of smart
meters (along with a smart grid; see Chapter 7) is a critical infrastructure that
must be in place first. Smart meters have been very beneficial for advancing
demand response programs because of the improved communication and
better ability to educate customers with respect to the programs.