PORTLAND, Ore. – The Pacific Northwest Smart Grid Demonstration, the largest of 16 U.S. Department of Energy pilot projects, is under way in five Northwest states. It seeks ways to balance the region’s huge base of hydroelectric power with its fast-expanding collection of wind farms.
With a budget of $178 million split evenly between an American Recovery and Reinvestment Act grant and local contributions by 11 utilities and other partners, the smart grid project (pdf) covers a wide array of missions. Charging plug-in electric vehicles, improving wind forecasting and creating a novel market “signal” meant to reflect a higher value for low-carbon electricity are among them.
A critical experiment centers on coping with wind power’s starts and stops by paying consumers to let utilities store surplus wind energy in hot water heaters. These and other energy conservation initiatives in the Northwest may become models for utilities and regulators elsewhere that are also facing the challenges of managing intermittent renewable energy flows, officials here say.
“We hope to learn a lot about wind integration. It is an important issue for the nation, the Pacific Northwest and Bonneville,” said Lee Hall, Bonneville’s Smart Grid Program Manager.
The Northwest needs some answers urgently.
“Right now, there is a major challenge in accommodating wind power,” said Jeffrey King, senior resource analyst at the Northwest Power and Conservation Council in Portland. The council’s Sixth Northwest Conservation and Electric Power Plan, issued this year, sets the region’s energy agenda through 2015.
Until now, hydro dams have primarily backed up wind, adding energy when wind speeds wane and backing off when wind picks up. Those days are numbered, because the queue of wind projects continues to grow.
“We’re getting to the end of the ability to use the hydro system for balancing,” said Eric King, wind integration project manager at the Bonneville Power Administration, which markets the electricity from the region’s federal dams.
More wind requires a more reliable backstop
If all politics is local, the Pacific Northwest stands for the proposition that all energy policy is regional. A traveler headed east from Portland through the sculpted Columbia River Gorge encounters the hydro dams first, beginning with the New Deal-era Bonneville installation. The first of more than 600 towering wind turbines come into view an hour later along the river’s ridges.
Since 1998, wind developers have added 4,000 megawatts of wind power generation capacity, which is available about one-third of the time. The region has about 33,000 megawatts of hydropower and can call on about half of that on average, because of seasonal low water conditions.
Half of the new wind energy is purchased by California utilities to meet their state’s demanding renewable energy requirements, said Jeffrey King. Oregon, Washington and Montana also have state renewable portfolio standards, contributing to a demand that could possibly push wind generation capacity as high as 12,000 megawatts in 2016, three times the current amount, according to the council’s report.
But wind and water aren’t turning out to be such good neighbors, said Steve Weiss, senior policy associate at the NW Energy Coalition, an advocate for clean energy and environmental protection in the Columbia River Basin. “Hydro sounds like it’s a great fit for wind, but it turns out to be pretty terrible fit.”
When the river is high and the wind blows hard, the region can be confronted with too much power. Hydropower from the region’s dams could provide a fast-acting backstop when wind power suddenly ramps up or down, but the Columbia’s flow has many claimants.
“There are lots of operational parameters that have to be addressed, including flood control, navigation, irrigation, recreation, and, of course, the compliance with the Endangered Species Act,” said BPA’s Hall. During the spring months, when melting snow fills the Columbia basis, dam operators are stretched to manage the river flow through their systems: Too much spillage over the dam can upset the river’s oxygen-nitrogen balance, killing salmon.
Storing surplus energy in home hot water heaters
“Everybody is relying on the hydro system, and hydro can’t really flex that much,” said Weiss. “It certainly can’t flex cheaply.”
“It’s pretty urgent,” said Terry Morlan, division director of the council’s Power Planning Division. “Bonneville had to scramble like crazy to deal with some of the situations where wind ramps up and down quickly.”
Bonneville’s customers are accustomed to bargain electricity rates thanks to hydropower. Retail power prices average about 9 cents per kilowatt-hour in Washington, half the rates in some East Coast states. The national average is 12 cents.
With the region’s hydro resources fully committed, the region faces higher future prices for power, the council’s study details, creating the potential for more debate between climate policy advocates and opponents. Smart grid technologies that reduce demand, conserve power and help integrate wind energy systems may be key factors in that debate.
In the region’s smart grid project, hundreds of customers’ electric water heaters will be equipped with controllers and two-way communication links to their utility, so that the heaters can be turned off in advance of a major wind front, then switched on to absorb the surplus electric power when the front arrives.
In one test, utility operators will control the off-and-on switch for a water heater, and when wind ramps up sharply, they could allow the water in the tank to heat significantly higher than the customary 120 degrees Fahrenheit. The water heater would be equipped with a mixing valve and sensor to ensure safe water temperatures at the tap.
Mason County Public Utility District No. 3 in Washington will install a system in which a wind farm will communicate directly with 100 customers’ water heaters, cycling them on and off depending on wind conditions. The project’s software will also factor in each customer’s water usage patterns to make sure there is enough hot water when family members customarily take their morning showers, said BPA’s Hall. The customers, all volunteers, can choose to override the heater controls, he added.
Other utilities will use water heater storage to contain an increase in the price Bonneville will be charging next year for peak power – reflecting the rising costs for generation on its system.
Experimenting with a price signal
Flathead Electric Cooperative Inc., in Montana, will equip about 150 homes with switches allowing it to cycle hot water heaters on and off to conserve power in peak periods. Other customers will get smart appliances, smart thermostats and home area networks.
Flathead and other utilities in the smart grid project will receive an energy “signal” devised by project managers that is meant to reflect generators’ electricity costs and the value of conservation, demand restraint, renewable power, storage and other factors, as conditions change on the region’s grid.
The signal may also include factors such as the impact of hydro operations on fish and the value of low-carbon renewable power, said John Lelivelt, project manager for Alstom Grid, one of the signal developers.
Still under development, the signal will alert utilities to times when generation costs are high, creating an incentive for utilities to conserve power through energy storage, said BPA’s Hall. If a utility activates a demand response program, the utility should earn a benefit that it would share with consumers who reduce their power usage, Lelivelt said.
The project will test various compensation approaches, said Russ Schneider, Flathead’s smart grid project manager. “We’ll see what our members like and don’t like, and which approach gets more bang for the buck.”
Mike Charlo, electric superintendent for the town of Milton-Freewater, in northeast Oregon, said the town has been managing customers’ hot water heaters since 1985, cycling them on and off through a voltage signal in order to shave peak power demand and lessen the energy bill it pays to Bonneville Power. It, too, is part of the regional smart grid program, and will install smart meters at 4,500 customer locations, plus other controls, paying half of the project’s $3 million total costs.
Power over the power bills
“Our customers have been doing it for 25 years. We’ve never ever had a problem” with consumer acceptance, he said. “We put in ads that we’re looking for another 50 to 100 volunteers, and we get all kinds of people. We actually get people calling to volunteer who are already in the project.”
The Pacific Northwest National Laboratory (PNNL) in Richland, Wash., which is overseeing the region’s smart grid project, said it was happy to have Milton-Freewater take part. “They told us, ‘Our people get it,'” Charlo said.
Later in the experiment, customers will get in-home electricity usage displays to track their power usage, and programmable thermostats. “They can get to the point where they can be more of a partner with us and get more control over their power bills,” said City Manager Linda Hall. “That’s what I’m most excited about.”
The Pacific Northwest Smart Grid Demonstration Project will eventually involve 60,000 customers in tests of whether the new technologies work as expected, whether consumers accept them, and whether the project’s benefits exceed costs, said BPA’s Hall.
But it is still a test. The hot water heater experiments total a few hundred kilowatts of capacity each. “We’re looking for tens or hundreds of megawatts to help smooth the system out here, and the question is how we scale that up,” said Hall.
The results of these smart grid demonstrations can provide benchmarks for assessing clean energy strategies, the project’s leaders say. “Job one is to prove the value here in the region. Job two is to translate those lessons learned out to the national agenda, as well,” said Carl Imhoff, PNNL’s electricity infrastructure manager.
“We would like to predict that it is going to be very cost-effective,” Bonneville Power’s Hall said. “But we have to prove it.”
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