Respond 2010 Contents List

Market Drivers and Inhibitors

• 1. Market Survey Findings, Drivers & Barriers
• Author(s):Jessica Strömbäck
• Abstract:Research for this section has been carried out over the course of two years and analyzed the development of smart meter enabled programs throughout Europe, the USA and Australia. The present findings are based upon 26 intensive interviews of distribution and retailer company managers and other market experts on the developments of demand response (DR) within their respective markets. These interviews formed the basis of the list of drivers and enablers that were later investigated in a survey. This survey had two parts; the first part asked respondents to spontaneously name 5 factors which they feel are acting as drivers for DR in their markets and 5 which they feel are acting as barriers1. The aim of this section was to ascertain what drivers and barriers the experts thought of first without guidance from the researchers. The second part provided a list of drivers and enablers gathered from the in-depth interviews and asked the respondents to state on a scale of 1-7 to which extend did they agree or disagree these factors were important2. One-hundred and twenty five questionnaires were sent out and eighty-seven replies were received. The survey is presented in the Annex. This report presents the results in written and graphical form.

Regulation

• 2. What does a regulator need to do for a successful smart meter roll out? – The case of GB and implications for other markets
• Author(s):Alastair Manson
• Abstract:To answer the question of the title I shall start by looking at the case of Great Britain; admittedly GB is, in so many ways, not typical but it is a good illustration of challenges that will be faced. If we can make smart metering work in the fragmented market in GB, we should be able to make it work anywhere. Whether we arrive at good solutions for GB or not there may well be lessons for other markets.

The Customer Experience

• 3. Integrating the customer experience through unifying software – The Microsoft Vision
• Author(s):Andreas Berthold-van der Molen
• Abstract:Power utility companies are facing fundamental changes in the nature of their future business relationship with customers. They need new capabilities to inform consumers about their role in a new energy ecosystem. This new ecosystem is one where consumers can use electricity in a cost-rational manner and also contribute to the grid with distributed renewable generation sources. Finding the right technology platform to create that environment is a primary challenge for utilities. In our view utilities must integrate their utility business operations and their underlying technology enablers with consumer behavior in order to be successful.

Distributed Energy

• 4. A Role for Distributed Resources in Demand Side Management?
• Author(s):Jon Slowe, Marlene Chitonga
• Abstract:Grid connected distributed resources (DR) are on the rise – such as electric vehicles (EVs), micro-CHP, and, heat pumps. Markets for these resources are in their early days, but are starting to emerge – with clear potential for rapid growth. In this article we briefly review the potential application of DR in demand side management providing an indication of available DSM capacity. We illustrate this potential with case study examples.

Tariffs and Pricing

• 5. Potential and Benefits of Variable Tariffs
• Author(s):Dr. Harald Schäffler, Constance Mörch
• Abstract:With an appropriate smart metering technology, suppliers will have new opportunities to design variable tariffs and develop new products. Variable tariffs may be used to improve the efficiency of energy consumption, for load curve modification as well as to achieve a participation of the costumer in the energy market and to individualise the energy products.

• 6. Gas Smart Meters for GB Homes : New Smart Tariffs and Smart Pre-Payment
• Author(s):Gill Owen, Judith Ward
• Abstract:This article for Respond 2010 considers the back-drop to the proposed roll-out of household gas smart meters in Great Britain. It draws on two newly-completed multi-sponsor studies by the authors – covering both gas and electricity household smart meters in Great Britain – as well as on earlier published research . In particular, it sets the forthcoming GB gas smart meter roll-out within the context of the dominant role played by gas in GB homes, considers the kinds of tariffs which might develop with gas smart meters and the scope for new developments in GB for smart gas pre-payment.

Knowledge Center

• 7. Status Review of End-User Price Regulation as of 1 January 2010
• Author(s):ERGEG
• Abstract:This document (E10-CEM-34-03) presents ERGEG’s Status Review of End-User Price Regulation as of 1 January 2010. The Status Review is a follow-up to ERGEG’s 2007 Position Paper on End-user Energy Price Regulation (Ref. E07-CPR-10-03) and ERGEG’s Status Review of End-User Price Regulation as of 1 July 2008 (Ref. E08-CPR-21-05). It provides an overview of the state of play of energy price regulation in ERGEG member and observer countries as of 1 January 2010. The review looks at whether regulated prices still exist following market opening and whether there has been progress towards markets without regulated end-user prices. ERGEG did not ask how prices are regulated or which methodologies are being used. Nor does it address the reasons for price regulation or price levels.

Display Strategy and Regulation

• 8. Putting the customer first – a user-centric approach to the in-home display
• Author(s):Jessica Diniz
• Abstract:Onzo provides utilities with customer intelligence solutions. Its flagship product, the Onzo smart energy kit, combines data capture, an uploader app, behaviour change software modules, web components in utility website, and an in-home display. It is the result of a user-centric design approach that involves meticulous research and an agile, fast-paced process. The sum of the factors we have had to take into account are discussed in this article.

• 9. Displays – A Growth Strategy for Utilities?
• Author(s):Simon Anderson
• Abstract:Much is developing in the utility marketplace which offers Utilities both opportunities and threats: the opportunity for incumbents to grow their businesses, but also the threat that new players will capture their existing customers. However, as yet consumers have not been engaged. Despite considerable publicity about climate change, smart everything and the prospect of higher energy prices few customers appear to have any interest. This article looks at the potential for energy displays to stimulate this market opportunity and trigger peoples’ interest. It draws on bespoke market research and a set of field trials. It discusses types of displays, what people respond to and the sort of actions and behaviours they can trigger.

• 10. Promising results: energy savings through direct feedback on household’s gas and power consumption in The Netherlands
• Author(s):Lisette Firet, Chris IJsbrandy
• Abstract:In 2006 the ‘European Directive on energy end-use efficiency and energy services’ was launched. Parts of this directive are expected to become part of Dutch law by 2011. Research indicates that direct feedback on gas and power consumption can - on the right conditions - indeed help households to reduce their in-home energy consumption. This is the result of a 2009 study by SenterNovem (currently ‘Agentschap NL’ - Dutch governmental agency), Nuon (Dutch energy supplier) and UCPartners (Dutch energy & utility research and consulting firm), in collaboration with Home Automation Europe (Dutch company specialized in integrated home management solutions)and the Technical University of Eindhoven.

• 11. Customers design displays for demand reduction: will utilities and regulators join them?
• Author(s):Dr Sarah Darby
• Abstract:Most of the discussion around business cases for smart metering concentrates on the potential for reducing electrical demand at peak times and reducing operating costs. But what of parts of the world where electrical demand is not very peaky? Swathes of central and northern Europe, for example. And everywhere, climate change and energy security concerns are telling us that it’s time to reduce demand in order to move as smoothly as possible to lower-impact systems.

• 12. Visualisation Results in Savings
• Author(s):Christina Öhman
• Abstract:The human behavior plays an important role when it comes to energy savings and efficiency in every day life. Interactive technology and design has a strong potential to support the understanding of energy use by visualisation. In a study conducted by the Interactive Institute a number of households tested the Energy AWARE Clock, a display that draws graphic in real time. The results are very interesting and give credibility to the importance of design and visualisation.

Electric Cars

• 13. Demand Response for Electric Mobility
• Author(s):Alain Chardon
• Abstract:Electric cars have been existing for over a century, with several unsuccessful attempts to expand its use. It is now the first time that some governments and industries plan massive deployment of electric mobility: Spain targets 500 000 electric vehicles by 2015, Germany expects up to one million electric vehicles by 2020, while France aims at a fleet of 2 000 000 at the same date, one third being full electric vehicles (EV) and two thirds being plug-in hybrid electric vehicles (PHEV).

Interoperability

• 14. The Smart Grid and Interoperability
• Author(s):Larry Colton, Philip Lewis
• Abstract:Smart metering is an essential part and foundation of the smart grid itself – offering increased functionality for Smart Grid applications, built-in two-way communications to take advantage of that functionality, and support for new customer focused applications. The critical thing about defining smart metering is that it’s not just about the meter. It is really about the enabling the smart grid, which is an energy infrastructure that spans from generation through distribution including the devices and systems that consume energy. Therefore, smart meters must be part of a “system” for delivering dramatic improvements in utility operations, reliability, and customer service by offering detailed usage information, demand metering, detailed power quality data, outage information, integrated disconnect switch, integrated customer premise interface and flexible billing options

Country Reports

• 15. Country Report – Belgium
• Author(s):Christophe Dromacque
• Abstract:Belgium is densely populated and heavily industrialized. It has a population of 10.5 million and the number of households is 4.6 million. There are about 5.4 million electricity meters in the country. The Kingdom of Belgium is a federation of three Regions (Flanders, Wallonia and Brussels) with three national languages, of which Dutch and French are predominant. The Regions enjoy a high level of autonomy; the regional governments can vote their own laws and energy policy is organized as a system of shared authority between the federal government and the regions. The national electrical energy demand in 2008 was 86.1 TWh and production amounted to 77.1 TWh. The average domestic consumption is estimated at 3,500 kWh a year per household; which is comparable to its direct neighbors.

• 16. Country Report – Alberta
• Author(s):Alex Henney
• Abstract:Alberta is a small market with a population of 3.3m people, 1.2 million meter points, and annual electricity generation of 68TWh in 2006. The wholesale market was restructured in three stages beginning in 1996 with the creation of a “gross” electricity Pool through which all of the power flowed. Legislation in 1998 required the plant owners to offer the dispatch and output of their units in long term power purchase agreements at auction, and over the period 2001 to 2005 these were disposed of to various purchasers, thus creating a reasonably competitive wholesale market. The government originally intended to open the mass market in 2001, but it was effectively deferred to 2004 because of the debacle in California.

• 17. Country Report – Australia
• Author(s):Alex Henney
• Abstract:Australia has an area of 7.7m sq. kms (which is about 80% of the USA land mass excluding Alaska) while its population is only 21m; there are about 10m meter points. The government is federal in character, with a Commonwealth Government, 6 states and 2 territories; they are called jurisdictions. The focus of this study is Victoria, New South Wales (NSW), and South Australia, who were the founder members of the National Electricity Market; who were the first to open to full retail competition; and where 70% of the population live.

• 18. Country Report – Great Britain
• Author(s):Alex Henney
• Abstract:The population of Great Britain is 59m; there are a total of 29m registered meters, 110,000 of which are half hourly and 26m are domestic. In 2007 British customers were supplied with 320TWh of electricity from the public system of which 112TWh was consumed by residential customers. The average annual consumption per household is about 4,300 kWh. There are 14 distribution network operators (DNOs) in Great Britain ranging in size from 0.8m to 3.5m meter points. They own and operate wires networks and may provide meters whose rental charges are regulated under price control. The 14 DNOs have seven different owners; some have retailing affiliates, others do not.

• 19. Country Report – California
• Author(s):Alex Henney
• Abstract:There are three investor owned utilities in California - Pacific Gas and Electric Company (PG&E), Southern California Edison (SCE), and San Diego Gas and Electric (SDG&E) – who are regulated by the California Public Utilities Commission (CPUC). They serve about 70% of the load in the state. From the opening of the market generators exercised market power in the energy market when demand was high, and were able to exercise market power in the ancillary services markets which could feed back into the prices in the Power Exchange. Starting in the summer of 2000 the generators and traders like Enron were ruthless in exploiting market power, gaming market rules, and pushing up prices for a year. The Direct Access programme of competitive choice was suspended in September 2001.

• 20. Country Report – Italy
• Author(s):Alex Henney
• Abstract:The population of Italy is 60 million; there are about 35.5m meters of which about 30m are residential. In 2007 the consumption of electricity from the public supply system was 298TWh. The electricity industry was nationalised in 1962 when 1,200 privately owned regional and local companies were combined to form Ente Nazionale Energia Elettrica (ENEL), a monopoly, responsible for the generation, import/export, transmission, distribution and supply of electricity across the country.

• 21. Country Report – New Zealand
• Author(s):Alex Henney
• Abstract:New Zealand comprises two main islands, the North Island where two thirds of the 4.1m population live, and the South Island where most of the hydro is located, interconnected by a 1040MW HVDC interconnector which normally transports power from the South Island to the North Island. In a typical year about 60% of the 45TWh production is hydro generated, 25% gas/coal, 7% geothermal, and 8% other; the average consumption per household is about 7400kWh.

• 22. Country Report – Nordic Countries
• Author(s):Alex Henney
• Abstract:In many respects the four Nordic countries of Denmark, Finland, Norway, and Sweden provide interesting contrasts. While the populations of the first three countries are about 5 million, that of Sweden is 9 million. The electric systems range from virtually 100% hydro in Norway to mainly thermal in Denmark (along with the highest proportion of wind generated power in Europe of about 20%); Sweden is half hydro half nuclear, while Finland has something of everything.

• 23. Country Report – Ontario
• Author(s):Alex Henney
• Abstract:Ontario is the most populous province of Canada with 12.2 million people, and an area of about 1 million sq. kms. In 2008 the consumption of electricity was 148TWh and the maximum demand was 24.2GW. There are 4.6m residential and small non-residential customers who consume about 66TWh p.a.; the average residential consumption is about 12,000kWh p.a.

• 24. Country Report – Spain
• Author(s):Alex Henney
• Abstract:The population of in peninsular Spain is 43m; the number of electricity customers is 23.8m and their consumption in 2007 was 238TWh. The average household consumption is 3200kWh p.a. Five companies undertake nearly all of the distribution.

• 25. Country Report – Texas
• Author(s):Alex Henney
• Abstract:Texas (population of 23 million) is virtually an electrical island. The ERCOT interconnected system comprises about 75% of the land area and 85% of the load in Texas, production was 312TWh in 2008. Residential customers account for approximately 35% of the energy demand in ERCOT and have an average annual consumption of about 20,000kWh.

• 26. Country Report – The Netherlands
• Author(s):Alex Henney
• Abstract:The population of the Netherlands is 16.3m in 6.75m households; there are 7.6m metering points. In 2005 Dutch customers consumed 110.2TW, of which 37.7TWh was by small customers (including 22.5TWh by households representing an average of 3350kWh/household).

• 27. Country Report – Republic of Ireland
• Author(s):Christophe Dromacque
• Abstract:The population of the Republic of Ireland was estimated at 4.5 million people in 2009. There are about 2 million electricity customers and installed capacity was 7,843 MW. Growth in electricity demand has been among the highest in OECD countries, fuelled by a rapid increase in population and economic growth until the global economic crisis hit Ireland at the end of 2007. The Republic of Ireland has a parliamentary system of government. The Irish state consists of twenty-nine administrative counties and five cities which are administered separately from the remainder of their respective counties. The national electrical energy demand in 2008 amounted to 27 TWh of which 0.5 TWh had to be imported to meet domestic demand. The average domestic consumption is estimated at 4,500 kWh a year per household.

• 28. Country Report – Portugal
• Author(s):Christophe Dromacque
• Abstract:Portugal has a population of 10.6 million and the number of low voltage electricity customers is about 6.1 million. The national electrical energy demand in 2008 was 50.6 TWh and the installed capacity 14,916 MW. The average domestic consumption is estimated at 3,000 kWh a year per household which is one of the lowest in Western Europe. In 2008, about 24% of the electricity consumed was generated from natural gas, 21% from coal, 19% had to be imported, 14.5% from "special regime production" minus wind (include small hydro, CHP, etc), 11% was from large Hydro, 8.5% from wind and the remaining 2% from other fuels. Peak demand tends to happen in December or January and the highest demand todate was recorded on December 18th, 2007 at 9,110 MW.

Systems MDM CIS and Architecture

• 29. A Smart Energy Reference Architecture: Road-map for a Global Smart Energy Ecosystem
• Author(s):Jon Arnold, Larry Cochrane
• Abstract:The structure, engineering and objectives of the world’s power system are undergoing dramatic rethinking and significant change due to the driving forces of climate change, novel market participants such as plug-in hybrid electric vehicles, and increasing energy demands. These are combining to drive development of the “smart grid.”

• 30. Are Your Systems Holding Back your Smart Vision?
• Author(s):Dr Philip E. Lewis
• Abstract:With significant media coverage and an intensive global conference circuit, utility executives have been bombarded with information about meter replacement and future metering technologies. This level of coverage is not unexpected, utilities and energy companies will spend billions over the coming decade installing smart meters and taking the first steps toward enabling the smart grid. However, considering the level of focus on metering technology, there has been surprising little information on the impact to utility systems beyond the need for an MDM.

Commercial DR

• 31. Energy Service Requirements for Commercial Demand Response
• Author(s):Phil Davis
• Abstract:In the opinion of many demand side experts, commercial buildings represent the largest untapped potential for smart grid benefits. Traditional building automation systems (“BAS”) provide control loops based on occupancy, temperature, humidity and weather. Often, facility staff override these systems to address tenant complaints. Over time, building occupancy changes, control nodes and sensors deteriorate, and the result is a system poorly in tune with the needs of the owners and occupants. Since this is fairly common, one must conclude in these cases that the BAS did not deliver enough value to justify maintaining it. Now, suppose that same BAS could contribute significantly to economic performance. Is there a configuration strategy that justifies the effort and expense required to keep the BAS in tune?

Smart Home Solutions

• 32. Taking the Lead in Smart Meter Home Services
• Author(s):Thomas N. Mikkelsen
• Abstract:By way of a strategical partnership with Panasonic, Danish energy company SEAS-NVE prepares to leap into the future of smart meter-based home energy services. Less than two years from now all of SEAS-NVE's 350.000 private customers will have a new smart meter installed in their home. By integrating the new meters with the home energy management solution Panasonic Lifinity, SEAS-NVE is entering a whole new era of consumer interaction and service. From several market surveys and large scale campaigns SEAS-NVE has concluded, that successful energy management solutions must focus on the home, on saving time and have a simple user interface. The smart meter/Lifinity-solution meets all three demands.

The Business Case

• 33. The Smart Meter Business Case: Costs and Benefits
• Author(s):Chris King
• Abstract:The great interest in smart meters is buoyed by the vision of broad utility and consumer benefits, above all energy efficiency, demand response, renewables integration, and utility operating savings. Smart meters offer the prospect of industry transformation once fully deployed and operationalized – particularly from the IT side of things. Understanding the costs and benefits of smart meters will help avoid them being tainted by the over-hype and splashy failures we have seen with some other technologies, such as broadband over power line.

Smart Home Vision 2020

• 34. Vision 2020 The Future of Smart Home and Demand Response
• Author(s):Dr Philip E. Lewis
• Abstract:The VaasaETT smart home vision has been developed ultimately over a period of 18 months. It is an amalgamation of leading opinions from the key thinkers in this field. It is a collection of the state-of the-art visions and solutions. It is based on what we know is being done, planned and intended by the best utilities and technology vendors. It also summarises what has been found in practice to drive customer interest, involvement and adoption relating to smart home, demand response and related issues. This section forms a cornerstone of the VaasaETT Respond 2010 project and is intended to guide strategy between now and at least 2020. It is intended to stimulate, challenge and support the visions of the reader. It should not be taken as a prediction of what the future will look like in 2020 or the lead up to it. Rather it should be seen as an indication of where leading opinion is heading, a vision for 2020 based on what is currently known. Future leaps in technology, new or worsening environmental challenges, political mindset changes, and social trend adjustments cannot be accounted for by such visions. It is essential that utilities and the industry at large adopt a degree of flexibility and adaptability that will allow it to take advantage of such opportunities.

Market Drivers and Inhibitors

• 35. Economics of Demand Response Drivers, Enablers, and Barriers
• Author(s):Jessica Strömbäck, Christophe Dromacque
• Abstract:The purpose of this research is to provide an overview of what factors are currently driving demand response programs forward, or acting as barriers. The aim of this is to provide a better understanding of what is required in a market for successful demand response program deployment.

Pilot Study Analysis

• 36. Demand Response Pilot Comparison
• Author(s):Stromback, Dromacque, Golubkina and Lewis
• Abstract:80 pilots have been reviewed for this report selected from a pool of approximately 120. Their effectiveness has been analysed according to type and according to a selection of variables, such as communication technology and information provided, to ascertain differing elements that may contribute to effectiveness. The pilots reviewed here cover: Critical Peak Pricing (CPP), Critical Peak Rebates (CPR) and Time of Use (TOU). As discussed above, feedback and customer communication are considered important in the success of long-term demand response and customer relations. This is especially true in markets where average household consumption is low and cost/benefit a challenge or in markets – such as California where pricing programs are implemented for the entire customer base.

Feedback

• 37. Improving Feedback – A Sociotechnical Approach
• Author(s):Ruth Mourik
• Abstract:This paper focuses on the potential role of feedback in changing the energy consumption of residential consumers, and how feedback can help utilities and retailers to improve their energy consumption and customer retention strategies.