Demand response has been around for decades, but the resource's complexity and scale is growing quickly as a more-integrated power grid allows for new products and services to be remotely controlled. The industry has come a long way from, say, demand response that was telephone-dispatched and emergency-only.
Now, providers are helping utilities control tens of thousands of devices, increasingly via two-way communication over wireless internet, cellular or advanced metering networks.That's on top of millions of one-way legacy devices already installed that must be integrated into the more-modern networks.
“What we’ve seen within the demand response industry in the last couple of years is two shifts," said Steve Gore, director of technology architecture for Comverge. "One is on the device side. We’ve moved from the majority of devices being one-way, typically paging devices, to a huge amount of interest in the deployment of two-way devices.”
The second change is functionality. "Before, we had a load management systems that were really about sending one-way signals—exactly same signal," said Gore. Now, those systems can work with installation crews in the field, provide customer portals for device management and examine metering data for efficiency operators.
“The concept of a DRMS (Demand Response Management System) has been around several years now, though certainly earlier ones were a little more crude," said Brett Feldman, a senior analyst at Navigant whose research shows the market for demand response systems is about to enter a period of significant growth.
"The idea of a DRMS has expanded in the last couple of years," Gore said. "What we saw was two trends and we wanted to understand how well we could dispatch two-way devices using a more complex, more feature-complete demand response event system."
To that end, Gore has authored a white paper on how Comverge went about testing its IntelliSOURCE system's ability to control 100,000 devices—with a goal of sending a signal and receiving feedback within 120 seconds. The ability to scale up these utility systems will ultimately allow a much greater integration of the utility grid, giving utilities the ability to harness not just customers willing to modify their load but also batteries, renewable generation and more.
"We have customers using demand response as part of their contingency planning or as part of their economic trading," Gore said. "They need to be able to make quicker decisions and have their systems and devices respond in a shorter amount of time than they have in the past."
Comverge currently controls about 90,000 two-way devices for four customers, Gore said. With the largest of those customers bringing about 50,000 devices, the company's existing system should be able to handle near-term growth. And frankly, if the number of connected devices outstripped Comverge's abilities Gore said that would be a welcome challenge.
"We have plenty of runway with how our systems are deployed," he said, "but we'd be happy to have that problem."
A market poised for growth
Navigant's analysis predicts global spending on DRMS systems will rise from about $46.1 million this year to more than $230 million in 2025, with the biggest chunk of that spending occurring in the United States.
While the market drivers include DR integration, more efficient program management and lower costs, the complexity of bringing many different devices and systems together is a tall order, the report concluded. "DRMS integration takes time depending on how much existing infrastructure can be leveraged," the report concluded. "Interoperability with legacy systems ... is complicated and requires significant interactions with different departments in the utility."
A DRMS deployment can take anywhere from three months to three years, Navigant said, depending on the size of the program and the speed of the rollout.
“On the technical side, a big part is integration with the utility systems. A DRMS doesn’t work in a vacuum," Feldman said. New systems tackle meter data management and analysis of distribution system data, customer and operational systems.
“It ẗakes a lot of work and the bigger a program gets, the more complex it gets," Feldman said. "They key to me is the interoperability. It’s great to see one vendor can work out how to communicate with one device but that's not really sustainable as utilities want to offer more choice … As you have more diverse resources it’s really about being able to communicate with other devices."
Survey findings
In addition to the approximately 90,000 two-way devices Comverge manages, there are also more than 1 million one-way devices on the system. While the trend is towards devices capable of two-way data flows, the company still works with customers installing one-way devices as well.
Getting them to all work together is key to helping utilities maximize the value of their resources, and to that end Gore's white paper is a technical document focused on how the company went about testing its systems.
Spoiler alert: they performed well.
Comverge was able to demonstrate that its IntelliSOURCE system can send and receive 100,000 messages in less than 100 seconds. "This result met our goal and has surpassed all of our customer’s service level agreements," the company concluded in the white paper. But now the company is looking to expand on that test, first to include 500,000 devices and then 1 million.
"We have a lot of confidence that we’ll be able to scale to those levels," Gore said. But he also acknowledged, "100,000 devices is obviously a different number than 1 million. You start to run into infrastructure requirements." Scaling up that high impacts everything from memory requirements to data storage to networking, he said. "Those are the things we are continuing to look at and plan for as we look at and continue to scale."
There were lessons learned from the simulations—albeit, technical SQL programming lessons. While Gore's paper acknowledged that it is natural to implement a single function requirement as a single process, "at large scale, a delay in one operation (storing telemetry) can impact the other operation (receiving messages). Separating those operations into multiple processes connected by a queuing mechanism can alleviate this bottleneck."
Comverge is now using its DRMS to help Central Hudson Gas & Electric address grid weaknesses without investing in traditional infrastructure. This summer, the utility announced that, as a part of the state's Reforming the Energy Vision process, it had selected Comverge to help reduce 16 MW of load in three specific zones through its "CenHub Peak Perks" program.
The program is targeted. To participate, customers must be served by specific circuits, and residential participants must have central air conditioning or a swimming pool pump. They will then be provided with a wifi-enabled smart thermostat or a program efficiency switch, in addition to cash rewards. On the commercial side, business customers are offered a customized set of incentives based upon their equipment and operations.
What's ahead for scaling demand response?
As the grid becomes more integrated, demand response will need to be more nimble in order to wring out the most value. Historically, said Navigant's Feldman, programs were focused on capacity and emergency response.
"But now, with the integration of renewable energy and the need for frequency regulation, 10-minute response times and faster are needed," Feldman said.
PJM Interconnection has been considering shortening the lead-time for demand response in its enhanced Capacity Performance product - dropping standard times from two hours in some spots, to requiring almost an immediate response. That's a high bar, but the ability to connect more load-responsive customers to a fast-reacting system will ultimately help transform DRMS systems.
"You get a couple of different benefits as you add additional devices," said Gore. "One is your overall scale goes up. You have more capacity or energy you can trade in a market or you can count towards your operating reserves. But as you scale up, you also get much more flexibiliy."
While the largest demand response programs are still on the C&I side, residential programs obviously bring the potential to alter—if not outright control—millions of smaller loads. Typically that means greater customer satisfaction, as a demand response provider can harness the same or larger energy volumes through smaller tweaks of a customer's usage.
"The sizes for different uses tend to be different," said Feldman. "If you can get 1 kW in an emergency response program, maybe in a fast response program you only want a fraction of that."
But DRMS will remain, for now, a fairly small market, Feldman said, particularly on the residential side.
While on the C&I side there are programs aimed at faster DR response, “on the residential side, you don’t want to play too much with their thermostats," he said. "It’s better to scale up, aggregate and make smaller changes. ... You don’t want to be switching residential customers on and off. You want to be invisible.”
But as systems gain in complexity, expect the DRMS concept to merge with the similar-sounding Distributed Energy Resource Management Systems (DERMS) which perform a similar function across a wider range of resources that include distributed renewables, storage, demand response, microgrids and other grid-edge technologies.
“In the future, you’re really not going to be able to distinguish those two because it’s basically the same platform," said Feldman. “It will take a while to get there, but from a systems standpoint the architecture is pretty similar.”
"We are prototyping this kind of evolution today," said Gore.
"On the one hand, the idea of sending signals to devices that are behind the meter is very equivalent, if were talking a thermostat or a battery ... in that regard, it's not that big of a jump," Gore said " With [distributed resources] there is a lot more flexibility. In addition to energy and capacity there are a number of things they can do. In that regard, it is more complicated to figure out what these devices are doing. But it's still a natural extension of a DRMS."