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Subject: RE: [smartgrid-discuss] Pricing standards
-------- Original Message --------
Subject: RE: [smartgrid-discuss] Pricing standards
From: "Considine, Toby (Campus Services IT)" <Toby.Considine@unc.edu>
Date: Fri, December 12, 2008 2:48 pm
To: 'Larry Lackey' <llackey@tibco.com>, "David RR Webber (XML)"
<david@drrw.info>
Cc: Multiple recipients of list <b2g_interop@nist.gov>,
"smartgrid-discuss@lists.oasis-open.org"
<smartgrid-discuss@lists.oasis-open.org>
Today, there is no market for local energy storage, because for most people, the price incentives to take advantage of the daily price swings are not there. I believe that a second stage effect of dynamic pricing will be to create markets for storage, big ones.There is the traditional:- “car Batteries” – lots of them
- Capacitors
- Fly wheels
- Ice makers on each floor to support A/C (offered by Trane since the 60’s in a market that never went anywhere)
There is the newer stuff- Sub-basement filled with vanadium chloride solution to provide week-long battery
- Compressed air
- Icy brine in basement
- Thermal storage, especially as a recycling strategy
There is even the old fashioned methods like the water tower to store wind power that we had on the ranch in the high chaparral when I was little. We do not know what this market will look like. It has fewer constraints then the mobile market, but larger capacity. Of course, in many parts of the country, any building which does any storage, cannot sell to the grid. That is a regulatory issue, and outside this forum.With the right informational interface, though, we can, as Krupp at the EDF says, fully unleash the awesome creative power of entrepreneurial capitalism on local storage…Third generation effect: the grid now has buffers. The grid with buffers is a whole new game. The rations of those who select “Must Have” vs. “When Available” changes entirely.This third generation is starting to look like the new e-tech revolution. Do not believe anyone who claims they know the market dynamics of e-tech.But it starts now, with creating lightweight service oriented interfaces for the sales, acquisition, bidding, and allocation of power that are market enabling, without presuming what that market looks like.tc
"A man should never be ashamed to own that he has been in the wrong, which is but saying ... that he is wiser today than yesterday." -- Jonathan Swift
Facilities Technology Office
University of North Carolina
Chapel Hill, NC
Phone: (919)962-9073blog: www.NewDaedalus.comFrom: Larry Lackey [mailto:llackey@tibco.com]
Sent: Friday, December 12, 2008 1:17 PM
To: David RR Webber (XML); Considine, Toby (Campus Services IT)
Cc: Multiple recipients of list; smartgrid-discuss@lists.oasis-open.org
Subject: RE: [smartgrid-discuss] Pricing standards
Recently financial markets have experienced similar problems with what they call counterparty risk and settling trades.A corrective action currently underway provides clearing houses for settlement, for example:Larry
From: David RR Webber (XML) [mailto:david@drrw.info]
Sent: Friday, December 12, 2008 10:25 AM
To: Considine,Toby (Campus Services IT)
Cc: Multiple recipients of list; smartgrid-discuss@lists.oasis-open.org
Subject: RE: [smartgrid-discuss] Pricing standards
Toby,This brings up the issue of guaranteed delivery. When I contract I can choose if I have a "must have" or a "when available" delivery. So for example - Hospitals, Emergency services, etc would be priority must have delivery centers, as would emergency devices - such as water pumps, etc.If I turn my dryer on - that would be a device I could designate as a "when available" - so command signals could shut it off remotely until load decreased or more power is available.This is a complete paradigm shift in how power gets delivered.The good news with power is it is a heck of a lot easier to route and share than apples from Washington!Thanks, DW-------- Original Message --------
Subject: RE: [smartgrid-discuss] Pricing standards
From: "Considine, Toby (Campus Services IT)" <Toby.Considine@unc.edu>
Date: Fri, December 12, 2008 10:16 am
To: Multiple recipients of list <b2g_interop@nist.gov>,
"smartgrid-discuss@lists.oasis-open.org"
<smartgrid-discuss@lists.oasis-open.org>Is DR a charge, or is it an incentive. I am of the opinion that it is an incentive.Here is the logic.Last week I contracted with my supplier to get apples at a given price each week. Based upon that price I ran store specials and pre-sold apple pies for Christmas. This week my supplier alerts me that he cannot fulfill his contract, and I start looking for liquidated damages…Instead of merely stiffing me, the supplier calls all the apple stands and bakeries in the city and sees which ones are willing to sell back the apples they have contracted for. The initial contract was for $1 a bushel, and he needs to buy them back for $1.50 a bushel, but it is worth it to keep the customers happy with the supplier., and to avoid liquidated damages.Alternately the supplier could find another source of apples in Washington State and pay extraordinary shipping charges to make the original contractI would argue that in traditional GAAP, the sales are still at a dollar a bushel. I could chose to add the shipping charges to Costs of Goods Sold, or I could create some sort of extraordinary cost line to hold the emergency buy-backs.If I understand the various market operation DR scenarios…- Supplier could send around a notice of willingness to buy out of previous contract.
- Supplier could have a Dutch auction until the clearing market for additional buyers is found
- Supplier could exercise existing call options on certain customers to get the apples to meet the contracts.
Whether the existing customer just happens to be the one who has advertised the apple buys for sale, i.e. is the customer who was being shorted is an irrelevant detail.This removes DR from Egg Math into a simpler model of two transactions that may happen to be with the same person…and I believe eliminates the difficulty you outlinetc
"A man should never be ashamed to own that he has been in the wrong, which is but saying ... that he is wiser today than yesterday." -- Jonathan Swift
Facilities Technology Office
University of North Carolina
Chapel Hill, NC
Phone: (919)962-9073blog: www.NewDaedalus.comFrom: b2g_interop@nist.gov [mailto:b2g_interop@nist.gov] On Behalf Of David Holmberg
Sent: Wednesday, December 10, 2008 3:21 PM
To: Multiple recipients of list
Subject: Re: [smartgrid-discuss] Pricing standards
Hi Toby,
How do you see demand charges fitting in with dynamic pricing? Whoever manages the distribution system has to be able to price electricity at a local level (or customer level) for demand. So the price has a location field, or customer code, or what? How do we get a local price distributed to a specific customer or locality? How does the distribution system owner communicate demand charge information to the market to effect price changes?
Speaking of locality issues, you raised the issue of emergency response needing building address or some GIS polygon, and similar information for utility operations (e.g., outage management, voltage sag). How are these similar, how different? Seems that emergency response is largely focused on address, versus utility operations which might be substation focused, or down to the meter level (which is address of course). Do we use geospatial coordinates for the front entrance, the meter, and for a polygon area when required? What does that have to do with a distribution circuit?
You just raised the issue of quantity, which I hadn't included. The idea of getting a cheaper price if you buy in bulk. So, price depends on (1) where you are and (2) how much you use in addition to (3) source properties and (4) quality.
Perhaps we keep a bill broken out as mine is according to generation charge, transmission charge, and distribution charge.
- The main component of price is generation and this covers source properties and quality
- transmission charge would cover distance from source
- distribution charge would include demand charges due to distribution system constraints (but I'm pretty ignorant about what else demand charges might cover)
- plus there might be a % discount based on quantity
Some thoughts for now,
David
At 11:32 AM 12/10/2008, Toby Considine wrote:I think we have to remember that we get the greatest interoperability from a *light* interface.
I may price my power because of a Utah mandated Tariff. To the California buyer, this is merely a price. If I am doing distributed generation from the Home Owner's Association of the recently built Off-TheGrid Neighborhood produced by [Comodity Homebuilder here], I may price my power based upon whether running the wind turbines does a better job of keeping Canadian Geese of the lawns….
The DR customer/recipient does not care how you came up with the price. In particular, I doubt that the decision maker receiving OpenADR price signals going to the Target Office in Minneapolis for stores in California cares at all which tariffs in California generated the prices. That decision maker is inward looking at his own business processes. What portion of the cost of my eggs at the store is due to feed or to shipping or to reduced margins during market surplus?
The supplier need to know how the supplier is pricing wares. The buyer needs to make bids and be held to them. And that's all. And pricing in this way is common for I2g/B3G/H2g/V2g…except where quantity discounts apply, which may be for I2g.
On Wed, Dec 10, 2008 at 8:45 AM, John Gillerman <johng@sisconet.com> wrote:David,
I am new to this group. Just to provide some background, I am on IEC TC 57 WG 13, 13, 16, and 19.
Your doc mentioned TC 57 so I thought I would forward two things that I think are relevant:
1) A recent copy of the IEC 61970 Common Information Model. This is the data model described in UML that TC 57 uses for enterprise integration. There is some modeling related to schedules in the CIM. This is an Enterprise Architect file.
2) A recent paper about ADR. This paper discuses the use of OPC Unified Architecture (OPC UA). OPC UA is the web services version of the services IEC 61970 specifies for exchanging CIM data. OPC UA is also known as IEC 62541. While OPC UA is new, it is likely to be widely supported by industrial control system vendors. As such it is a good choice for DR related communication with industrial customers.
You should know that EPRI and the IEC are beginning to actively work in this area. We probably want to figure out how things fit together at some point so that we don't end up doing the same thing twice.
Regards,
John Gillerman
SISCO
T: 732 937-9745
F: 586 254-0053
M: 732 979-9595
From: David Holmberg [mailto:david.holmberg@nist.gov]
Sent: Tuesday, December 09, 2008 3:08 PM
To: smartgrid-discuss@lists.oasis-open.org; b2g_interop@nist.gov
Subject: [smartgrid-discuss] Pricing standards
All,
As part of the discussion on smart grid economics, in addition to schedules is the more general topic of pricing. I have written up some thoughts on what we need to do to move forward on pricing. Part of this is getting some standardized schedule as Toby mentioned. Perhaps a pricing standard will end up in OASIS as well. Does everyone know about the GridEcon meeting being planned for March in Chicago? The plan is to come with a pricing proposal in hand to that meeting, and I believe there is significant work to tackle prior to that time. Your input is appreciated.
David
David Holmberg
NIST Building & Fire Research Lab
Building Environment Division, Mechanical Systems and Controls Group
100 Bureau Drive, Bldg. 226, Room B114, MS 8631, Gaithersburg, MD 20899-8631
TEL: 301/975-6450 FAX: 301/975-8973
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________________________________________
"When one door closes, another opens; but we often look so long and so regretfully upon the closed door that we do not see the one which has opened for us." -- Alexander Graham Bell
________________________________________
Toby Considine
Chair, OASIS oBIX TC http://www.oasis-open.org
Co-Chair, OASIS Technical Advisory Board
Toby.Considine@gmail.com
TC9, Inc
Phone: (919)619-2104
blog: www.NewDaedalus.comDavid Holmberg
NIST Building & Fire Research Lab
Building Environment Division, Mechanical Systems and Controls Group
100 Bureau Drive, Bldg. 226, Room B114, MS 8631, Gaithersburg, MD 20899-8631
TEL: 301/975-6450 FAX: 301/975-8973--------------------------------------------------------------------- To unsubscribe, e-mail: smartgrid-discuss-unsubscribe@lists.oasis-open.org For additional commands, e-mail: smartgrid-discuss-help@lists.oasis-open.org
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