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Subject: RE: [emix] Baselines and Relative and Absolute Deltas
Not that this is entirely on-track with
the conversation but tangentially, perhaps: Smart Grid Today paraphrased Susan
Swan, the VP of smart grid development for Consumers Energy (Michigan): “Most
commissions are opposed to customers incurring huge penalties if they do not
respond to signals asking them to use less power certain times of the
day. With dynamic pricing rates, it is altogether a better idea to give
customers rebates and other incentives for modifying their use during peak
periods.” Source: http://www.smartgridtoday.com/public/1753.cfm
This is perhaps a model that needs to be a
part of the mix (the eMIX). While it’s regulatory and
business-practice –oriented, it is something that, perhaps, needs to be
conveyed in a standard format. For example, where a utility says that 4pm
to 6pm Thursday is a “critical” period for them: for every kW the No solutions from me at the moment; just
sharing thoughts to get ideas rolling. - Jeremy Jeremy J. Roberts Technical Director LonMark International From: Phil Davis
[mailto:pddcoo@gmail.com] Rish, I think we agree with perhaps some
difference in detail. OpenADR was developed around a retail relationship
(IOU’s to the end user). As an event signal management mechanism,
it works well, largely because it is easy to understand and to implement.
There are a number of other examples of retail relationships to end users
(other utilities, aggregators), mostly with proprietary systems that
essentially convey the same data. It would not surprise me to see OpenADR
used in some of those cases outside In the case of price, the LMP advanced by
FERC is a wholesale number. The case of multiples over a base is a Obtaining a ratified standard based on
FERC direction in wholesale seems a more efficient path to an approved
standard. At the same time, might it be meaningful to establish some
empty user-defined fields that those playing in retail can use for extensions
to the standard? This would allow us poor downtrodden manufacturers of
equipment to begin the development cycle for smart grid in a meaningful way. Thanks! Phil From: Girish Ghatikar
[mailto:gghatikar@lbl.gov] Phil, On Sun, Jun 27, 2010 at 11:30 AM, Phil Davis <pddcoo@gmail.com> wrote: Rish, I agree with you within the retail context, but am not aware of any
examples in the wholesale context (but would like to know of them outside of
VAT's). The retail context is almost entirely governed by state regulatory
commissions while wholesale largely is the province of a single agency, FERC.
My recommendation is that we work from the simple (wholesale) to the
complex (retail). Otherwise, I fear we will have what mathematicians
refer to as an imponderable. A multiplies is an expression of social policy that operated
independently of price. Otherwise, you have to know the current price
(set by orders to sell=orders to buy), as well as an arbitrary "base
price" (who decides and under what authority?), and then do the
calculation to arrive at the multiple. This strikes me as requiring two
additional calculitic steps that aren't necessary (since you already have
access to the current price. I can see where derivatives of a ratio of current price to
base price could be useful for analysis and strategy, but these would occur in
systems other than energy management. I think... Phil
On Sun, Jun 27, 2010 at 11:57 AM, Girish Ghatikar <gghatikar@lbl.gov>
wrote: Phil and Toby, On Sun, Jun 27, 2010 at 7:23 AM, Phil Davis <pddcoo@gmail.com> wrote: Toby, Lest we develop a whole new financial schema, perhaps we can
benefit from existing practice in other commodities trades. Does anyone
know if multiples are used elsewhere and for what purpose? The only
instance of multiples as a signal for energy (that I am aware of) is in Any discussions we have for that type of environment are purely
academic. PUC decisions on the matter will result from the normal process
of interveners and politics. I am familiar with at least one IBM plant
that is charged for electricity as a function of the amount of water consumed
by its chillers. The tariffs written for local economic development
purposes truly can be bizarre. This is why utility billing systems are so
costly and why each is unique. At least for this phase, it might be more productive either to
restrict our activities to wholesale market constructs, or to distinguish
between wholesale and retail transactions. In the latter case, we should
invite heavy input from NARUC and EEI (and similar). Also, since “baseline” has such a specific meaning and
wide adoption with regard to a demand profile, might it be preferable to use
another term for pricing, such as “reference price”? Since FERC’s current NOPR deals with Locational Marginal
Price, my belief is that we will have much difficulty with any construct based
on another pricing concept. Since LMP itself can be volatile intraday,
using a multiples approach would add complexity to complexity and you’d
still have to track the value of LMP anyway. Multiples can make sense at the retail level since either tariffs
or contracts (from REPs) tend to talk in specific dollar values. However,
billing systems in those environments can have a unique rate for each
customer. The ability to do this is at the heart of a competitive
retailer’s “differential advantage”. The best approach for
the retail side might be to define “fields to be used later” in
their layouts. Reactions? Thanks! Phil ________________________________________________________________________________________________ From: Toby Considine [mailto:tobyconsidine@gmail.com]
On Behalf Of Toby Considine A continuing point
of contention is unspecified prices that are changes from current prices. I
want to start a conversation on baselines and relative and absolute change. As I understand
the argument, there are times when it would be simple to send out a signal to
everyone announcing that something is going to change. Whether you currently
buy power at 0.02, o.08, 0.20, or 0.45 $ per kW h, you will experience a price
change. Such a change could be one of two forms. (1) Relative:
All prices double at 3:00 this afternoon (2) Absolute:
App prices go up by 0.25 this at 3:00 this afternoon. Do we need both
(assuming we need either)? I think it is essential here that we are discussing
functionality and information required, and not discussing whether it is
possible to communicate some price signal that was created to make sense at a
PUC meeting as a way to juke the existing systems which only had one register
free and that worked as a plausible hack on existing software and
hardware—which is alas how many tariffs get written. Discussion: 1) Relative
can be handled with no changes to the existing data structures, but with the
creation of a special currency case, the “baseline”. Prices at 2:00
AM are .3 baselines. Price this afternoon is 1.4 baselines. This can make a
clean set of rules for systems to optimize energy use over a 24 hour period. 2) Delta’s
require more facts. It is unclear whether a rise of /50/kW H is interesting
without special knowledge. Each system would need to hold occult knowledge,
i.e. what was the price before. Is this change insignificant or is it a
several-fold change in price? Delta’s also require a larger change in the
base communication—it needs additional fields (and complexity and a new
source of ono-interoperation). I would prefer no
baseline pricing. I know others fell that we need relative pricing. I am
stepping back from that argument for a moment. The question here
is what does relative pricing look like, and what is the simplest kind of
relative pricing we can use. “It is
difficult to get a man to understand something, when his salary depends upon
his not understanding it” -- Upton Sinclair.
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