There have been some limited residential DR programs here in California aimed at air conditioning (AC) cycling, but these involved targeted groups of ratepayers and required special equipment to remotely control residential AC units.  Utilities are now looking at much more ambitious programs that impact most ratepayers – in the form of new pricing programs that more accurately reflect the time component of electricity generation.  The average Joe or Jane Ratepayer would be surprised to learn that generation of electricity has different costs at different times since this is not typically reflected in their current bills. 

Education is one of the three big challenges to implementing wide spread DR programs for residential use.  It will take time to communicate carefully developed messages that build the foundation of knowledge for residential ratepayers to appreciate the price variations in generation and the benefits of DR and dynamic pricing.  They will need exposure to messages like this one offered by CAISO in their December 2007 eGrid Technologies Help Achieve Environmental Goals report, “Demand reduction is just as effective, and often less expensive, than adding megawatts onto the grid and it doesn’t add a single pollutant.”

The second challenge focuses on the business model.  Proxy DR for residential participation requires new business entities called Demand Response Providers (DRPs) – enterprises that can aggregate enough consumers to represent the amount of electricity that can be bid into the retail market.  There are a few businesses operating in this market, but they are relatively new to the space, and there is much to learn about how to set up the most efficient and profitable model. 

The third challenge is technological.  Consumers will need robust and reliable HANS and easy-to-use HEMS applications to participate in DRP programs.  Their HANs must reliably communicate price signals and/or DR alerts to “enrolled” devices that can either automatically shut off or reduce their electricity use.  The HEMS applications must be simple to use to achieve the widest possible consumer adoption. 

One of the most interesting HAN technologies that promises that robustness and reliability is the Open Source Home Area Network or OSHAN.  Stay tuned next week for some more information about it.

Much like the familiar LANs or Local Area Networks, HANs are simply the same communications capability within a home.   Here is the definition of a HAN from the Smart Grid Dictionary:  “A network of energy management devices, digital consumer electronics, signal-controlled or enabled appliances, and applications within a home environment that is on the home side of the electric meter.  It can also be considered as a home-based LAN, but it connects more than just computers.  HAN specifications include Zigbee, HomePlug, Z-Wave and Wireless M-Bus (a wireless variant of M-Bus).” 

Instead of a network of servers, printers, copiers, and computers, the HAN connects devices that are capable of sending and receiving signals from a meter, In-Home Displays (IHDs) and /or HEMS applications.  While it is unlikely that in the future my refrigerator has anything interesting to say to my dryer, both devices should communicate with a smart meter or an IHD to identify start times or learn operation parameters that were set up by my HEMS application. 

Wired or wireless, there are tradeoffs that involve power consumption, signaling distance, sensitivity to interference, and security.  The main point here is that HANs are not energy management applications – they enable energy management applications to monitor and control the devices on the home network. 

HANs and IHDs still need an energy management application – a HEMS solution – in order to gain the most benefit from these Smart Grid components.  IHDs are great devices, but have limited data input and display capabilities – in fact some do nothing more than provide a visual indicator of the electricity rates at any point in time.  A HEMS web portal is the best interface to the utility billing and Demand Response programs – it enables the easiest designation of intelligent appliances that can be “enrolled” into utility demand response programs.  The HEMS solution allows me to “set and forget” my appliances’ operations, get suggestions on energy efficiency improvements, and see how my energy management compares to others in my peer group or neighborhood.      

What are the other features I’d like to see in a HEMS solution? 

• Open, non-proprietary, and standards-based software
• Simple and intuitive user interface
• Delivers user-definable information to a selection of IHDs
• Support for IHDs that combine HAN gateway and HEMS display capabilities
• Controls any manufacturer’s intelligent appliances
• Contains HAN diagnostics
• Easy to deploy and upgrade
• Secure access to utility billing system to view bills
• EV charging management
• Micro generation and energy storage management and diagnostics

Some of these capabilities are available now from a number of HEMS providers, but others are future capabilities and will be for quite some time.  I’ll talk about other desirable HEMS capabilities in next week’s blog.

Fortunately, there are very smart and dedicated people working with great speed and purpose on establishing standards for interoperability and cybersecurity.  The National Institute of Standards and Technology (NIST) has a leading role in developing national Smart Grid interoperability standards for the USA.  Working in close coordination with major stakeholders like utilities and industry vendors, NIST has a 3 phase plan to build consensus on existing standards for interoperability and cybersecurity and an interim roadmap; facilitate public/private panels to drive harmonization of standards and evolution of technologies to those standards; and then develop a plan for a test and certification framework.    The interim roadmap was published late last week and is available for public view at http://www.nist.gov/smartgrid/InterimSmartGridRoadmapNISTRestructure.pdf.  It’s an interesting read!

Now on to standard thinking.  We all have great expectations of the technological advances that the Smart Grid can deliver.  It appears that at least some technology vendors and utilities have great expectations of consumers too.  At a recent conference, an oft-cited example of demand response and how price changes will drive consumer behavior concerned laundry.  In this example, it was predicted that consumers will choose to do their laundry at midnight when rates are lowest rather than another time of day (or night).  Hello???? Here are three reasons why this is a really great example of bad standard thinking:  1)  who is getting up at 1AM to move clothes from the washer to the dryer?  Or is that what the live-in maid is supposed to do?  2)  many multi-tenant communities (like my condo association) don’t allow laundry after 9pm because of noise.  3)  Midnight is not the best time to line-dry clothes – especially for consumers who are fortunate to have outdoor lines.  I don’t know about you, but I like to hang laundry outside in daylight hours when I can see what I’m doing. 

So here’s my plea to the technology vendors - get past the standard thinking.  Its not about what the technology can do, its about what people can and will do with the technology.