COHO, Sockeye and Chinook If demand response were salmon, what would it look like in the pacific northwest? Stuart Schare Managing Director, Energy Northwest DR Symposium Seattle, Washington September 2016

What Is Demand Response? Changes in electric usage by end-use customers from their normal consumption patterns… … in response to changes in the price of electricity over time, or … to incentive payments designed to induce lower electricity use …at times of high wholesale market prices or …when system reliability is jeopardized What? Why? When? Source: FERC Examples: Direct load control of electric water heaters via RF paging Interruptible tariff credits for C&I Critical peak pricing Common element: DISPATCHABLE

With so many forms of demand response, How do you Navigate your way?

Evolution of demand response: where will the pacific northwest jump in? Interruptible tariffs for large C&I Phone call/pager Long notification & manual curtailment 1-way DLC for residential A/C and water heaters Capacity for planning & emergency needs DR in wholesale markets Increased automation and precision of curtailment Storage & load increase Ancillary services (near-instantaneous up/down) Behavioral/voluntary DR Smart thermostats 2-way communications Near real-time M&V and operations monitoring Source: Navigant Adapted from PLMA

Water Heaters Air Conditioners Central Heating Pool Pumps Residential demand response: the big four appliances Water Heaters Air Conditioners Central Heating Pool Pumps Winter load Shut off for events Daily load shifting Advanced control Sumer load “Cycle” on/off Potential in PNW? Fewer available loads HP auxiliary heating Baseboard heaters problematic Summer load Often on timers Little load in PNW

In the Beginning… There Was the Load Control Switch Demand Response Program Design & Implementation Training Course In the Beginning… There Was the Load Control Switch Simple but Effective Load switches on A/C and water heaters Cycling limits for A/C run time 1-way radio frequency or powerline carrier Switches installed outside the home 15 minutes on (max), 15 minutes off No way to know if load was curtailed 1-way means you don’t know whether customer was controlled. Can ID bad switches Mention Carrier’s 2-way…pros: ID receipt of signal, equip failures, use for some M&V/override info. Con expensive communications …this is lead in to evolution of technology via AMI and 2-way ©Peak Load Management Alliance 2015

Evolution of Residential DLC Programs Demand Response Program Design & Implementation Training Course Evolution of Residential DLC Programs Simple but Effective Load switches on A/C and water heaters Cycling limits for A/C run time 1-way radio frequency or powerline carrier Technology Advances Intelligent algorithms Control via “smart” thermostats Temperature offset strategies Internet-based control of thermostats 2-way communications possible but expensive 1-way means you don’t know whether customer was controlled. Can ID bad switches Mention Carrier’s 2-way…pros: ID receipt of signal, equip failures, use for some M&V/override info. Con expensive communications …this is lead in to evolution of technology via AMI and 2-way Early Years ’80s and ’90s The Technology Transition ~2000-2010 Latest Trend ©Peak Load Management Alliance 2015

Smart Thermostats: more than just a new way to do Load control

COMMERCIAL & INDUSTRIAL DR Evolution of C&I Demand Response Industrial/ Process Interruption Commercial (Partial) Curtailment Precision Management of Loads Large loads Proven Not flexible EVOLUTION Aggregated loads Automated response Moderate value Advanced controls & communications Select end uses High value

Commercial DR Event Processes Manual Control Semi-Automated Control Customer facility personnel… Shut off lights Change thermostat Shut non-critical equipment and processes Customer facility personnel... Engage BEMS to achieve lighting, cooling, process reductions BEMS pre-programmed with load-shed strategies Utility to customer Phone call Email Text message Automated outbound communication Utility  DRAS* to customer facility (via broadband) *Demand Response Automation Server Auto-DR DR event signal received by BEMS at customer facility BEMS initiates pre-programmed load shed strategy

Next on the dr agenda… Availability Year-round availability Dispatchable dozens or hundreds of times per year Speed of Response Response time < 10 min. Frequency/regulation response now possible Performance Ramp-up and down (“inc” and “dec”) Precision curtailment (MW) Real-time visibility from control room

Grid-Interactive Water Heating (GIWH) Two-way communications to/from the grid operator and water heater Automated signals from the grid “Up” and “Down” load control Appliance status to operator Increased energy storage Extra large tanks Super-insulated High temp (>50C) with mixing valve “Self-learning” of usage patterns

GIWH Storage and Dispatch GIWH as a wind balancing resource (Bonneville Power Administration) GIWH as a load following resource (PowerShift Atlantic, Canada)

Refrigerated Warehouses DR for Load Balancing of Wind Power Bonneville Power Administration (BPA) COLD STORAGE Refrigerated Warehouses PROCESS STORAGE Pulp and Paper Mill Equipment Enabled Compressors, evaporators Motors Load Control Measures Raise/lower set-point (~400 kW per facility) Turn on/off mechanical pulping motors (40 MW) DR Capability 10-minute bi-directional response INCremental Power to the Grid DECremental Power to the Grid (“Soaking up” excess renewables) Compliments of EnerNOC

“Firming” Renewables with Dynamic Load Response PowerShift Atlantic (Nova Scotia Power) 30 industrial sites 2,000 devices 15 MW of load 24x7 availability Individual Customer Loads System Operator Control Signal Aggregated Response (ENBALA Power Networks) Compliments of Enbala

Evolution of demand response: catch up to today before tomorrow leaves you behind Interruptible tariffs for large C&I Phone call/pager Long notification & manual curtailment 1-way DLC for residential A/C and water heaters Capacity for planning & emergency needs DR in wholesale markets Increased automation and precision of curtailment Storage & load increase Ancillary services (near-instantaneous up/down) Behavioral/voluntary DR Smart thermostats 2-way communications Near real-time M&V and operations monitoring One of many DERs DR prosumers provide grid services Continual DR response to price signals Localized distribution congestion management Source: Adapted from PLMA

Stuart Schare Managing Director 303.728.2504 stuart.schare@navigant.com