world bank brown bag lunch discussion global progress...

World Bank DiscussionGlobal Progress Towards Smarter Grid Cities and

Their Enablement of Energy Efficiency

January 27, 2010

Copyright © 2009 Accenture All Rights Reserved.2

Introduction and Discussion Context

Discussion Topics

• Introduction and Discussion Context

• Demand Side Management/Energy Efficiency Findings

• Accenture Point-of-View and Conclusions


Copyright © 2009 Accenture All Rights Reserved.Copyright © 2009 Accenture All Rights Reserved.Copyright © 2009 Accenture All Rights Reserved.


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Accenture Smart Grid Services (ASGS) Overview

ASGS is a dedicated practice within Accenture focused on smart grid and infrastructure

modernization for utilities

4

Accenture Smart Grid Services

• 500+ people working on smart metering/smart grid utility projects

• Accenture has led roughly 40 Smart Grid/AMI projects over the past three years ranging from

strategy development to implementation

• We are the advisor to the World Economic Forum on smart grid

• UK’s Department of Energy and Climate Change selected Accenture to provide strategic consulting

on the planning and implementation of smart grids in the U.K.

• 0 2 4 6 8 • 11.3

• DRAKE V 1.2 June 24, 2004 SE&G Primary System

• 0 2 4 6 8 • 11.3

Customer Care

Transformation

as a result

of AMI/DSM/EE

initiatives

CIS

Implementation

Program

Management

& Metrics

Achievement

Security

&

Access

Management

Grid Analytics

& Renewable

Integration

Work

ManagementField Force

Automation

Asset

Management

Customer Facing SG Services SG Program Services SG Operational Services

AMI,

DSM/Efficiency

Implementation

Copyright © 2009 Accenture All Rights Reserved.


A number of macro forces are compelling

utilities to modify their existing operating models

5



Smart Grid Outcomes and Value

Outcomes

and

Value

Increase customer

satisfaction

Improve reliability

Support regulatory

/societal mandates

Increase

revenue/new

business

Optimize

Cost to Serve

• Enables customers to reduce energy bill and encourage

conservation

• Provides more accurate information on outages, billing

• Improve service order response

• Enables environmental choice

• Ability to improve customer side operations

• Supports building renewable generation (wind, distributed energy)

• Facilitates wholesale market efficiency

• Enables demand response

• Key component of carbon reduction agenda

• Reduce field and call center labor

• Reduce credit/collection cost

• Increase billing accuracy

• Reduce line losses

• Defer capital investment

• Decrease outage duration with self-healing grid and predictive

outage restoration

• Decrease outage frequency with better system planning, proactive

maintenance and asset management decision-making

• Decrease lost revenue/theft

• Energy-related products/services (e.g., DSM, CPP, TOU)

• Advanced home services

• Infrastructure growth

6


A Smart Grid is a power grid that uses sensing, embedded processing, digital communications, and software to manage network-derived information, thus making itself:

7

Observable

measure the states of all

grid elements

Controllable

affect the state of any grid element

Automated

adapt and self-heal

Integrated

connected to utility

processes and systems

These capabilities support the three major business functions of the T&D utility: power delivery, asset management, and consumer experience enablement.


Smart Grid Definition



Smart Grids Represent Utility Model of the Future

SmartD

Substation

SmartT

Substation

SmartT

Substation

SmartD

Substation

Grid-based

renewables

Grid-based

storage

Nuclear

Power Plant

Coal & Gas

Plant with CCS

Natural Gas

Transmission

CO2 Transport for

Sequestration

Tidal Power

Hydrogen, biofuels and gasoline/diesel distribution infrastructureH2 production –

electrolysis

Direct H2

production –

Gen IV

H2 production –

electrolysis

Direct H2

production –

Gen IVBio-fuels

Production

H2 production –

electrolysis

Direct H2

production –

Gen IV

High Temp

Super

Conductor

Super Grids

HVDC link to

neighboring

grids

CHP/District

heating

network, DC

Micro Grid

Embedded

renewables

Embedded

storage

Photo Voltaics

Heat pump

Smart

Sensors

Automatic

Fault Isolation

Smart Buildings

Smart Homes

Fault

Location

Sensors,

Smart Switches

Highly insulated

housing structure

Micro

generation

Photovoltaic

roof tiles

Dynamic control

of refrigeration

and HVAC

In-house

data on

usage and

costs

Demand side

management

High efficiency

appliances

Plug-in hybrid

Wind Farm

Wind Farm

Fault

Location

Generation

Transmission & Distribution

Retail

Utility Model of the Future



Accenture Smart Grid Projects - North America

So Cal Edison: MDMS strategy, AMI business

case assessment; regulatory filing support

Sempra Energy: AMI integration to CIS

Xcel Energy:

Smart Grid City

PECO: AMI assessment, fit-

gap analysis

BGE: Overall program

management, Systems

Integration for AMI and DR

programs

Dominion: Smart meter

strategy and business case

ComEd: AMI,

MDM and ESB

implementatio

n

Enbridge: MDMS

implementation

PSE: Meter-to-cash/smart

meter assessment

Power Stream: Hosted MDMS operations

Newmarket-Tay Hydro: Hosted MDMS

operations

Thunder Bay Hydro: Hosted MDMS operations

Duke: Smart

grid strategy

and MDMS

integration

e.on:

Smart grid

strategy

National Grid:

Smart meter

strategy &

business case

CL&P:

Demand

response / AMI

pilot

PG&E: AMI integration,

smart grid and HAN

strategy

PSEG: Smart meter

strategy & business

case

PPL: Program

Management

support, Change

Management, and SI



Accenture Smart Grid Projects – Global

Enel: Operate and maintain MDM

solution for 30+M AMI implementation

ERDF: AMI strategy and program

management

City of Amsterdam: Smart Grid City

Implementation

Alliander: Smart metering transformation

Delta: Delivered head-end implementation

for 200K households

Rhein Energie: Smart metering strategy

Light S.A.:

MDM

implementatio

n and

integration to

SAP IS/U

SP AusNet: SAP ISU with an interface to

eMeter’s Energy IP for >1M smart meters

Jemena: SI for a 1.1M meter deployment

Eskom: PM and SI

for smart metering

and load control

implementation

State Grid of

China: Smart

Grid Strategy

CLP: Smart Grid

Strategy

Scottish & Southern: Hosted and implemented a MDM for a 10K meter deployment

Scottish Power: Smart Buildings / white label services

ESB: Designed smart metering structure, processes, and AMI requirements

National Grid: Smart Grid Strategy and business case

United Utilities: Strategy and MDMS evaluation

EDF: Managed a 300K meter pilot

BT: Communications strategy

https://www.nationalgridus.com/

http://www.cgc.enbridge.com/index.html

http://www.comed.com/Pages/home.aspx

http://www.jemena.com.au/Index.aspx

http://www.sp-ausnet.com.au/

http://www.scottishpower.com/default.asp

https://www.nationalgridus.com/

http://www.esb.ie/main/home/index.jsp

http://www.bt.com/index.jsp



Discussion Topics




• Open Discussion


AMI (DSM Efficiency) Initiatives and Results

DR Reductions Requires Integration of Rate and Tech. Design

Source: Accenture analysis and Piloting the Smart Grid, Ahmad Faruqui, Bryan Hledik and Sanem Sergici

The typical reductions seen in traditional DSM programs are not enough to

achieve a number of the demand reduction requirements that are emerging.

Pricing changes of 10x current prices on peak are required to get 15+% reductions.

-30.0%

-25.0%

-20.0%

-15.0%

-10.0%

-5.0%

0.0%

% C

ha

ng

e i

n P

ea

k D

em

an

d

Average Customer Cust w/ CAC Cust w/o CAC

Average Customer 0.0% -3.8% -6.2% -7.9% -9.3% -10.4% -11.4% -12.3% -13.0% -13.7% -14.3% -14.9% -15.4% -15.8% -16.3%

Cust w/ CAC 0.0% -6.3% -10.2% -13.1% -15.4% -17.3% -18.9% -20.2% -21.5% -22.5% -23.5% -24.4% -25.2% -26.0% -26.7%

Cust w/o CAC 0.0% -2.3% -3.7% -4.7% -5.5% -6.2% -6.7% -7.2% -7.7% -8.0% -8.4% -8.7% -9.0% -9.3% -9.5%

$0.13 $0.23 $0.33 $0.43 $0.53 $0.63 $0.73 $0.83 $0.93 $1.03 $1.13 $1.23 $1.33 $1.43 $1.53

% D

em

an

d R

es

po

ns

e Im

pa

ct

Critical Peak Price Responsiveness Technology impact on Demand Response

0%

10%

20%

30%

40%

50%

Series1 0% 8% 18% 29% 30% 46%

Series2 0% 3% 8% 16% 21% 32%

Series3 0% 5% 13% 23% 26% 39%

Baseline TOU PTR CPP TOU w/ Tech CPP w/ Tech

High

Low

Mean

Technology impact

Technology

impact

TOU

CPP

21%

16%



Number of DR* Trials Completed Across the Globe

Demand response trials completed across the globe have demonstrated demand

response benefits in the range of 5 – 50% reductions in peak & non-peak loads.

* DR = Demand Response

U.S:

• CA: City of Anaheim

• CA: Automated Demand Response Pilot

System (ADRS)

• CA: State-Wide Pricing Pilot

• CO: Xcel Energy TOU Pilot

• FL: Golf Power Select Program

• ID: Power Company Energy Watch Program

• IL: Energy Smart Pricing Plan

• MS: Ameren Critical Peak Pricing Pilot

• NJ: GPU Pilot

• WA (Seattle): Puget Sound (PSE) TOU

Program

• WA: The Olympic Peninsula Project

Canada:

• Ontario: Hydro Ottawa

Australia:

• Country Energy

• Energy Australia

• Energy Australia’s Network Tariff Reform

Europe:

• Norway

• France: Electricite de France (EDF) Tempo Program

Source: Brattle Group’s “Unlocking the €53 Billion Savings from Smart Meters in the EU” – Oct 2009



Demand Response Pilot Savings

* Assumes no ARRA or any other type of government funding or subsidy; Capital costs include Program Management for deployment

** Does not include any incremental operational expenses, including maintenance, associated with deployment of Smart Technologies

Note: Assumes base tariff of ¢11.26 per kWh; Annual consumption of 10,000kWh; Load Shape from Southeastern Utility

Source: Accenture Analysis

Average Reductions in Usage During Peak Times

Projects included above:

Rate Design

Number of

Observations Mean

95%

Lower

Bound

95%

Upper

Bound Min Max

TOU 5 4% 3% 6% 2% 6%

TOU w/Technology 4 26% 21% 30% 21% 32%

CPP 8 17% 13% 20% 12% 25%

CPP w/Technology 8 36% 27% 44% 16% 51%

• AmerenUE Residential TOU Pilot Study

• Anaheim Critical Peak Pricing Experiment

• BGE Smart Energy Pricing Pilot

• California Automated Demand Response System Pilot (ADRS)

• California Statewide Pricing Pilot (SPP)

• Electricite de France (EDF) TempoProgram

• Energy Australia’s Network Tariff Reform

• GPU Pilot

• Idaho Residential Pilot Program

• Olympic Peninsula Project

• Ontario Energy Board Smart Price Pilot

• Public Service Electric and Gas (PSE&G) Residential Pilot

Program

• Puget Sound Energy (PSE)’s TOU Program

• The Community Energy Cooperative's Energy-Smart Pricing

Plan (ESPP)

• The Gulf Power Select Program

• Xcel Experimental Residential Price Response Pilot Program


The best results (17-35% reduction on peak) are achieved when

customers are provided information through value based

interactions that are enabled by both price and technology.

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

Newfoundland Power

Hydro One T

OU 1

Hydro One R

TM

BC Hydro

Woodsto

ck Hydro

SRP

Country Energy

Hydro One T

OU 2

Co

nse

rva

tio

n I

mp

act

(%

)

IHD-Only Impacts IHD and Prepayment

Impacts

IHD and Time-Varying Rates

Impacts

Role of Technology on Pilot Program Impacts

0%

5%

10%

15%

20%

25%

30%

35%

40%

PSE&G (TOU) PSE&G (CPP) CA SPP (CPP) AmerenUE-2004

(CPP)

AmerenUE-2005

(CPP)

Pilot Program

% R

ed

uc

tio

n i

n L

oad

No Technology

Technology

Consumers conserve when their usage is displayed…

…and respond dramatically to dynamic price

signal and enabling technology…

2-18%

range

12-17% price

17-35% w/tech

• Pilots’ widely varying results on conservation and

demand shift owe to their specialized design

objectives:

• Display centric pilots have not been tested

with smart rates, and rarely with enabling

technology (e.g., smart stat, controls)

• Dynamic pricing have been tested with

enabling techs but not with display impact

• Limited sample size make extrapolation across

customer segments and end use/geographic

situations difficult

• SGC Boulder will be first “pilot” at scale to testing all

4 major components of customer value proposition:

• Display (Prius effect) = awareness

• Smart Rates (inclining block) = price incentive

• Enabling Premise Techs = facilitate response

• DSM/EE Programs = lock in/amplify usage cut

• Large customer benefits in bus case predicated on

accelerated penetration - > requiring “campaign-style”

rollout of tailored value props to priority segments

• Increased scrutiny/mandates for customer outcomes

likely including incentive/penalty structure –

establishing fair baseline expectations imperative and

dependent on robust pilot design to increase

confidence level

Source: Brattle Group15



Number of Lessons Learned from DR Pilots

Lessons Learned Implications

• There is conclusive evidence that

households (residential

customers) respond to higher

prices by lowering usage

• The magnitude of price response

depends on

– The magnitude of the price

increase

– The presence of central air

conditioning

– The availability of enabling

technologies such as two-

way programmable

communicating thermostats

• Time-of-use rates induce a drop in peak

demand that ranges between 3-6%

• Critical-peak pricing tariffs induce a drop

in peak demand between 13-20%

• When accompanied with enabling

technologies, the CPP tariffs lead to a

drop in peak demand in the 27-44%

range

• Consumers who actively use an IHD

reduce their consumption of electricity

on average by 7% and 14% when

prepayment of electricity is and is not

involved, respectively



Discussion Topics


• Smart Cities Initiatives and Results – 2 case studies



• Open Discussion


Accenture Point-of-View and Conclusions

Smart Grids Represent Fundamental Paradigm Shift

• Potential of smart grids to drive energy

efficiency is limitless

• Operationalizing & fully realizing

benefits requires paradigm shift

• Most utilities do not possess requisite

capabilities in-house

• Consortiums, partnerships, and

alliances key to smart grids

• Deployment of end-to-end smart grids

capabilities is evolutionary

• True value lies in beyond-the-meter

applications (customer value)

• Customer privacy issues will continue

to be an issue to manage

• Do not underestimate power/influence

of regulators & authorities

Smart Grids Lessons Learned Smart Grids CSF’s*

* CSF’s = Critical Success Factors

• Engage state and local regulators and

authorities early

• Proactively work to align various

stakeholder interests

• Get and stay ahead of state and local

regulatory filing deadlines

• Assure consortium partners bring

‘right’ capabilities to table

• Secure stable and requisite funding

sources up-front

• Be clear on aspirations, vision, and

benefits hypotheses

• Undertake pilot approach to minimize

deployment risks

• Track smart grids results early & often

• Expect the unexpected!!!



As a result of the Smart Grid Technologies, the

following Stakeholder Groups are most impacted

19



Customer Adoption Journey to Energy Consumerism

• Budget billing programs that

disconnect energy costs from

consumption

• Bill frequency and complexity

• Pricing / billing complexity

• Customer affordability

• Customer Awareness

• Lack of Trust

• Misinformation

• Technological Complexity

Energy Consumerism

Study your

customers by

segments

Design Customer-

Centric

Experience &

Interaction Points

Employ soft-sell

and personal

touch approach

Obstacles

Embrace both

traditional and

new channels

Alignment and development of visible product and pricing signals.

Define the key

messages &

entry points

Develop customer-

empowered

products, services

and tools

Use analytics to drive

evolution of programs and

products

Open dialogue

with

customers

20


• Budget billing programs that

disconnect energy costs from

consumption

• Bill frequency and complexity

• Treatment of financially

disadvantaged customers

• Pricing / billing complexity

• Reflection of ‘true costs’ in pricing

• Data ownership and security

• Customer adoption and awareness

• Customer affordability

• Employee engagement and change

management


Operational Journey to Energy Consumerism

Energy Consumerism

Imp CIS,

MDMS, CRM

2.0. Including,

pilot roll-out

and programs

Contact

Center

Transformatn

Security

Solutions

Marketing &

Adoption

Programs

Customer

Segmentati

on

Demand

Response

Programs

Obstacles

Revenue Cycle

Transformatin

Alignment and development of visible product and pricing signals.

Change Mgmt

& Employee

Programs

Partnership

and Alliance

Development

Pricing &

Program

Developmt

Multi-channel

Implementatn

21

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