Energy companies marketing in Chicago

http://www.suntimes.com/4175776-417/five-energy-companies-take-on-comed-to-power-chicago-area.html

US Investments in Smart Grid -- Hardware vs Software Investment numbers

Today, the most important potential Smart Grid capabilities are centered on self-awareness and automation, managing thousands—or even millions—of inputs to optimize grid functioning.


For fiscal year 2010 the U.S. DOE’s Office of Electricity Delivery and Energy Reliability (OE) Smart Grid research & development budget was $125 million, up from just $83 million in fiscal 2009. The funding request for fiscal 2011 is up almost 16% to $144 million.

Smart Grid funding  is still hardware focused, particularly for the installation of smart meters. But advanced meters and other sensors are just the fingers of an emerging smarter electrical grid. Rather it is the data that these devices generate and the backend applications that will manage and use said data that will be the nervous system and brain of an active and fully capable Smart Grid.


At EIM, we are working on building an energy information hub bringing our information management expertise in this domain in a more productized fashion. Contact us for more information.

Oil price

I saw this news today in fox/CNN
http://www.foxnews.com/politics/2010/12/27/oil-exec-predicts-gallon-gas-energy-shortages-decades-end/?test=latestnews

and I am wondering about its impact.. could it make us to increase our domestic oil supply or domestic electric vehicle supply? or will it be impacted by the world trend of more alternate fuel options?

Some numbers

This morning, I saw some numbers and news' I found interesting:

1. SunTech 3rd Quarter revenue up by 19% - $743.7 million.
2. Italian Govt. just suspended its emissions trading market under the suspicion of some VAT fraud.
3. Pikes Research stated that around 57.9 million smart meters will be installed by more than 90 utilities in the country, 21 million of which are expected to be online by the end of the year. Another highlight was Texas-New Mexico Power’s selection of SmartSynch, which only managed to have 1 percent market share in the second quarter, resulting in the largest residential advance metering infrastructure deployment using a public wireless network in the United States.
   
   In short, as we saw earlier in this blog market at this point is focusing fairly around Smart Grid/Meter/Related Software, Wind Turbine and large-to-medium solar. I guess we all noticed it: but the solar market in NA is slightly different than in EU/APAC. What I meant to say is: beyond NA, we see a lot of individual/private small scale buyers of renewables (farmers/ residents). 

In contract, in NA, I guess the economics of the market in future will probably tend towards having large energy firms (solar/wind/geo..) which will serve the residential market. In that context, having cellular/regional renewable energy firm + local grids might help than having each individual customer trying to become energy efficient. That's so far an idea. Such local grids will off course tap into National infrastructure and so forth for energy trading purpose. But, one factor we need to consider that, it may not be profitable for a firm in IL to trade energy with a firm in OR simply because of the rent they need to pay to the distribution chain. Thus, probably a consortium commodity trading based model will emerge in this sector someone will buy some anticipated future energy production capacity and sell that to another firm in another location (the sell will include distribution cost).

US Utility Market

I thought to see how the utility market looks like (or is projected to be). Imagine what you can do at 10:45 PM in night .

First: The projected sales

OK: Then what is the mix in this market?

The funny thing (and funny being subjective) is the proportion of coal utilization against natural gas. I guess we need to spend more time in understanding this disparate set of data.

Later

Batteries

So, its after one month that we came to the blog. Last month was really a lot of work. So, last night our son in his Halloween party dressed as iron man (he is a second grader). I saw the paladium thingi (plastic in this case) on iron man's chest and thought we should spend some time on batteries/cells/source of power generically.

Lets see what is going around the world.

Researchers at the Massachusetts Institute of Technology have been studying the properties of a molecule called fulvalene diruthenium in the hopes of developing a rechargeable battery that can store heat rather than electricity. Such a battery could be used for solar thermal devices to allow it to provide a stable source of renewable energy. Fulvalene diruthenium, which was discovered in 1996, works to store and release heat on demand. The molecule undergoes a structural transformation when it absorbs sunlight, putting it into a higher-energy state where it can remain stable indefinitely.

The fact is: if we get heat as the source of energy and it is easier to store heat that may be a better form than to store electricity which I guess has already been proven takes more or less some unitary amount of volume growth against energy growth.
If I may slightly digress: I like this idea because it reminds me of the following research about finding an optimum Hamiltonian Path by bees when they collect necter.
http://www.qmul.ac.uk/media/news/items/se/38864.html
Its just solving the same problem by defining it differently and approaching differently.

Anyhow enough of digration.

If we study the recent events we see that (just taking a short sighted view purposively:)

1. SBI Energy predicts the fuel cell market will double to $1.22 billion in four years.
2. McPhy Energy gains ground for expansion after pocketing $17.2 million in second funding round.
3. A major focus off late has been shifted from traditional hydrogen fuel cells into
1. Producing Hydrogen from bio degradables using bio components (microbes specifically). Example: Scientists at Biodesign Institute of Arizona State University produce hydrogen using specialized bacteria.
2. Sea water could become a major source of energy if the previous one works correctly.
3. Purdue scientists develop new process to generate and store hydrogen without use of a catalyst
4. Developing new organic fusable components that help in lighter production of energy storage ( lets face it, major problem of storage today is the bulkiness - we need to trim it down).
5. In United States, California, Connecticut, New York, Ohio and South Carolina are leading states for fuel cell technology.
4. Some transactions (from SBI report).
1. The portable sector boasts of the fastest growth in the fuel cell market due to toys and educational devices powered by low-watt fuel cells. Companies such as Horizon Fuel Cell Technologies and Thames & Kosmos have created fuel cell car kits that allow children to assemble the cars while learning about the basics of the technology.
2. However, the largest demand for fuel cells is for power generation units. In August, Ballard Power System shipped the largest fuel cell system to an Ohio utility for a five-year trial run. The system can produce as much as 1 megawatt of electricity – enough to power 500 homes.

In summary, storage of energy will act as a major factor in responding to energy demand response apart from the rate (in fact it may influence rate and rate will become a dependent variable to the storage capability) as we explored in previous blog entry about smart grid architecture.

 

Now, lets all get back to work. Have a wonderful week ahead.

Smart Grids – taking a micro economic viewpoint to utility demand response

Since I have spent some time on this blog on the supply i.e. generation side of the game I thought today I will look into the demand side of the game. Hence smart grids. First, lets define the demand. So, what is the demand?

In United states, this demand is causing rise of electric bills.

So, we need to increase the supply or respond to the demand to reach the equilibrium or maintain it.  But how do we respond to the rising demand? It cannot be the existing technology as that is causing this rise and is not able to balance the demand.

Hence we need a new technology – a smarter infrastructure that can think like us and feel like us and in some way act like us human beings. Thus, smart grid. But what is a smart grid?

Quoting from NEMA (The Association of Electrical and Medical Imaging Equipment Manufacturers) – “ Smart Grid refers to an improved electricity supply chain that runs from a major power plant all the way inside your home.”

In reality, it is an integration of electrical infrastructure and information infrastructure.

An electricity supply chain consists of three parts: generation (power plants); delivery (transmission and distribution networks); and customers (residential, commercial, industrial, military, etc.). Supply and demand have to remain tightly balanced at all times, since there is
no commercial solution for large-scale storage of electricity to absorb any excess power or shortfall.
It is a complex and expansive system consisting of numerous primary elements interacting continuously through electrical, magnetic, and mechanical forces—far more complex than what might be ascribed to transportation or communication systems.

And why cannot existing grids work when we put some solar and wind firms and replace fossil fuel? Quoting Alan Schriber, Chairman of Ohio PUC – “ You can build wind generators and solar
panels. All that’s nice, but at the end of the day, reducing consumption is the cheapest way to do it. By leveling demand, you forgo the need to continually build. That’s the beauty of Smart Grid”

Yes, it is about leveling the demand of our digital society.

So, how do we level it out? We improve (which will increase) the demand management. Going back, thinking about electrical infrastructure and information infrastructure, that is done using smart meters and AMI (automated meter infrastructure).

Through such a consolidated infrastructure, the customers respond better to price signals and price responds better to customer demands. It acts as a pipe through which electricity, information and money flows.

Caveat: Since our target is demand response, we need to be cognizant of the fact that as consumers we will only respond if we are stakeholders in this game i.e. our utility bill gets reduced if we install smart meter at our home and turn of that hallway light during day time. Thus, we need incentives which is the rate plan. Yes, that is the single most thing that can make or break the success of the demand response strategy.

Here is some data about how demand response using smart grid has worked.

In conclusion: it is more about economics of demand response that makes smart grids the most enticing of all clean tech investments. It leverages as much as possible existing infrastructure of electricity and internet.