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Topic Title: Demand Response Aggregator
Topic Summary: Energy Management
Created On: 07 November 2017 09:47 PM
Status: Read Only
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 07 November 2017 09:47 PM
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Andy65

Posts: 11
Joined: 30 August 2013

I'm looking to pick your brains again I'm afraid.

The company has been approached with a scheme which will generate an income by reducing our loading during peak times. The main idea is to install 1MW of batteries which would be charged and billed at our normal rate but sold back to the generating company when there is a demand on their system.

I was sceptical at first with the initial outlay for setting up the infrastructure but have since spoken to an ex-colleague who says that his company have done very well from it. The difference being that they already had a generator on site that just needed updating and servicing. Big organisations are already involved in this such as the NHS.

My problem is that I've only had this company's sales patter so I'd be grateful for your opinions and experience.
 08 November 2017 12:39 AM
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mapj1

Posts: 9581
Joined: 22 July 2004

I can't help you with that I'm afraid but I'd be interested to know more about what sort of system this is proposing.
I'm familiar with normal demand aggregation by load shedding where a factory or similar pay a cheaper rate, and get 30mins notice of being cut off if the call comes to give time to either stop the plant or fire up the caterpillar diesel.
But this with the option of feeding in sounds like a significant novelty.-do I have it right the idea is that your loads get booted off the network and the batteries turned to invert back into the grid, when your own demand is high, or some sort of remote demand based thing, at any time when the grid is running out due to a loss of wind power or something ?
I can imagine it will stand or fall by the rates charged when you are on load and charging, versus the amount you get knocked off the bill when running on battery and/or feeding current back in, buy electricity when it is in surplus and cheap, put it back when there is a shortage and the price is high. I have heard something similar mooted for cars on charge, so I guess a stand alone is a logical extension.
Who makes the import/export decision ? Also I might be worried about battery life and more general reliability of anything novel.

-------------------------
regards Mike
 08 November 2017 06:28 AM
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broadgage

Posts: 2437
Joined: 07 August 2007

The use of a diesel generator to reduce or eliminate demand from the grid at times of shortage, in return for payment, is a well understood technique.

I would be a bit more doubtful about batteries. There is nothing inherently unsound in the idea, but I am doubtful of this rather new idea especially if it is being sold by high pressure sales "engineers"

Before proceeding, a very detailed study of the merits of the scheme should be done, involving a chartered engineer to asses the technical merits, and an accountant to asses the chances of profit.
The fact that the NHS are said to be customers is no recommendation, and could even be a reason to avoid. ! IIRC, the NHS was a major buyer of voltage "optimisers" and related snake oil products.
 08 November 2017 06:43 AM
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Andy65

Posts: 11
Joined: 30 August 2013

You sound as sceptical as me.

These events may only last a few minutes or even just seconds. I asked how many a year and they responded with 'there can be 15'. At this point a wrinkley frown appeared on my forehead as I said, well that'll take years to pay for the components, your fee, maaontenence and to actually make profit. I never got a satisfactory answer.

The Electrical engineer said nothing all meeting, just took mental notes.

They obviously want to get our company name, which is fairly prestigious, to go alongside the MOD, NHS and other big names.

Another concern I have is, when they have hundreds of companies on board how will they decide which ones to switch in to meet demand, they won't need all of them. Once they have a surplus of back up energy, will they reduce the rates of pay?
 08 November 2017 09:07 AM
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mapj1

Posts: 9581
Joined: 22 July 2004

I agree, if the numbers you quote are taken at face value, it sounds a lot of work for 15 megawatt minutes of fame per year. I'm not sure what you would be paid for feed in, but even at a very steep thousand pounds per megawatt hour, I suggest you'd want to see it running in export for a few weeks per year, not several hours, just to pay the depreciation on the equipment, and to pay its way in terms of what else you could do with the building, before recovering the capital outlay.
Remember traditional gensets have a life of decades, batteries and electronics are lucky if they reach ten without serious refurbishment.
If you already need a battery bank and inverter as a super reliable UPS, and it has this extra feature for free, that's nice, but if it is being installed specially, then it needs to be worth doing.
I share Broadgage's concern, large Govt departments often do things that are not actually very commercially savvy, for other more political reasons 'greenwash', 'we must spend the budget or lose it' , and are no guarantee of collective wisdom..

Push for a proper cost-benefit justification, and if the numbers sound iffy, we can probably advise in general terms on that aspect better.

-------------------------
regards Mike
 08 November 2017 10:42 AM
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AJJewsbury

Posts: 16014
Joined: 13 August 2003

The company has been approached with a scheme which will generate an income by reducing our loading during peak times. The main idea is to install 1MW of batteries which would be charged and billed at our normal rate but sold back to the generating company when there is a demand on their system.

Sounds like two slightly different ideas here. Firstly, in effect, a big UPS that you can use to ride through power loss and lop peaks off your demand so saving on either penalty changes from the supplier or the cost of reinforcing the supply. With not much more additional cleverness that could even be tweaked to re-charge the batteries from an off-peak supply and your loads at peak times.

Getting money back from the supplier would presumably either mean feeding back into the grid, or possibly just removing your load from the grid (and so running entirely off batteries) at the grid's behest where you have a certain tariff.

I know the IET has been doing some work in this area - e.g. http://www.theiet.org/resources/standards/eess-cop.cfm

Economics can be looked at from several points of view - and can be influenced by the availability of cheaper electricity at certain times of day (perhaps not fixed) and perhaps a need for a reliable supply - if you can use such a system to avoid the costs of a few individual UPS systems or improve overall productivity - the economics can look better than if you just look at electricity cost/resell prices.

- Andy.
 08 November 2017 10:46 AM
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broadgage

Posts: 2437
Joined: 07 August 2007

Do the vendors of the system or product offer any PRINTED brochure or catalogue that includes technical data ? and costs.

If so, ask them if you can put a copy on this website.
If they yes, then plenty of good advice should be available on here.

If they no, then the reluctance to expose the product to wider scrutiny is interesting in itself.
 08 November 2017 10:52 AM
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pal1952

Posts: 9
Joined: 30 October 2017

If your company will own the equipment and the facility will be used regularly then you will need to factor in the full cost of battery replacement when they become inefficient.
 08 November 2017 10:58 AM
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statter

Posts: 148
Joined: 06 February 2013

Hello
You can avoid significant elements of your charges using this approach including Transmission charges and capacity scheme charges. Hello, You can also benefit from charging the batteries during times when system prices pay you. All of this assumes that your supply contract is structured to deliver the benefits. This would need a careful assessment however as I am far from sure that even though the savings can be large that they would be enough to pay for a battery and inverters of this size.
If you are considering pursuing this I would get an independent review of the proposal but beware there are a lot of people offering advice that do not have the necessary background knowledge, analytical capability of understanding of the risks. Also be aware that the whole area of network charging is under review by the regulator and this may impact savings.
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