A Transactive Grid Can Reduce Load Swings And Costs: PNNL Study

by Peter Maloney
APPA News
February 2, 2022

Consumers can save about 15 percent on their annual electric bill by coordinating with their utility to control devices that use large amounts of electricity, such as heat pumps, water heaters, and electric vehicle charging stations, according to a new report from the Pacific Northwest National Laboratory (PNNL).

The Distribution System Operator with Transactive (DSO+T) study found that a transactive energy system would reduce daily load swings by 20 percent to 44 percent. The study identified a transactive energy system as one in which there is an agreement between consumers and utilities about the flexible use of energy.

In a transactive system, homes, commercial buildings, electric appliances and charging stations are all in constant contact, the PNNL researchers said, and smart devices receive a forecast of energy prices at various times of day and develop a strategy to meet consumer preferences while reducing cost and overall electricity demand.

PNNL, with Avista and McKinstry, has deployed a pilot version of an urban transactive system in the city of Spokane, Washington’s Eco-District. However, a transactive energy system has never been deployed on a large scale, so the PNNL researchers designed a simulation to analyze how distribution system operators can use transactive energy principles and mechanisms to integrate large numbers of flexible assets into the everyday operation of the electric power system.

The Electric Reliability Council of Texas (ERCOT) region provided the basis for PNNL’s analysis. The researchers created a model that represented ERCOT’s network, including more than 100 power generation sources and 40 utilities. The analysis also included representations of 60,000 homes and businesses and their energy-consuming appliances.

The researchers conducted multiple simulations under various renewable energy generation scenarios to determine how the energy system would react to the addition of differing amounts of intermittent power sources, such as wind and solar power.

The study looked at transactive coordination for two separate asset deployment scenarios: flexible loads (heating-ventilation-air conditioning units and residential water heaters) and behind-the-meter batteries. The results were compared with a corresponding business-as-usual case without flexible assets.

Both cases were subject to two scenarios: a moderate renewable generation scenario to represent current levels of deployment and a future high renewables scenario with 40 percent renewable generation, including the increased use of rooftop solar and about 30 percent of residences having an electric vehicle.

The simulation showed that if a transactive energy system were deployed on the ERCOT grid, peak loads would be reduced by 9 percent to 15 percent, translating into economic benefits of up to $5 billion annually in Texas alone, or up to $50 billion annually if deployed across the continental United States, according to PNNL.

“Because Texas’ grid is quite representative of the nation’s energy system, it not only enabled the modeling and simulation of transactive concepts but provided a reliable extrapolation of the results and potential economic impacts to the broader United States grid and customers,” Hayden Reeve, a PNNL transactive energy expert who led the team that designed and executed the study, said in a statement.

The study also explored the impact of a new kind of entity, a distribution system operator, who would manage a grid that has multiple energy sources owned and operated by distinct entities all contributing energy to the grid at different times and amounts. The distribution system operator would negotiate the transactions with customers that allow flexible load control.

The study confirmed the value of establishing entities, such as a distribution system operator, to manage transactive energy, the PNNL researchers said.

“A smart grid can act as a shock absorber, balancing out mismatches between supply and demand,” Reeve said. “Through our study, we sought to understand just how valuable effective coordination of the electric grid could be to the nation, utilities and customers. Working with commercial building owners and consumers to automatically adjust energy usage represents a practical, win-win step towards the decarbonization of the electrical, building and transportation sectors without compromising the comfort and safety of participating homes and businesses.”