April 2011
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Dynamic Energy Management
Dynamic energy management takes the load monitoring and curtailment strategy a step further to combine the power of spot market intelligence, real-time monitoring, and automation technology to provide a complete and instant picture of current power usage and cost.

Peter Kelly-Detwiler
Peter Kelly-Detwiler

Senior Vice President,
Demand Response,
Constellation Energy

Demand response (DR) – the curtailing of electricity consumption based on the electric grid’s changing stress levels - has grown in popularity over the years as a cost-effective way to ensure system energy needs are met.  A critical component of many of today’s facility energy management strategies, DR’s value will become even more pronounced as energy prices continue to rise over time.  The adoption of more renewable energy, which is intermittent and cannot be stored, is also expected to increase stress on the grid and contribute to price volatility.  The economic benefits of DR, in fact, are rapidly becoming indisputable: Greentech Media recently reported that the Federal Energy Regulatory Commission estimated a reduction of 37 gigawatts in peak demand from DR in 2009, and projects this figure could jump to 188 gigawatts in 2019.

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Commercial and industrial entities have a growing number of energy-related concerns, the most prevalent of which is continually rising facility-management costs.  Add to that volatile electricity pricing, an aging infrastructure with few new transmission lines or power plants being built, and growing stress on the grid, and it’s easy to understand why constant monitoring is required to assess and manage power usage at an efficient level.  For these reasons, “dynamic energy management” has emerged as a way for facilities to balance the wide-ranging variables impacting their current and future energy use.

Using DR as a foundation, dynamic energy management takes the load monitoring and curtailment strategy a step further to combine the power of spot market intelligence, real-time monitoring, and automation technology to provide a complete and instant picture of current power usage and cost.  VirtuWatt, an online interface developed by Constellation Energy to instantly assess and address energy load, embodies dynamic energy management and serves as an example for how automated  monitoring and load shedding can become a critical tool in the energy management arsenal for today’s facility managers.

Creating an Ideal Dynamic Energy Management Tool

Traditionally, managing one’s energy consumption has been a guessing game.  With the electricity bill arriving as much as five weeks after the first kilowatt-hour has been consumed, customers have been able to do little to manage their consumption in real-time.  As a consequence, managing to budget has been nearly impossible. In the commercial building space, with significant HVAC load, this can be a real problem; a week of very hot weather can eat a significant portion of a monthly budget, and the facilities manager won’t know the implications until the bill arrives.

VirtuWatt’s active online monitoring brings more control and visibility to energy management through a set of intelligent views.  For example, its intuitive dashboard provides prices and current power usage across multiple zones or facilities, serving to increase transparency and control.  This tool also provides time-frame snapshots and usage estimation for utilities budgeting, which helps eliminate some of the uncertainty involved in facilities management.  Another distinct advantage is the application showing the correlation between outside temperature and energy consumption.  In some markets where such prices are available, it also displays the day-ahead price, thereby allowing managers to map tomorrow’s strategy (for example, pre-cooling) ahead of time. 

The functionalities that many energy managers dream about – real-time control, bidding capabilities and even mobile access – are also part of the offering.  A bidding platform provides access to various wholesale energy markets, and an iPhone app puts dynamic energy management directly into the hands of busy, mobile facility managers.  With these features combined, it also serves as an ideal energy budget protection system, enabling instant control in response to various grid conditions or market signals.

Putting DEM Automation Into Practice

Automating some or all of an energy management strategy, however, only partially qualifies the solution as “dynamic” or intelligent management.  In practice, energy management strategies have to be able to communicate to a variety of various building automation and controls systems.  They also must be adapted according to specific facility requirements. VirtuWatt provides the flexibility to automate and then select from various pre-engineered strategies.  For example, hotel ballrooms would be potential zones for load curtailment, unless a facility is hosting a wedding in a particular ballroom, during which time that specific zone would be off-limits for adjustments.  This type of setting can be automated as facility managers are able to choose which assets to deploy or avoid.

Reliable Controls Vornado/Charles E. Smith, based in the Washington D.C. region, recently saw the benefits of the automated monitoring first hand. During last summer’s severe heat, Vornado received a signal from the grid to participate in a demand response event and help avoid a potential blackout.   The facilities managers were able to select the appropriate pre-determined strategies with a few clicks of a mouse, and create an automated response in 27 buildings under management, without affecting tenant comfort.

Beyond helping to avoid a potential grid emergency, the automated capabilities help to promote sustainability efforts and foster overall energy efficiency and awareness.  Demand response as managed by tools like VirtuWatt ultimately enables the facilities manager to reduce energy costs without affecting the critical mission of providing a safe, comfortable, and secure environment to the tenant.

Why DR, Why Now?

Demand response has proven to be a beneficial strategy for many types of facilities – schools, hospitals, retail sites, data centers – and VirtuWatt is emerging as the ideal tool for highly automated energy management with minimal customer interaction.  That said, DR can be even more effective when employed as part of an integrated energy solution.  The product's online, mobile dynamic energy management capabilities are, for the first time, creating a true handshake between the power markets and electricity users.  For many, it is seen as a competitive advantage, but for some, it is already emerging as the backbone of their energy management strategies.  


About the Author

Peter Kelly-Detwiler is senior vice president, Demand Response, at Constellation Energy, a leading competitive supplier of energy products and services. Contact him at Peter.Detwiler@constellation.com.

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