Navigant Research Blog

Thermostat Studies Show Benefits of Being Smart

— February 16, 2015

This month Nest announced several studies that have been conducted on its learning thermostat.  One was conducted by MyEnergy, a Nest subsidiary that analyzes residential energy information. The others were conducted by the Energy Trust of Oregon and by Vectren Corporation, an Indiana-based holding company. The results boost Nest’s claims that the thermostat can pay for itself in only a year or 2.

Across the studies, evaluators found average annual reductions in electricity use between 13.9% and 15% for cooling and 10% and 12% for heating loads.  For natural gas, the Vectren study confirmed an average annual reduction of 12.5%.  In terms of cost savings, Nest states that adopters showed an average of 9.6% savings on their gas bill and 17.5% on their electric bill.

Last year, competitors EnergyHub and EcoFactor released third-party studies that indicated reductions in electricity use of 6% to 17% after thermostats controlled by their back-end platform were installed in users’ homes.

The Limits of Studies

Smart thermostats have become increasingly numerous in recent years. According to Navigant Research’s report, Smart Thermostats, North American household penetration of these devices is expected to exceed 20% by 2023. Until recently the market was concentrated in warm weather states, but adoption across colder climates is becoming more common, and utilities are becoming interested in smart thermostats for year-round energy efficiency and demand response (DR) programs.

Regardless, the high prices—$150 to $300 for the device alone—are still a barrier. Hence, smart thermostat vendors have trumpeted third-party studies that indicate positive return on investment (ROI) through energy bill savings. Analyses of products from EcoFactor, EnergyHub, and now Nest indicates annual energy savings in the 8% to 15% range.

But such studies can be interpreted in several ways. The most obvious conclusion is that the chances of incurring similar savings are good given the variety in the studies’ methodology and sample populations. On the other hand, factors like the locations of households, weather varying, and simultaneous energy efficient behaviors all affect study results.

Your Results May Vary

For states where heating and cooling are a small part of the utility bill, the savings from a smart thermostat will look different than those in an area where the costs are high. In such cases the results could be misleading.

The MyEnergy study included households from all over the country in its sample, and Nest claims that it is fairly representative of their adoption base—but is that representative of U.S. consumers as a group? The average reported savings might not fall in the middle of the spectrum of all consumers, so someone using this information as a basis for purchase of the $250 device could be anywhere from greatly or slightly disappointed to slightly or very pleased depending on how similar they are to the majority observed that indicated decent savings.

And if the consumer doesn’t really care enough to break down this information in the first place, much less nitpick findings from a variety of disparate studies? These types of adopters might be drawn to purchase the device simply for its user delight qualities. Nest has created an iconic device that by most accounts works really well and that has a lot of informational features designed to trigger more energy efficient behavior. That would be a great outcome.

 

Into the Wild, with Clean Technology

— February 2, 2015

Yosemite National Park remains among the largest preserved wild spaces in the world, but with over 4 million visitors annually, it’s becoming more and more difficult to find solitude there. This month, Yosemite was thrust into the media as the United States became aware of (and potentially a little obsessed with) two rock climbers trying successfully to free-climb the Dawn Wall, which is the most difficult route on one of Yosemite’s iconic rock faces, El Capitan.  Through mobile phones and hotspots, climbers Tommy Caldwell and Kevin Jorgeson shared and received real-time updates (including photos and streaming videos) with friends, family, and of course the media.

The climbers spent 19 days off the ground, much longer than the typical iPhone battery could ever last. So, they hauled solar powered chargers up the wall with them to power their phones, lights, cameras, computers, and other gadgets.  Their solar gear came from Goal Zero, one of a few companies that fill the niche for mobile/recreational solar power kits for athletes and travelers.

All the Mod Cons

These devices, although they lower demand for energy infrastructure in wilderness areas, are among many new technologies that are allowing visitors to enjoy modern niceties while enhancing preservation efforts in the face of record numbers of visitors.  Over the years, the park has had to develop strategies for transportation, sanitation, power, and communications that support preservation.

Another big issue is constant, full bandwidth connectivity.  On the Dawn Wall, the climbers enjoyed a relatively strong cellular connection.  But for areas without such access, the connectivity problem can be solved with a two-way satellite phone, an old technology that can now carry enough bandwidth to upload and send photos and videos.  A couple of years ago, these climbers remotely produced and shared a short film from a peak in Nepal.  Edmund Hillary would be astounded, not to say depressed.

The Waste Issue

Aside from managing new demands for connectivity and power, one of the biggest issues for the national parks and other preservation bureaus is human waste.  As the number of visitors grows, so does the need to deal with their … leftovers.  There are basically two ways to deal with human waste in areas without sewage systems.  The first is to carry it away and put it somewhere else. Most commonly, companies are contracted to collect and transport the waste, which is expensive.  In British Columbia, Bugaboo Provincial Park uses a helicopter to transport waste out of the park.

The second method, much less common, is to deal with it on site.  A park in Colorado began constructing an evaporative system for human waste in 2001, with reported successful outcomes.  Organizations like the Bill and Melinda Gates foundation have recently poured money into research for developing isolated toilet systems for rural developing communities, which could also be appropriate for public outdoor spaces (I wrote a blog about the Gates program in 2013).

Caldwell and Jorgeson stored their waste and disposed of it offsite, which is common practice for mountaineers and climbers. This system, made by a company called Metolius Gear, comes highly recommended.

In any case, the Dawn Wall ascent and the worldwide interest it generated, highlighted a keen interest in natural spaces and human activity therein.  More than ever, companies in various markets have begun to realize how their technologies can support this growing wave of outdoor enthusiasts who desire to visit these spaces in comfort and with a good connections.  That’s a good thing, because these spaces are now able to support more visitors with heightened needs while retaining the beauty that makes them so special.

 

India’s Power Sector Moves into the 21st Century

— January 14, 2015

In December, ABB announced a $55 million project win in the Indian states of Behar and West Bengal.  ABB will install both transmission and distribution (T&D) substations, incorporating ABB substation technologies with fiber optic telecommunications systems and new substation automation systems.  As a part of an overall goal to meet growing demand, improve access, and reduce losses, the facilities will support generation and other transmission investments in Northern India.  And ABB isn’t alone – big wins in India have also been announced by Alstom and Tata Consulting Agency.

India has seen a lot of activity in terms of electric infrastructure investment over recent years, and the nation is on its way to becoming a global leader in the installation of smart grid technologies.  As my colleague James McCray describes, these Investments are benefiting from several large-scale efforts to expand electrification, reduce the environmental impacts of generation, and decrease power system losses.  In 2009, The World Bank and POWERGRID (India’s transmission operator) introduced the Fifth Power System Development Project, a series of transmission investment projects set up to bolster India’s then-troubled economy through providing resources for industrial and agricultural enterprises.   Now in its fifth year, the planned $16 billion program has funded regional projects in both Northern and Southern India.

Acceleration

In terms of expanding and updating its distribution grid, India’s central government has begun the second stage of its Restructured Accelerated Power Development and Reform Programme (also known as R-APDRP).   This two-phase project has supported individual state utilities in an initial stage of data gathering for information and planning, as well as the aforementioned second stage of new grid construction and upgrades, including advanced metering infrastructure and distribution automation rollouts.  Investments under this plan are expected to total around $10 billion.

If you haven’t noticed yet, the sums of money involved are tremendous.  The global smart grid market for distribution was forecast at $15 billion in 2014, indicating that if India is allocating between $10 to $20 billion (of the $26 billion total for T&D) over the course of a few years, that would make the country one of the world’s largest spenders, the United States, Western Europe, and China.  Yet, India’s Power Minister, Piyush Goyal, stated in November that India needed to put even more into its T&D infrastructure – $50 billion over the next 5 years.

The Big Shift

India has several primary drivers for investment: growing demand and a need to increase electrification; reduction of fossil fuel consumption (the majority of India’s electricity is coal-fired according to the U.S. Energy Information Administration, and the country wants to install more solar); and reliability (India has suffered heavily from rolling blackouts in recent years).  At the moment, India’s grid is constrained due to limited and aging infrastructure – some estimate that generation plants are utilized as little as 70% because of this.

Investing in new infrastructure and smart grid projects, India is targeting efficiency while simultaneously extending its grid.   For the time being, India will increase coal-fired capacity to meet its demand challenges, but the country is also promoting renewables both directly (through government investment) and indirectly as it improves its transmission infrastructure.  With these investments and states such as Gujarat leading the way in progressively supporting renewables, it is possible that India could soon shift from an underdeveloped energy infrastructure heavily dependent on fossil fuels to a leading example of clean and efficient energy at a national scale.

 

Outage Management Technology Looks to an Integrated Future

— December 30, 2014

First deployed in the 1970s, outage management systems (OMSs) were originally designed to incorporate outage notifications from external sources to create a map view of the outage and generate an optimized power restoration plan.  Today, with smart grids revolutionizing power delivery through telecommunications and automation, OMSs have evolved into something much more sophisticated.  However, it’s also become less and less clear what an OMS actually is.

Conventional OMSs understand the outage, determine the correct course of action to take, and issue switching orders for the control room operator and/or distribution management or supervisory control and data acquisition (SCADA) system.  Though these systems can be linked, each one typically maintains a separate database, meaning that no system holds a complete understanding of the network state or restoration process.  Now, vendors are combining outage management with distribution management and SCADA, creating what is often called an advanced distribution management system (ADMS).  Incorporating a single system map and database, ADMSs can manage the engineering grid with the restoration process in real time, resulting in faster, more informed action to restore power.

Real-Time Resilience

On the communications side, new OMSs may integrate real-time, two-way information from the customer call center, the interactive voice response (IVR) system, smart meters, mobile crews, and even social media.  This enables the system to update itself immediately upon the reception of outside information and exchange pertinent notifications and updates with mobile crews and customers.  Again, OMSs have traditionally not managed these different communications media; they’ve only exchanged limited information with them.  Now, due to proliferating open standards, the pace of this exchange has increased, and new platforms, such as social media, are increasingly involved.

Analytics solutions represent another game-changer for OMSs and grid resiliency/reliability efforts.  Analytics technology combines notifications, voltage readings, and outside sources, such as weather, to inform preventive maintenance efforts, increase the accuracy of damage assessment, and improve the efficiency of the restoration plan.  Analytics systems can be integrated into a combined DMS/OMS/SCADA, ADMS, or purchased as a separate overlay to enhance systems.

All Together Now

Navigant Research expects growth for standalone OMSs to decline as more utilities adopt ADMS strategies, but market demand for improved reliability and lowering outage costs will continue to drive adoption of products and services to support advanced outage management — analytics, customer engagement tools, and distribution automation. As Navigant Research’s report, Outage Management Systems, makes clear, these systems certainly aren’t what they used to be.  Not only are they more dynamic, reliable, and flexible, but they’re also used by utilities in new ways that require traditionally siloed departments that manage engineering, operations, and communications to work closely together.

Not all utilities will adopt a full ADMS solution from a single vendor—it’s likely that many will configure systems in a more integrated fashion and will move toward a combined management philosophy, where outage management is one application within a platform that manages operations, engineering, and even customer engagement during events.

 

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