Navigant Research Blog

The Overlooked Renewable

— May 19, 2015

Hydropower may account for just 7% of U.S. electricity generating capacity, but this sometimes overlooked renewable energy source could play a more significant role. That’s one of the conclusions from a first of its kind study on hydropower that quantifies the size, scope, and variability of hydropower in the United States.

The new U.S. Department of Energy (DOE) study (2014 Hydropower Market Report) describes a diverse fleet of hydropower plants that collectively produce enough electricity to power more than 20 million homes. The report also notes that the size of the hydropower fleet has grown in the last decade, mainly as owners have upgraded existing hydro assets, with a net increase of nearly 1.5 GW from 2005 to 2013. Total investment in hydropower amounted to more than $6 billion for refurbishments, replacements, and upgrades during that timeframe.

 One Major Hurdle

On the plus side, the report indicates that the United States has more than 77 GW of potential hydropower capacity, and that the current development pipeline encompasses a mix of proposed projects at non-powered dams, conduits, and undeveloped rivers or streams. These projects, as well as large-scale pumped storage hydropower (PSH) projects, account for the bulk of current development plans. However, there is a major hurdle that clouds this picture. The widely available bond, grant, and tax-credit programs that helped drive development of hydropower projects in recent years have gone away, and new projects are likely to depend on alternative funding sources, which more than likely means a slower pace for upcoming projects.

Without a doubt, hydropower has it limits and cannot be thought of as a viable alternative in certain regions – drought areas of the Southwest come to mind. But given its potential for adding tens of gigawatts of untapped power, it should be part of the overall energy conversation because of its proven track record as a source of clean, reliable power, despite the potential funding hurdles.


Framing the Smart Grid of the Future

— April 29, 2015

Armed with years of data, utility industry officials are highlighting some of the results from the most ambitious smart grid demonstration project in the United States. One of the key lessons they learned is how difficult it can be to use the latest smart grid hardware to consistently produce high quality data.

That was the conclusion noted recently by Ron Melton, the director of the Pacific Northwest Smart Grid Demonstration Project and a senior leader at Pacific Northwest National Laboratory (which is operated by Batelle). Launched in 2010, the demo was federally funded under the American Recovery and Reinvestment Act (ARRA) at a cost of $178 million, making it the largest single project of its kind. It included five states—Oregon, Washington, Idaho, Montana, and Wyoming—comprising some 60,000 metered customers, 11 utilities, two universities, and assets in excess of 112 MW. The goal was to test a broad range of ideas and strategies to see if a regional smart grid could lower energy consumption and increase reliability.

Lacking Tools

One of the broad lessons for utilities is that the tools and skills to manage the huge volume of data from smart meters and sophisticated sensors on the grid are largely nonexistent, according to Melton. But it goes beyond merely managing data; the real challenge is to get consistently good data to ensure that sensors across the grid are working properly and that key operating decisions can be made based on reliable high-quality information.

Transactive Control

One of the core technologies used in the project is called transactive control, which in essence is two-way communications between electricity generation and end-use devices, such as electric water heaters, furnaces, clothes dryers, etc. The control signals communicate the price of delivering power to that device at a specific time, and the device can decide when to use electricity—with the owner’s consent, of course. This is the underlying technology for demand response (a topic discussed in detail in Navigant Research’s report, Demand Response Enabling Technologies). Project managers were able to show that transactive control works and could theoretically reduce 4% of peak power costs in the Pacific Northwest. But, as Melton says, this would require about 30% of demand on the system to be able to respond in this way. To get there will take a concerted effort to clearly show the value streams to all parties and then figure out the financial incentives.

Clearly, utilities are still in the early phase of the smart grid and handling big (and small) data in new ways is often uncharted territory. Nonetheless, this demo highlights the framework on which the future grid—what we at Navigant Research see as the energy cloud—will be built, and the steps necessary as the grid of tomorrow emerges.


ZigBee, Thread Find Common Ground

— April 29, 2015

Two key technology groups have taken a step toward interoperability that should make it easier for smart home devices with different capabilities to work in unison in the coming months and years. The ZigBee Alliance and the Thread Group have agreed to collaborate to enable ZigBee devices to operate over Thread’s protocol.

The two groups will define a specification that will allow the ZigBee applications layer to function over Google-backed Thread. The aim is to simplify product development for device manufacturers and give consumers a better experience as they connect devices and services in the home—an early-stage trend often called the Internet of Things (IoT).

New Connections

Specifically, the effort will make it possible for ZigBee devices, such as Philips Hue lights, to connect to a network that natively supports Internet Protocol (IP) addresses, which Thread does. The new specification will be focused on the ZigBee Cluster Library, which standardizes software functionality such as energy use, home automation, and lighting. The new specification is expected to be available sometime after June of this year.

Despite this cooperation, the two organizations are still committed to acting independently, and there’s not yet been any indication that they will merge their efforts. As pointed out by the EE Times, the move can be seen as a defensive one for ZigBee, which has been around for years but has lagged the trend toward 32-bit processors and IP networks.

Plenty of Rivals

In addition, the nascent IoT market still has many players and standards vying for dominance, or at least a significant share of the pie. Besides ZigBee and Thread, Wi-Fi, Bluetooth, Z-Wave, the AllSeen Alliance, the Open Interconnect Consortium, and the Industrial Internet Consortium all have a stake in this ecosystem. In other words, this is a crowded space, and remains fragmented for now.

Even with that fragmentation, utilities and energy management providers need to pay attention to the ZigBee-Thread détente. It could be the needed big step toward device and service interoperability that unleashes a burgeoning market of connected and intelligent devices like thermostats, appliances, and lights. This one move is not going to get it done alone. Others will need to alter their stances, or risk missing out on the expected boom. Of course, Apple could still go it alone with HomeKit, but proprietary solutions are hard to scale. And it is likely that most other vendors will seek more open standards so that the overall market can flourish, and not get stuck in silos.


PG&E-Bidgely Pilot Yields Energy Savings, Now It Needs to Scale

— April 20, 2015

Separating energy use in a home down to the appliance level for improving efficiency has long been a goal of technology vendors and utilities alike—some call it a holy grail. The latest effort by California utility Pacific Gas & Electric (PG&E) and partner Bidgely yielded up to 7.7% energy savings among some 850 participants in a pilot program. The results were announced recently and highlight one of several methods aimed at energy load disaggregation.

The PG&E-Bidgely pilot lasted from August through December of last year. Customers who took part were given an in-home energy monitor that gathered real-time electricity consumption data from a smart meter and broke it down by device. For example, the amount of usage by an air conditioner, refrigerator, pool pump, or clothes dryer was broken out along with a cost estimate. The Bidgely system then provided updates and alerts to customers through online access or mobile devices. Armed with this data, customers could take steps to reduce their consumption, such as delaying a dryer cycle until rates were lower or adjusting the air conditioner (AC).

Points of Entry

Other vendors in this space, like PlotWatt and Smappee, offer to analyze and interpret energy consumption down to the appliance level, as well. Both offer ways of detecting appliance-level consumption and utilize a separate device to do so. But unlike Bidgely, these companies are not focused on utilities as their market point of entry. PlotWatt aims its service at residential customers and restaurants, while Belgium-based Smappee is going direct to consumers for now.

The other big player working to help utilities’ customers reduce consumption is Opower. Though it does not disaggregate household load, its programs do help residential customers change their behavior to reduce consumption. Opower programs have shown that energy use can be reduced by 1% to 3%. In behavioral demand response programs, peak demand has been lowered by up to 5%.


For its part, Opower has been able to convince dozens of utilities to deploy its solution at scale among millions of end users. The challenge for Bidgely and the disaggregation competitors is this issue of scale. Can they also provide insights and help change user behaviors across a large number of customers? These latest results are promising, and Bidgely has expanded with projects at Texas utility TXU and London Hydro in Canada. As noted in Navigant Research’s report, Home Energy Management, there is growing momentum and consumer awareness around the latest tools for reducing energy use. The trick will be in sustaining this momentum and moving beyond early adopters and into the mainstream.


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