Navigant Research Blog

Storage Helps Ease Schools’ Demand Charge Pain

— April 7, 2015

For many businesses, demand charges are like room service delivery charges for travelers, only more painful. Utilities levy demand charges on customers for short duration peak power usage during a month, which can add between 15%–50% to the cost of a utility bill for the entire month. In some cases, this can mean hundreds or thousands of dollars for a few minutes of excessive power use.

Utilities justify these substantial fees because high consumption of power at peak times can strain transmission and distribution assets or cause them to invoke their most costly generation equipment.

No Money Down

In power-constrained California, where demand charges run high, five school districts have turned to batteries to save money by reducing or avoiding demand charges. Energy storage solutions provider Green Charge Networks (GCN) developed energy storage systems using battery packs from Samsung SDI for Mountain View-Los Altos Union High School District, Oak Park Unified School District, Butte Community College, Peralta Community College District, and California State University, Fullerton.

GCN’s CEO Vic Shao told me that because of the high demand charges (Shao says San Diego Gas and Electric charges $45 per kilowatt), his company can provide the systems for free to the schools. The company can recoup its investment quickly by receiving a share of the savings that the schools receive from avoiding demand charges. For perpetually cash-strapped schools, a no-money-down solution for cutting energy costs can be compelling.

Solar Fee

Since the partnering schools are focused on reducing emissions, GCN also threw in free Level 2 electric vehicle (EV) chargers to incentivize employees and the districts to buy EVs. Shao said that thanks in part to California’s incentive program for storage and other clean energy technologies, the company has done more business aimed at combatting demand charges in the last 2 months than in the previous 3 years. New York City is another attractive market for storage systems, according to Shao.

Similarly, demand for energy storage systems in Arizona could be on the rise thanks to a controversial new demand charge being levied exclusively on solar customers by the Salt River Project utility.

GCN is one of several vendors, along with Stem and CODA Energy, offering storage products aimed at demand charge mitigation, as described in Navigant Research’s report, Community, Residential, and Commercial Energy Storage.

 

Going Small, Americans Seek More Efficient Housing

— March 25, 2015

If you have spent any time on social media lately, you’ve likely encountered at least one post or online album that features so-called tiny homes. Literally tiny, averaging less than a couple hundred square feet, tiny homes have inspired numerous periodical references, coffee table books, and at least one documentary. Given that Americans on average tend to inhabit more square footage than people from almost any other nation, it’s remarkable to see this change in attitude as a growing number of people not only accept, but also intentionally pursue smaller living spaces.

Though it’s a far cry from the idyllic rural landscapes that many tiny houses are photographed in, large cities like New York, where high demand for space has inflated rental and housing markets and regulators are pursuing more sustainable forms of urban development, are benefiting from this minimalist attitude. Recently, a collaborative micro-apartment project called My Micro NY received the city’s adAPT NYC award to design, build, and operate a 55-unit space in Manhattan, with each apartment to be less than 400 square feet.

Hold Please

From an energy-efficiency perspective, small-unit multi-tenant living spaces have many benefits. Individual small units require much less energy to heat and cool, and efficient multi-tenant spaces can benefit from shared climate control. If the resident struggles with personal energy management (e.g., they constantly push the hold button on their thermostat and forget to turn it off), much less energy is wasted in a shared climate. Most importantly, as with multi-tenant spaces in general, heating and cooling can be shared, so the per-capita energy requirements are much lower. And if the space is designed to be energy efficient—or even better, zero energy—then these effects are multiplied.

Of course, there are downsides, including the potential negative effects on one’s health that can be caused by spending too much time in a small, studio-like space. Experts generally agree that while this type of housing can be suitable for young professionals in their 20s, it can have detrimental health effects on individuals in their 30s and 40s who have different lifestyle preferences and forms of stress. Families and couples should be aware of possible issues surrounding privacy and the ability to concentrate in small, shared spaces.

Small Is Beautiful

Still, energy-efficient housing solutions are becoming widely available for people of all ages, incomes, and lifestyle preferences. The explosion of the energy-efficient pre-fab market, which is characterized by smaller overall spaces, is an indication that Americans are compromising space for efficiency—and not necessarily with cost as a major driver (aside from the fact that smaller square footage = less overhead cost).

Although tiny homes on wheels and pod apartments will likely remain niche markets, the growing buzz and number of options offer design and lifestyle benefits that are catching the interest of many Americans. As a culture, Americans are still far from being characterized as energy-conscious, but this growth in the small housing market signals a step in the right direction.

 

A Bird’s Eye View of the Construction Sector

— March 13, 2015

From mysteriously hovering over the Paris skyline to enabling extrajudicial executions to repairing and maintaining power grids, unmanned flying drones are finding more and more uses. Recent rules from the FAA establishing a regulatory framework for the fledgling technology has limited many commercial uses. Amazon’s plan to deliver packages by drone may be grounded for now, but applications of drones in the construction industry hold promise.

The current capabilities of drones, namely the ability to fly and take pictures, make them well-suited to create as-built drawings of buildings. Often, as buildings are constructed, the original design has to be modified based on conditions in the field. In order to be useful for operations and maintenance, these drawings need to be accurate and up-to-date. Unfortunately, the accuracy and completeness of as-built drawings are often lacking. Drones could provide a way to document what gets installed behind the walls of a building as those walls go up. Artificial intelligence and image processing could nearly eliminate the role of people in the process.

The Sky Is the Limit

As drone capabilities expand, so too will their role in construction. The Swiss architecture firm Gramazio Kohler Architects has used quadcopters to build a structurally stable tower out of blocks. The drones are able to collaborate and communicate through an algorithm that directs the drones to avoid collisions and optimizes the path for fast payload pickup and release.

A day where drones are used to replace manual labor in the construction of buildings may not be far behind. Construction equipment maker Komatsu has already unveiled plans for unmanned bulldozers and excavators to dig holes and move earth autonomously using data from drones. Currently, the unmanned equipment will mainly operate along preprogrammed routes and have human operators able to take control if necessary. But automating more of the unskilled construction tasks is one step closer to reality.

Do Robots Dream of Electric Masonry Saws?

Though drones are a visible step toward construction automation, they will not be the only robots on the job site. Both R-O-B Technologies and Construction Robotics have developed prototypes of robotic bricklayers. Using robotic arms, rather than drones, the demonstrations have yielded faster production than human workers with high levels of accuracy and precision. Moreover, robots can make construction sites safer. With 796 fatal work injuries in the United States during 2013, construction is one of the deadliest professions. Replacing human labor with robot labor holds promise for a safer future.

 

Islands Sail into Energy Storage

— March 3, 2015

Saddled with the highest electricity rates in the world (and threatened by climate change more than almost any other communities), many islands and isolated grids have opted to integrate wind and solar to replace expensive, imported diesel fuel. One challenge for these systems is that they do not have the benefit of calling upon neighboring systems to balance their wind and solar against load–leading to instability and insecurity of supply.

As a result, many remote grids are adjusting their technical requirements for connecting intermittent resources like wind or solar to the grid, requiring that these resources be firmed. In late 2013, for instance, Puerto Rico adjusted its technical requirements for connecting wind and solar assets to the Puerto Rican grid. This isn’t a direct requirement for energy storage specifically, but is a good fit for storage.

The Flywheel Option

Other island markets are betting on storage more directly. Aruba has committed to an aggressive plan to become 100% renewable by 2020 and has signed agreements with BYD and Temporal Power, as well as a power purchase agreement with Hydrostor in order to achieve its energy goals.

The typical applications in these markets are wind, solar, and diesel hybrids. In previous years, the most common technology for remote, isolated grid storage was advanced batteries. This was partly a function of availability and technology fit. Very few other storage technologies are modular–underground compressed air and traditional pumped storage require specific geologies–and few vendors were targeting the space. Moreover, the working assumption in terms of technology fit has been that a longer-duration storage system is more valuable than a short-duration storage system. Several flywheel vendors are disproving this assumption, however.

ABB’s Powercorp, for example, uses flywheel technology in remote microgrids, such as the BHP Billiton nickel mine in Western Australia and the Coral Bay community in Northwestern Australia. These are remote diesel-led systems.

Way Up North

Beacon Power has commissioned a demonstration project in St. Paul, Alaska, combining an existing plant, which includes a 225-kW wind turbine and 300 kW of diesel generators, with a 160-kW flywheel system. In this scenario, the flywheel system will enable the host utility to further improve wind utilization and deliver fuel savings of up to 30% over existing (pre-flywheel) consumption levels.

While it is still the case that some amount of long-duration storage is necessary in order to achieve very high renewables penetration on an isolated grid, flywheels are demonstrating that significant diesel savings can be achieved with as little as 30 minutes or less of storage.

 

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