January 2009
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Standards and Opportunities when Smart Buildings
meet the Smart Grid

The goal of the new standards efforts is to support new markets that we do not today know or understand.

Toby Considine
Toby Considine
Systems Specialist,
Facility Services, University of North Carolina – Chapel Hill
The New Daedalus

Contributing Editor

In December, the group working to advance the OpenADR specification to a national and perhaps international standard, began to hold discussions in an discussion in an open forum at OASIS (www.OASIS-Open.org). OpenADR (Automated Demand Response) is a California developed specification developed for the regulated electricity providers in that state. Demand-Response (DR) refers to live negotiations between the grid and its end nodes (buildings) to reduce demand before a shortfall causes problems. DR is a very important first step on the road to transacted energy, and solves some big problems in the short term. OASIS, or the Organization for the Advancement of Structured Information Standards, is the home for the underpinnings of e-commerce, for web security, and for service oriented architecture.

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By moving to OASIS, we are acknowledging that DR is a business interaction more than a control transaction. The end nodes of the power grid contain far too diverse a mix of systems for grid operators to control well. As Gale Horst at Whirlpool has observed, a washing machine cannot respond to a grid request to shed [electrical] load unless it has determined that there is no bleach in the current load of laundry. Every system in a home or business has its own rules. For all but the smallest response, DR will require an economic incentive and decisions from the agents running all the systems.

The Supply-Side Problem

The North American power grid is the world's largest robot. It was imagined in the 30's, designed in the 50's and has been built out and patched ever since. Some very bright people have done extraordinary things to retrofit the system with digital descendents of the original analog controls. It is very much less stable than folks let on. It suffers from an instability condition that occurs periodically and has for years. This condition was occurring when a tree branch took a transmission line and thereby a third of North America on August 14, 2003. That underlying instability occurs an order of magnitude more frequently today than it did then. Something has to change.

The archetype for modern power markets was established 100 years ago in Chicago on April 1908. At that time, power demands were low, and electric metering consisted of pens on mechanical turntables that spun as power was used. These paper sheets were collected and read periodically. Modern power marketing was established a natural monopoly with regulated cost recovery, much as telecommunications used to be. The regulated cost recovery market is only slowing to take advantage of digital metering using two way communications. Many new installations are still being designed as asymmetric interfaces, with the demand side, i.e., the building inhabitant, excluded from direct communication. New business models must support transparency and symmetry.

The Carterphone law suit established that third party equipment could be attached directly to the phone system, and Judge Green tore down the natural monopolies. The model of 25 year depreciation of black handsets owned by the phone company began to erode. New business models, beginning with fax, continuing to modem-based communications began to arise. Today deep process interactions running through slow moving standards bodies prevent the attachment of new types of systems. Innovations must be approved as expenditures by 50 public utilities commissions. Today's need for rapid innovation in energy generation, storage, and conversions demand more agile business models.

In 1908, there was no exchange of power between local markets. There was no dynamic pricing. Consumers still use power as if it were a static resource; wholesale prices oscillate though each day. In many parts of the country, power prices are actually negative at regular times each week. Most goods can stay in the warehouse overnight; electricity cannot. We can win great savings by smoothing power demand. Without price signals, end users in buildings and homes have no incentive to help.

The grid is built for peak capacity. 17% of the grid's generating capacity is used for less than 110 hours a year. This capacity is the dirtiest and by far the most expensive generation. These plants may even be spun up but idle, ready to be called into use if needed. The system as a whole bears the cost of this very expensive peak load. If consumers in buildings, homes and industry could respond rapidly to signals that the grid was nearing the need to use these resources, it would greatly reduce costs, both monetary and environmental. The power industry calls this Demand-Response, and as of yet there are no standards. OpenADR is a good start.

Today's power grid, and SCADA (Supervisory Control and Data Acquisition) strategies, and system operations are like Windows 95, limited by backward compatibility and hampered by the reasonable decisions of long ago. Perfecting Windows 95 led to the increasingly unwieldy Windows 98 and Windows ME. Sometimes it is better to simply go forward then to look backward at how things are done today.

Sometimes it is better to do things that aren't so hard.

The Demand-Side Problem

Building systems have traditionally been invisible and uncontrollable. They have been managed to reduce costs with no real focus on the service they are providing. They have grown up in sandboxes, using their own peculiar protocols. These protocols are deep and technology specific, and often without effective interface. These systems are operated, when they are operated by process specialists.

Building occupants rarely have a precise understanding of how these systems affect their business. They may know exactly what a too-hot or too-cold call costs. They know that tenant dissatisfaction may lead to un-renewed leases. They may suspect that under ventilation may lead to sleepy occupants, but can rarely put any exact price tag on that. This makes them conservative about making changes in building operations.

Demand Response (DR) is emerging a critical tool for dealing with peak load management. Peak loads are by far the most expensive and dirtiest electricity we have; their costs, on both bottom lines, swamping others. Demand response is moving from direct control to economic incentives, but underneath, today's integrations are process centric rather than service oriented. Energy providers order or pay energy customers to turn off things on just a few days a year, to manage the peak. We encourage only the crudest, least effective energy savings, while denying the market the energy signals that would cause better.

At the commodity system level, DR is already moving to services and agents. Agents defend their own mission while responding to the outside world. Washing machines know not to respond to grid signals until they determine that the current laundry is not soaking in bleach. Refrigerators know not to respond if they have just finished a defrost cycle. These systems know and understand what services they provide and so are ready to be responsive. Building systems are not.

Reliable Controls We will get larger DR when we talk to the building occupant. We will get better participation when the occupant remains in control. The occupant will not allow DR when the in-laws are coming for the weekend. The occupant knows the family overspent at Christmas and is willing to respond to any and all incentives. The access control system may know that only three people on the fourth floor came to work today. Human resources knows that the sales force is on a retreat. Together, they can choreograph far greater response from the building systems than ever will be permitted as an automatic response from control communications.

Demand Response must be about economic signals to a business entity. When thought of in this way, there is no need for different signals to Industry and to Business (and to home and to vehicle). The business may choose to automate this. The business may benefit from templates for response, whether developed by EPRI or by ASHRAE, which reduce the risk of considering participation. These choices and these templates are not part of the interface.

Standards and Interfaces

The interface between the grid and the buildings should not not concern itself with the underlying technology and control protocols. It should not be based upon BACnet, or OPC, or LON or any number of other low level control system protocols. The interface must be one that enables business decisions. Control systems should offer up service interfaces for choreographed response.

Whatever offer and counter offer DR requires, whether amount of load shed or maximum load used or time to respond must be in the interface, but no deep process. The smartgrid to building/industry/home interface is about how the Service Oriented Building can respond to the Service Oriented Grid. Just as in other services, the underlying processes should be hidden.


Inquiries about how it is done today are not always useful. Paving the cow paths to handle heavy traffic is not the best way forward. The goal of the new standards efforts is to support new markets that we do not today know or understand. They must stabilize the grid even as we add de-stabilizing new energy sources. They must promote better control even as we accept new players and more point sources of generation.

New business models will encourage a move from hierarchical command and control operations to symmetrical peer to peer negotiations on the power grid. Renewable energy sources will decrease reliability. Distributed generation will create more power sources not under the control of traditional utilities. Zero Net Energy buildings will make each end node both a buyer and seller of power.

What is the model? If we do this right, that question will be like asking what the new economy would look like before the DotCom boom…

To join the smartgrid-discuss@lists.oasis-open.org list, send email to smartgrid-discuss-subscribe@lists.oasis-open.org. The list is open to all, and there is no commitment to join OASIS or participate in a technical committee implied. List archives can be found at http://lists.oasis-open.org/archives/smartgrid-discuss/. For a general discussion of applying e-commerce standards to new energy, you may wish to read http://www.oasis-open.org/resources/white-papers/blue/


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