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B2G - Moving Smart Grid, Beyond the Grid
The opportunities of integrating smart buildings with the Smart Grid
successful in 2011, the industry needs to focus heavily on developing
the value proposition, business models, and technologies to ensure the
transition of Smart Grid, beyond the grid, is a success.
The Value Proposition
is the value proposition of B2G? The value proposition of B2G is
crystal clear if you understand Smart Grid. The key to understanding
the value of B2G is appreciating that one of Smart Grid’s critical
functions is to facilitate demand side management (DSM).
DSM is a way for utilities to create virtual power plants, what many call “negawatts,” where the avoidance of generating a megawatt is more valuable than actually generating the same megawatt. Thus, buildings that can drop load when capacity is short can benefit in real terms financially.
great for carbon reduction and thus climate change, the growing amount
of renewable generation sources on the grid can create havoc for grid
operators as they work to maintain the fine balance of supply and
demand. Consider what happens when 30 percent of generation comes from
solar and wind, and the sun is suddenly obscured by clouds and the
winds die down, causing a major drop in power within seconds! The
amount of electricity available will be reduced, and without backup
generation available, the only option would be to reduce demand
quickly. How is this done? By sending a signal to large loads – like
buildings – to essentially switch large-consuming devices “off” based
on the building owner’s preferences.
The above two scenarios are clear examples of how linking buildings with the grid -- B2G -- can create significant value.
So how is this value captured by businesses in this new emerging market? A few models are emerging; although, in reality, we are still in the early days of B2G innovation.
Demand Response (DR) companies, like EnerNOC, Comverge and
Constellation Energy, are making big waves to monetize B2G
opportunities focused on curtailing demand when electricity prices are
high. If building operators can buy and sell power based on the
market price of electricity, then there is an opportunity to lower the
overall energy bills for the building. Working with utilities and
Independent System Operators (ISOs), who manage the regional wholesale
electricity market, DR companies and building automation solutions
(BAS) providers could realize tremendous business opportunities in the
B2G space by helping building operators facilitate DR activities.
As building systems connect to Smart Grid, the need for technology to help manage the growing complexity of building systems will be required – providing opportunities for industry entrepreneurs. From data normalization to managing complex control system logic strategies, BAS contractors and integrators should find tremendous opportunities suited to their expertise, technology, and business profiles.
bring additional value to businesses through equipment retrofits,
continuous commissioning, predictive maintenance, and increased
intimacy with existing building owners whom many BAS companies have
strong relationships with.
What technologies are required for this business area to flourish?
the technologies on the building side already exist today in building
automation systems. BAS today can handle extremely complex logic in
controlling HVAC equipment that make up the largest percentage of
energy loads within buildings. BAS providers typically do this to
ensure occupant comfort, while relegating management of energy
consumption since the cost of energy is generally low in many parts of
the world -- particularly in North America. Tweaking BAS to take input
from external sources, such as signals from the utility, would not be
One of the missing components is the availability of standards, since it would be much more effective if there were a single mechanism to connect buildings to the grid. Fortunately, partly as a result of the standards work being done by the National Institute of Standards and Technology (NIST), a number of critical standards are now evolving to help ease the integration of Smart Grid with buildings.
An initiative called OpenADR, initially created by the Lawrence Berkeley National Laboratory, is now providing a focused solution to implementing open automated demand response (OpenADR). A number of vendors are implementing or planning to implement OpenADR into products that should come to market soon.
Expanding Smart Grid Beyond the Grid
For a number of years now, the Smart Grid has been promoted as the next “big thing” in electric grid technology. While this may be true, the focus has mainly been on the utility’s grid and the modernization that is necessary for the grids of the western world to manage an increase in loads, and the building of new grids in developing parts of the world to provide much-needed energy for economic growth.
The reality of the Smart Grid is that it will affect the full, end-to-end energy system from generation (wherever it may be) to consuming devices (wherever they may be). This, by necessity, has to include electricity consumers that are both small (residential) and large (commercial and industrial).
Smart Grid cannot happen without smart buildings, and B2G is the bridge to make this happen and a significant opportunity for building automation players.
The B2G Summit at AHR Expo
Working in conjunction with many organizations in the Smart Grid and BAS areas, Clasma Events is organizing the B2G Summit for the fourth consecutive year at the AHR Expo in Las Vegas on Tuesday, Feb. 1, 2011.
The summit will be a great venue for BAS professionals to better understand the opportunities around B2G, and to network with thought leaders in the space. For more information, visit www.b2g-summit.com.
Major gathering at ConnectivityWeek
out, the major gathering for B2G will be at ConnectivityWeek in Santa
Clara, CA, taking place May 23-26, 2011. With an expected 1,500
attendees, the BuilConn and DR-Expo portions of ConnectivityWeek will
dig in much more deeply into the opportunities for businesses in the
growing B2G space. For more information, visit www.ConnectivityWeek.com.
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