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Power Grids Should Be as Data Driven as the Internet

Real-time information on supply and demand and electricity pricing will improve how we use the grid

3 min read
Illustration of a hand holding a smart phone with plugs on the screen.
Illustration: Dan Page

Governments aresetting ambitious renewableenergy goals in response to climate change. The problem is, the availability of renewable sources doesn’t align with the times when our energy demands are the highest. We need more electricity for lights when the sun has set and solar is no longer available, for example. But if utilities could receive information about energy usage in real time, as Internet service providers already do with data usage, it would change the relationship we have with the production and consumption of our energy.

Utilities must still meet energy demands regardless of whether renewable sources are available, and they still have to mull whether to construct expensive new power plants to meet expected spikes in demand. But real-time information would make it easier to use more renewable energy sources when they’re available. Using this information, utilities could set prices in response to current availability and demand. This real-time pricing would serve as an incentive to customers to use more energy when those sources are available, and thus avoid putting more strain on power plants.

California is one example of this strategy. The California Energy Commission hopes establishing rules for real-time pricing for electricity use will demonstrate how overall demand and availability affect the cost. It’s like surge pricing for a ride share: The idea is that electricity would cost more during peak demand. But the strategy would likely generate savings for people most of the time.

Granted, most people won’t be thrilled with the idea of paying more to dry their towels in the afternoons and evenings, as the sun goes down and demand peaks. But new smart devices could make the pricing incentives both easier on the customer and less visible by handling most of the heavy lifting that a truly dynamic and responsive energy grid requires.

For example, companies such as Ecobee, Nest, Schneider Electric, and Siemens could offer small app-controlled computers that would sit on the breaker boxes outside a building. The computer would manage the flow of electricity from the breaker box to the devices in the building, while the app would help set priorities and prices. It might ask the user during setup to decide on an electricity budget, or to set devices to have priority over other devices during peak demand.

Back in 2009, Google created similar software called Google PowerMeter, but the tech was too early—the appliances that could respond to real-time information weren’t yet available. Google shut down the service in 2011. Karen Herter, an energy specialist for the California Energy Commission, believes that the state’s rules for real-time pricing will be the turning point that convinces energy and tech giants to build such smart devices again.

This year, the CEC is writing rules for real-time pricing. The agency is investigating rates that update every hour, every 15 minutes, and every 5 minutes. No matter what, the rates will be publicly available, so that breaker box computers at homes and businesses can make decisions about what to power and when.

We will all need to start caring about when we use electricity—whether to spend more money to run a dryer at 7 p.m., when demand is high, or run it overnight, when electricity may be cheaper. California, with the rules it’s going to have in place by January 2022, could be the first to create a market for real-time energy pricing. Then, we may see a surge of devices and services that could increase our use of renewable energy to 100 percent—and save money on our electric bills along the way.

This article appears in the August 2020 print issue as “Data-Driven Power.”

The Conversation (0)
This photograph shows a car with the words “We Drive Solar” on the door, connected to a charging station. A windmill can be seen in the background.

The Dutch city of Utrecht is embracing vehicle-to-grid technology, an example of which is shown here—an EV connected to a bidirectional charger. The historic Rijn en Zon windmill provides a fitting background for this scene.

We Drive Solar

Hundreds of charging stations for electric vehicles dot Utrecht’s urban landscape in the Netherlands like little electric mushrooms. Unlike those you may have grown accustomed to seeing, many of these stations don’t just charge electric cars—they can also send power from vehicle batteries to the local utility grid for use by homes and businesses.

Debates over the feasibility and value of such vehicle-to-grid technology go back decades. Those arguments are not yet settled. But big automakers like Volkswagen, Nissan, and Hyundai have moved to produce the kinds of cars that can use such bidirectional chargers—alongside similar vehicle-to-home technology, whereby your car can power your house, say, during a blackout, as promoted by Ford with its new F-150 Lightning. Given the rapid uptake of electric vehicles, many people are thinking hard about how to make the best use of all that rolling battery power.

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