Research and Innovation

Transactive Energy Framework – The Rise of the Sharing Economy in Utilities

 
April 24, 2018

The growing importance of distributed energy resources (DER) in the electricity distribution system has effectively democratized energy. The erstwhile consumers of electricity, in avatar of prosumers, are now able to generate enough energy to fulfil not just their own needs but also sell the surplus back to grid or their neighbours. It made perfect long-term commercial sense because by 2020, renewable energy is slated to be consistently cheaper than fossil fuels. However, the closer we move towards that goal and these DERs become commonplace, the grid becomes immensely complex with a network of millions of control points. These developments in the distribution grid will not only impact the share of energy supplied, but also introduce new challenges in the era of transactive energy (TE).

To enable active prosumer participation and exploit available green energies for environmental sustainability, the evolving smart grid will require a control mechanism and an economic framework for governing transactions between all parties. GridWise® Architecture Council (GWAC), supported by US Department of Energy (DOE), has developed a TE Framework (TEF), which dynamically balances “supply and demand across the entire electricity infrastructure using value as a key operational parameter.”

Utilizing Flexibility of Demand

The intermittency of renewable energy sources makes it very difficult to maintain this supply-demand balance. TEF can help utilize the flexibility of demand by sending a transactive signal – taking into consideration willingness and preferences of prosumers to derive such a signal. This entire ecosystem can then be thought of as a retail electricity market where participants submit their demand and supply bids. The distribution system operator (DSO) will match these bids to clear the market and find a market-clearing price. Each participant can then compare this market-clearing price with its bid price and act accordingly. In a typical TE model, these participants could be prosumers or the devices. With millions participating in a distribution grid, it is important to have a scalable TE model, smart devices, and sophisticated control systems to run the system within technical limits.

Reimagining Reliability and Resiliency

To develop a roadmap for making energy distribution more reliable, resilient, efficient, adaptable, and sustainable, the concept of a dynamic microgrid configurator (DMC) will be very useful. DMCs configure the distribution network into multiple irregular honeycomb microgrids to meet variable electrical load demands. These flexible structures can be created based on the network topology, line power flows, weather, demand, and distributed energy resources. During normal operations, the DMC will periodically run an algorithm to configure these dynamic microgrids (DMs) through network topology processing (NTP) and distribution power flow (DPF). Current DM configurations will be readily available to the DSOs, and the DMs will continue to operate as one interconnected network. Islanding options will be exercised only when contingencies or events such as faults occur.

By continuously redefining microgrid boundaries, it will easier to transition to an islanded mode during faults and return to interconnected mode when the network resumes normal operations. These seamless transitions are supported by a distribution automation infrastructure, such as intelligent switches or reclosers, which come with efficient communication capabilities – both hierarchical and peer-to-peer. DMs provide additional degrees of freedom to the DSO to address critical issues – which may arise from temporal variability of renewable sources and penetration of plug-in electric vehicles (PHEVs) resulting in a dynamic shift of point of connection of source and sink nodes.

Bringing the two together

Given increased DER penetration will ensure continuous supply in case of islanded microgrids, consumers will experience uninterrupted power under any grid conditions with dynamic microgrid based operations (DMBO). We can measure DMBO’s performance by evaluating it against a defined set of KPIs tied to distribution efficiency, load balance, and more. However, the willingness and preferences of the DER providers must also be taken into the consideration.

The DMC-TE co-simulation platform will be capable of responding to the changes in grid conditions to create dynamic microgrid groups, which satisfies the economic, and control mechanisms of a TE system. In the broader scheme of things, a DMBO will help utilities cope with high price elasticity as the energy generation and distribution market become even more democratized.

To bring various stakeholders together to create and demonstrate modelling and simulation platforms with different TE models, National Institute of Standards and Technology (NIST) recently announced “The Transactive Energy Modeling and Simulation Challenge for the Smart Grid” (abbreviated as TE Challenge). TCS has actively participated in the two phases of the challenge, and has developed and demonstrated the TE models.

To know more about this, please connect with utilities.marketing@tcs.com

Narayanan Rajagopal is a Senior Scientist with the Research & Innovation wing at Tata Consultancy Services Ltd. He has over 27 years of experience in the area of Power System. He has extensive work experience in Product Development, Research, System Application, Test system development, and Customer training areas of Substation and Distribution Automation systems (SA and DA), Major areas of his current research include development of new solutions meeting the challenges faced by electricity utilities including integration of distributed energy resources and microgrids. He completed his graduation from University of Madras and masters from Memorial University, Canada, in Electrical Engineering. He is a certified Smart Grid Maturity Model Navigator, Senior Member of IEEE, Member of IET, UK, and Member of Institution of Engineers, India.