Ignore Volt/VAR optimization at your peril

Ignore Volt/VAR optimization at your peril

Following many years of gentle seas, the tide appears to be shifting with regard to regulatory policy toward energy efficiency (EE) initiatives. The days of relying on changes in consumer behavior to achieve energy savings are waning, as limits to that approach have been reached and EE goals nationwide continue to fall short.

Electric utilities presently have a tool at their disposal that is effective regardless of habits, energy-efficient appliances or CFL light bulb use. Voltage control specifically Volt/VAR Optimization (VVO) is a solution with many added benefits over Conservation Voltage Reduction (CVR) methods that have traditionally been used to achieve voltage reduction. VVO is not your grandfathers CVR and in order to get ahead of the regulatory wave right now, utilities should begin evaluating VVO solutions that provide more than just CVR benefits.

Beginning with the NARUC Resolution of November 2012, which stated that state regulatory bodies should remove all barriers to allow utilities to implement VVO/CVR as an EE tool, the waters have been slowly rising as regulators in various states are learning that VVO/CVR can have a significant impact on EE and conservation levels - all without any associated customer participation or required change in behavior. VVO/CVR offer great payback, relatively speedy results and customer benefits that are verifiable through the Measurement & Verification (M&V) process.

States leading the charge

Several states have been leading the charge. Maryland has directed its utilities to develop CVR programs to meet EE mandates by 2015. The PA PUC has approved the use of CVR as part of utilities plans for meeting state EE mandates. The Nevada PUC requested its utilities provide VVO/CVR plans and is supportive of CVR Pilot Programs. In California - spurred on by CPUC approval of VVO as one of ten utility smart grid initiatives - PG&E will soon have a VVO Lab & Field Pilot underway that the rest of the industry will be watching closely.   

On the back of these rising waters, a tidal wave is slowly building as industry first-movers, like American Electric Power (AEP) and other utilities in the Midwest, are asking for regulatory approval and revenue recovery for VVO as an EE/DSM measure in states like Indiana and Ohio, with Indiana giving approval so far. And this trend is sure to continue as regulators in other jurisdictions look to those states for precedent and become more educated on the advantages of VVO over CVR.

The challenges with CVR-only

A CVR-only strategy is limited to EE gains and demand reduction. With more advanced VVO solutions, however, the levels of EE gains and demand reduction are not only higher overall than those achieved by CVR, but VVO offers additional benefits. Real-time monitoring and intelligent, adaptive voltage control allow the operator increased visibility into grid operations while providing valuable information, and help reduce OP-EX maintenance costs and CAP-EX equipment spending by decreasing asset operations on load tap changers, voltage regulators and capacitor banks.

And as the smart grid continues to develop and adapt, advanced VVO solutions offer future-proofing by enabling increased circuit penetration of PV and DG resources down the road. Real-time monitoring and intelligent voltage control help utilities to both stay informed of associated power flow issues and mitigate against the disruptive influence of PV/DG intermittency on voltage levels.

Its time for utilities to get ahead of the trend and perform their own assessment of VVO technologies that offer more than just CVR benefits or risk playing catch up when the wave is looming overhead.

Source: Smart Grid News

SMART GRID Bulletin July 2017


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