- Dean, Advanced Collaborative Research Organization for Smart Society (ACROSS)

- Director, Research Institute of Advanced Network Technology (RIANT)

- Professor, Graduate School of Advanced Science and Engineering, Major in Electrical Engineering and Bioscience

Yasuhiro HAYASHI (WASEDA University)

Aggregation business framework

June 9, 2017

2

Agenda 1. Background

2. Communication standard for aggregation

3. Aggregation business

4. Future prospects and efforts

Energy saving and renewable energy for low-carbon society

3

COP21-Paris Agreement Japan committed to reduce CO2 emissions by 26% compared to 2013. Expand into policy

Ministry of Economy, Trade and Industry： Energy Innovation Strategy （April 2016）

Cabinet Office： Energy and environment innovation strategy NESTI2050 （April 2016） Plan to arrest global warming （May 2016）

Currently, Japan depends heavily on overseas fossil fuels （High geopolitical risk）

It is important to realize the energy mix centered on energy saving and renewable energy.

Electric Power System Reform & Markets

4

Spot Market (day ahead)

Negawatt Market

Adjustment Capacity

Procurement

Real-time Market

Capacity Market

1st reform

2nd reform

3d reform

Electric Power System Reform

Markets

Establishment of the Organization for Cross-regional Coordination

of Transmission Operators (OCCTO)

Full retail competition

Legal unbundling of transmission / distribution

sector

Abolishment of retail tariff

２０１５ ２０１６ ～２０２０

Period of transitional arrangement for retail tariff

1. Keep stable supply 2. Suppress electricity price 3. Expanding choices of customers and business opportunities

etc.

Hour-Ahead Market

Imbalance adjustment

Battery PV

Energy saving

Big challenge of the electric power system is ongoing

5

Supply Demand

Voltage / Frequency

Maintain demand-supply balance

Paradigm shift

Load

Renew able

Nega watt

Posi watt

Customer Large scale centralized power supply

Smartness of demand

Introduction of renewable energy

Combine distributed resources, aim for coexistence of different purposes DR・VPP

Voltage / Frequency

Unidirectional

Bidirectional Bidirectional

DR for Negawatt and Renewable energy control

6

Energy supplier

Or

Aggregator

When （Demand＞Generation）

Renewable energy

suppression request

When （Demand＜Generation）

Suppress demand

Normal Generation

Demand Demand

Time

Time

PV PV

Time

PV PV

Consume the generation

Demand Demand

Time

Demand suppression

request

Energy resource

Energy resource

Energy resource

Energy resource

Suppress generation

Energy resources aggregation

7

Demand

Generation

Demand＞Generation

Generation＞Demand

BESS

EV HP

Negawatt

Demand creation

BESS

Posiwatt

Suppress generation

BESS

FC

PV

Properly aggregation of Negawatt & Posiwatt

EV

EV

Light

Other devices

AC

BESS

EV HP

Light

Other devices

AC

FC

FC

Properly aggregation of Demand creation & Suppress generation

Industry creation through energy resource aggregation

8

Energy

Energy and related service

Price

Energy service

Incentive / price

Load equipment

Energy storage

Power supply

Price

Customer Resource aggregator / retail company

Res. A Ener

gy

Time

Res. B Res. C

Res. A Ener

gy

Time Ener

gy

Time Res. B

Ener

gy

Time Res. C

Transition to the distributed cooperative system that integrates and utilizes distributed energy resources (DER) such as renewable energy, highly efficient energy equipment, storage batteries, etc.

Energy resource

aggregation

Along with a major reform of electric power and gas systems, it is expected to create new industries

Transmission and distribution

company

Markets

Retail company

Virtual Power Plant

9

Parent aggregator Resource aggregator

Utility company

Control centralized power supply, adjust demand-supply balance

The aggregator integrates and controls energy resources on customer side using IoT, making it function as if it were a single power station.

Request demand-supply control

Customer side energy resource

1. Replacement of thermal power plant as adjustment power → CO2 reduction → Energy cost reduction → Improve energy self-sufficiency rate

2. Expansion of introduction of renewable energy → CO2 reduction → Improve energy self-sufficiency rate

Resource aggregator

10

Agenda 1. Background

2. Communication standard for aggregation

3. Aggregation business

4. Future prospects and efforts

Time and quantity negotiation

11

Utility Operation target

Control

Request

Utility

Control right Operate faithfully according to

instantaneous control instructions

Instantaneous control

Time and quantity request

Acceptance / availability

Aggregation of operation targets

Time and quantity negotiation

Operation target closely related to life

Ener

g

Time Res

Ever

gy

Time Res

Ener

gy

Time Res

In order to use the resources linked with social activities, the negotiation type communication system should be needed.

OpenADR is the communication standard suitable for time and quantity negotiation.

Battery

Generator

Air-con

Time and quantity request

Acceptance / availability

ERAB investigative commission and ERAB forum

12

Energy resource aggregation bussiness

Industry-academia collaboration

Neutral opinion

consolidation

Vision sharing

Transmission of

information

Environmental arrangement

Measuring method

Negawatt guideline

Aggregator requirements

International communication

standard

ERAB forum ERAB investigative commission

Control quantity

evaluation

Cyber Security

Communication standard for aggregation

With the negotiation type communication standard and progress of energy aggregation technology, the aggregation business works fine.

13

Transmission and distribution company

Retail company

Aggregator Aggregator

OpenADR

GW GW BEMS HEMS

Utilizing OpenADR

ECHONET Lite VPP Spec.

BACnet e.t.c.

Server-to-server cooperation Server-to-server

cooperation

Tokyo Elec Negawatt Order

Smart Cities

Aggregator

Incentive DR projects

Chubu Elec

Kansai Elec

Aggregator Aggregator

Automated Demand Response project (METI) Waseda University EMS R&D Center Bi-directional standard communication

TEPCO BSP program

Companies test site

Over 2000 customers

Negawatt guild line Base-line

ADR Signal

22 Aggregators

Chubu Area Kansai Aria Kanto Aria

Negawatt signal management server

ADR Signal

ADR Signal

ADR Signal ADR Signal

Negawatt Order

Negawatt Order

Negawatt signal management server

DR project: Estimation of reduction potential

15

Estimated one hour ahead DR potential of private power generator and air conditioner. Area: Nationwide Sector: Industry (excluding railroad) and business sector

Result: Stable prospect throughout year Summer = 13,893 MW Fall = 11,590 MW Winter = 14,597 MW

4,733 4,112 4,215

594610 607

1,3911,571 1,320

7,176

5,297

8,454

13,893

11,590

14,597

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

夏 13-17時 秋 9-11,13-19時 冬 9-11,17-19時

ポテ

ンシ

ャル量

(MW

)

Estimation result of negative watt potential.

13,893

Pote

ntia

l（M

W）

11,590

14,597

Summer 13-17

Fall 9-11, 13-19

Winter 9-11, 17-19

Private generator (Business)

Air conditioner (Business) Air conditioner (Industry)

Private generator (Industry)

Aggregator

PV suppression project (NEDO) Waseda University EMS R&D Center Bi-directional standard communication

PV Control signal

Renewable energy management server

Renewable energy order

Hokuriku Area Kansai Area Kanto Area

Roof top PV

Mid-size PV

Large scale PV

Waseda University EMS R&D Center

Smart Houses

PV Control Unit PV Control Unit HEMS

Tokyo Elec

Hokuriku Elec

Kansai Elec

PV Control signal

Renewable energy order

Renewable energy order

PV Control signal

Automated control under PV suppression (NEDO)

17

PV Control

Generated amount

PV Control event

Smart meter / distribution panel Load

ECHONET Lite ECHONET Lite Consumption

HEMS

Event sharing

If HEMS increases customer’s consumption, loss of power generation opportunity can be reduced

Even during PV control, if self consumption is increased, PV generation is permitted.

PV Control Unit

18

Agenda 1. Background

2. Communication standard for aggregation

3. Aggregation business

4. Future prospects and efforts

Business of energy resource aggregator

19

Energy resource

aggregator Industry Home

Aggregate the resources on the customer

side

T&D company Retail company Generation company Power supply procurement Imbalance avoidance

Adjustment Capacity Procurement Power quality maintenance

PV suppression avoidance

Provide collected resources as service

Electricity （kW, kWh)

- Price - Service

Electricity （kW, kWh)

Electricity（kW, kWh)

Price

- Price - Service

Types and Promotion of Negawatt Trading

20

Retailers reduce demand of customers of other companies to achieve the same amount at the same time

Grid operator reduce demand as adjustment power

Negawatt Market

Begin full-scale from April this year

Negawatt adjustment fee

Adjustment Capacity

Type１－１ Type１－２ Type２

Realized It is required to

provide various and attractive services

under a free competitive environment

Generation Generation Generation

Retail Retail X Retail A

Customer

Customer Customer

Retail Grid

operator

Aggregator

Aggregator

Aggregator

Retail contract Retail contract

Retail contract

Supply contract Supply contract

Supply contract

Negawatt contract

Negawatt contract

Negawatt contract

Supply contract Negawatt

contract

Contract for adjustment capability

Public offering result of adjustment capability

21

The transmission and distribution companies (10 companies) got the adjustment power by public offering in accordance with the guidelines of the Ministry of Economy, Trade and Industry.

The bidding using demand response (DR) was 122,000 kW for the total offering amount of 1327,000 kW for the five transmission and distribution companies. 958,000 kW (about 3,593 million yen) was awarded for four of them.

Aggregators that accumulated knowledge by DR demonstration projects made a total of ten successful bids(216,600 kW).

Types of adjustment capability

22 22

Result of public offering of adjustment capability

23

Capacity: kW, JP Yen/kW

24

Agenda 1. Background

2. Communication standard for aggregation

3. Aggregation business

4. Future prospects and efforts

Movement toward expansion of ERAB opportunities

25

Bid price （Yen/kW)

Highest bid price

kW

Bid amount

Conventional From now on

送配電事業者

Expanding transactions in the negawatt trading market

Conventional negawatt trade

Aggregator

Retail company (Retail contract)

Retail company (No retail contract)

T&D company Energy saving

Customers

Pow

er

supp

ly

Neg

awat

t

Cons

ider

atio

n

Expansion of bidding for public offering of adjustment power

Bid

pric

e (Y

en/k

Wh)

Bid amount (kWh)

Expansion of negawatt resources (Market)

26

Aggregate negawatt resources up to the minimum trading unit and earn profit by market contribution. ⇒ Inexpensive aggregation of small amount of resources using IoT and communication standard.

Expansion

Minimum trading unit of JEPX ■One day ahead market → Minimum＝1000kW (30min - 500kWh) ■One hour ahead market → Minimum ＝100kW (30min - 50kWh) Minimum suppression of demand per one customer ＝ 1000W (30min - 500Wh)

Bid

pric

e (Y

en/k

Wh)

Bid amount (kWh)

Buying bid Selling bid (Generated) Selling bid (Negawatt)

Investigation and implementation items of FY 2017 at ERAB

27

Transmission and distribution company

Parent aggregator

OpenADR

Cyber security WG Consider the way of cyber security measures when the aggregator connects to the transmission and distribution business operator

Control quantity evaluation WG Consider measuring method and baseline setting method when controlling equivalent to power supply I - b

VPP experimental project - Acquisition of control technology equivalent to power supply I-b - Verify the effectiveness of device-specific implementation guidelines for OpenADR

Resource aggregator Resource aggregator Resource aggregator

Building DRAS Plan to build DRAS experimentally at general transmission and distribution operators.

DRAS

ECHONET Lite WG Consider VPP compatible specifications of lighting, HEMS controller, etc.

FY2017 VPP experimental project

Negawatt control

Renewable control

Utility Utility

Utility

Retail Parent aggregator Resource aggregator

Social implementation of DR automation server

R&D of DR automation server

OpenADR

Aligned with the national energy policy DRAS R&D contributing to DR automation

Utilize research result

DRAS

Building DRAS that can withstand actual operation Scalability improvement through automation Operation for power supply I’ and I-b Demand creation DR control

Rapid control Verify the implementation guidelines Measuring method and baseline

Standardization

28

T&D

Neutral / fair

VPP experimental project

Renewable control

Load control

Resource aggregator

WASEDA University EMS R&D Center