 This is Guillermo Sabatier, your host for the show. I am the Director of International Services for the Health and Safety Institute, and this week I am coming at you from Bacaville, California, and I was here for work. I'll be flying back home tomorrow, back to Florida. We were fortunate enough to have avoided the effects of Hurricane Ian, but some folks on the other side of the state were not. So again, thoughts and prayers go to them, and by the time we get back home, we will probably be doing some work in order to assist. So along with those topics today, we're going to be discussing what's next with distributed energy resources. It's rather interesting the fact that we're looking at a potential use of a resource that could be useful in these sort of situations, such as a hurricane or a system-wide blackout. That's the first thing that comes to mind, right, is having the ability to be able to be self-sustaining, the fact that you're a resource, you have both solar, the ability to generate, and then you also have storage, whether it's a battery or in the form of an EV, like your vehicle, or something like a Tesla Powerwall, for example, that ends up, you have that deployed in your house. Either way, combine those together and you have yourself a pretty reliable resource that should keep you running for a few hours at least, sometimes longer. One of the things we're seeing now is a lot of incentives, especially here in California, for example, I'm seeing quite a bit of rooftop solar everywhere, and I see the effects of that as far as how that is dispatched and how they operate that from the perspective of a bulk electric system. So PG&E along with other larger utilities are currently in the process of carrying out some testings of pilots on how to dispatch distributed energy resources and integrate that into the grid, more so like a partnership between the prosumers, which is both a consumer and producer of energy, and the utilities themselves. So right now they're undergoing that pilot and ideally what they're going to end up doing is using those resources as another virtual power plant. Now in Florida, one of the larger utilities, Florida PowerLite, has currently been offering an incentive program that will pretty much cover the cost of a level two charger and meaning the materials, the installation, the permitting, the labor, and they will give you unlimited off-peak charging, and all they require is a commitment of 10 years and the monthly payment of that. It's about $36 a month, between $35 and $40 a month. So that's really a bargain because an example would have been like a Tesla Model 3 at about 2,000 miles a month, daily charging, where I'm at, it'll run you about $120 a month charge, and that's your energy expenditure, right, for charging that vehicle pretty much every day. So at 2,000 mile commute monthly, for example, that's about, on that EV, it's about $120 a month. So even at that rate, being charged $36 a month for that unlimited off-peak charging is an incredible bargain. Now, the incentive there, of course, is they will be able to control the time and rate of charging, especially off-peak charging, but what I anticipate will be the next step in the revolution will be coming up with a partnership and agreement with the automakers that will allow them to then dispatch those devices. And I say the word devices, meaning the EV batteries, right, they'll be able to dispatch them using some kind of software that they'll agree on, and ultimately use that as a resource, depending on what the utility needs. Well, of course, that could be anything from supplementing their generation resources or the way to even providing voltage or frequency support. The other stream case would be naturally using that far off into the future, perhaps as a black star resource or something to recover from a blackout, which becomes interestingly important during these events where you have natural disasters. Now, on the other side of the spectrum, of course, is the challenge and the risk of having an energized conductor from the customer side back into the system that definitely presents a certain level of risk for utility personnel, especially when they're working in restoration. So there will be some kind of interlock or lockout where they will have to be somewhere in the some breaker, some breaker on the customer's meter side will have to be opened automatically, and that will prevent that backfeed from getting into the system. So there we see that particular case for that. And I'm suspecting a lot of different utilities are going to start doing this as well. We just saw some of the co-ops were also taking advantage of some of the incentives offered as well, not just the level to chargers, but also so they were getting into the fiber communications business. So when they're deploying fiber optic communications systems out in the rural areas through their distribution circuits, and then they're getting involved with the telecommunications part of the market, then there's definitely an opportunity there for not just the ability to get into the high speed internet, but also the ability to control all of these resources, much more efficient. Clearly, the ability to do this depends a lot on high speed internet and getting the telemetry back and getting the control from the control centers down to the individual prosumers or distributed energy resources. So where does this leave us as a, I guess, as a nation, right? Ideally, what we're looking at the transition from where we're at today to eventually having zero admissions generation. And that is impossible to do right now with the step change. You just cannot go totally also or all wins without having a certain type of mix in your portfolio. So some of the viable transition generation resources could be natural gas like we're using now, and we're using a lot more of it. But the idea in the next few years, we'll probably be looking at small modular reactors, which the Department of Energy had just approved several designs. So we'll be seeing a few of these deployed the next few years, particularly smaller SMRs, small modular reactors, SMRs that will be probably about the size of 20 or 40 megawatts. And those could be deployed pretty much anywhere in the country, close to load centers, specifically, and varied on the script and not a large footprint. The other interesting thing about them is that they're completely modular, which means they'll be able to be once the fuel expends and those fuels last over a decade or more. They'll be able to pull that modular reactor out replaced to the new one and so on and so forth. The other thing is that technology is going to be improving. We are quite a bit behind the rest of the world when it comes to nuclear technology development, along with training that the personnel that comes along with that. So as we progress forward, hopefully this will be a change for us as we're better positioned globally to be a major energy producer. Now, as we're looking at other events throughout the world, and I'm sure you're familiar with what's happened with the Nord pipelines up in the Baltic Sea, for us as an opportunity to be able to help Europe with our natural gas or even our LNG, which has to be shipped over there in maritime commerce, which of course adds greatly to the price of that commodity. So for them, getting natural gas from Russia was inexpensive and always available, whereas now their natural gas has to come in the form of LNG literally shipped from the US to Europe. So that makes a price way more expensive. So hopefully with that, that'll give them a better chance of doing well this winter because they do expect a rough winter. Now, given the fight that, for example, Germany has had some severe issues with their expected energy supplies, France has stepped up and has been providing them with a lot of electricity, mainly from their nuclear fleet. I mean, France, I think it's the majority of their portfolio runs on nuclear energy. And those generators are dispatchable, meaning that they don't sit at base load 24 hours a day for months at a time. They are dispatched a lot of cases just like a conventional internal combustion or fossil fired plants, which natural gas or anything else like that. So usually a lot of resistance from that in nuclear, but France is really at the cutting edge of nuclear energy. So the South Koreans have done a credit good job as well. Now, they installed two reactor unit over there in Dubai and they're doing the same thing for Saudi Arabia pretty soon. So as this begins proliferate, you're going to see the resurgence of nuclear energy back again, mainly because of the fact that we don't have the resources to be able to look or rather the reliability and the renewable resources that we have right now. Now, that being said, I mean, it's not every place will be as inviting for a large nuclear site. So that's why the SMRs may become more attractive in markets like ours throughout the country. And so what else can we do in really reality, right, rather than relying on gas, trying to build up a nuclear site that's dispatchable, or dealing with the variability of renewable resources? Well, one of the answers here is the distributed energy resources and as as more and more buildings have them, the fact that they'll become more of a viable resource when they're aggregated throughout the country. And a lot of utilities just seem to start are looking at that with a serious application as a as a reliable resource. Now, that is challenges. I mean, for an EV, you can probably run run a whole house for quite a quite a few hours and looking at the example of the Ford Lightning pickup truck. And based on the capacity of that vehicle has, you know, they can they can run the house typical 1500 kilowatt load, right, and then household for a few hours, which really is enough to get through like a minor disturbance, right? But something like what happened in Florida, it's going to take a whole lot more to be able to manage that. I mean, possibly if if the solar panel survived the wind damage, and that's a big if then you can then hopefully you charge your batteries on a daily basis, and then you can rely on that the rest of the day. But unlikely that you'll be able to sustain yourself 24 hours, not in the current state of technology or efficiency of panels, or unless you have a large enough battery bank, you continually charge but with motor loads like running air conditioning, or or something else that may take a long time. Which brings me to my next point. There is the possibility of using a lot of heat pumps out there in colder environments. So those heat pumps themselves become a potential source of stored energy as well. So a lot of different options that can be used at this time and they're being looked at. And one of the challenges that that we see, of course, is the the ability to dispatch these resources. So currently at this time, I see rooftop solar or or the utilities where they're using where it comes to storage is naturally it's being viewed as negative load. So when you have when you have the load during the day and the your resources are putting up energy from that regarding all you'll see it is a decline in load and sometimes that load drops pretty low between the hours of 10 and three and 10 am and three in the afternoon. Well, that's when the sun is brightest. So the challenge there is to treat it as a virtual power plant, which again, is the aggregation rule of FERC issued an order last year about a year before last, I'm sorry, about order 2222 allowing aggregation. But no, that's yet to be seen as far as that develops. So having so next question that we have, right, is running off of these distributed energy resources, right? So the dispatch ability is one aspect of it. But what happens when when all this flow coming in for the distribution network is flowing its way back into the transmission system or the bulk electric system, right? So eventually, that's going to cause either some kind of instability, or it's going to prove very difficult to be able to plan or run system studies with that particular resource in mind. So especially when almost every house out there is going to have this, right? Sooner or later, a lot of the majority of homes here in California, from what I'm seeing, you know, have have solar panels. I mean, it's only a matter of time before they begin to install batteries, or they begin to hook up their use their EVs as a resource. And they combine all that together and you have the ER distributed energy resource. So the next step in this case really is coming up with really it's getting the automakers to agree to be able to dispatch the cars as a dispatchable resource. Naturally, you know, that could that could affect the way they they apply warranty, so those devices that make sure in the life of the certain batteries. So of course, that there's going to be an incentive where the utilities will probably pay for availability. And they'll certainly pay a little more perhaps for the use and the dispatch of that resource at that time. But right now, not a lot of automakers have agreed to to make to make this available, much less agree on a common protocol to be able to run these resources. But that's coming. That's that seems to be next on the horizon. And once that hurdle is overcome, I think it's going to be the next phase in the evolution of this particular resource. Now, that's all well and good. But how do you control all these resources? How do you collect all this data real time, manage it, give yourself turn this data into useful information, and then make decisions based on that meaning you have to control the system and that happens second by second, 24 hours a day. So that in itself is going to be a big challenge when it comes to communication and bandwidth for having this sort of visibility and control of all of these resources. So for now, it seems like one of the one of the companies that I think is ahead of the game when it comes to developing this, this is perhaps OATI. They're they've always been ahead of everything else when it comes to managing energy transactions. And they themselves are already quite involved in the distributed energy resource management systems, software. So my bet will probably be beyond them. I mean, Siemens is doing its work. National Renewable Energy Labs has also done quite a bit of work with that. And there's at least for any other other organizations that are competing for that, that particular protocol that that will win out over everybody else. So, so we'll see. I mean, there's still some time before we see any viable and useful come out. But no, but I think open access is company is probably going to be ahead of everybody else in this regard. Now, on the topic of the ERs and where we're headed, right? I think to me what's next is really is going to be a partnership. Once all of those technical hurdles are ironed out and overcome, the really is going to be more of a partnership between the utilities. And ultimately, the customers and in the middle of that, it won't it won't longer be just the transmission operators. It'll also be the distribution providers. So now the distribution providers won't only be so watching flow go from from top to bottom in their direction. Now it's going to be flowing both directions. And occasionally, there'll be something as granular as customers buying and selling power from each other on the secondary bus. So that would be interesting. And a lot of those applications will more than likely be run on a mobile platform, or at least you'll be able to access it on a mobile platform. Clearly, there's going to be some hardware that operates behind the meter at the customer side. And that, of course, always links up to the utility. And at the same time, you will need a lot of bandwidth. But one of the things that that that is being foreseen is really having that kind of flexibility and availability to be able to sell and share or do peer to peer energy trading between neighbors, so to speak. The next stage of that will be, of course, selling buying into or participating in a larger aggregator market, where you are one of thousands of people that are throwing your few kilowatts into this larger pool. And that aggregator is a virtual power plant that will be deployed somewhere in the system. So we'll see what happens then. Of course, my biggest concern of all really with all these developments is first and foremost will always be cybersecurity. Once you begin to introduce always different access points, you know, now you have a real challenge when it comes to not just keeping everybody out, but the sort of damage that this could this could incur on a system, meaning you have one dominant platform that runs all of these aggregators or even all of these smaller DERs. Can you imagine that particular platform being compromised and then they're able to control the input and the output of those resources? That could really cause some damage in the system. So hopefully that's that's what I think would be one of the one of the biggest risks at this time. I mean, once we get past all those hurdles and then we get the technology ironed out, we get the agreements between the automakers, the battery manufacturers and the utilities, you know, and to the point that you get customers on board with that partnership where they're getting in some kind of equity in that in that participation, whether they're being paid for the energy they sell back or they're being paid for them to absorb all this energy as excess or even being paid to be available, right, for this batch in a system. It could be a matter of both the support or frequency support. Once all that's figured out that that next hurdle really will be will be cybersecurity and hopefully that's being looked at way ahead of everything else because a lot of those competitors that are buying for those protocols, I'm not going to mention the names right now, but a lot of those are working in an open source platform, which is great. We want to share a lot of answers and resources, but that also can introduce the potential for a lot of accidental or even deliberate vulnerabilities that can be later on accessed and used against us or even weaponized. So, I mean, there are a lot of bad actors out there. Some of those are individual hackers, but some of those are also nation states that are that are causing them looking at ways to be able to affect us as a nation. So this could easily be one of those things that gets rolled into the whole national security. I mean, treating energy as a national security policy. So I mentioned that before in previous shows and it's something that they store resonate with in the fact that as we move further along with this tech, it's going to be something even more significant. So, and ideally, we shouldn't completely do away with fossil fuels. There should be like a small minimal base load requirement to have that in order to give ourselves that kind of to give ourselves diversity when it comes to the way we generate energy. Relying too much on one thing is also dangerous. I mean, a lot of utilities right now have a large reliance on natural gas. Of course, natural gas is only makes a fraction of the emissions that oil used to make or carbon for that matter. A lot of utilities have used natural gas to move away from these large emission producing resources. So again, that's been the transition of fuel. And as the years go by, they get a lot cleaner and the natural gas is rather abundant and expensive and it's a lot cleaner than oil and natural gas. But eventually, there is a pressure to get away from that entirely. So we will see where that leads. Right now, we're in a business apparently of selling a lot of natural gas to Europe. So for now that, you know, we're going to be in that business for a while, it seems. Hopefully, nuclear over there makes a comeback. I know that I have it completely retired or dismantled some of the nuclear plants. I think they can still be brought out of mothballs and brought back online, but that wouldn't be, that's not something that will happen right away. So it could be take some time. But along with that, though, I am pretty optimistic that these DERs will be a very viable and significant resource, especially when treated as a partnership between the utilities and all of the consumers. So it seems like a bright future and I really look forward to. Anyway, that's all I have for today. I want to thank you all for taking part and if you have any questions, just make sure you like us, subscribe and write questions and comments and I'll try to get to them and answer them if I can. So thank you again. Thank you so much for watching Think Tech Hawaii. If you like what we do, please like us and click the subscribe button on YouTube and the follow button on Vimeo. 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