Friday, November 21, 2014

Power, Energy, and Utilities

If I have this correct, Power is the product of Energy and time, so that whereas energy has the unit called a volt, which describes the difference in electrical potential over a given resistance (the resistance is expressed in ohms), power describes how much energy is transported over that resistance in a given time period (as in kWh that one reads on one's electric bill).  I'm not completely sure I understand the terminology, because there are not only volts, watts, and ohms, but also Amperes, which describes how much energy is put through one ohm of resistance by one volt...  It all seems fairly circular, but I suppose that's not so different than the definitions for the circumference, radius, and area of a circle (though the latter are more physically easily modeled and therefore make more sense to the likes of me).
Utilities like SDG&E provide power, over transmission lines which they (typically) build and also maintain.

I started reading an article by the Rocky Mountain Institute, found here:

http://blog.rmi.org/blog_2014_09_25_why_the_net_energy_metering_debate_misses_the_point

in which they discuss the problem of "net metering."

My initial reaction, when first approached with the problem of utilities paying small producers the same amount as the utility charges its customers was that the utility needs to separate the cost of the energy provided from the cost of transmission.  To that, I would now add a third element:  energy storage (capacity?), which has become a hot topic with respect to the electrical grid.  As it stands, electricity is not "saved" or "held in reserve."  What is produced must be used immediately, and therefore, so-called "peak" plants are being proposed by utilities, such as SDG&E, under the assumption that electricity demand will continue to rise, and therefore, they need "peak" plants, for which they receive government money to construct and operate.

Unfortunately for customers, while they still pay through the nose for peak electricity, the utilities (such as my local provider, SDG&E) appear to be double dipping, since they receive grants from the government for building "peak plants" so that they can provide such power in the first place.  SDG&E takes no risk in its investment, and yet reaps the rewards from both taxpayers and ratepayers.

Just yesterday morning, I watched a few presentations by VPs of energy storage and management firms, including Tesla, who is building a factory in Nevada for the production of high capacity (think utility-scale) batteries.  One smaller firm, called Sunverge Energy, is working with smaller capacity energy producers, some as small as multi-residential housing complexes like condominiums (condominia?), who install batteries in addition to on-site solar generation.  Smaller capacity batteries ensure consistent power service to the customer as well as leveling off the customer's peak demand on the grid, thereby avoiding "peak charges" that utilities (such as SDG&E) demand during those times, such as the middle of (hot) summer SoCal afternoons, when many folks run their (electric) A/C units.

As battery storage becomes common, utilities will be pushed even further to move their business model from a "one stop shop energy producer/provider" to that of an energy broker or power transmitter.  They can keep their role of keeping the wires and lines in good repair, and allow others to put their energy onto the grid (and therefore the market) to charge what they will for the power they produce.  Not so unlike Ma Bell back in the day?...


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