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TOU Rates + Solar + Storage = New Innovations for Grid Optimization

Time-of-use (TOU) rates mean customers pay more for electricity when demand is higher and less in time periods that it is lower. They’re a great way to encourage people to use less energy at peak times, and more and more utilities across the United States are using TOU plans to help smooth load profiles. In California, for instance, time-variable rates will be the default by next year.

Of course, TOU rates have been around for a long time, especially for commercial and industrial electricity customers. But recent advances in solar and storage technologies mean their time to shine in the spotlight may finally have come.

Here are a couple examples. Tesla has just released a software update for its Powerwall 2 home storage battery that allows homeowners to take better advantage of variable energy costs, by scheduling their own time-based controls. Additionally, customers with smart thermostats can often take advantage of software features that will optimize their HVAC usage based on these TOU rates.

Customers can use a home battery pack in a few different ways. They can use it just like a backup generator, which kicks in during a power outage. Or they can use it to store energy from a rooftop solar array, to maximize the amount of self-generated energy they use, and rely less on the grid, even after sundown. They can even charge the battery from the grid during low cost times and discharge to end uses during higher demand (and rate) periods.

And now, in areas with variable TOU energy rates, consumers can use a home battery pack or smart thermostat to maximize savings by load shifting throughout the day. Tesla’s new update means customers can program their Powerwall to store low-cost energy during off-peak times and use it to power their home when grid electricity is more expensive.

In fact, smart thermostats and Powerwall actually learn how you use energy. By monitoring your energy usage and solar energy production (if your home has photovoltaic panels), they forecast future patterns and, using your utility’s price scheduling data, optimize the times they charge and discharge. As they learn, you are guaranteed to always get the best value without having to change how or when you use energy.

Home battery packs like Powerwall and smart thermostats can help smooth the load profile of individual homes—and the cumulative effect naturally allows utilities to manage larger-scale demand fluctuations more easily. But now, storage packs are also being linked together in virtual power plants, which aggregate customer storage into a useful grid resource.

In Hawaii, for example, EnSync Energy plans to install a 750 kW photovoltaic panel canopy over the parking spaces of a 320-unit affordable housing development at Keahumoa Place, along with a 500 kWh energy storage system.

All the individual solar and storage modules will be interconnected using the pioneering “True Peer-to-Peer DC-LinkTM” behind each home’s utility meter, so that the energy of the solar-storage system can be shared super efficiently across the network of homes.

When a home generates more energy than its load, it will charge that unit’s battery. Once the battery is full, the DC-Link will channel any additional energy generated to other homes in the network that, at that time, are using more energy than they’re generating or storing.

Brad Hansen, the president and CEO of EnSync, says being able to control loads with storage not only creates efficiencies that make clean energy affordable for lower-income consumers, it also “dramatically reduces the negative impacts of tenant vacancy, absence and vacation schedules … as well as micro-loading effects from appliances such as refrigerators and air conditioners.”

EnSync Energy is working with Hawaiian Electric to connect the system to its grid, so they can provide power to future Keahumoa residents as an on-demand back-up resource. Many multi-residential projects create fluctuating, inconsistent loads and inject an intermittent energy resource to the grid, which can be destabilizing. But the plan is that the aggregated, predictable load profile of the Keahumoa solar-storage system will create a stabilizing effect for the Hawaiian Electric grid.

These are just two examples that show how using solar and storage technologies alongside variable electricity pricing generates intriguing opportunities for innovation. Not only can customers maximize savings on their energy bills by managing their usage throughout the day, but utilities can benefit from ever smarter grid optimization. And that’s great news for everyone. To learn more, contact a Franklin Energy expert today.



EnSync’s solar+storage to allow energy sharing in Hawaii, Utility Dive, 10 May 2018: https://www.utilitydive.com/news/ensync-system-in-hawaii-combines-solar-and-storage-to-allow-energy-sharing/523234/

Tesla software update allows Powerwall 2 owners to optimize for time-varying rates, Utility Dive, 15 May 2018: https://www.utilitydive.com/news/tesla-software-update-allows-powerwall-2-owners-to-optimize-for-time-varyin/523588/

EnSync Energy Announces Solar Plus Storage Project with True Peer-to-Peer Network at Hawaii Affordable Housing Project, Cision PR Newswire, 9 May 2018: https://www.prnewswire.com/news-releases/ensync-energy-announces-solar-plus-storage-project-with-true-peer-to-peer-network-at-hawaii-affordable-housing-project-300645091.html

Tesla releases Powerwall 2 update to let owners take better advantage of variable energy costs, Electrek, 13 May 2018: https://electrek.co/2018/05/13/tesla-releases-powerwall-2-update/

Support: Time-based control, Tesla: https://www.tesla.com/support/energy/learn/powerwall/time-based-control


Greg Wassel
Written by Greg Wassel

Greg Wassel understands that grid optimization is key to our industry’s future. He is responsible for identifying new and innovative approaches to integrated demand side management programs, forging partnerships with industry-leading companies to enhance operations and developing new products and services for clients. Greg also leads our grid optimization product line and monitors demand response and other distributed resources program performance, ensuring quality every time. Greg supports our existing clients and business development teams by conducting regular best practice and innovation meetings to ensure that each client is kept up to date regarding the rapidly changing demand side management industry. He has a master’s degree in geography from the University of Georgia and is a certified energy manager (CEM).


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