IEEE Power & Energy Magazine - May/June 2016 - 62

rate. The establishment of the TOU rates is currently under
evaluation. A traditional peak and critical peak pricing
model is under consideration, but also under consideration
is a TOU approach that reflects the periods when renewable
energy is plentiful and low cost. While that time has not yet
occurred, it is expected to occur in California before 2020.

Use of Transactive DR/DER Capabilities
for Provision of Balancing Energy
BWP has implemented an integrated automated dispatch system (IADS) to optimize the use of its internal
resources for the provision of balancing energy. IADS
could use offers from the transactive DR/DERs within
the BWP footprint along with cost-based curves from
BWP's own generation to provide balancing energy. The
real-time dispatch interval is 5 min with a horizon of
three hours. The IADS also runs in the operations planning time frame (hourly for next day or next several days)
to optimize the use of BWP's conventional generation,
transactive DR/DER offers, BWP storage facilities, and
trades, considering BWP's load forecast and the forecast
of renewable generation. The IADS cooptimizes energy
transactions with grid services.

Provision of Synthetic Frequency
Response from Autonomous DR/DERs
BWP could consider deploying a new control architecture along with low-cost, grid-edge control and sensing
devices to enable the provision of synthetic frequency
response, synthetic regulation, and synthetic ramping
from DR and DERs in its footprint. The control architecture will utilize an innovative, cost-effective, and
secure distributed real-time load control technology with
centralized coordination to provide these grid services,
along with supporting functions to forecast, aggregate,
and integrate the DR/DER capabilities with the BWP
Energy Control Center and its automatic generation control operation. BWP is considering using an OATI patentpending technology for provision of synthetic frequency
response. Real-time performance in accordance with the
NERC balancing area control performance standards will
be provided through local grid frequency sensing and
load control capability implemented on a low-cost device
with local processing capability. The operations and trigger set-points of the local controllers are coordinated with
the grid control center operation for provision of synthetic
frequency response, regulation, balancing (slow regulation/load following), and ramping services under different system conditions.

Transactive Primary Frequency Response
To meet its frequency bias obligation vis-à-vis its balancing area, BWP could consider bilateral trading of PFRs to
supplement the frequency response it can get from its internal resources (conventional generation and DR/DERs). To
62

ieee power & energy magazine

this end, BWP is considering a combination of financial
and physical trading of PFRs. Financial trading of PFRs
involves only an accounting of PFR obligation with no need
for dynamic scheduling or transmission reservation. BWP
would simply include its purchased PFR in its frequency
bias performance report. This is a convenient arrangement; however, the financially traded PFR is not included
in BWP ACE computation, and as such may impact the
BWP's inadvertent interchange. In contrast, the physical
PFR trade would require dynamic scheduling (or pseudotying) of the seller's PFR resource, which is more costly, but
it will impact BWP's ACE computation and reduce BWP's
inadvertent interchange.

Conclusions
The electric industry landscape is changing due to increasing bulk-power renewable generation, the proliferation of
distributed energy resources, new information, communication, and intelligent end-use device technologies, and
increased prosumer participation. The implications include
operational challenges at both bulk-power and distribution levels as well as the need for a new utility business
model. The TE systems framework and the DSO construct
may be used to advantageously to construct a road map to
meet these challenges to the mutual benefit of prosumers,
utilities, and system operators. However, this can only be
accomplished with a corresponding revision of regulatory
provisions for transactive interactions of prosumers, utilities, and system operators.

For Further Reading
F. Rahimi and S. Mokhtari, "From ISO to DSO," Public
Utilities Fortnightly, pp. 42-50, June 2014.
The GridWise Architecture Council, "GridWise transactive energy framework (draft final)," PNNL.22946, vol. 1.0,
Jan. 2015.
F. A. Rahimi and A. Ipakchi, "Transactive energy techniques: Closing the gap between wholesale and retail markets," Electr. J., vol. 25/8, pp. 29-35, Nov. 2012.
"Pacific Northwest Smart Grid Demonstration Project
Rep.," Battelle Memorial Institute, PNWD.4438, vol. 1, June
2015.
J. Medina, N. Muller, and I. Roytelman, "Demand response and distribution grid operations: Opportunities and
challenges," IEEE Trans. Smart Grid, vol. 1, no. 2, pp. 193-
198, Sept. 2010.

Biographies
Farrokh Rahimi is with Open Access Technology International, Inc., Minneapolis, Minnesota.
Ali Ipakchi is with Open Access Technology International, Inc. Minneapolis, Minnesota.
Fred Fletcher is with Burbank Water and Power, Burbank, California.
p&e
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