IEEE Power & Energy Magazine - September/October 2016 - 69

Utilities developed programs designed to promote energy
efficiency as a utility resource, meaning that utilities could treat
load reduction in the same manner as new generation.
distributed intelligence. also clear from such an inte-
grated grid vision is that new players are already entering
the power industry that provide deregulated services to the
traditional utility customers, sometimes eroding revenue
from the traditional utility and in competition with the
power utilities. These services are associated with der
services including distributed generation on customers'
premises, demand response, and energy-efficiency-related
services, but it is only the beginning. More services are
currently being delivered and planned by third parties that
go back to the core operations of power utilities like ancil-
lary services including pv smoothing, frequency regula-
tion, voltage regulation, real-time power balancing, black-
start, and spinning reserves.
energy storage is currently being considered and used
by third-party companies like alevo to provide these ancil-
lary and energy efficiency services directly to independent
service organizations and utilities, using resource and load
forecasting. several states are currently allowing deregu-
lated services to residential and industrial customers, and
these new players are causing several utilities to rethink their
traditional business models.
companies that provide power electronic solutions con-
nected to the grid edge, e.g., varentec, gridco, enphase,

and others, sometimes associated with pv inverters, are
connecting to low-voltage networks, providing volt-var re-
gulating services. energy storage converter systems are
currently upgraded to utilize stacked application methodolo-
gies. These converter and technology vendors are regulating
voltage, minimizing the need for mechanical voltage regula-
tors and providing distributed support and distributed intel-
ligence to the grid. in the future, this service can also be
decoupled from the core utility business through third-party
service providers. see Figure 2, where the impacts of substa-
tion versus grid edge regulation are described and may in the
future be provided by third-party suppliers.

Demand Response and Energy Efficiency
during the energy shocks of the 1970s, utilities recognized
that customer demand was growing rapidly and costs would
become difficult to control. in response, utilities developed
programs designed to promote energy efficiency as a utility
resource, meaning that utilities could treat load reduction in
the same manner as new generation. savings from such pro-
grams can defer or displace new generation and potentially
offset the need for new transmission and distribution invest-
ments. utilities or other program administrators deploy effi-
ciency by offering programs, services, and other activities that

Power System That Is Highly Flexible, Resilient, and Connected and Optimizes Energy Resources

figure 1. Optimizing an integrated grid. (Source: EPRI, used with permission.)
september/october 2016

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