IEEE Power & Energy Magazine - September/October 2016 - 72

Residential

Peak Day
0

2

4

6

Weekday

Weekend

8 10 12 14 16 18 20 22 24
Hour

0

2

4

6

8 10 12 14 16 18 20 22 24
Hour

Load Without Solar
Net Load with South-Facing Panels
Net Load with West-Facing Panels

Commercial

figure 4. The net load from a customer in three scenarios:
1) no solar installation (i.e., the customer's intrinsic load),
2) a typical south-facing solar installation, and 3) a westfacing solar installation. The load shapes are very different,
with approximately two hours of peak shifting enabled by a
west-facing solar installation.
Peak Day
0

2

4

6

Weekday

Weekend

8 10 12 14 16 18 20 22 24
Hour

Industrial

Peak Day
0

2

4

6

Weekday

Weekend

8 10 12 14 16 18 20 22 24
Hour

figure 3. Sample load profiles by hour for different customer classes on a typical July day in the Commonwealth
Edison territory.

they represent an averaging across multiple profound load
profile differentiators. They generally ignore the angle of
inclination of the customer-sited solar array (which affects
the timing of peak generation, midday or evening) and the
ratio between the solar capacity and the customer's intrinsic
load (which affects the ultimate load shape and determines
whether it ever goes negative; see Figure 4). as a result, the
value of solar tariffs are guilty of the same faulty assumption
of homogeneity as the tariffs they purport to replace.
While we use solar as an example, "electric vehicle (ev)
charging" or any other such special-class tariffs are ultimately
limited by the irreducible heterogeneity of customers in a world
of widespread ders. While a utility or balancing authority
might know which of its customers have installed solar panels
72

ieee power & energy magazine

(e.g., from interconnection requests) and which have chosen to
register their evs with their utility, there is so much more cus-
tomer-level detail that they likely will not, and cannot, know.
battery backup systems; timed water heaters; fuel cells; smart
appliances and heating, ventilation, and air-conditioning sys-
tems; precooling algorithms; home energy management sys-
tems; solar generation; and evs, and the like will be deployed
across customers to a variety of degrees in an infinite number of
combinations. in a world of irreducible heterogeneity, the prac-
tice of creating special tariffs for homogeneous classes eventu-
ally leads to a special tariff for each customer. in other words, it
means the end of customer classes as we know them.

Ubiquitous Agency
The other key assumption underpinning the utility business
model has been that customers, with few exceptions, are
passive recipients of centrally provided electricity and elec-
tricity services for which there is no viable alternative. This
assumption enables the concept of a utility as a monopoly
with regulated pricing. as technology advancements pro-
vide consumers with 1) more economically viable means to
actively participate in electrical transactions via ders and
2) automated systems to manage and optimize these transac-
tions (e.g., home energy management systems and dispatch
algorithms), more consumers become active agents on the
electrical grid, not just passive "load centers."
industries with regulated pricing can be severely strained
by the participation of active agents, as they introduce the
potential for arbitrage that can destabilize prices. active
agents can choose to transact with the regulated system in
circumstances that extract value for the active agent at the
expense of the regulated utility and its customers, and they
can choose not to transact (or even withdraw from the system)
when circumstances are unfavorable. This characteristic is
september/october 2016



Table of Contents for the Digital Edition of IEEE Power & Energy Magazine - September/October 2016

IEEE Power & Energy Magazine - September/October 2016 - Cover1
IEEE Power & Energy Magazine - September/October 2016 - Cover2
IEEE Power & Energy Magazine - September/October 2016 - 1
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IEEE Power & Energy Magazine - September/October 2016 - Cover3
IEEE Power & Energy Magazine - September/October 2016 - Cover4
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