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current magazine ARTIS INTELLIGENCE / SUMMER 2019

INSIDE Early Innovators Timeline Energy Facts Glossary of Terms

Power Innovators & Amazing Inventions current magazine

ARTIS ENERGY INTELLIGENCE SUMMER 2019

PUBLISHED BY Artis Energy Intelligence

EDITOR-IN-CHIEF Christopher Dente

WRITERS Christopher Dente Zachary Martin

ART DIRECTOR Christopher Dente

DESIGNER Gregory Cullen Charles-Augustin André-Marie de Ampère 1736–1806 1775–1836 DISCLAIMER This publication is the property of Artis Energy Intelligence. No portion Benjamin of this document may be Franklin 1745–1827 photocopied, reproduced, or 1706–1790 scanned into an electronic system or transmitted, forwarded or distributed in any way without prior consent of Artis Energy Intelligence. The information contained in this publication is derived from carefully selected sources we believe are reasonable. We do not guarantee its accuracy or completeness and nothing in this document shall be construed to be a representation of such a guarantee. Any opinions expressed reflect the current judgment of the author of the relevant article or features and does not necessarily James Prescott Thomas Alva reflect the opinion of Artis Edison Energy Intelligence or any of 1818–1889 1847–1931 their affiliates. The opinions presented are subject to change without notice. Artis Energy Intelligence accepts James Clerk John Ambrose no responsibility for any Fleming liability arising from use of 1831–1879 1849–1945 this document or its contents. Early Innovators: Influential Energy Scientists

Georg Joseph 1789–1854 1797–1878

Hans Christian Ørsted 1791–1867 1777–1851

Nikola Heinrich Edward Lawry 1856–1943 1857–1894 Norton 1898–1983

Léon Charles Guglielmo Thévenin Marconi 1857–1926 1874 –1937 current magazine

ALTERNATING CURRENT (AC) typically refers to a cur- rent that reverses its direction at regularly recurring intervals of time and that has alternately positive and negative values. Almost all utilities generate AC electricity because it can easily be trans- formed to higher or lower .

AMPERE (AMP) The base unit of electrical current produced in a circuit by 1 acting through a resis- tance of 1 ohm. The measure of the rate of flow of past a given point in an electric conductor such as a power line.

ASHRAE AUDITS The American Society of Heating, Refrig- erating and Air-Conditioning Engineers (ASHRAE) has developed facility energy audit guidelines based on the level of detail and effort required to provide the desired energy evaluation to a facility. Level 1: Brief on-site survey of the building; savings and cost analysis of low-cost/no- cost energy conservation measures (ECMs); identification of potential capital improve- ments meriting further consideration Level 2: More detailed building survey; breakdown of energy use; savings and cost analysis of all ECMs; Identification of ECMs requiring more thorough data collection and analysis Level 3: Attention to capital-intensive projects identified during the Level 2 audit; more detailed field audit and analysis; cost and savings calculations with a high level of accuracy; 3D building model; submetering

AVOIDED COST The cost to produce or procure that an electricity utility does not incur because it purchases this increment of power from a qualifying facility. It may include a capacity payment and/or an André-Marie Ampère energy payment component. André-Marie Ampère discovered that a wire carrying can attract or repel another wire next to it that’s also carrying electric current. BASE LOAD The attraction is magnetic, but no are necessary for the effect to The minimum amount of electric power be seen. He formulated ’s Law of and produced delivered or required over a given period the best definition of electric current of his time. Ampère also proposed the existence of a particle we now recognize as the . The SI unit of of time at a steady rate. The minimum electric current, the ampere, is named in his honor. continuous load or demand in a power system over a given period of time.

4 Michael Faraday Michael Faraday is credited with many notable discoveries, including electromagnetic rotation, which would eventually develop into the . Faraday is also credited with discovering Gas Liquefaction and Refrigeration, Benzene, Electromagnetic Induction, Diamagnetism as a Property of all Matter, Faraday’s Laws of , the Faraday Cage, and the Faraday Effect.

Faraday’s electromagnetic rotation experiment

BASE LOAD CAPACITY on controlling facility assets such as The generation units normally used to meet HVAC, lighting, security automation and demand around-the-. observation, access control, fire alarm system, elevator control, plumbing, closed- BASE LOAD PLANT circuit television (CCTV), engineering A plant normally operated to take all or systems, control panels, and PA systems. part of the minimum continuous load of a (see Energy Management System (EMS)) system, and which consequently produces electricity at an essentially constant rate. BUILDING ENVELOPE A base load plant typically has relatively Building envelope is the physical divide high fixed costs and low unit operating between interior and exterior environ- costs. Traditionally, nuclear plants have ments. Energy efficiency building envelope been considered as base load plants. upgrades can include windows, insulation, roofing, awnings, etc. which allow the BRITISH THERMAL UNIT (BTU) building to better retain cooled air in the The quantity of required to raise summer, and heat in the winter. Infrared one pound of water (about one pint) one exterior facility scans can be utilized to degree at or near its point determine where building envelope perfor- Energy of maximum density. A common unit of mance improvements are needed. use in for gas prices. 1034 BTUs = 1 cubic . An MMBTU (-mil BTUs) is America is roughly equivalent to an MCF (a thousand A transmission element designed to inject doubling cubic feet). reactive power into the transmission network. Also used to increase voltages, every 20 BUILDING AUTOMATION SYSTEM reduce loadings, and increase available kW years. (BAS) & BUILDING MANAGEMENT output from generators. Capacitor ratings SYSTEM (BMS) typically given in Megavars (MVAr). Building Automation System (BAS) and Building Management System (BMS) CAPACITY primarily focus on real-time control of a The power output rating of a generator, facility. They are typically more robust typically in megawatts, measured on an in their capabilities than an energy instantaneous basis. management system (EMS), focusing

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Alessandro Volta Invented the first called the “.” Discovered “contact electricity” resulting from contact between different metals. Recognized two types of electric conduction. Wrote the first electromotive series; this showed, from highest to lowest, the voltages that different metals can produce in a battery. Discovered that in a capacitor is directly proportional to . In recognition of Volta’s contributions to , the unit of electric potential is called the volt.

CAPACITY (PURCHASED) industry up to but not exceeding the cap. The amount of capacity available for Covered entities must have their emissions purchase from other power systems. independently verified and must surrender Water vapor allowances to match their annual emissions CAPACITY CHARGE each year, normally with penalties for is the most One element of a two-part pricing method non-compliance. Since the overall cap is used in power transactions (energy charge below actual emissions, this cuts the overall abundant is the other element. Assessed on the level of pollution and creates a scarcity greenhouse amount of capacity being purchased, typi- of allowances, and therefore a monetary cally in units of currency per MW or kW). value. Those with a surplus may sell them to gas, but those with a shortfall, creating a tradable most scientists CAPACITY MARGIN market for allowances. believe that The amount of capacity above planned peak system demand available to provide water vapor for scheduled maintenance, emergency produced outages, system operating requirements, directly by and unforeseen demand. human CAP-AND-TRADE A market mechanism designed to reduce activity the cost of cutting pollution. The regulator contributes caps pollution at a level below business- as-usual and allocates allowances to very little to Reactive Power the amount of measured in VAR kVAR

water vapor in Apparent Power the atmosphere. measured in VA kVA

Power Triangle

Power Factor = kWkVA

Real or True Power measured in kW

6 COGENERATION (COGEN), COM- CONGESTION (TRANSMISSION BINED HEAT AND POWER (CHP), CONGESTION) Hospitals in OR TRIGENERATION (TRIGEN) Congestion occurs when there is insuffi- The production of both electricity and use- cient energy supply, or delivery capacity, to the United ful from the same energy meet the demands of customers at a given States rank source. Natural gas tends to be a favored point in time. When congestion conditions fuel for combined-cycle cogeneration units, occur energy market prices increase. If the as some of in which waste heat is converted to steam, congestion becomes significant enough, the highest hot water, or for use in absorption chillers there is risk of energy blackouts or brown- for cooling. outs occurring. In order to alleviate con- energy gestion, the grid can add new transmission consumers COMBINED CYCLE infrastructure, increase the generation in the entire The combination of one or more gas and capacity, or incentivize end users to curtail steam turbines in an electric generation energy consumption. world. plant. An electric generating in which electricity is produced from other- CONNECTION wise lost waste heat exiting from one or The physical junction (transmission lines, more gas (combustion) turbines. The heat , gear, etc.) between is routed to a conventional boiler or to a two electric systems permitting the trans- heat recovery steam generator for use by a fer of electricity. steam turbine in the production of electric- ity. This process increases the efficiency of CONTRACT PRICE the electric generating unit. Periodic (monthly/quarterly/annual) price agreed between sellers and buyers of com- COMBINED HEAT AND POWER modities for term business. Most oil and PLANT (CHP) gas contract prices are “floating;” they are Power plant, usually embedded, which tied to spot market assessments published produces both electric and thermal energy by Platts, NYMEX or other market pricing in the form of steam (see cogeneration). services rather than set at outright levels.

Drawing by of an

Joseph Henry Joseph Henry was at the forefront of the great electromagnetic advances of the . For most of the second half of the 1800s he was America’s most renowned scientist. He built the world’s most powerful and made practical breakthroughs that allowed Samuel Morse to invent the telegraph. The unit of electrical is named the henry in his honor, with the symbol H.

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CURRENT A flow of electrons in an electrical conduc- tor. The rate of movement of the electricity, measured in .

DEADBAND CONTROL Deadband temperature controls limit the ability for HVAC to simultaneously heat and cool a space. For example, setting the cool- ing to 74⁰ and the heating to 68⁰ will allow for a 6⁰ range where no heating or cooling load is requested. Deadband temperature controls can also be applied to a single set- point. For example, setting cooling to 74⁰ +/- Charles-Augustin de Coulomb 1⁰ will tell the HVAC system to turn on when Charles-Augustin de Coulomb was an eminent the temperature hits 75⁰ and cool the space French who formulated “Coulomb’s law,” which deals with the electrostatic until it reaches 73⁰. This method of cooling interaction between electrically charged or heating prevents the HVAC equipment particles. The coulomb, SI unit of electric from turning on/off frequently, extending charge, was named after him. equipment life and potentially reducing the energy required to cool or heat the facility.

DEGREE DAY (DEGREE HOURS) Degree days are calculated as the number of degrees above or below a standard temperature on any given day. In winter, US traders track heating degree days week by week, or month by month, normally against a standard temperature of 65°F, on the basis of how many degrees of heat are required to bring office buildings up to this temperature. Five days of heating by 2 degrees, for example, equals 10 heating degree days. In summer, the market tracks cooling degree days.

DEMAND In Power: the rate at which electricity is de- livered to or by a system at a given instant or averaged over a designated period, usually expressed in kilowatts (kW), megawatts (MW), or kilovolt-amps (kVA) In Oil: the rate of consumption of refined products, normally measured in millions of barrels per day, or in million tonnes per year.

DEMAND SIDE MANAGEMENT (DSM) Activities or programs undertaken by an electricity system or consumers to influence Edison’s first patent: Electrographic vote-recorder the amount and timing of electricity use. The goal is to keep costs low by reducing the need for new transmission and distribu- tion capacity additions on the grid.

8 Thomas Alva Edison Thomas Alva Edison is one of the greatest American inventors. While two of his most famous inventions are the incandescent lamp and the phonograph, his contributions and inventions included an electric vote recorder, the universal stock printer, advances in receivers and , the duplex, tape and automatic printers, the , the carbon telegraph , the Edison Effect, the Edison battery, the kinetograph camera, and he operated America’s first electric station in New York City using a DC supply system. accumulated 2,332 patents worldwide for his inventions.

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James Clerk Maxwell , known for Maxwell’s Equations, was the first scientist ever to unify any of ’s fundamental forces. He discov- ered that electricity and are actually the same force — the electromagnetic force. In doing so, Maxwell proved that is an electro- magnetic wave and so linked electricity, magne- tism, and optics. He introduced probability into the of the very small, laying the founda- tion for quantum theory and was the first person ever to produce a color photograph; He used mathematics to explain Saturn’s rings over 100 years before the Voyager spacecraft confirmed that he was correct. In his , Maxwell established that the temperature of a gas is entirely dependent on the speed of its or .

DIRECT CURRENT (DC) the grid throughout the middle of the day An electricity current that flows in one is being reduced. However, as solar assets direction with a magnitude that does not begin to lose efficiency as the sun goes vary or that varies only slightly. down, the strain on the grid increases, causing a duck curve shape to form. DIRTY POWER Managing the evening peak load present An average Is an abnormality in the power quality on the grid load curve is a challenge many hurricane that is being delivered to a system. These power grids are currently facing. abnormalities can include low power factor, produces variations variations, ENERGY CHARGE 14 6×10 Watts spikes, and surges. The portion of the charge for electricity based upon the electrical energy (kWh) of energy, DISTRIBUTION consumed or billed. Also known as the released The system of lines, transformers, and commodity charge. through that connect a transmission network to customer load. The transport ENERGY CONSERVATION could/rain of electricity to ultimate use points such as MEASURE (ECM) formation. This homes and businesses. A project, new technology, or CAPEX improvement made with the intention is equivalent DOE of reducing the energy consumption of a to 200X Designated Operational Entity is an facility accredited entity engaged in Measurement the world- and Verification (M+U) and validation of ENERGY MANAGEMENT wide electical energy and/or emissions reductions. SYSTEM (EMS) generating An Energy Management System (EMS) is DUCK CURVE a reporting and decision support tool for capacity. The Duck Curve refers to the shape of facility managers to monitor and control the electric grid’s load curve throughout their building loads. Energy management a given day. With the prevalence of systems are typically less comprehensive renewable solar assets, the energy load on than building management systems

10 (BMS) or building automation systems (BAS) focusing on HVAC, lighting, and main/submeter monitoring. (See Building Management Systems (BMS) or Building Automation Systems (BAS))

ENERGY STAR PORTFOLIO MANAGER® ENERGY STAR Portfolio Manager is an online benchmarking and performance evaluation tool used to track the energy efficiency of commercial facilities against comparable facilities throughout the US and Canada. Cities like New York, Seattle, and Boston have passed mandatory facility benchmarking laws, making ENERGY STAR Portfolio Manager a required tool for many facilities to use. In some regions, if an ENERGY STAR score falls below a given threshold the facility may be required to implement ECMs to improve their ranking. John Ambrose Fleming (see Energy Conservation Measure (ECM) John Ambrose Fleming invented the thermionic , a device allowing electric current to flow in one direction FAULT DETECTION & only. The invention gave birth to the modern electronic age. DIAGNOSTICS (FDD) Fleming also devised the commonly used hand rules for Using equipment level sensors and electric motors and generators. advanced understanding of how a facility should operate under normal conditions, fault detection and diagnostics software can discover/identify anomalies in equipment performance and help prioritize which operational/equipment improvements should be made first.

FEDERAL ENERGY REGULATORY COMMISSION (FERC) A US federal agency created in 1977 to regulate interstate wholesale gas and transportation of gas and electricity at “just and reasonable” rates.

FIRM ENERGY Energy sales which, although not subject to interruption for economic purposes, may be interrupted under force majeure conditions.

FIRM GAS Also called uninterruptible services, are First prototypes of the Fleming Valve services providing natural gas supplies, that are intended to be available at all times during a period covered by an agreement.

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Nikola Tesla invented the alternating-current (AC) motor (image, right). He also developed the Tesla coil, a steam-powered oscillating generator, the Tesla Polyphase System, experimented with X-ray imaging, power and lighting, remote control, bladeless turbines, and even a radio-controlled boat which he hoped to sell as a guided torpedo to navies around the world. Tesla’s company was awarded a contract to Westinghouse Electric for building a two-phase AC generating system at the Niagara Falls, based on Tesla’s advice and Westinghouse’s demonstration that they could build a complete AC system.

12 FIRM POWER Electricity capacity intended to be available at all times during the period covered by a guaranteed commitment to deliver. Firm power consists of either firm energy, firm capacity, or both.

FIXED CHARGE The charge calculated to recover all or a portion of the fixed costs of a utility, including genera- tion facility and transmission lines, meters, and some taxes.

FORCED OUTAGE The shutdown condition of a , transmission line, or distribution line when the generating unit is unavailable to produce power due to unexpected breakdown.

FORCED OUTAGE RATE The rate of shutdown of a generating unit, transmission line, or other facility for emergen- cy reasons or a condition in which the generat- ing equipment is unavailable for load because of unanticipated breakdown, measured in total hours per year.

FORWARD PRICE CURVE When plotted together, a series of forward Georg Simon Ohm was a German physicist, best known for his prices creates a forward curve, reflecting a range “Ohm’s Law,” which states that the current flow through a conductor of today’s tradable values for specified dates in is directly proportional to the potential difference (voltage) and the future. The structure shown by the forward inversely proportional to the resistance. The physical unit of electrical curve is most often used as a guide for trading resistance, the Ohm (symbol: Ω), was named after him. and hedging within the delivery date range along that curve. Ohm’s Law FORWARD CONTRACT An over-the-counter transaction between two companies involving the future delivery of a V V V commodity at a specific date and location at a fixed price, established on the date at which the I R I R I R contract is originated. Forwards can be custom- ized to suit the specific needs of the counterpar- VoltageV= I R (V) = CurrentI = V (I) = ResistanceR = V (R) = ties involved while a futures contract is standard- Current (I) × Voltage (V) ÷ Voltage (V) ÷ ized and traded on an exchange. Resistance (R) ResistanceR (R) CurrentI (I)

FUEL CELL Voltage: (measured in ) is the electric potential between two A device that generates electricity by means of points in an ; Current: (measured in amperes) is the amount of electric charge transferred per unit of time; Power: an electrochemical process. (measured in watts) is the rate at which electric energy is tranferred by an electric circuit. FUEL SWITCHING Fuel switching is the substitution of one energy source for another in order to meet requirements for heat, power, and/or electrical generation.

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GENERATION HVAC (HEATING VENTILATION The process of producing electricity AND/OR AIR CONDITIONING) by transforming other forms of energy Variable Air (VAV): A VAV system K-12 school such as steam, heat, or falling water. is a type of HVAC that keeps supply air The amount of electricity produced is temperature consistent but varies airflow districts usually expressed in kilowatt-hours (kWh) through damper controls. This setup allows in the or megawatt-hours (MWh). for zoning of a facility. US spend Constant Air Volume (CAV): A CAV GENERATOR system if a type of HVAC that keeps airflow $6 billion A or similar for converting consistent but varies temperature of the annually on into electricity. supply air. CAV systems are generally considered to be less efficient than VAV energy. That’s GEOTHERMAL systems and do not allow for individual more than Power generated from heat energy derived zoning of a facility from hot rock, hot water, or steam below they spend the earth’s surface. HYDROELECTRIC PLANT on computers A plant in which the turbine generators and textbooks GIGAWATT (GW) are driven by water. There are three types One gigawatt equals 1-billion watts, of hydropower facilities: impoundment, combined. 1-million kilowatts, or 1,000 megawatts. diversion, and pumped storage. The most common type is an impoundment facility. GIGAWATT HOUR (GWh) An impoundment facility, typically a large One billion -hours. hydropower system, uses a dam to store river water in a reservoir. Water released GREENHOUSE GASES (GHGS) from the reservoir flows through a turbine, The six GHGs recognized and regulated spinning it, which in turn activates a gener- by the Kyoto Protocol are: carbon ator to produce electricity. A diversion, or

dioxide (CO2), methane (CH4), nitrous run-of-river, facility channels a portion of a

oxide (N2O), hydrofluorocarbons (HFCs), river through a canal or penstock. Pumped perfluorocarbons (PFCs), and sulphur storage works like a battery, storing the

hexafluoride (SF6). electricity generated by other power sourc- es like solar, wind, and nuclear for later use. GRID The layout of an electrical transmission IMPEDANCE system or a synchronized transmission The opposition in an electrical circuit to the network flow of alternating current (AC).

Léon Charles Thévenin Léon Charles Thévenin developed Thévenin’s Theorem, which made it possible to calculate currents in more complex electrical circuits and allowing people to reduce complex circuits into simpler circuits called Thévenin’s equivalent circuits

Thévenin Equivalent Circuit: Any black box containing resistances only and voltage and current sources can be replaced by a Thévenin equivalent circuit consisting of an equivalent in series connection with an equivalent resistance.

14 James Prescott Joule established a relationship between the flow of Paddle-Wheel Experiment. Calorimeter used by current through a resistance and the heat generated. This led him to Joule in his 1876 determination of the mechanical discovering “ Law” in 1840. Joule’s law states that the amount of heat equivalent of heat per second that develops in a wire carrying a current is proportional to the electrical resistance of the wire and the square of the current. The derived unit of energy or , the Joule, (J) is named after him.

INTERCONNECTION INDEPENDENT POWER Facilities that connect two electricity grid PRODUCERS (IPP) systems, gas pipelines, or control areas. An independent power producer (IPP) or non-utility generator (NUG) is an entity, INTERMEDIATE LOAD which is not a public utility, but which owns The range from base load to a point facilities to generate electric power for sale between base load and peak load. This to utilities and end users. Enough point may be the midpoint, a percent of the sunlight peak load, or the load over a specified time KILOVOLT-AMP (kVA) reaches period. (see Base Load and Peak Load) kVA is kilo-volt-ampere. kVA is a unit of apparent power, which is electrical power the earth’s INTERMEDIATE LOAD PLANT unit. 1 kilo-volt-ampere is equal to 1000 surface each A plant which has lower fixed costs than a volt-ampere base load plant, but higher variable costs, minute and is used to cover the intermediate load KILOVOLT-AMPERE REACTIVE (kVAR) to satisfy requirements. Traditionally, intermediate A unit of reactive power. Actual power con- load plants are gas fired and coal power sumed by loads is called Kilowatt Power. All the world’s plants. (see Base Load Plant and Peak the power given to the load is not utilized as energy Load Plant) useful power, some power is being wasted. demands — The power which is not consumed is called INTERRUPTIBLE DEMAND reactive power i.e. kVAr. Apparent power for an The amount of customer demand that, in kVA is the vector sum of kW and kVAr. entire accordance with contractual arrangements, can be interrupted by direct control of the KILOWATT (kW) year. system operator, remote tripping, or by kW is a kilowatt. A kW is a unit of electricity action of the customer at the direct request equal to one thousand watts. of the system operator. KILOWATT-HOUR (kWH) INTERRUPTIBLE GAS kWh is a kilowatt-hour. A kWh is the basic Gas sold to customers with a provision that unit for pricing electric energy, equal to one permits curtailment or cessation of service kilowatt of power supplied continuously for at the discretion of the supplier. one hour (or the amount of electricity need- ed to light ten 100-watt lightbulbs for one hour). One kWh equals 1,000 watthours.

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Guglielmo Marconi was awarded the Nobel Prize in Physics with in 1909 for their development of practical wireless . He established the world’s first radiotelephone link, and later he devised the microwave beacon for ship navigation.

16 LEAK DETECTION Leak Detection can refer to discovering leaks/inefficiencies in compressed air systems, steam systems, and/or HVAC ductwork. In each of these scenarios, First Power the leaks may not be noticeable to the Plant: Thomas Edison’s Jumbo human eye/ear but can represent 20% Dynamo on display or more of the energy consumed by the at the Henry Ford respective load. Museum.

LEED CERTIFICATION LEED (Leadership in Energy and LOAD MANAGEMENT Environmental Design) is a worldwide Load management, also known as demand building rating system which allows side management (DSM), is the process facilities to certify that they are a green of balancing the supply of electricity on building. LEED focuses on a holistic the network with the electrical load by approach to sustainability including adjusting or controlling the load rather energy, water, waste, and air quality. than the power station output. Thomas Edison built LIGHTING RETROFITS LOAD SEQUENCING the Exchanging less efficient fluorescent Load sequencing is a strategy of reducing first lighting with more efficient LED lighting demand peaks by staggering the start-up of power is a simple CAPEX investment which will large electrical loads. For energy consumers and in increase the value of the property, lower with demand charges on their electric plant, energy costs and electricity consumption bill, load sequencing strategies can be an 1882 his Pearl when the are being utilized, and easy low/no cost way of lowering monthly Street Power can provide better light coverage than energy charges. traditional lighting solutions. Station sent LOAD SHAPE electricity LOAD A method of describing peak load demand The amount of electricity delivered or and the relationship of power supplied to to 85 required at any specific point or points the time of occurrence. buildings. on a system. The load of an electric system is affected by many factors and LOCATIONAL MARGINAL People were changes on a daily, seasonal, and annual PRICING (LMP) initially afraid basis, typically following a pattern. A way for wholesale electric energy prices of electricity System load is usually measured in to reflect the value of electric energy at megawatts (MW). different locations, accounting for the and parents patterns of load, generation, and the would not let LOAD CURVE physical limits of the transmission system. In a power system, a load curve or load Generally, LMP rates are updated every their children profile is a chart illustrating the variation 5 minutes. near the in demand/electrical load over a specific time. Generation companies use this in- MARGINAL COST PRICING lights. formation to plan how much power they A system of pricing designed to ignore will need to generate at any given time. all costs except those associated with producing the next increment of power LOAD FACTOR generation. Sometimes referred to as The ratio of average load to peak “incremental cost pricing.” load during a specific period of time, expressed as a percent. The load factor MARGINAL PRICE OF ENERGY indicates to what degree energy has Marginal prices, from a consumer been consumed compared to maximum perspective, are those prices consumers demand or relative total system capacity. pay (or save) for their last

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NATURAL GAS Naturally occurring gas, predominantly meth- What is the ane, but usually containing some proportions of ethane, propane and butane. Natural gas Difference can be either associated gas, found in associ- Between kWh ation with oil, or non-associated, found in a and kW? reservoir only containing gas.

A kilowatt-hour NATURAL GAS CCF: A hundred cubic feet (kWh) and a MCF: A thousand cubic feet kilowatt (kW) may BCF: A billion cubic feet sound similar, but TCF: A trillion cubic feet they’re actually Hans Christian Ørsted CBM: A cubic meter quite different. Hans Christian Øersted discovered that BCM: A billion cubic meters electricity and magnetism are linked. He Technically, the TCM: A trillion cubic meters showed by experiment that an electric current Quad or Quads: A quadrillion cubic feet difference is that flowing through a wire could move a nearby . The discovery of electromagnetism set MMBtu: A million British thermal units a kWh is a the stage for the eventual development of our Dekatherm (DTH): 10 therms or 1,000,000 measurement modern technology-based world. British thermal units of energy, NET GENERATION while a kW is a used (or saved). For utilities, marginal Gross generation less the electric energy measurement electricity costs are the costs experienced consumed at the generating station for of power; by utilities for the last kilowatt-hour (kWh) station use. however, the of electricity produced. terms power and NIGHTTIME/WEEKEND SETBACKS MEGAWATT (MW) Nighttime/weekend setback strategies are energy are often MW is a megawatt. MW is a unit of electrical a simple energy efficiency measure where mistakenly used power equal to one million watts or one temperature setpoint are increased for interchangeably. thousand kilowatts. cooling loads and decreased for heating Energy refers to loads to prevent the HVAC system from being the ability to do MEGAWATT-HOUR (MWh) utilized then the facility in unoccupied. For MWh is a megawatt-hour. MWh is one example, changing cooling setpoints from 74⁰ work — power million watt-hours of electricity. A unit to 78⁰ and heating setpoints from 68⁰ to 64⁰ refers to the rate of of electrical energy which equals one during scheduled unoccupied periods. energy production megawatt of power used for one hour. or consumption. To NUCLEAR POWER PLANT really understand MMBtu A nuclear power plant is a facility that kWh and kW, MMBtu is one million British thermal converts atomic energy into usable power. In units (Btu). a nuclear electric power plant, heat produced you also need to by a reactor is converted to steam, which is consider time. MMcF used to drive a turbine, which in turn drives an The equation MMcf is one million cubic feet of . is simply (kW x natural gas. Time = kWh). NYMEX New York Mercantile Exchange. Also known in The full-load continuous rating of a gen- the energy industry as “the NY Merc.” erator or other electric power production equipment under specific conditions as OFF-PEAK designated by the manufacturer. Installed Refers to lower, discounted electricity prices generator nameplate rating is usually indi- during the time of day when a power system cated on a nameplate physically attached to would experience its lightest load, typically the generator. during early morning, nights and weekends.

18 Benjamin Franklin Benjamin Franklin proposed that “vitreous” and “resinous” electricity were not different types of “electrical fluid,” but the same “fluid” under different . Franklin was the first to label them as positive and negative respectively, and he was the first to discover the principle of conservation of charge. In 1748 he constructed a multiple plate capacitor, that he called an “electrical battery” (not to be confused with Volta’s pile) by placing eleven panes of glass sandwiched between lead plates, suspended with silk cords and connected by wires. Franklin’s electrical experiments led to his invention of the lightning rod.

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Heinrich Hertz discovered radio waves and established that James Clerk Maxwell’s theory of electromagnetism was correct. This discovery was the basis for much of our modern technology; radio, television, satellite communications, and mobile phones all rely on it. Microwave ovens also use electromagnetic waves. Hertz also discovered the , providing one of the first clues to the existence of the quantum world. The unit of frequency, the hertz, is named in his honor.

OHM maximum load periods. Characterized An ohm is an electrical resistance between by quick start times and generally high two points of a conductor when a constant variable costs, but low fixed costs. potential difference of one volt, applied to these points, produces in the conductor a PEAKING CAPACITY current of one ampere, the conductor not Capacity of generating equipment being the seat of any . normally reserved for operation during the hours of highest daily, weekly, or ON-PEAK seasonal loads. Refers to higher, more expensive electricity prices during the time of day when a power POWER FACTOR system would experience its greatest load, The ratio of the actual electrical power typically during the late morning to evening (kW) to apparent electrical power (kVA). hours on weekdays. The difference between the two is caused by reactance in the circuit and represents OPERATING RESERVE MARGIN power that does no useful work. The amount of unused available capacity Approximately that can be applied to the system within POWER TRIANGLE ten minutes at peak load for a utility The three circuit elements (kW, kVA, 30% of system, expressed as a percentage of total and kVAR) which make up the electrical energy used in capacity. power consumed in an AC circuit can buildings is used be represented by the three sides of a PEAK DEMAND right-angled triangle. inefficiently or The maximum electrical load during a unnecessarily. specified period of time. Usually expressed POWER QUALITY in kilowatts (kW), megawatts (MW), or Power quality is the relationship of kilovolt-amps (kVA). voltage, frequency, and waveform. when good power quality is present, PEAK LOAD voltage and frequency are steady, and The maximum electrical load demand in a the waveform represents a smooth stated period of time. On a daily basis, peak sine wave. When poor power quality loads occur at midmorning and/or in the is present, equipment may require early evening. irregular maintenance, circuits may frequently trip, high equipment PEAK LOAD PLANT may occur. To isolate the A plant usually housing low-efficiency, cause of poor power quality, sub-second quick response steam units, gas turbines, data loggers should be installed and diesel, or pumped-storage hydroelectric analyzed at the facility. equipment normally used during the

20 Edward Lawry Norton Edward Lawry Norton is credited with the development of Thévenin’s theorem, which held, in part, that any linear with voltage and current sources and resistances only can be replaced at A “watt” is a terminals A-B by an equivalent voltage unit of power source Vth in series connection with an equivalent resistance Rth. that measures the rate of producing or using energy. The term (SOURCE) STORAGE Any naturally occurring, theoretically inex- Battery: Storing energy during low cost off was named haustible source of energy, such peak times to be used during high cost on after Scottish as biomass, solar, wind, tidal, and wave, peak periods. Battery storage can reduce engineer that is not derived from fossil or nuclear the times that costly peak load plants need fuel. Hydroelectric power is generally not to be in operation, having the effect of counted as a renewable energy source due significantly lowering the cost of electricity (1736–1819), to the potential for negative environmental during historically high cost times. impacts of hydroelectric dams. Hydroelectric: Water can be stored in who developed large reservoirs to be used to meet grid an improved RESERVE CAPACITY demand during peak load times. In some Extra generating capacity available to cases, water is pumped uphill into reser- . meet unanticipated demands for power or voirs using excess solar/wind generation, Watt measured to generate power in the event of loss of then dispatched during peak periods to his engine’s generation. meet grid demands. Oil: Typically on land tankage facilities for performance SOFT STARTERS short- or long-term storage of crude or in horsepower. Soft starters are similar to variable products; sometimes used in economic frequency drives in that they limit the parlance interchangeably with the concept One amount of power provided to a motor of oil stocks. horsepower to allow for more efficient equipment Natural Gas: Facilities used to store natural operation. Soft starters extend the life gas which has been transferred from its equals 746 of electric motors by limiting the current original location. Usually consists of natural watts. used to start and/or stop an electric motor, geological reservoirs like depleted oil or they also can significantly reduce peak gas fields, water-bearing sands sealed on power loads. (see Variable Frequency top by an impermeable cap rock, under- Drive (VFD). salt domes, bedded salt forma- tions, or in rare cases, abandoned mines. SOLAR PHOTOVOLTAIC A method for generating electric power SUBSTATION by using solar cells to convert energy from Facility equipment that switches, changes, the sun into a flow of electrons by the or regulates electric voltage. An electric photovoltaic effect. Solar cells produce power station which serves as a control and electricity from sunlight transfer of power flow, transform voltage which can be used to power equipment, levels, and serve as delivery points to indus- charge battery storage, or is directed back trial customers. to the electric grid. TARIFF SPOT MARKET Rates a regulated entity will charge to A market where goods are traded for provide service to its customers as well as immediate delivery. the terms and conditions that it will follow in providing service.

21 current magazine

U.S. Energy overview: Electric generating capacity build by fuel type

70

60

50 n Other n Renewables 40 n Hydro 30 n Nuclear n Oil Gigawatts GW 20 n Gas 10 n Coal

0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Source: Bloomberg, Sustainable Energy in America Factbook.

THERM Renewable Portfolio Requirements: Is a unit of heat energy equal to 100,000 The costs associated with obtaining power British thermal units (Btus). It is approxi- from renewable energy assets mandated mately the energy equivalent of burning by state government regulations. 100 cubic feet of natural gas. United King- dom regulations were amended to replace TIERED RATES The United therms with joules in 1999; however, the A rate design which divides customer use States has wholesale UK gas market currently trades into different tiers, or blocks, with different more nuclear in therms. prices charged for each. reactors, THIRD PARTY SUPPLY RATE COMPONENTS An electrical device for changing the volt- more Energy: The cost of actual energy con- age of alternating current. nuclear sumed (kWh). How much energy is con- sumed, how consistently energy is con- TRANSMISSION power sumed, and when energy is consumed can The network of lines, trans- capacity all influence the cost of energy formers and switches used to move elec- Capacity: Capacity payments are required tricity from generators to the distribution and by system operators to ensure that there is system or used to interconnect different generates an adequate amount of generation assets utility systems and independent power more nuclear available to meet grid demand. Capacity producers together into a synchronized payments help fund the future expansion, network. Transmission is considered to end power than replacement, or improvements of grid when the energy is transformed for distri- any other generation assets. bution to the consumer. Transmission: Charges associated with country in moving the power consumed from the TRANSMISSION LOSS the world. generation asset to the end user. The power lost in transmission between Energy Losses: Energy losses occur one point and another. It is measured as the through transmission/distribution of difference between the net power passing energy from the generation asset to the the first point and the net power passing end user. Customers who receive power at the second point. higher voltages typically incur less energy loss charges. TRANSMISSION VOLTAGE Ancillary Services: Charges to support and Voltage levels utilized for bulk transmission maintain reliable transmission of power systems: generally 69 KV - 750 KV AC or DC. from the seller to the purchaser of power.

22 TURBINE VOLTAGE CONTROL The part of a generating unit usually con- The control of transmission voltage adjust- sisting of a series of curved vanes or blades ments in generator reactive output and on a central spindle, which is spun by the transformer taps, and by switching capaci- force of water, steam, or hot gas, to drive tors and on the transmission and an electrical generator. distribution systems. VARIABLE FREQUENCY DRIVE (VFD) VOLTAGE REDUCTION The word Traditionally, electric motors either operate Any intentional reduction of system voltage at 100% capacity or are off. This is like by 3 percent or greater for reasons of “energy” driving a car by flooring the gas and maintaining the continuity of service of the comes from slamming on the breaks. VFD’s can control bulk electric system. the energy input to a motor (speed of the the Greek motor) depending on how much output is WATT energeia, required. It is a much more efficient way of A measure of real power production or us- operating a motor which will save energy age equal to one Joule per second. The rate meaning and can improve the longevity of the equip- of energy transfer equivalent to 1 ampere operation, ment it is controlling. flowing under a of 1 volt. activity. VOLT WATT-HOUR (Wh) The unit of measurement of electromotive A Wh is an electrical energy unit of measure force. It is equivalent to the force required equal to 1 watt of power supplied to, to produce a current of one ampere or taken from, an electric circuit steadily through a resistance of one ohm. The unit for 1 hour. of measure for electrical potential. Gen- erally measured in kilovolts or kV. Typical transmission level voltages are 115 kV, 230 kV, and 500 kV.

ENERG SOURCES

Non-Renewable Renewable

Petroleum Natural Coal Wind Solar Hydro Biofuel Gas

High Octane Propane Industrial Wood Bioalcohol Biodiesel Gasoline Fuel

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