by David Edwards, Technical Visionary, Horizon Power

David Edwards

Horizon Power is about to deploy Australia’s first fully fledged Distributed Energy Resource Management System (DERMS) into three of its portfolio of 38 regional microgrids to leverage the phenomenal pace of advancement in renewable energy technology, and begin the next phase of its evolution as a manager of Advanced Microgrids.

Since its creation in 2006, Horizon Power has been on a mission to increase renewable energy penetration into its portfolio of regional microgrids. Reliant on government subsidy to bridge the gap between the cost of regional power delivery and the price it can charge under the uniform tariff structure, renewable energy has long held the promise of reducing the cost of energy delivered into the networks of its highest cost to serve towns.

Exploring innovative Power Purchase Agreements to encourage Independent Power Producers (IPP) to supply higher levels of renewable energy; signing Western Australia’s first supply contract with a privately-owned solar farm; and experimenting with flywheel and battery technologies in regional towns are all examples of how Horizon Power has tackled the problem from the traditional utility supply side perspective. However, adapting to the rapid uptake of Distributed Energy Resources (DER) such as solar PV by its customers is where Horizon Power has proven its ability to innovate and act decisively.

Many eastern state distributors operate with basic system control tools within the context of an ‘infinite pool’, where the network operator effectively sees the power system as an endless supply of energy and interconnectivity amongst loads and supply sources. Horizon Power does not have that luxury. The microgrids it operates are small, and as such, technical challenges are encountered long before larger grids see the same problems.

With the exception of its North West Interconnected System, the geographic isolation of Horizon Power’s microgrids, and their lack of interconnectivity to larger systems presents an operational challenge when penetration of fluctuating renewable energy sources into the network push the boundaries of the available spinning or operational reserve required to cover their variability. Horizon Power has become the canary in the coal mine as it were, developing solutions to manage increasing penetration levels of solar PV and of necessity has found itself at the vanguard of microgrid developments both technically and operationally.

Smoothing out increasing volumes of solar PV

In 2008, pushed by the appetite for solar PV from its customers, who by virtue of WA’s disposition as the sunniest part of the country have airconditioned-driven power bills that even the wisest men of the east would cringe at, Horizon Power was faced with impending and unacceptable levels of risk to power quality by the volume of solar PV being connected and the amount of energy being exported into its networks. Development of a comprehensive PV Hosting Capacity methodology for its geographically isolated microgrids, and detailed targets published on its website in 2009 set clear expectations in regional communities of how much rooftop solar PV could be connected to each microgrid.

The adoption of solar smoothing, using energy storage as a shock absorber for PV during cloud events, and Feed-in Management for larger PV systems as a means to make more hosting capacity available, coupled with the most generous Feed-in Tariffs in the country to stimulate PV uptake in diesel-powered towns, followed in 2010.

Similar to the Hawaiian Islands’ utilities, Horizon Power has pushed efficiency in the management of its portfolio of microgrids as far as it can. It is now using the advanced meter infrastructure across its entire service area, and its status as the country’s last vertically integrated utility to leverage its wealth of data and emerging technologies to further decrease costs.

Horizon Power’s Smart Sun trials in Broome are proving the value of combining appliance control with solar PV, energy storage and demand management. This will reduce energy bills for customers and provide land developers a way to reduce infrastructure head works cost. The Australian Renewable Energy Agency (ARENA) funded DER trials in Carnarvon are developing control and forecasting techniques to manage third party DER aggregators and Virtual Power Plants, to gain visibility and control of DER so that those resources can eventually contribute ancillary services to improve network power quality.

Developing blueprints for decentralised microgrids

In 2013, Horizon Power established its System Blueprint project to determine the most economical way to deliver energy to each of its service areas. Working with the CSIRO on ‘Horizon Power specific’ future scenario planning, the System Blueprints body of work has produced a series of sensitivity analyses and planning models, which consider ongoing BAU, CAPEX and OPEX, asset replacement and fuel supply projections against the declining costs of solar PV, energy storage technology and data capture plus business intelligence. With a blueprint for each microgrid, it is now possible to begin the work of progressively transforming them away from predominantly centralised to predominantly decentralised Advanced Microgrids by identifying and quantifying key drivers that can be tested to avoid asset impairment, and ensure a cost-effective investment glide path that balances return on investment, reduced government subsidy and a low carbon energy supply.

At a high level, this transformation is being driven by the combined forces of the three D’s: decentralisation, digitisation and decarbonisation. From an industry, or whole-of-system standpoint, the transformation is occurring in an increasingly ad hoc, and at times chaotic, manner, disrupting traditional business models and the electric grid operating philosophy. This is because traditional incentives were never designed to encourage customer DER investments that support whole-of-system optimisation and our electricity systems are now increasingly being stretched beyond their original architectural boundaries.

These changes, also being experienced around much of the world, are driving the need for entirely new system architectures designed to harness the full potential of a high-DER future. In this context, Horizon Power is leading the development of Advanced Microgrids as a fundamental building block of low-cost, high-DER electricity systems. Advanced Microgrids achieve this by maximising reliance on intermittent renewable generation, better balancing supply and demand, reducing extreme peak demand, and increasing service reliability. Advanced Microgrids are powered by integrating centralised power generation with high levels of DER (30 per cent or more), either located on customer sites or directly connected to the distribution network. They enable customer DERs to provide optimisation services to the grid in exchange for a financial benefit and support energy trading of ancillary services. Distributed energy resources as part of the solution rather than the problem is akin to every pearl starting its life as an irritation.

Investing in cutting-edge DER technology

At the heart of the Advanced Microgrid lies the DERMS, designed to manage and optimise the technical operations of thousands of grid-connected DER to dynamically manage supply and demand, maintain system stability and optimise long-term economic efficiency. Horizon Power is currently focused on developing and adapting these systems in its portfolio of microgrids.

Horizon Power’s investment in the System Blueprints — along with trials with leading innovators and the creative culture fostered within the company — has yielded returns with opportunities to develop new tariff structures such as MyPower, new customer engagement models, modern service level agreements with technology providers, and operational experience in cutting-edge DER technology, allowing it to procure a DERMS package as an informed customer with a deep understanding of the impact of this breed of control system on its operational, safety and engineering practices, and its business model.

As an active champion of the CSIRO/ENA Network Transformation Roadmap, Horizon Power’s rich history of innovation and the blessing of vertical integration positions it perfectly to take advantage of international advances in smart inverter technology, the adoption of open industry standards such as the Sunspec protocol and IEEE 2030.5, and the latest developments in DERMS technology to deliver savings to government with lower cost energy supplied through Advanced Microgrids.

Following a procurement process in 2018, Horizon Power selected PXiSE Energy Solutions, LLC, a unit of Sempra Energy in California, to supply a DERMS solution for deployment into the towns of Onslow, Carnarvon and Esperance throughout 2019. PXiSE has partnered with Australia-based Green Technology Solutions (GTS) to provide on-site support during project implementation.

The PXiSE DERMS application currently controls DER at a number of renewable energy projects in Hawaii and California, including at Sempra Energy’s headquarters in San Diego and a winery in Sonoma County. During the procurement process, PXiSE demonstrated an impressive understanding of the operational constraints that Horizon Power faces, the rapid march to a high DER future underway in Australia and a keen enthusiasm to work with Horizon Power on the next generation of Advanced Microgrids

The PXiSE DERMS will enable otherwise disparate DER systems to be managed (monitored, controlled and optimised) as a coordinated system monitoring and controlling utility-scale assets such as battery storage systems of solar farms, using third party aggregators to manage Virtual Power Plants or reaching customers’ homes or business’ via a secure gateway device that can communicate with their PV/Battery systems and nominated loads such as airconditioning or heat pumps.

Using data to enable better grid awareness

The DERMS will integrate with Horizon Power’s SCADA systems (PowerOn Fusion and Citect) to enable bidirectional data transfer and control, and with key IT/OT systems to dynamically update the network connectivity model, equipment ratings and parameters, power flows, generation and load profiles, weather and customer data, facilitating a level of ‘grid awareness’ unprecedented on Horizon Power’s microgrids to date.  

For this round of deployment, and until more experience is gained with the DERMS package integration into isolated microgrids, a microgrid supplied by a power station with generators, a central solar PV, and energy storage owned and operated by Horizon Power will continue to operate the generators autonomously in load following mode. The DERMS will not directly control the generators, it will manage DER systems which indirectly influence the loading on the generating units while treating any technical limitations in the centralised generation as a ‘constraint’. However, in some instances, the DERMS will integrate with the power station Master System Controller and coordinate with control schemes identified to be impacted from DERMS control of DER systems in the microgrid.

Where a microgrid is supplied by a power station owned and operated by an IPP, the power station will continue to operate autonomously in load following mode. Again the DERMS will not directly control generating units, it will manage directly controllable DER systems which indirectly influence the loading on the generating units. The DERMS will monitor the output parameters of the IPP power station and the directly controlled DER, and monitor the supply as a network constraint, ensuring that delivered energy and power quality objectives are consistent with contractual obligations.

The DERMS software and components will be installed and configured into Horizon Power’s Operating Technology Infrastructure hosted on the SCADA server environment. The DERMS software includes core integrations with SCADA systems and IT systems to provide continuous, high-resolution visibility into the operations of the solar panels, batteries and generators. This will enable us to automatically respond to changing conditions and use the available portfolio of energy storage and renewable energy generation to correct any real-time disturbances to ensure a smooth, two-way flow of electricity across its systems.

The PXiSE Active Control Technology platform runs on a standard Microsoft Windows platform, analysing and responding to grid data from numerous power resources. The continuous higher-resolution visibility and artificial intelligence balances a mix of renewable energy, storage and traditional generation on the electrical grid.

First steps to creating the power grid of the future

Horizon Power operates a wide array of power system equipment with small diesel and gas generators, hybridised thermal power stations augmented with renewable energy, large combined-cycle gas turbines, small distribution lines, large transmission lines and terminal substations, and a variety of connected customer facilities, providing ample future opportunities for the DERMS platform to reduce Horizon Power’s operational government subsidy and carbon intensity by progressive optimisation of key assets.

The future holds orchestration of distributed assets as the key to a fair exchange of DER value between the utility and its customers, and allowing them to actively participate in supplying their community’s energy needs. Horizon Power is striving to make that possible through investing in DERMS and Advanced Microgrid technology.

So what’s next for the ‘hipster utility who isn’t just a dinosaur dressed in Lycra’? Horizon Power has recently formed the International Microgrid Association with a number of key industry players to “provide economic growth, through purposeful cross-sector collaboration across the global microgrid value chain, starting with the utilisation of one of the world’s largest ‘living lab’ microgrid networks in Western Australia”. Its goal will be to identify key operational, technical and market issues, educate stakeholders and foster the development and adoption of microgrid solutions to enable a transformed electric power system.

In addition we can also expect higher penetrations of renewable energy into Horizon Power’s microgrid portfolio; embracing third party DER aggregators to manage Virtual Power Plants and respond to locational pricing signals; customer-friendly tariff options and home automation load control products to create an environment that encourages Horizon Power’s customers to invest in renewable energy and storage technology and rewards them for doing so…exciting times ahead.

Lauren ‘LJ’ Butler is the Assistant Editor of Utility magazine and has been part of the team at Monkey Media since 2018.

After completing a Bachelor of Media, Communications and Professional Writing at the University of Wollongong in 2014, and prior to writing about the utility sector, LJ worked as a Journalist and Sub Editor across the horticulture, hardware, power equipment, construction and accommodation industries with publishers such as Glenvale Publications, Multimedia Publishing and Bean Media Group.

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