Some of you may recall an earlier post describing the business services provided by environmental conditioning systems in a big-box pharmacy. The first service was “Ahh, I’m here”. This highly variable service makes the customer glad they have arrived. The second service is a highly regulated environment for storing and dispensing labile pharmaceuticals. This service is less variable and this type of service may be tightly associated with detailed reporting and requirements. The third service, defined for the storage areas, was “Don’t melt...
Organizing System Behaviors
One Ring to rule them all , One Ring to find them , One Ring to bring them all and in the darkness bind them – J.R.R. Tolkien
Central control, including influences on apparently distributed systems that their owners do not anticipate, are the bane of civil society in Tolkien’s classic trilogy. Today’s models for the control of another kind of power reach deep into businesses and people’s homes, and will ultimately provoke reaction that will limit their scope and range.
Today, building systems and energy user are participants in some very bad markets. Good markets have multiple participants making value decisions to trade freely. Good markets encourage the buyers to selected products based upon value delivered, however the buyer perceives value. Good markets drive innovation and performance as sellers compete to find more profitable ways to deliver the same value, or new ways to deliver more value, to those customers. Building systems and energy are not part of such a market.
Future power systems and future buildings will be interactive at every level, from the generation of power to the provision of building-side amenities. Old centralized models of control, especially a regulated focus on cost recovery instead of value delivery, provide the organizing tenets of today’s energy markets. Energy markets that share information and decision making will achieve greater acceptance and benefits through their influence on autonomous systems than central control ever will.
Buildings are becoming complex adaptive systems that involve large numbers of distributed agents and rules governing their interactions. These agents will react to the actions of other agents and to changes in the environment. The building systems will be autonomous, so control and decision-making will be decentralized and distributed. As these agents mature and develop, they will interact with the businesses in the buildings, the lives of those in the homes, and the external environment of the power grid and environment. These autonomous systems will ultimately adapt to the changes that they themselves helped to bring about through their independent decisions.
A defining characteristic of a complex adaptive system, and thereby of well functioning markets, is that they are self-organizing; self-organization is an emergent property. Emergence simply means that a larger-scale pattern emerges out of the interaction of the smaller-scale decisions and actions of the agents.
Emergent patterns arise out of the interaction of decentralized agents acting with distributed control. Distributed control is actually self control in response to individual incentives. The most effective and innovative markets exhibit emergent order, when the larger-scale pattern that emerges is one of coordination of voluntary activity. This contrasts greatly with the ineffective and anti-innovative results that derive from the imposition of a pattern in a top-down or command-and-control manner. Even in ostensibly similar markets, the two processes of achieving order can yield dramatically different results.
This month marks the 100th anniversary of the decision to regulate U.S. markets in energy generation and distribution. The decision was in part technical; the means to measure use were limited and control functions were primitive. A poor understanding of markets contributed to the decision. The largest factor, however, was the technocratic populism that held sway around the world for much of the century—a now discredited theory that was at the heart of most of the last century’s wars and social unrest. Markets for electricity generation, distribution, and use are among the last remnants of these failed models for organization of complex systems.
The technology props to this bad theory are no longer valid. It is time to use new technology and new models of system organization to end the 100 year experiment that wastes energy and inhibits innovation in the name of control.
Reflecting on a full life
My father is 90 years old today, an age that surprises him more than anyone. He knew he would never make it past the age his father lived to. Seven years later, he is still the center of a more vibrant world than most people get in their prime of life.
Last weekend, we gathered in San Diego to celebrate. It was the first time that all eight of his sons were in the same town at the same time for more than twenty years. With family only, children, spouses, grandchildren, and great grandchildren, there must have been more than 60 there, it was a time to reflect on how the world had changed in his life, and the effect that he had in changing it. There is no comparison between the less self-reliant life I live, and the always connected, always in reach life of the next generation, and his. (This is family history, not history, and exact ages and dates may be lost in the fogs of my memory and the frequent re-telling.)
Charles Considine moved from Minnesota to Burlingame, just south of San Francisco, when he was seven as his father, also Charles, was sent by Hormel to start a meat packing plant there. At fourteen, he was already hopping a train, jumping off to report to the plant for work at 4:00 am before going on to school. He continued this schedule through high-school, augmented by afternoons when he became the all-city tennis champion and played piano evenings as Chuck Considine and his band, sharing singing duties with his younger brother Bob’s fine Irish tenor. In summers, he learned sales working the routes of vacationing reps selling meat to butcher shops and delis. These routes were especially hard because each regular salesman would make sure his customers were especially well stocked before vacation.
He attended Berkeley, then known merely as Cal, and apparently had a great time of it. In my youth, I remember him still maintaining an active relationship with former professors. He played center on the freshman football team at a weight that today would barely qualify you to play cornerback. At some freshman outing, he and a socially prominent young lady were left behind in the wilderness, generating lurid headlines in the San Francisco papers. When asked how they kept warm, he was quoted as replying “we sang college songs”. This is quintessentially him; all the children learned all of the California fight songs, and Kappa Alpha drinking and love songs, during long car rides. Somehow he found time to sing in the chorus of the San Francisco Opera, and continued to perform with his band, including a gig at the lodge at Yosemite.
His senior year, he met “the most beautiful redhead” at the freshman dance. At the time, a welcoming committee of seniors met the two incoming lines of freshmen, men and women. Each freshman would shake hands with the president, and be whisked off to the dance floor by a more experienced senior, who would quiz him or her on home town and interests. The seniors would introduce their respective freshmen, get conversation started, and return for another freshman. He counted back, traded places, and whisked Thalia Kelly onto the gym balcony, keeping her to himself through evening and proposing to her at the end of the evening.
She accepted a week later. They dropped out of school after she turned eighteen that fall to get married. This may seem abrupt, and risky, but after eleven children and nearly sixty years, Thalia, or Mother, or Granny, was still with him this last weekend.
Before he dropped out, he, and two classmates, and a professor signed the charter creating the association of industrial engineers. He stayed at home during the war, an identified critical worker, in the Kaiser shipyards, tuning their processes to turn out a ship a day from each set of seven dry docks. He took time off from the shipyards to tune the Mustang productions lines to a 70-fold increase in production. Family stories of that time include the blackouts and the injured FBI agents living in their basement, keeping an eye on the neighbors and providing babysitting for the three young children who called them uncle.
After brief return to Minnesota, they moved to San Diego, Thalia’s home town. San Diego was about 135,000 people at the time, and just moving of the Navy’s hazardous pay list as a malaria zone. Chuck switched to accounting, building his business by teaching at the growing San Diego State and providing bookkeeping for most of the Catholic parishes in town. The family continued to grow.
By the mid 50’s, with seven children, the family moved to a cattle ranch out in the high chaparral, because he wanted the children to grow up with plenty of chores. We were up early every morning, doing chores before breakfast and the hour drive to town to attend a good school. His growing practice meant that we scaled the playground fence before 6:00 during tax season, that period between January and April 15 that drives accountants. In the 60’s, he continued this schedule while earning a PhD in math. We kids would sit in the car, doing homework and wrestling, on nights when he had class.
His practice increasingly involved real estate, and complex real estate transactions. Tax free exchanges, in all their permutations were identified by him. A key early case of his was accepted by the US Supreme Court before his client decided to settle. During the 70s, he was lecturing around the country, putting on as many as 40 three day seminars per year.
It was a good thing he was doing well, as he put all of his children through college, as well as silently putting through various talented students identified by his many civic groups. Most of us were sent to top boarding schools around the country as well. He always preferred being a silent donor, a silent supporter, but the range of is good works was always broad, and always personal.
For more than twenty years he has been fully retired. He has continued to send many to college, his grandchildren and others. His largest joy is the lunch he hosts every Sunday, in which any of his descendants in town are invited. Many college roommates of his grandchildren also make regular appearances at these lunches, with or without the person who originally brought them. He is enjoying two new grandchildren in the last six months.
He is a great man, and I am proud to be his son.
OpenADR must respond to future demands
I have been reading through the current draft of the OpenADR standard this week. The ADR stands for Automated Demand Response (although I would prefer autonomous demand response, as regular readers might guess). Demand-Response refers to the conversations between electrical utilities and their customers, so that when the former anticipates a too large demand, the latter might respond with a curtailment plan. This curtailment might be under an existing rate agreement or subject to a live auction.
OpenADR is a nice and well rounded specification, focused tightly on solving today’s problems. Even the documentation, generated using LiquidXML Studio, is clear, crisp, and visually attractive. I wish it were more focused on emerging markets, because the work within it can clearly help them to develop.
OpenADR today has three components: communications between utilities, communications from the utility to the consumer, and communications from the consumer back to the utility. Utilities can exchange information on how much power they can produce. Utilities can alert customers to anticipated shortages and request bids to meet anticipated shortages. Customers can respond by making commitments to shed load, and bidding for the prices they would demand to do so. In the future, the lines between these areas will be blurred, causing the components to blur.
The proper target for OpenADR is the enterprise, not the building. OpenADR and its predecessor, DRAS, started out as interactions with building systems. The proper focus of DR requests is the enterprise. The enterprise owns the building systems and so can decide which requests are worth responding too. The enterprise also owns the business processes, which can enable still greater response than can the building systems. If we do this right, these negotiations will be two-way, creating non-hierarchical markets.
So what do I think the emerging market of the future looks like? How is this market different from the simple interactions in today’s ADR?
Participants will want to schedule things further out. Today’s long range DR is essentially a guess based upon tomorrow’s weather report. Longer term options will be based upon longer horizons. What price can I get if I commit today to a maximum use in the afternoon for Thursday and Friday for the rest of the summer? If I opt for four ten hour days during the summer, will the grid pay more for me to turn off the building on Mondays or Fridays? Building Resources such as conference rooms will know that they are unable to provide conditioned space on these days. Scheduling questions should look more like the corporate standard ICAL (used for scheduling meetings) and less like any control system interval.
What if I am a third party energy manager. I have an ever changing portfolio of customers/office buildings. Because the grid is a physical distribution system, shortages have a defined geographical range. Some of my portfolio will be inside the DR area, some will not. I might wish to shut off some systems in each facility for 10 minutes and meet my bids in aggregate. Every Demand request will include geographical areas following open standards that can be reviewed on any tool I use, even Google Earth.
What if I follow the French model and have an all company vacation during the heat wave. Can I get bids in advance to run my generators during afternoons and sell lit back to the grid? What about my solar cells on the roof for all day re-sale? In the future, every building is potentially an energy source, so every building is a potential participant in as a power seller.
Then there are the questions, the questions that must be answered whether or not there is any current DR event. What is my current use? What is my current price? If I needed more power, what would it cost me? Would the reliability of my portion of the grid be reduced by that request? How much more power can I ask for?
I will write more about this later. But watch for OpenADR.