by Mike Wise, Data Scientist / Solution Architect – MCS Incubation Services
Building energy consumption is a huge component of energy consumption. In the USA for example, around 40 percent of the energy consumed is in buildings, and as the USA consumes something like 25 percent of the worlds energy, it is clear we are talking about a multi-trillion-dollar segment with a huge environmental footprint. So it makes sense to look for ways to cut it back. And as more and more of our energy comes from renewable but intermittent sources like solar and wind, we will need to introduce variable pricing that reflects the current availability of energy — facilitating the move to sustainable solutions.
Load shaping is a technique that describes the process of changing the timing of your energy consumption to take advantage of low energy prices when they occur, or avoid times of high prices. There are many ways to do this, and I was fortunate enough to have been tasked with implementing a form of load shaping to reduce wintertime peak energy usage on the Microsoft campus in cooperation with Microsoft RE&F (Real Estate and Finance). R was the language that we used for it.
Business Problem and Solution
While load shaping is surely in our future, variably-priced energy for consumers is still very much the exception — due in part to the relative rarity of smart meter deployment.
However, one form that is very common in the commercial market place is “demand charging”, or a demand surcharge that is proportionate to the worst 15-minute period in a month. This is rarely seen in the retail market, but is pretty common worldwide in the commercial space as it is easy to implement without smart meters. For example, note the following figure, a typical bill for a rather large building on campus. The demand charge is a power charge (kW), whereas all of the other consumption based charges are for energy (kWH).
On this campus the worst peaks occur on some cold winter mornings, when the buildings are electrically heated and have been allowed to cool down overnight. This means that they will have to be heated up aggressively again, just as everyone is coming in and powering up their computer, brewing coffee, and turning on the lights. This is sometimes referred to as “Sharktoothing” because of shape of the energy usage profile.